EXHIBIT 13
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") dated
as of December 9, 1997, between XXXXXXXX ASIAN GROWTH FUND, INC. (the "Fund"), a
corporation formed under the laws of the State of Maryland, and XXXXXXXX SERIES
TRUST II, a business trust formed under the laws of the State of Delaware, on
behalf of its initial series, Xxxxxxxx All-Asia Fund (the "Trust").
WHEREAS, this Agreement is intended to effect the reorganization
of the Fund into a Delaware business trust by the transfer of all of the assets
of the Fund to the Trust solely in exchange for assumption by the Trust of all
of the liabilities of the Fund and issuance to the Fund of shares of beneficial
interest of the Trust (the "Class A Shares"), followed by the distribution, on
the Closing Date, as hereinafter defined, of the Class A Shares of the Trust to
the holders of shares of the Fund (the "Stockholders") and by the dissolution of
the Fund as provided herein, all upon the terms and conditions hereinafter set
forth; and
WHEREAS, the Reorganization, as hereinafter defined, is intended
to qualify as a tax-free reorganization under Section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code");
NOW THEREFORE, in consideration of the promises and the covenants
and agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. STOCKHOLDER APPROVAL.
A special meeting (the "Special Meeting") of the stockholders of
the Fund shall have been called and held for the purpose of approving this
Agreement and the transactions contemplated herein.
2. REORGANIZATION.
The transactions described in this section are hereinafter
referred to as the "Reorganization." The Reorganization shall occur with respect
to the Fund and the Trust.
2.1. Subject to the terms and conditions set forth herein and on
the basis of the representations and warranties contained herein, the Fund
agrees to transfer substantially all of its assets as set forth in paragraph 2.2
to the Trust by filing Articles of Transfer with the State of Maryland to become
effective at the close of business on the Closing Date. The Trust agrees in
exchange therefor (1) that the Trust shall assume all of the Fund's liabilities,
whether contingent or otherwise, existing as of the Closing Date, and further
(2) that on the Closing Date the Trust shall deliver to the Fund the number of
full and fractional Class A Shares equal to the value and number of full and
fractional shares of the Fund outstanding on the Closing Date. The Fund and the
Trust will execute a cross-receipt evidencing the transactions contemplated by
this paragraph 2.1.
2.2. The assets of the Fund transferred to the Trust shall
include, without limitation, all cash, cash equivalents, securities, receivables
(including interest and dividend receivables), claims or rights of action or
rights to register shares under applicable securities laws, books and records of
the Fund, all other property owned by the Fund and all deferred or prepaid
expenses shown as assets on the books of the Fund on the Closing Date.
2.3 Immediately upon delivery of the Class A Shares to the Fund
pursuant to paragraph 2.1 above, any officer of the Fund is authorized, on
behalf of the Fund as sole shareholder of the Trust, (1) to elect as trustees of
the Trust ("Trustees") the persons who currently serve as directors of the Fund;
and (2) to approve (I) the investment advisory agreement between Xxxxxxxx
Capital Management International Inc., the investment adviser of the Fund (the
"Adviser"), and the Trust, which shall have been approved by the stockholders of
the Fund, and (II) the continuation for the Trust's fiscal year ending October
31, 1998 of the engagement of Coopers & Xxxxxxx L.L.P., the independent
accountants who currently serve in that capacity for the Fund.
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2.4. Upon consummation of the transactions described in paragraph
2.1 above, the Fund will distribute to each Fund Stockholder of record Class A
Shares of the Trust pro rata in proportion to each Fund Stockholder's interest
in the Fund. The Trust will not issue certificates evidencing Class A Shares
except upon written request.
2.5. As soon as is practicable following the distribution of Class
A Shares to Fund Stockholders pursuant to paragraph 2.4 above, the Fund shall be
dissolved by filing Articles of Dissolution with the State of Maryland.
2.6. Ownership of Class A Shares by the former Fund Stockholders
will be reflected on the books of the Trust's transfer agent.
2.7. Any reporting responsibility of the Fund is and shall remain
its responsibility up to and including the later of the Closing Date and any
date on which the Fund may be dissolved.
3. CLOSING AND CLOSING DATE.
3.1. The transfer of substantially all of the Fund's assets in
exchange for the assumption by the Trust of the liabilities of the Fund and the
issuance of Class A Shares, as described above, together with all related acts
necessary to consummate such acts (the "Closing"), shall occur on March 20, 1998
(the "Closing Date") at the offices of Forum Financial Services, Inc.,
sub-administrator of the Trust, Two Portland Square, Portland, Maine, or at such
other place or later date as the parties may agree. All acts taking place at the
Closing shall be deemed to take place simultaneously as of the last
determination of the Fund's net asset value or at such other time and place as
the parties may agree.
3.2. In the event that on the Closing Date (A) the New York Stock
Exchange is closed to trading, or trading thereon is restricted, or (B) trading
or reporting of trading on said exchange or in any market in which portfolio
securities of the Fund are traded is disrupted so that accurate appraisal of the
value of the total net assets of the Fund is impracticable, the Closing shall be
postponed until the first business day upon which trading shall have been fully
resumed and reporting shall have been restored. For purposes of this Agreement,
a "business day" shall mean each day that the New York Stock Exchange is open
for trading.
3.3. The Fund shall deliver at the Closing a certificate of an
authorized officer of the Fund stating that it has notified the custodian of the
Fund of the transfer of the assets of the Fund to the Trust.
3.4. The transfer agent for the Fund shall deliver at the Closing
a certificate as to the closing of the transfer books of the Fund prior to the
Closing Date and to the transfer of the Fund Stockholders' accounts to the
transfer agent of the Trust. The Trust shall issue and deliver a confirmation to
the Fund of the number of Class A Shares to be credited to the Fund with respect
to the Trust on the Closing Date or provide evidence satisfactory to the Fund
that such Class A Shares have been credited to the Fund's account on the books
of the Trust.
3.5. At the Closing, each party shall deliver to the other such
bills of sale, checks, assignments, stock certificates, receipts, instructions
and other documents as such party may deem appropriate or as such other party
may reasonably request.
4. VALUATION.
4.1. The value of the Fund's net assets to be acquired by the
Trust shall be the net asset value computed as of the close of business on the
Closing Date, using the valuation procedures set forth in the Fund's then
current prospectus.
4.2. The number, value and denominations of full and fractional
Class A Shares to be issued in exchange for the Fund's net assets shall be equal
to the number, value and denominations of full and fractional Fund shares
outstanding as of the close of business on the Closing Date.
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5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE FUND.
5.1. ORGANIZATION, EXISTENCE, ETC. The Fund is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maryland and has the power to carry on its business as it is now being
conducted. The Fund has all necessary Federal, state and local authorizations to
own all of its properties and assets and to carry on its business as it is now
being conducted.
5.2. REGISTRATION AS AN INVESTMENT COMPANY. The Fund is registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as a
closed-end management investment company; such registration has not been revoked
or rescinded and is in full force and effect.
5.3. CAPITALIZATION. The authorized stock of the Fund consists of
100,000,000 shares of Common Stock, each having a par value of $.01 per share,
and 16,107,100 shares are issued and outstanding.
5.4. FINANCIAL STATEMENTS. The audited financial statements of the
Fund for the fiscal year ended October 31, 1997 (the "Financial Statements")
fairly present the financial position of the Fund as of the date thereof and the
results of its operations and changes in its net assets for the periods
indicated.
5.5. FUND SHARES. The outstanding shares of the Fund are duly
and validly issued and outstanding, fully paid and nonassessable.
5.6. AUTHORITY RELATIVE TO THIS AGREEMENT. The Fund has the power
to enter into this Agreement and to carry out its obligations hereunder. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Fund's Board
of Directors and by the Fund Stockholders at the Special Meeting, and no other
corporate proceedings by the Fund are necessary to authorize the performance of
this Agreement and the transactions contemplated hereby.
5.7. LIABILITIES. There are no liabilities of the Fund, whether or
not determined or determinable, other than liabilities disclosed or provided for
in the Financial Statements or incurred in the ordinary course of business
subsequent to October 31, 1997, none of which has been materially adverse to the
business, assets or results of operations of the Fund. All liabilities of the
Fund to be assumed by the Trust were incurred by the Fund in the ordinary course
of business.
5.8. LITIGATION. There are no claims, actions, suits or
proceedings pending or, to the knowledge of the Fund, threatened which would
adversely affect the Fund's assets or business or which would prevent or hinder
consummation of the transactions contemplated hereby. The Fund is not under the
jurisdiction of a court in a proceeding under Title 11 of the United States Code
or similar case within the meaning of section 368(a)(3)(A) of the Code.
5.9. CONTRACTS. Except for contracts and agreements disclosed in
the initial prospectus of the Fund or as otherwise described in the Fund's
reports required under the Securities Exchange Act of 1934, as amended, or as
otherwise disclosed to the Trust, under which no material default exists, the
Fund is not a party to or subject to any material contract, debt instrument,
plan, lease, franchise, license or permit of any kind or nature whatsoever.
5.10. TAXES. The Fund has filed all federal income tax returns of
the Fund required to be filed by it, and all taxes payable pursuant to such
returns have been paid. The Fund has qualified as a regulated investment company
("RIC") under Subchapter M of the Code for each taxable year since it commenced
operations and will continue to meet all the requirements for such qualification
for its current taxable year through the Closing Date.
5.11. DISSOLUTION. As soon as practicable following the
distribution of Class A Shares to Fund Stockholders pursuant to paragraph 2.4
above, the Fund shall be dissolved by filing Articles of Dissolution with the
State of Maryland.
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6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE TRUST.
The Trust represents and warrants to the Fund as follows:
6.1. ORGANIZATION, EXISTENCE, ETC. The Trust is a Delaware
business trust duly organized, validly existing and in good standing under the
laws of the State of Delaware, and the Trust has filed its Trust Certificate
with the Secretary of State of Delaware.
6.2. REGISTRATION AS AN INVESTMENT COMPANY. On the Closing Date,
the Trust will be registered under the 1940 Act as an open-end management
investment company.
6.3. CAPITALIZATION. Prior to the Closing Date, there shall be no
issued and outstanding Class A Shares. Class A Shares issued on the Closing Date
in connection with the transactions contemplated herein will be duly and validly
issued and outstanding, fully paid and non-assessable under Delaware law.
6.4. COMMENCEMENT OF OPERATIONS. The Trust has not commenced
operations and will not commence operations until after the Closing.
6.5. AUTHORITY RELATIVE TO THIS AGREEMENT. The Trust has the power
to enter into this Agreement and to carry out its obligations hereunder. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Trustees, and
no other proceedings are necessary to authorize its officers to effectuate this
Agreement and the transactions contemplated hereby. The Trust is not a party to
or obligated under any charter, bylaw, indenture or contract provision or any
other commitment or obligation, or subject to any order or decree, which would
be violated by its executing and carrying out this Agreement.
6.6. LIABILITIES. There are no liabilities of the Trust, whether
or not determined or determinable, other than liabilities otherwise previously
disclosed to the Fund, none of which has been materially adverse to the
business, assets or results of operations of the Trust.
6.7. LITIGATION. There are no claims, actions, suits or
proceedings pending or, to the knowledge of the Trust, threatened which would
adversely affect the Trust or its assets or business or which would prevent or
hinder consummation of the transactions contemplated hereby.
6.8. CONTRACTS. Except for contracts and agreements disclosed to
the Fund, under which no default exists, the Trust is not a party to or subject
to any material contract, debt instrument, plan, lease, franchise, license or
permit of any kind or nature whatsoever.
6.9. TAXES. The Trust intends that it will meet all the
requirements to qualify as a RIC under Subchapter M of the Code for each of the
taxable years ending after the Reorganization.
6.10. CONTINUATION OF THE FUND'S BUSINESS. The Trust has no plan
or intention to issue additional Class A Shares following the Reorganization
except for shares issued in the ordinary course of the Trust's business as an
open-end investment company; nor does the Trust have any plan or intention to
redeem or otherwise reacquire any Class A Shares issued to Fund Stockholders
pursuant to the Reorganization, other than through redemptions arising in the
ordinary course of that business. The Trust will actively continue the Fund's
business.
7. CONDITIONS TO OBLIGATIONS OF THE TRUST.
The obligations of the Trust hereunder with respect to the
consummation of the Reorganization are subject to the satisfaction of the
following conditions:
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7.1. APPROVAL BY STOCKHOLDERS. This Agreement and the transactions
contemplated hereby, including, as necessary, any amendment of any investment
restrictions of the Fund that might otherwise preclude the consummation of the
Reorganization, shall have been approved by the affirmative vote of holders of
two-thirds of the outstanding shares of the Fund.
7.2. COVENANTS, WARRANTIES AND REPRESENTATIONS. The Fund shall
have complied with each of its covenants contained herein, each of the
representations and warranties contained herein shall be true in all material
respects as of the Closing Date, there shall have been no material adverse
change in the financial condition, results of operations, business, properties
or assets of the Fund since October 31, 1997, and the Trust shall have received
a certificate of the President of the Fund satisfactory in form and substance to
the Trust so stating.
7.3. TAX OPINION. The Fund and the Trust shall have received an
opinion of their tax counsel, dated on or before the Closing Date, to the effect
that, on the basis of existing provisions of the Code, current Treasury
Regulations issued thereunder, administrative interpretations thereof and court
decisions, for Federal income tax purposes: (I) no gain or loss will be
recognized by the Trust or the Fund upon the transfer of the assets of the Fund
to the Trust in exchange for Class A Shares of the Trust; and (II) no gain or
loss will be recognized by Fund Stockholders on the exchange of shares of the
Fund for Class A Shares of the Trust and the holding period and tax basis of the
Class A Shares of the Trust received by each Stockholder of the Fund will be the
same as the holding period and tax basis of the Stockholder's Fund shares held
immediately prior to the exchange. For purposes of rendering their opinion, tax
counsel may rely exclusively, and without independent verification as to factual
matters, upon the statements made in this Agreement, upon the proxy statement
distributed to Fund Stockholders in connection with the Reorganization, and upon
such other written representations as the Trust and the Fund shall make as of
the Closing Date.
7.4. OPINION OF COUNSEL TO THE FUND. The Fund and the Trust shall
have received the opinion of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, Maryland counsel
to the Fund, dated as of the Closing Date and addressed to each of them, to the
effect that: (I) the Fund is a corporation duly organized and existing under the
laws of the State of Maryland; (II) the Fund is a closed-end management
investment company registered under the 1940 Act; and (III) this Agreement and
the Reorganization provided for herein and the execution of this Agreement have
been duly authorized and approved by all requisite action of the Fund, and this
Agreement has been duly executed and delivered by the Fund, and is a valid and
binding obligation of the Fund, subject to applicable bankruptcy, insolvency,
fraudulent conveyance and similar laws or court decisions regarding enforcement
of creditors' rights generally and to general principles of equity.
7.5. OPINION OF COUNSEL TO THE TRUST. The Fund and the Trust shall
have received the opinion of counsel to the Trust, dated as of the Closing Date
and addressed to each of them, to the effect that: (I) the Trust is a Delaware
business trust duly organized and validly existing under the laws of the State
of Delaware; (II) the Trust is an open-end management investment company
registered under the 1940 Act; (III) this Agreement and the Reorganization
provided for herein and the execution of this Agreement have been duly
authorized and approved by all requisite action of the Trust, and this Agreement
has been duly executed and delivered by the Trust, and is a valid and binding
obligation of the Trust, subject to applicable bankruptcy, insolvency,
fraudulent conveyance and similar laws or court decisions regarding enforcement
of creditors' rights generally and to general principles of equity; (IV) the
Trust's Registration Statement has been declared effective under the Securities
Act and, to the best of counsel's knowledge after reasonable investigation, no
stop order has been issued or threatened suspending its effectiveness; and (V)
the Class A Shares of the Trust to be issued in the Reorganization have been
duly authorized and upon issuance thereof will be validly issued, fully paid and
nonassessable.
8. CONDITIONS TO OBLIGATIONS OF THE FUND.
The obligations of the Fund hereunder with respect to the
consummation of the Reorganization as it relates to the Fund are subject to the
satisfaction of the following conditions:
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8.1. COVENANTS, WARRANTIES AND REPRESENTATIONS. The Trust shall
have complied with each of its covenants contained herein, and each of the
representations and warranties contained herein shall be true in all material
respects as of the Closing Date.
8.2. REGULATORY APPROVAL. All approvals, registrations, and
exemptions under Federal and state laws required to effect the Reorganization
and the transactions contemplated hereby shall have been obtained.
8.3. TAX OPINION. The Fund and the Trust shall have received
the opinion referred to in paragraph 7.3 of this Agreement.
9. AMENDMENTS; WAIVERS; TERMINATION; NON-SURVIVAL OF COVENANTS, WARRANTIES AND
REPRESENTATIONS.
9.1. AMENDMENTS. This Agreement may be amended at any time by
action of the directors of either party hereto notwithstanding approval thereof
by the Fund Stockholders, provided that no amendment shall have a material
adverse effect on the interests of such stockholders.
9.2. WAIVERS. At any time prior to the Closing Date either of the
parties may waive compliance with any of the covenants or conditions made for
its benefit contained herein.
9.3. TERMINATION BY EITHER PARTY. This Agreement may be terminated
at any time prior to the Closing Date without liability on the part of either
party hereto or its respective Trustees, Directors, officers or stockholders by
any party on notice to the other party.
9.4. SURVIVAL. No representations, warranties or covenants made in
or pursuant to this Agreement (including certifications of officers) shall
survive the Reorganization.
10. EXPENSES/LIABILITIES.
The Fund and the Trust shall each be responsible for all of their
expenses in connection with the Reorganization.
11. GENERAL.
This Agreement supersedes all prior agreements between the parties
(written or oral), is intended as a complete and exclusive statement of the
terms of the Agreement between the parties and may not be changed or terminated
orally. This Agreement may be executed in one or more counterparts, all of which
shall be considered one and the same agreement, and shall become effective when
one or more counterparts have been executed by the Trust and the Fund and
delivered to each of the parties hereto. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Nothing in this Agreement, express
or implied, is intended to confer upon any other person any rights or remedies
under or by reason of this Agreement.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement
as of the date first above written.
Attest: XXXXXXXX ASIAN GROWTH FUND, INC.
By: /S/ XXXXXXXXX XXX By: /S/ XXXXXX XXXXXX
----------------------- -----------------------------
Xxxxxxxxx Xxx Xxxxxx Xxxxxx
Attest: XXXXXXXX SERIES TRUST II,
on behalf of its series
Xxxxxxxx All-Asia Fund
By: /S/ XXXXXXXXX XXX By: /S/ XXXXXX XXXXXX
-------------------------- ----------------------------
Xxxxxxxxx Xxx Xxxxxx Xxxxxx
COPIES OF THE TRUST INSTRUMENT, AS AMENDED, ESTABLISHING THE TRUST ARE ON FILE
WITH THE SECRETARY OF THE TRUST, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT
AND PLAN OF REORGANIZATION IS EXECUTED ON BEHALF OF THE TRUST BY OFFICERS OF THE
TRUST AS OFFICERS AND NOT INDIVIDUALLY AND THAT THE OBLIGATIONS OF OR ARISING
OUT OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE TRUSTEES, OFFICERS,
SHAREHOLDERS, EMPLOYEES OR AGENTS OF THE TRUST INDIVIDUALLY BUT ARE BINDING ONLY
UPON THE ASSETS AND PROPERTY OF THE TRUST.
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