Agreement and Plan of Reorganization
This AGREEMENT AND PLAN OF REORGANIZATION
("Agreement") is made as of this 28th day of
November, 2008, by and among Domini Social
Investment Trust, a Massachusetts business trust
(the "Acquiring Entity"), with its principal
place of business at 000 Xxxxxxxx, 0xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, on behalf of each of its
series listed on Exhibit A attached hereto (each,
an "Acquiring Fund"), and Domini Advisor Trust, a
Massachusetts business trust (the "Acquired
Entity"), with its principal place of business at
000 Xxxxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, on behalf of each of its series listed on
Exhibit A attached hereto (each, an "Acquired
Fund").
WHEREAS, each Acquired Fund and Acquiring Fund
is a series of an open-end management investment
company registered pursuant to the Investment
Company Act of 1940, as amended (the "1940 Act");
WHEREAS, it is intended that, for United
States federal income tax purposes (i) each
transaction contemplated by this Agreement
constitute a "reorganization" within the meaning
of Section 368(a) of the Internal Revenue Code of
1986, as amended (the "Code"), and (ii) this
Agreement constitute a plan of reorganization
within the meaning of Section 368 of the Code and
Treasury Regulations Section 1.368-2(g);
WHEREAS, each reorganization will consist of
(1) the sale, assignment, conveyance, transfer
and delivery of all of the property and assets of
the Acquired Fund to the Acquiring Fund in
exchange solely for (a) shares of beneficial
interest of the Acquiring Fund (the "Acquiring
Fund Shares") corresponding in class to the
outstanding shares of beneficial interest of the
Acquired Fund (the "Acquired Fund Shares"), as
described herein, and (b) the assumption by the
Acquiring Fund of all liabilities of the Acquired
Fund, and (2) the subsequent distribution of the
Acquiring Fund Shares (which shall then
constitute all of the assets of the Acquired
Fund) to the shareholders of the Acquired Fund in
complete redemption of the Acquired Fund Shares
and the termination of the Acquired Fund, as
provided herein (each, a "Reorganization"), all
upon the terms and conditions hereinafter set
forth in this Agreement;
WHEREAS, the Board of Trustees of the
Acquiring Entity (the "Acquiring Entity Board")
has determined, with respect to the Acquiring
Fund, that the sale, assignment, conveyance,
transfer and delivery of all of the property and
assets of the Acquired Fund for Acquiring Fund
Shares and the assumption of all liabilities of
the Acquired Fund by the Acquiring Fund is in the
best interests of the Acquiring Fund and its
shareholders and that the interests of the
existing shareholders of the Acquiring Fund will
not be diluted as a result of this transaction;
and
WHEREAS, the Board of Trustees of the Acquired
Entity (the "Acquired Entity Board") has
determined, with respect to the Acquired Fund,
that the sale, assignment, conveyance, transfer
and delivery of all of the property and assets of
the Acquired Fund for Acquiring Fund Shares and
the assumption of all liabilities of the Acquired
Fund by the Acquiring Fund is in the best
interests of the Acquired Fund and its
shareholders and that the interests of the
existing shareholders of the Acquired Fund will
not be diluted as a result of this transaction;
NOW, THEREFORE, in consideration of the
premises and of the covenants and agreements
hereinafter set forth, the parties hereto
covenant and agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND
TO THE ACQUIRING FUND IN EXCHANGE FOR
ACQUIRING FUND SHARES, THE ASSUMPTION
OF ALL ACQUIRED FUND LIABILITIES AND
THE TERMINATION OF THE ACQUIRED FUND
1.1 Subject to requisite approvals and the
other terms and conditions herein set forth and
on the basis of the representations and
warranties contained herein, the Acquired Entity,
on behalf of each Acquired Fund, agrees to sell,
assign, convey, transfer and deliver all of its
property and assets attributable to that Acquired
Fund, as set forth in paragraph 1.2, to the
corresponding Acquiring Fund, and the Acquiring
Entity, on behalf of each Acquiring Fund, agrees
in exchange therefor: (a) to deliver to the
corresponding Acquired Fund the number of full
and fractional Acquiring Fund Shares
corresponding to the Acquired Fund Shares as of
the time and date set forth in paragraph 3.1,
determined by dividing the value of the Acquired
Entity's net assets with respect to the Acquired
Fund (computed in the manner and as of the time
and date set forth in Article 2) by the net asset
value of one share of the corresponding class of
Acquiring Fund Shares (computed in the manner and
as of the time and date set forth in Article 2);
and (b) to assume all liabilities of such
Acquired Fund as set forth in paragraph 1.2.
Such transactions shall take place on a closing
date as provided for in paragraph 3.1 (the
"Closing Date"). For purposes of this Agreement,
shares of an Acquired Fund correspond to the
Class A Shares of the applicable Acquiring Fund,
and the term "Acquiring Fund Shares" shall be
read to mean, as to each Acquired Fund, such
class of shares of the applicable Acquiring Fund.
1.2 The property and assets of the Acquired
Entity attributable to each Acquired Fund to be
sold, assigned, conveyed, transferred and
delivered to and acquired by the corresponding
Acquiring Entity, on behalf of the applicable
Acquiring Fund, shall consist of all assets and
property of every kind and nature of the Acquired
Fund, including, without limitation, all rights,
receivables (including dividend, interest and
other receivables), cash, cash equivalents,
claims (whether absolute or contingent, known or
unknown), securities, commodities and futures
interests, good will and other intangible
property, any deferred or prepaid expenses and
all interests, rights, privileges and powers, the
Acquired Fund owns at the Valuation Date (as
defined in paragraph 2.1) (collectively,
"Assets"). The Acquiring Entity, on behalf of
the applicable Acquiring Fund, shall assume all
of the liabilities and obligations of each
Acquired Fund, including, without limitation, all
indemnification obligations of such Acquired Fund
with respect to the current and former Board
Members and officers of the Acquired Entity,
whether accrued or contingent, known or unknown,
existing at the Valuation Date (collectively,
"Liabilities"). Each Acquired Fund will promptly
sell, assign, convey, transfer and deliver to the
Acquiring Entity, on behalf of the corresponding
Acquiring Fund, any rights, stock dividends, cash
dividends or other securities received by the
Acquired Fund after the Closing Date as stock
dividends, cash dividends or other distributions
on or with respect to the property and assets
transferred, which rights, stock dividends, cash
dividends and other securities shall be deemed
included in the property and assets transferred
to the Acquiring Entity, on behalf of the
corresponding Acquiring Fund, at the Closing Date
and shall not be separately valued, in which case
any such distribution that remains unpaid as of
the Closing Date shall be included in the
determination of the value of the assets of the
Acquired Fund acquired by the Acquiring Entity on
behalf of the corresponding Acquiring Fund.
1.3 Immediately following the actions
contemplated by paragraph 1.1, the Acquired
Entity shall take such actions as may be
necessary or appropriate to complete the
liquidation of each Acquired Fund. To complete
the liquidation, the Acquired Entity, on behalf
of each Acquired Fund, shall (a) distribute to
the shareholders of record of the applicable
Acquired Fund Shares as of the Closing Date
("Acquired Fund Shareholders"), on a pro rata
basis, the Acquiring Fund Shares received by the
Acquired Entity, on behalf of that Acquired Fund,
pursuant to paragraph 1.1, in complete redemption
of such Acquired Fund Shares, and (b) terminate
the Acquired Fund in accordance with applicable
Massachusetts law. Such distribution and
redemption shall be accomplished, with respect to
the Acquired Fund Shares, by the transfer of the
corresponding Acquiring Fund Shares then credited
to the account of the Acquired Fund on the books
of the Acquiring Fund to open accounts on the
share records of the Acquiring Fund in the names
of the Acquired Fund Shareholders. The aggregate
net asset value of the Acquiring Fund Shares to
be so credited to each of the corresponding
Acquired Fund Shareholders shall be equal to the
aggregate net asset value of the Acquired Fund
Shares owned by those Acquired Fund Shareholders
on the Closing Date. All issued and outstanding
Acquired Fund Shares will be canceled on the
books of the Acquired Fund. The Acquiring Fund
shall not issue certificates representing any
class of Acquiring Fund Shares in connection with
such exchange.
1.4 Ownership of Acquiring Fund Shares will
be shown on the books of the Acquiring Fund as
maintained by the Acquiring Fund's transfer
agent.
1.5 Any reporting responsibility of an
Acquired Fund, including, but not limited to, the
responsibility for filing regulatory reports, tax
returns, or other documents with the Securities
and Exchange Commission ("Commission"), any state
securities commission, and any federal, state or
local tax authorities or any other relevant
regulatory authority, is and shall remain the
responsibility of the Acquired Entity, on behalf
of such Acquired Fund. The Acquiring Entity
shall fully cooperate to the extent necessary or
desirable for these responsibilities to be
discharged.
1.6 As promptly as practicable following
the Reorganization of each Acquired Fund, the
Acquired Entity will take all necessary action to
effect its deregistration as an investment
company in accordance with the rules and
regulations of the Commission and shall
subsequently voluntarily dissolve in accordance
with the requirements of Massachusetts law.
2.VALUATION
The value of the Assets and the amount of the
Liabilities of each Acquired Fund shall be
determined as of the time for calculation of its
net asset value as set forth in the then-current
prospectus for the Acquired Fund, and after the
declaration of any dividends by the Acquired
Fund, on the applicable Closing Date (such time
and date being hereinafter called the "Valuation
Date"), computed using the valuation procedures
established by the Acquired Entity Board. All
computations of value and amounts shall be made
by the fund accountant for each Acquired Fund.
The net asset value of each Acquiring Fund's
Acquiring Fund Shares shall be determined as of
the time for calculation of the Acquiring Fund's
net asset value as set forth in the then-current
prospectus for the Acquiring Fund, and after the
declaration of any dividends on behalf of the
Acquiring Fund, on the Closing Date (such time
and date being hereinafter called the "Valuation
Date"), computed using the valuation procedures
established by the Acquiring Entity Board. All
computations of value and amounts shall be made
by the fund accountant for the applicable
Acquired Fund or Acquiring Fund.
3. CLOSING AND CLOSING DATE
3.1 Subject to the terms and conditions set
forth herein, the Closing Date shall be November
28, 2008, or such other date as the parties may
agree. All acts taking place at the closing of
the transactions provided for in this Agreement
("Closing") shall be deemed to take place
simultaneously as of the "close of business" on
the Closing Date unless otherwise agreed to by
the parties. The close of business on the
Closing Date shall be as of the close of regular
trading on the New York Stock Exchange or such
later time on that date as the Acquired Fund's
net asset value and/or the net asset value per
share of the class of shares of the Acquiring
Fund is calculated in accordance with paragraph 2
and after the declaration of any dividends. The
Closing shall be held at the offices of Xxxxxxx
XxXxxxxxx LLP or at such other time and/or place
as the parties may agree.
3.2 The Acquired Entity shall direct State
Street Bank and Trust Company (the "Custodian")
to transfer ownership of the Assets from the
accounts of the applicable Acquired Fund that the
Custodian maintains as custodian for the Acquired
Fund to the accounts of the Acquiring Fund that
the Custodian maintains as custodian for the
Acquiring Fund and to deliver to the Acquiring
Entity, at the Closing, a certificate of an
authorized officer stating that (i) the Assets of
the Acquired Fund have been so transferred as of
the Closing Date, and (ii) all necessary taxes in
connection with the delivery of the Assets of the
Acquired Fund, including all applicable federal
and state stock transfer stamps, if any, have
been paid or provision for payment has been made.
3.3 The Acquired Entity shall direct PNC
Global Investment Servicing (U.S.) Inc., in its
capacity as transfer agent for each Acquired Fund
("Transfer Agent"), to deliver to the Acquiring
Entity at the Closing a certificate of an
authorized officer stating that its records
contain the name and address of each Acquired
Fund Shareholder and the number and percentage
ownership of the outstanding Acquired Fund Shares
owned by each such shareholder immediately prior
to the Closing. The Acquiring Fund shall deliver
to the Secretary of the corresponding Acquired
Fund a confirmation evidencing that (a) the
appropriate number of Acquiring Fund Shares have
been credited to the Acquired Fund's account on
the books of such Acquiring Fund pursuant to
paragraph 1.1 prior to the actions contemplated
by paragraph 1.3 and (b) the appropriate number
of Acquiring Fund Shares have been credited to
the accounts of the Acquired Fund Shareholders on
the books of such Acquiring Fund pursuant to
paragraph 1.3. At the applicable Closing, each
party shall deliver to the other party such bills
of sale, checks, assignments, share certificates,
if any, receipts or other documents as the other
party or its counsel may reasonably request.
3.4 In the event that on the Valuation Date
(a) the New York Stock Exchange or another
primary trading market for portfolio securities
of an Acquiring Fund or an Acquired Fund (each,
an "Exchange") shall be closed to trading or
trading thereupon shall be restricted, or (b)
trading or the reporting of trading on such
Exchange or elsewhere shall be disrupted so that
accurate appraisal of the value of the net assets
of such Acquired Fund or such Acquiring Fund is
impracticable (in the judgment of the Acquiring
Entity Board with respect to such Acquiring Fund
and the Acquired Entity Board with respect to
such Acquired Fund), the Closing Date shall be
postponed until the first Friday (that is also a
business day) after the day when trading shall
have been fully resumed and reporting shall have
been restored.
4. REPRESENTATIONS AND WARRANTIES
4.1 Except as has been fully disclosed to
the Acquiring Entity in Schedule 4.1 of this
Agreement, the Acquired Entity, on behalf of each
Acquired Fund, represents and warrants to the
Acquiring Entity and the corresponding Acquiring
Fund as follows:
(a) Such Acquired Fund is duly
established as a series of the Acquired Entity,
which is a corporation duly organized, validly
existing and in good standing under the laws of
the Commonwealth of Massachusetts, with power
under its Declaration of Trust, as amended (the
"Acquired Entity Charter"), to own all of its
assets and to carry on its business as it is
being conducted as of the date hereof. The
Acquired Entity is duly qualified to do business
as a foreign trust in each jurisdiction in which
the conduct of its business makes such
qualification necessary except where the failure
to so qualify would not have a material adverse
effect on the condition (financial or otherwise),
business, properties, net assets or results of
operations of the Acquired Entity. The Acquired
Entity has all necessary federal, state and local
authorization to carry on its business as now
being conducted and to fulfill the terms of this
Agreement, except as set forth in paragraph
4.1(c).
(b) The Acquired Entity is a registered
open-end management investment company, and its
registration with the Commission as an investment
company under the 1940 Act, and the registration
of the class of Acquired Fund Shares under the
Securities Act of 1933, as amended ("1933 Act"),
is in full force and effect.
(c) No consent, approval, authorization,
or order of any court or governmental authority
is required for the consummation by the Acquired
Fund of the transactions contemplated herein,
except such as may be required under the 1933
Act, the Securities Exchange Act of 1934 ("1934
Act"), the 0000 Xxx, xxxxx securities laws and
the Xxxx-Xxxxx-Xxxxxx Act.
(d) The current prospectus and statement
of additional information of such Acquired Fund
(true and correct copies of which have been
delivered to the Acquiring Entity) and each
prospectus and statement of additional
information of the Acquired Fund used during the
three (3) years prior to the date of this
Agreement conforms or conformed at the time of
its use in all material respects to the
applicable requirements of the 1933 Act and the
1940 Act and the rules and regulations of the
Commission thereunder and does not or did not at
the time of its use include any untrue statement
of a material fact or omit to state any material
fact required to be stated therein or necessary
to make the statements therein, in light of the
circumstances under which they were made, not
materially misleading.
(e) On the Closing Date, the Acquired
Entity, on behalf of such Acquired Fund, will
have good and marketable title to such Acquired
Fund's Assets and full right, power and authority
to sell, assign, convey, transfer and deliver
such Assets hereunder free of any liens or other
encumbrances, and upon delivery and payment for
the Assets, the Acquiring Entity, on behalf of
the corresponding Acquiring Fund, will acquire
good and marketable title thereto, subject to no
restrictions on the full transfer thereof,
excluding such restrictions as might arise under
the 1933 Act.
(f) The Acquired Fund is not engaged
currently, and the execution, delivery and
performance of this Agreement by the Acquired
Entity, on behalf of such Acquired Fund, will not
result, in a material violation of Massachusetts
law or of the Acquired Entity Charter or the by-
laws of the Acquired Entity, or of any agreement,
indenture, instrument, contract, lease or other
undertaking to which the Acquired Entity, on
behalf of such Acquired Fund, is a party or by
which it is bound, and the execution, delivery
and performance of this Agreement by the Acquired
Entity, on behalf of such Acquired Fund, will not
result in the acceleration of any material
obligation, or the imposition of any material
penalty, under any agreement, indenture,
instrument, contract, lease, judgment or decree
to which the Acquired Entity, on behalf of such
Acquired Fund, is a party or by which it is
bound.
(g) All material contracts or other
commitments of such Acquired Fund (other than
this Agreement, certain investment contracts,
including options, futures, swaps and forward
contracts, the indemnification agreements of the
current and former members of the Acquired Entity
Board, and those contracts listed in Schedule
4.1) will terminate without liability to such
Acquired Fund on or prior to the Closing Date.
Each contract listed in Schedule 4.1 is a valid,
binding and enforceable obligation of such
Acquired Fund and, to the Acquired Fund's
knowledge, the other parties thereto (assuming
due authorization, execution and delivery by the
other parties thereto) and the assignment by such
Acquired Fund to the corresponding Acquiring Fund
of each such contract will not result in the
termination of such contract, any breach or
default thereunder by such Acquired Fund or the
imposition of any penalty thereunder.
(h) No litigation or administrative
proceeding or investigation of or before any
court or governmental body is presently pending
or, to the Acquired Entity's knowledge,
threatened against the Acquired Entity, with
respect to such Acquired Fund or any of its
properties or assets, that, if adversely
determined, would materially and adversely affect
its financial condition or the conduct of such
Acquired Fund's business. The Acquired Entity,
on behalf of such Acquired Fund, is not a party
to or subject to the provisions of any order,
decree or judgment of any court or governmental
body which materially and adversely affects such
Acquired Fund's business or the Acquired Entity's
ability to consummate the transactions herein
contemplated on behalf of such Acquired Fund.
(i) The Statement of Assets and
Liabilities, Statements of Operations and Changes
in Net Assets and Schedule of Investments of such
Acquired Fund as at the last day of and for the
most recently completed fiscal year of such
Acquired Fund prior to the date of this
Agreement, have been audited by KPMG LLP,
independent registered public accounting firm,
and are in accordance with accounting principles
generally accepted in the United States of
America ("GAAP") consistently applied, and such
statements (true and correct copies of which have
been furnished to the Acquiring Entity) present
fairly, in all material respects, the financial
condition of such Acquired Fund as of such date
and for such period in accordance with GAAP, and
there are no known contingent, accrued or other
liabilities of such Acquired Fund required to be
reflected on a balance sheet (including the notes
thereto) in accordance with GAAP as of such date
that are not disclosed therein.
(j) Since the last day of the most
recently completed fiscal year of such Acquired
Fund prior to the date of this Agreement, there
has not been any material adverse change in such
Acquired Fund's financial condition, assets,
liabilities or business, other than changes
occurring in the ordinary course of business, or
any incurrence by the Acquired Fund of
indebtedness for money borrowed maturing more
than one year from the date such indebtedness was
incurred. For the purposes of this subparagraph
(j), a decline in net asset value per share of
Acquired Fund Shares due to declines in market
values of securities held by such Acquired Fund,
the discharge of Acquired Fund liabilities, or
the redemption of Acquired Fund Shares by
shareholders of such Acquired Fund shall not
constitute a material adverse change.
(k) All federal and other tax returns,
dividend reporting forms and other tax-related
reports of such Acquired Fund required by law to
have been filed (taking into account any
extensions) shall have been timely filed (taking
such extensions into account) and shall be
correct in all material respects, and all federal
and other taxes shown as due or required to be
shown as due from the Acquired Fund on said
returns, forms and reports shall have been paid
or provision shall have been made for the payment
thereof and, to the best of the Acquired Entity's
knowledge, no such return is currently under
audit and no outstanding assessment has been
asserted with respect to such returns.
(l) Such Acquired Fund is a separate
series of the Acquired Entity that is treated as
a corporation separate from any and all other
series of the Acquired Entity under Section
851(g) of the Code. For each taxable year of its
operation (including the current taxable year,
assuming such year ends on the Closing Date),
such Acquired Fund has met (or will meet) the
requirements of Subchapter M of Chapter 1 of the
Code for qualification and treatment as a
"regulated investment company," has elected to be
treated as such, and has been (or will be)
eligible to compute and has computed (or will
compute) its federal income tax under Section 852
of the Code. For each taxable year of its
operation (including the current taxable year,
assuming such year ends on the Closing Date),
such Acquired Fund will have distributed, on or
before the Closing Date, substantially all of (a)
its investment company taxable income (as defined
in the Code) (computed without regard to any
deduction for dividends paid), (b) the excess of
its interest income excludable from gross income
under Section 103(a) of the Code, if any, over
its deductions disallowed under Section 265 and
Section 171(a)(2) of the Code, and (c) any net
capital gain (as defined in the Code) (after
reduction for any allowable capital loss
carryover) that has accrued or been recognized,
respectively, through the Closing Date such that
for all tax periods ending on or before the
Closing Date (and treating the current tax year
as ending on the Closing Date) such Acquired Fund
will not have any unpaid tax liability under
Section 852 of the Code. For each calendar year
of its operation (including the calendar year
that includes the Closing Date), such Acquired
Fund will have made such distributions, on or
before the Closing Date, as are necessary so that
for all calendar years ending on or before the
Closing Date, and for the calendar year that
includes the Closing Date, such Acquired Fund
will not have any unpaid tax liability under
Section 4982 of the Code.
(m) All issued and outstanding Acquired
Fund Shares of such Acquired Fund are, and on the
Closing Date will be, duly authorized and validly
and legally issued and outstanding, fully paid
and non-assessable by the Acquired Entity and
have been offered and sold in any state,
territory or the District of Columbia in
compliance in all material respects with
applicable registration requirements of all
applicable federal and state securities laws.
All of the issued and outstanding Acquired Fund
Shares of such Acquired Fund will, at the time of
Closing, be held by the persons and in the
amounts set forth in the records of the Transfer
Agent, on behalf of such Acquired Fund, as
provided in paragraph 3.3. Such Acquired Fund
does not have outstanding any options, warrants
or other rights to subscribe for or purchase any
of the Acquired Fund Shares of such Acquired
Fund, nor is there outstanding any security
convertible into any of the Acquired Fund Shares
of such Acquired Fund.
(n) The execution, delivery and
performance of this Agreement, and the
transactions contemplated herein, have been duly
authorized by all necessary action on the part of
the Acquired Entity Board, on behalf of such
Acquired Fund, and this Agreement constitutes a
valid and binding obligation of the Acquired
Entity, on behalf of such Acquired Fund,
enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy,
insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights
and to general equity principles.
(o) The provisions of the Acquired Entity
Charter, the bylaws of the Acquired Entity, and
Massachusetts law do not require the shareholders
of the Acquired Entity, on behalf of each
Acquired Fund, to approve this Agreement or the
transactions contemplated herein in order for the
Acquired Entity, on behalf of each Acquired Fund,
to consummate the transactions contemplated
herein with respect to an Acquired Fund.
(p) The information to be furnished by
the Acquired Entity, on behalf of such Acquired
Fund, for use in the registration statement on
Form N-1A of the Acquiring Entity with respect to
the corresponding Acquiring Fund and other
documents filed or to be filed with any federal,
state or local regulatory authority, which may be
necessary in connection with the transactions
contemplated hereby, shall be accurate and
complete in all material respects and shall
comply in all material respects with federal
securities and other laws and regulations
thereunder applicable thereto.
4.2 Except as has been fully disclosed to
the Acquired Entity in Schedule 4.2 to this
Agreement, the Acquiring Entity, on behalf of
each Acquiring Fund, represents and warrants to
the Acquired Entity and the corresponding
Acquired Fund as follows:
(a) Such Acquiring Fund is duly
established as a series of the Acquiring Entity,
which is a business trust duly organized, validly
existing and in good standing under the laws of
the Commonwealth of Massachusetts, with the power
under the Acquiring Entity's Declaration of
Trust, as amended (the "Acquiring Entity
Charter"), to own all of the assets of such
Acquiring Fund and to carry on its business as it
is being conducted as of the date hereof. The
Acquiring Entity is duly qualified to do business
as a foreign trust in each jurisdiction in which
the conduct of its business makes such
qualification necessary except where the failure
to so qualify would not have a material adverse
effect on the condition (financial or otherwise),
business, properties, net assets or results of
operations of the Acquiring Entity. The
Acquiring Entity has all necessary federal, state
and local authorization to carry on its business
as now being conducted and to fulfill the terms
of this Agreement except as described in
paragraph 4.2(c).
(b) The Acquiring Entity is a registered
open-end management investment company, and its
registration with the Commission as an investment
company under the 1940 Act, and the registration
of the class of Acquiring Fund Shares under the
1933 Act, is in full force and effect or will be
in full force and effect as of the Closing Date.
(c) No consent, approval, authorization,
or order of any court or governmental authority
is required for the consummation by the Acquiring
Fund of the transactions contemplated herein,
except such as may be required under the 1933
Act, the 1934 Act, the 1940 Act, state securities
laws and the Xxxx-Xxxxx-Xxxxxx Act.
(d) The current prospectus and statement
of additional information of such Acquiring Fund
(true and correct copies of which have been
delivered to the Acquired Entity) and each
prospectus and statement of additional
information of such Acquiring Fund used during
the three (3) years prior to the date of this
Agreement conforms or conformed at the time of
its use in all material respects to the
applicable requirements of the 1933 Act and the
1940 Act and the rules and regulations of the
Commission thereunder and does not or did not at
the time of its use include any untrue statement
of a material fact or omit to state any material
fact required to be stated therein or necessary
to make the statements therein, in light of the
circumstances under which they were made, not
materially misleading.
(e) Such Acquiring Fund is not engaged
currently, and the execution, delivery and
performance of this Agreement by the Acquiring
Entity, on behalf of such Acquiring Fund, will
not result, in a material violation of
Massachusetts law or the Acquiring Entity Charter
or the by-laws of the Acquiring Entity, or of any
agreement, indenture, instrument, contract, lease
or other undertaking to which the Acquiring
Entity, on behalf of such Acquiring Fund, is a
party or by which it is bound, and the execution,
delivery and performance of this Agreement by the
Acquiring Entity, on behalf of such Acquiring
Fund, will not result in the acceleration of any
material obligation, or the imposition of any
material penalty, under any agreement, indenture,
instrument, contract, lease, judgment or decree
to which the Acquiring Entity, on behalf of such
Acquiring Fund, is a party or by which it is
bound.
(f) No litigation or administrative
proceeding or investigation of or before any
court or governmental body is presently pending
or, to the Acquiring Entity's knowledge,
threatened against the Acquiring Entity, with
respect to such Acquiring Fund, or any of its
properties or assets, that, if adversely
determined, would materially and adversely affect
its financial condition or the conduct of such
Acquiring Fund's business. The Acquiring Entity,
on behalf of such Acquiring Fund, is not a party
to or subject to the provisions of any order,
decree or judgment of any court or governmental
body which materially and adversely affects such
Acquiring Fund's business or the Acquiring
Entity's ability to consummate the transactions
herein contemplated on behalf of such Acquiring
Fund.
(g) The Statement of Assets and
Liabilities, Statements of Operations and Changes
in Net Assets and Schedule of Investments of such
Acquiring Fund as at the last day of and for the
most recently completed fiscal year of such
Acquiring Fund prior to the date of this
Agreement, have been audited by KPMG LLP,
independent registered public accounting firm,
and are in accordance with GAAP consistently
applied, and such statements (true and correct
copies of which have been furnished to the
Acquired Entity) present fairly, in all material
respects, the financial condition of such
Acquiring Fund as of such date and for such
period in accordance with GAAP, and there are no
known contingent, accrued or other liabilities of
such Acquiring Fund required to be reflected on a
balance sheet (including the notes thereto) in
accordance with GAAP as of such date that are not
disclosed therein.
(h) Since the last day of the most
recently completed fiscal year of such Acquiring
Fund prior to the date of this Agreement, there
has not been any material adverse change in such
Acquiring Fund's financial condition, assets,
liabilities or business, other than changes
occurring in the ordinary course of business, or
any incurrence by such Acquiring Fund of
indebtedness for money borrowed maturing more
than one year from the date such indebtedness was
incurred. For the purposes of this subparagraph
(h), a decline in net asset value per share of
Acquiring Fund Shares due to declines in market
values of securities held by such Acquiring Fund,
the discharge of Acquiring Fund liabilities, or
the redemption of Acquiring Fund Shares by
shareholders of such Acquiring Fund shall not
constitute a material adverse change.
(i) All federal and other tax returns,
dividend reporting forms and other tax-related
reports of such Acquiring Fund required by law to
have been filed (taking into account any
extensions) shall have been timely filed (taking
such extensions into account) and shall be
correct in all material respects, and all federal
and other taxes shown as due or required to be
shown as due from the Acquiring Fund on said
returns, forms and reports shall have been paid
or provision shall have been made for the payment
thereof and, to the best of the Acquiring
Entity's knowledge, no such return is currently
under audit and no outstanding assessment has
been asserted with respect to such returns.
(j) Such Acquiring Fund is a separate
series of the Acquiring Entity that is treated as
a corporation separate from any and all other
series of the Acquiring Entity under Section
851(g) of the Code. For each taxable year of its
operation (including the taxable year that
includes the Closing Date), such Acquiring Fund
has met (or will meet) the requirements of
Subchapter M of Chapter 1 of the Code for
qualification and treatment as a "regulated
investment company," has elected to be treated as
such, and has been (or will be) eligible to
compute and has computed (or will compute) its
federal income tax under Section 852 of the Code.
For each taxable year of its operation ending
prior to the Closing Date, such Acquiring Fund
will have distributed (or will distribute
pursuant to the provisions of Section 855 of the
Code) substantially all of (a) its investment
company taxable income (as defined in the Code)
(computed without regard to any deduction for
dividends paid), (b) the excess of its interest
income excludable from gross income under Section
103(a) of the Code, if any, over its deductions
disallowed under Section 265 and Section
171(a)(2) of the Code, and (c) any net capital
gain (as defined in the Code) (after reduction
for any capital loss carryover) such that for all
tax periods ending prior to the Closing Date such
Acquiring Fund will not have any unpaid tax
liability under Section 852 of the Code. For
each calendar year of its operation ending prior
to the Closing Date, such Acquiring Fund will
have made such distributions as are necessary so
that for all calendar years ending prior to the
Closing Date such Acquiring Fund will not have
any unpaid tax liability under Section 4982 of
the Code.
(k) All issued and outstanding Acquiring
Fund Shares are, and on the Closing Date will be,
duly authorized and validly and legally issued
and outstanding, fully paid and non-assessable by
the Acquiring Entity and will have been offered
and sold in any state, territory or the District
of Columbia in compliance in all material
respects with applicable registration
requirements of all applicable federal and state
securities laws. Such Acquiring Fund does not
have outstanding any options, warrants or other
rights to subscribe for or purchase any Acquiring
Fund Shares, nor is there outstanding any
security convertible into any Acquiring Fund
Shares. All of the Acquiring Fund Shares to be
issued and delivered to the Acquired Entity, for
the account of the Acquired Fund Shareholders,
pursuant to this Agreement, will on the Closing
Date have been duly authorized and, when so
issued and delivered, will be duly and validly
and legally issued Acquiring Fund Shares and be
fully paid and non-assessable by the Acquiring
Entity.
(l) The execution, delivery and
performance of this Agreement, and the
transactions contemplated herein, have been duly
authorized by all necessary action on the part of
the Acquiring Entity Board, on behalf of such
Acquiring Fund, and this Agreement constitutes a
valid and binding obligation of the Acquiring
Entity, on behalf of such Acquiring Fund,
enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy,
insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights
and to general equity principles.
(m) The information to be furnished by
such Acquiring Fund for use in the registration
statement on Form N-1A of the Acquiring Entity
with respect to the Acquiring Fund and other
documents filed or to be filed with any federal,
state or local regulatory authority, which may be
necessary in connection with the transactions
contemplated hereby, shall be accurate and
complete in all material respects and shall
comply in all material respects with federal
securities and other laws and regulations
thereunder applicable thereto, and shall not, as
of the effective date of such registration
statement, 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 not materially
misleading.
5. COVENANTS
The Acquired Entity, on behalf of each
Acquired Fund, and the Acquiring Entity, on
behalf of each Acquiring Fund, respectively,
hereby further covenant as follows:
5.1 The Acquired Fund and the Acquiring
Fund each will operate its business in the
ordinary course and shall comply in all material
respects with all applicable laws, rules and
regulations between the date hereof and the
Closing Date, it being understood that such
ordinary course of business will include the
declaration and payment of customary dividends
and other distributions, and any other
distribution that may be advisable.
5.2 The Acquiring Fund Shares to be
acquired by such Acquired Fund hereunder are not
being acquired for the purpose of making any
distribution thereof, other than in accordance
with the terms of this Agreement.
5.3 The Acquired Entity, on behalf of each
Acquired Fund, will assist the Acquiring Entity
in obtaining such information as the Acquiring
Entity reasonably requests concerning the
beneficial ownership of the Acquired Fund Shares.
5.4 Subject to the provisions of this
Agreement, the Acquiring Entity, on behalf of
each Acquiring Fund, and the Acquired Entity, on
behalf of each Acquired Fund, each will take, or
cause to be taken, all action, and do or cause to
be done, all things reasonably necessary, proper
or advisable to consummate and make effective the
transactions contemplated by this Agreement.
5.5 Each of the Acquiring Entity, on behalf
of each Acquiring Fund, and the Acquired Entity,
on behalf of each Acquired Fund, will use its
reasonable best efforts to fulfill or obtain the
fulfillment of the conditions precedent to effect
the transactions contemplated by this Agreement
as promptly as practicable.
5.6 The Acquired Entity, on behalf of each
Acquired Fund, will, from time to time, as and
when reasonably requested by the Acquiring
Entity, execute and deliver or cause to be
executed and delivered all such assignments and
other instruments and will take or cause to be
taken such further action as the Acquiring
Entity, on behalf of the corresponding Acquiring
Fund, may reasonably deem necessary or desirable
in order to vest in and confirm (a) the Acquired
Entity's title to and possession of the Acquiring
Fund Shares to be delivered hereunder and (b) the
Acquiring Entity's title to and possession of all
the Assets and to otherwise to carry out the
intent and purpose of this Agreement.
5.9 The Acquiring Entity, on behalf of each
Acquiring Fund, will use all reasonable efforts
to obtain the approvals and authorizations
required by the 1933 Act, the 1940 Act and such
of the state blue sky or securities laws as may
be necessary in order to continue its operations
after the Closing Date.
6.CONDITIONS PRECEDENT TO OBLIGATIONS
OF EACH ACQUIRED FUND
The obligations of the Acquired Entity, on
behalf of each Acquired Fund, to consummate the
transactions provided for herein shall be
subject, at the Acquired Entity's election, to
the following conditions:
6.1 All representations and warranties of
the Acquiring Entity, on behalf of such Acquiring
Fund, contained in this Agreement shall be true
and correct in all material respects as of the
date hereof and, except as they may be affected
by the transactions contemplated by this
Agreement, as of the Closing Date, with the same
force and effect as if made on and as of the
Closing Date.
6.2 The Acquiring Entity, on behalf of such
Acquiring Fund, shall have performed all of the
covenants and complied with all of the provisions
required by this Agreement to be performed or
complied with by the Acquiring Entity, on behalf
of such Acquiring Fund, on or before the Closing
Date.
6.3 The Acquiring Entity, on behalf of such
Acquiring Fund, shall have executed and delivered
an assumption of the Liabilities of the
corresponding Acquired Fund and all such other
agreements and instruments as the Acquired Entity
may reasonably deem necessary or desirable in
order to vest in and confirm (a) such Acquired
Fund's title to and possession of the Acquiring
Fund Shares to be delivered hereunder and (b) the
Acquiring Entity's assumption of all of the
Liabilities and to otherwise to carry out the
intent and purpose of this Agreement.
6.4 The Acquiring Entity, on behalf of such
Acquiring Fund, shall have delivered to such
Acquired Fund a certificate executed in the name
of the Acquiring Entity, on behalf of such
Acquiring Fund, by the Acquiring Entity's
President or Vice President and its Treasurer or
Assistant Treasurer, in a form reasonably
satisfactory to the Acquired Entity and dated as
of the Closing Date, as to the matters set forth
in paragraphs 6.1 and 6.2 and as to such other
matters as the Acquired Entity shall reasonably
request.
6.5 The Acquiring Entity, on behalf of such
Acquiring Fund, and the Acquired Entity, on
behalf of the corresponding Acquired Fund, shall
have agreed on the number of full and fractional
Acquiring Fund Shares to be issued in connection
with the Reorganization after such number has
been calculated in accordance with paragraph 1.1.
7.CONDITIONS PRECEDENT TO OBLIGATIONS OF
EACH ACQUIRING FUND
The obligations of the Acquiring Entity, on
behalf of each Acquiring Fund, to consummate the
transactions provided for herein shall be
subject, at the Acquiring Entity's election, to
the following conditions with respect to the
applicable Acquiring Fund:
7.1 All representations and warranties of
the Acquired Entity, on behalf of such Acquired
Fund, contained in this Agreement shall be true
and correct in all material respects as of the
date hereof and, except as they may be affected
by the transactions contemplated by this
Agreement, as of the Closing Date, with the same
force and effect as if made on and as of the
Closing Date.
7.2 The Acquired Entity, on behalf of such
Acquired Fund, shall have performed all of the
covenants and complied with all of the provisions
required by this Agreement to be performed or
complied with by the Acquired Entity, on behalf
of such Acquired Fund, on or before the Closing
Date.
7.3 The Acquired Entity shall have
delivered to the Acquiring Entity, on behalf of
such Acquiring Fund, a Statement of Assets and
Liabilities of the corresponding Acquired Fund as
of the Closing Date, including a schedule of
investments, certified by the Treasurer of the
Acquired Entity on behalf of such Acquired Fund.
The Acquired Entity, on behalf of such Acquired
Fund, shall have executed and delivered all such
assignments and other instruments of transfer as
the Acquiring Entity may reasonably deem
necessary or desirable in order to vest in and
confirm (a) the Acquired Fund's title to and
possession of the Acquiring Fund Shares to be
delivered hereunder and (b) the Acquiring Fund's
title to and possession of all the Assets and to
otherwise to carry out the intent and purpose of
this Agreement.
7.4 The Acquired Entity, on behalf of such
Acquired Fund, shall have delivered to the
Acquiring Entity a certificate executed in the
name of the Acquired Entity, on behalf of such
Acquired Fund, by the Acquired Entity's President
or Vice President and its Treasurer or Assistant
Treasurer, in a form reasonably satisfactory to
the Acquiring Entity and dated as of the Closing
Date, as to the matters set forth in paragraphs
7.1 and 7.2 and as to such other matters as the
Acquiring Entity shall reasonably request.
7.5 The Acquired Entity, on behalf of such
Acquired Fund, and the Acquiring Entity, on
behalf of the corresponding Acquiring Fund, shall
have agreed on the number of full and fractional
Acquiring Fund Shares to be issued by such
Acquiring Fund in connection with the
Reorganization after such number has been
calculated in accordance with paragraph 1.1.
8. FURTHER CONDITIONS PRECEDENT TO
OBLIGATIONS OF EACH ACQUIRING FUND AND
EACH CORRESPONDING ACQUIRED FUND
If any of the conditions set forth below have
not been satisfied on or before the Closing Date
with respect to the Acquired Entity, on behalf of
each Acquired Fund, or the Acquiring Entity, on
behalf of the corresponding Acquiring Fund, the
other party to this Agreement shall be entitled
on behalf of the corresponding Acquired Fund or
Acquiring Fund, as applicable, at its option, to
refuse to consummate the transactions
contemplated by this Agreement with respect to
the applicable Acquired Fund and its
corresponding Acquiring Fund:
8.1 On the applicable Closing Date, no
court or governmental agency of competent
jurisdiction shall have issued any order that
remains in effect and that restrains or enjoins
the Acquired Entity, with respect to such
Acquired Fund, or the Acquiring Entity, with
respect to such Acquiring Fund, from completing
the transactions contemplated by this Agreement.
8.2 All consents of other parties and all
other consents, orders and permits of federal,
state and local regulatory authorities deemed
necessary by the Acquiring Entity or the Acquired
Entity to permit consummation, in all material
respects, of the transactions contemplated hereby
shall have been obtained, except where failure to
obtain any such consent, order or permit would
not involve a risk of a material adverse effect
on the assets or properties of such Acquiring
Fund or such Acquired Fund, provided that either
party hereto may for itself waive any of such
conditions.
8.3 The registration statement of the
Acquiring Entity with respect to Class A Shares
of each Acquiring Fund shall have become
effective under the 1933 Act and no stop orders
suspending the effectiveness thereof shall have
been issued and, to the best knowledge of the
parties hereto, no investigation or proceeding
for that purpose shall have been instituted or be
pending.
8.4 The parties shall have received the
opinion of Xxxxxxx XxXxxxxxx LLP, dated the
Closing Date, substantially to the effect that,
based upon certain facts, assumptions and
representations and upon certifications made by
the Acquired Entity, on behalf of the applicable
Acquired Fund, the Acquiring Entity, on behalf of
the applicable Acquiring Fund, and their
respective authorized officers, (i) the
applicable Reorganization will constitute a
reorganization within the meaning of Section
368(a) of the Code, and the applicable Acquired
Fund and the corresponding Acquiring Fund will
each be a "party to a reorganization" within the
meaning of Section 368(b) of the Code; (ii) no
gain or loss will be recognized by such Acquiring
Fund upon receipt of the Assets of the
corresponding Acquired Fund solely in exchange
for the applicable Acquiring Fund Shares and the
assumption by such Acquiring Fund of the
Liabilities of the applicable Acquired Fund;
(iii) the basis in the hands of such Acquiring
Fund of the Assets of such corresponding Acquired
Fund will be the same as the basis of such Assets
in the hands of the Acquired Fund immediately
prior to the transfer, increased by the amount of
gain (or decreased by the amount of loss), if
any, recognized by the Acquired Fund upon the
transfer; (iv) the holding period of each Asset
in the hands of such Acquiring Fund will include
the period during which the Asset was held by
such Acquired Fund (except where investment
activities of the Acquiring Fund have the effect
of reducing or eliminating the holding period
with respect to an asset); (v) no gain or loss
will be recognized by such Acquired Fund upon the
transfer of its Assets to the corresponding
Acquiring Fund in exchange for the applicable
Acquiring Fund Shares and the assumption by the
Acquiring Fund of the Liabilities of the Acquired
Fund, or upon the distribution of the Acquiring
Fund Shares by the Acquired Fund to its
shareholders in complete liquidation except for
(A) any gain or loss that may be recognized with
respect to contracts subject to Section 1256 of
the Code, (B) any gain that may be recognized on
the transfer of stock in a "passive foreign
investment company" as defined in Section 1297(a)
of the Code and (C) any other gain or loss that
may be required to be recognized as a result of
the closing of the Acquired Fund's taxable year
or upon the transfer of an Asset regardless of
whether such transfer would otherwise be a non-
taxable transaction under the Code; (vi) no gain
or loss will be recognized by the Acquired Fund
Shareholders of such Acquired Fund upon the
exchange of their Acquired Fund Shares solely for
the Acquiring Fund Shares of the corresponding
Acquiring Fund as part of the Reorganization;
(vii) the aggregate basis of the Acquiring Fund
Shares that each Acquired Fund Shareholder
receives in connection with the transaction will
be the same as the aggregate basis of his or her
Acquired Fund Shares exchanged therefor; and
(viii) an Acquired Fund shareholder's holding
period for his or her Acquiring Fund Shares will
include the period for which he or she held the
Acquired Fund Shares exchanged therefor, provided
that he or she held such Acquired Fund Shares as
capital assets on the date of the exchange. The
delivery of such opinion is conditioned upon the
receipt by Xxxxxxx XxXxxxxxx LLP of
representations it shall request of the Acquiring
Entity and the Acquired Entity. Notwithstanding
anything herein to the contrary, neither the
Acquiring Entity nor the Acquired Entity may
waive the condition set forth in this paragraph
8.4.
8.5 The Acquiring Entity, on behalf of
each Acquiring Fund, shall have received on the
applicable Closing Date an opinion of Xxxxxxx
XxXxxxxxx LLP, in a form reasonably satisfactory
to the Acquiring Entity, and dated as of the
Closing Date, substantially to the effect that,
based upon certain facts and certifications made
by the Acquired Entity, on behalf of the Acquired
Fund, and its authorized officers: (a) the
Acquired Entity is a business trust validly
existing under the laws of the Commonwealth of
Massachusetts; (b) the Acquired Entity, with
respect to the corresponding Acquired Fund, has
the power as a business trust to carry on its
business as presently conducted in accordance
with the description thereof in the Acquired
Entity's registration statement as an open-end
investment company registered under the 1940 Act;
(c) this Agreement has been duly authorized,
executed and, so far as known to such counsel,
delivered by the Acquired Entity, on behalf of
the corresponding Acquired Fund, and assuming due
authorization, execution and delivery of this
Agreement by the Acquiring Entity, on behalf of
such Acquiring Fund, constitutes a valid and
legally binding obligation of the Acquired
Entity, on behalf of the corresponding Acquired
Fund, enforceable against the Acquired Entity in
accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and laws of general
applicability relating to or affecting creditors'
rights and to general equity principles (whether
in a proceeding under equity or at law); provided
that such counsel shall be entitled to state that
it expresses no opinion with respect to the
validity, binding effect or enforceability of any
contractual provisions purporting to provide
indemnification of any person for any claims,
damages, liabilities or expenses which may be
limited by any applicable federal or state
securities laws or as a matter of public policy;
and (d) the execution and delivery of this
Agreement did not, and the transfer of the Assets
for Acquiring Fund Shares and the assumption by
the Acquiring Fund of the Liabilities pursuant to
this Agreement will not, violate the Acquired
Entity Charter or the by-laws of the Acquired
Entity. Such opinion may state that it is solely
for the benefit of the Acquiring Entity and the
Acquiring Entity Board. Such opinion may contain
such assumptions and limitations as shall be in
the opinion of Xxxxxxx XxXxxxxxx LLP appropriate
to render the opinions expressed therein.
8.6 The Acquired Entity, on behalf of each
Acquired Fund, shall have received on the
applicable Closing Date an opinion of Xxxxxxx
XxXxxxxxx LLP, in a form reasonably satisfactory
to the Acquired Entity, and dated as of the
Closing Date, substantially to the effect that,
based upon certain facts and certifications made
by the Acquiring Entity, on behalf of the
corresponding Acquiring Fund and its authorized
officers: (a) the Acquiring Entity is a business
trust validly existing under the laws of the
Commonwealth of Massachusetts; (b) the Acquiring
Entity, with respect to the corresponding
Acquiring Fund, has the power as a business trust
to carry on its business as presently conducted
in accordance with the description thereof in the
Acquiring Entity's registration statement as an
open-end investment company registered under the
1940 Act; (c) this Agreement has been duly
authorized, executed and, so far as is known to
such counsel, delivered by the Acquiring Entity,
on behalf of the corresponding Acquiring Fund,
and assuming due authorization, execution and
delivery of this Agreement by the Acquired
Entity, on behalf of such Acquired Fund,
constitutes a valid and legally binding
obligation of the Acquiring Entity, on behalf of
the corresponding Acquiring Fund, enforceable
against the Acquiring Entity in accordance with
its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance,
reorganization, moratorium and laws of general
applicability relating to or affecting creditors'
rights and to general equity principles (whether
in a proceeding under equity or at law); provided
that such counsel shall be entitled to state that
it expresses no opinion with respect to the
validity, binding effect or enforceability of any
contractual provisions purporting to provide
indemnification of any person for any claims,
damages, liabilities or expenses which may be
limited by any applicable federal or state
securities laws or as a matter of public policy;
and (d) the execution and delivery of this
Agreement did not, and the issuance of the
Acquiring Fund Shares and the assumption of the
Liabilities in exchange for the transfer of the
Assets pursuant to this Agreement will not,
violate the Acquiring Entity Charter or the by-
laws of the Acquiring Entity. Such opinion may
state that it is solely for the benefit of the
Acquired Entity and the Acquired Entity Board.
Such opinion may contain such assumptions and
limitations as shall be in the opinion of Xxxxxxx
XxXxxxxxx LLP appropriate to render the opinions
expressed therein.
9. INDEMNIFICATION
9.1 The Acquiring Entity, out of each
Acquiring Fund's assets and property (including
any amounts paid to the Acquiring Fund pursuant
to any applicable liability insurance policies or
indemnification agreements) agrees to indemnify
and hold harmless the Acquired Entity and the
members of the Acquired Entity Board and its
officers from and against any and all losses,
claims, damages, liabilities or expenses
(including, without limitation, the payment of
reasonable legal fees and reasonable costs of
investigation) to which the Acquired Entity and
those board members and officers may become
subject, insofar as such loss, claim, damage,
liability or expense (or actions with respect
thereto) arises out of or is based on (a) any
breach by the Acquiring Entity, on behalf of an
Acquiring Fund, of any of its representations,
warranties, covenants or agreements set forth in
this Agreement or (b) any act, error, omission,
neglect, misstatement, materially misleading
statement, breach of duty or other act wrongfully
done or attempted to be committed by the
Acquiring Entity or the members of the Acquiring
Entity Board or its officers prior to the Closing
Date, provided that such indemnification by the
Acquiring Entity is not (i) in violation of any
applicable law or (ii) otherwise prohibited as a
result of any applicable order or decree issued
by any governing regulatory authority or court of
competent jurisdiction.
9.2 The Acquired Entity, out of each
Acquired Fund's assets and property (including
any amounts paid to the Acquired Fund pursuant to
any applicable liability insurance policies or
indemnification agreements) agrees to indemnify
and hold harmless the Acquiring Entity and the
members of the Acquiring Entity Board and its
officers from and against any and all losses,
claims, damages, liabilities or expenses
(including, without limitation, the payment of
reasonable legal fees and reasonable costs of
investigation) to which the Acquiring Entity and
those board members and officers may become
subject, insofar as such loss, claim, damage,
liability or expense (or actions with respect
thereto) arises out of or is based on (a) any
breach by the Acquired Entity, on behalf of an
Acquired Fund, of any of its representations,
warranties, covenants or agreements set forth in
this Agreement or (b) any act, error, omission,
neglect, misstatement, materially misleading
statement, breach of duty or other act wrongfully
done or attempted to be committed by the Acquired
Entity or the members of the Acquired Entity
Board or its officers prior to the Closing Date,
provided that such indemnification by the
Acquired Entity is not (i) in violation of any
applicable law or (ii) otherwise prohibited as a
result of any applicable order or decree issued
by any governing regulatory authority or court of
competent jurisdiction.
10. BROKER FEES AND EXPENSES
10.1 The Acquiring Entity, on behalf of
each Acquiring Fund, and the Acquired Entity, on
behalf of each Acquired Fund, represent and
warrant to each other that there are no brokers
or finders entitled to receive any payments in
connection with the transactions provided for
herein.
10.2 Domini Social Investments, LLC will
pay all the costs of each Reorganization.
Notwithstanding any of the foregoing, expenses
will in any event be paid by the party directly
incurring such expenses (without reimbursement by
another person) if and to the extent that the
payment by another person of such expenses would
prevent such party from being treated as a
"regulated investment company" under the Code or
would prevent the Reorganization from qualifying
as a tax-free reorganization.
11. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
11.1 The Acquiring Entity and the Acquired
Entity agree that neither party has made any
representation, warranty or covenant, on behalf
of an Acquiring Fund or an Acquired Fund,
respectively, not set forth herein and that this
Agreement constitutes the entire agreement
between the parties.
11.2 The covenants to be performed after
the Closing by both the Acquiring Entity and the
Acquired Entity, and the obligations of the
Acquiring Entity, on behalf of each Acquiring
Fund, in Article 9, shall survive the Closing.
All other representations, warranties and
covenants contained in this Agreement or in any
document delivered pursuant hereto or in
connection herewith shall not survive the
consummation of the transactions contemplated
hereunder and shall terminate on the Closing.
12. TERMINATION
This Agreement may be terminated and the
transactions contemplated hereby may be abandoned
with respect to any Acquiring Fund or Acquired
Fund at any time prior to the Closing Date with
respect to the applicable Reorganization by
resolution of either the Acquiring Entity Board
or the Acquired Entity Board, if circumstances
should develop that, in the opinion of that
Board, make proceeding with the Agreement
inadvisable with respect to such Acquiring Fund
or such Acquired Fund, respectively. Any such
termination resolution to be effective shall be
promptly communicated to the other party and, in
any event, prior to the Closing Date. The
termination of this Agreement with respect to an
Acquired Fund or its corresponding Acquiring Fund
shall not affect the continued effectiveness of
this Agreement with respect to any other Acquired
Fund or Acquiring Fund, nor shall it affect the
rights and obligations of any party in respect of
any breach of this Agreement occurring prior to
such termination.
13. AMENDMENTS
This Agreement may be amended, modified or
supplemented in such manner as may be deemed
necessary or advisable by the authorized officers
of the Acquired Entity and the Acquiring Entity;
provided, however, that following the meeting of
the Acquired Fund shareholders called by the
Acquired Fund pursuant to paragraph 5.2 of this
Agreement, no such amendment may have the effect
of changing the provisions for determining the
number of Acquiring Fund Shares to be issued to
Acquired Fund shareholders under this Agreement
to the detriment of such shareholders without
their further approval.
14. NOTICES
Any notice, report, statement or demand
required or permitted by any provisions of this
Agreement shall be in writing and shall be given
by facsimile, electronic delivery (i.e., e-mail),
personal service or prepaid or certified mail
addressed to the Acquiring Entity or the Acquired
Entity, at its address set forth in the preamble
to this Agreement, in each case to the attention
of its President.
15. HEADINGS; COUNTERPARTS; GOVERNING LAW;
SEVERABILITY; ASSIGNMENT; LIMITATION OF
LIABILITY
15.1 The Article headings contained in this
Agreement are for reference purposes only and
shall not affect in any way the meaning or
interpretation of this Agreement.
15.2 This Agreement may be executed in any
number of counterparts, each of which shall be
deemed an original.
15.3 This Agreement shall be governed by
and construed and interpreted in accordance with
the internal laws of the State of New York.
15.4 This Agreement shall bind and inure to
the benefit of the parties hereto and their
respective successors and assigns, but no
assignment or transfer hereof or of any rights or
obligations hereunder shall be made by any party
without the written consent of the other parties.
Nothing herein expressed or implied is intended
or shall be construed to confer upon or give any
person, firm or corporation, other than the
parties hereto and their respective successors
and assigns, any rights or remedies under or by
reason of this Agreement.
15.5 The warranties, representations and
agreements contained in this Agreement made by
the Acquired Entity, on behalf of each of the
Acquired Funds, are made on a several (and not
joint, or joint and several) basis. Similarly,
the warranties, representations and agreements
contained in this Agreement made by the Acquiring
Entity, on behalf of each of the Acquiring Funds,
are made on a several (and not joint, or joint
and several) basis.
15.6 Consistent with the Acquiring Entity
Charter, the obligations of the Acquiring Entity
with respect to the Acquiring Fund entered into
in the name or on behalf of the Acquiring Entity
by any of its Trustees, officers, employees or
agents are made not individually, but in such
capacities, and are not binding upon any of the
Trustees, officers, employees, agents or
shareholders of the Acquiring Entity, personally,
but bind only the assets of the Acquiring Entity
belonging to the Acquiring Fund, and all persons
dealing with any series or funds of the Acquiring
Entity must look solely to the assets of the
Acquiring Entity belonging to such series or fund
for the enforcement of any claims against the
Acquiring Entity.
[Rest of page intentionally left blank]
IN WITNESS WHEREOF, each of the parties hereto
has caused this Agreement to be executed by its
duly authorized officer.
DOMINI SOCIAL INVESTMENT TRUST,
on behalf of EACH OF ITS SERIES LISTED IN EXHIBIT
A ATTACHED HERETO
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: President
DOMINI ADVISOR TRUST,
on behalf of EACH OF ITS SERIES LISTED IN EXHIBIT
A ATTACHED HERETO
By: /s/ Xxx X. Xxxxxxxx
Name: Xxx X. Xxxxxxxx
Title: President
Solely for purposes of paragraph 10.2 of the
Agreement:
DOMINI SOCIAL INVESTMENTS, LLC
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: President and Chief Operating Officer
Exhibit A
Acquired Fund Share Acquiring Fund Share
Class Class
Domini Social Equity Class A Domini Social Equity Fund Class A
Portfolio
Domini European Social Class A Domini European Social Equity Class A
Equity Portfolio Fund
Domini European PacAsia Class A Domini European PacAsia Class A
Social Equity Portfolio Social Equity Fund
Domini PacAsia Social Class A Domini PacAsia Social Equity Class A
Equity Portfolio Fund
SCHEDULE 4.1
None
SCHEDULE 4.2
None
