AGREEMENT AND PLAN
of
REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement")
is made as of the 27th day of June, 2014, by and between New
Alternatives Fund, Inc. (the "Company"), a New York corporation
and New Alternatives Fund (the "Trust"), a Delaware statutory
trust.
This Agreement is intended to be and is adopted as a plan of
reorganization within the meaning of Section 368 (a) (1) (F) of
the U. S. Internal Revenue Code of 1986, as amended (the "Code"),
and is intended to effect the reorganization (the
"Reorganization") of the Company as a new series of the Trust
(the "Successor Fund"). The Reorganization will include the
transfer of all of the assets of the Company to the Successor
Fund of the Trust solely in exchange for (1) the assumption by
the Successor Fund of all liabilities of the Company and (2) the
issuance by the Trust to the Company of Class A Shares of
beneficial interest of the Successor Fund (the "Class A Shares").
The aggregate number of Class A Shares of the Successor Fund
issued to the Company will be equal to the number of full and
fractional shares of common stock ("Shares") of the Company
outstanding immediately before the Reorganization. These
transactions will be promptly followed by a pro rata distribution
by the Company of the Class A Shares of the Successor Fund that
it receives in the exchange described above to the holders of its
Shares in exchange for those Shares, in liquidation of the
Company, and the cancellation of the Company's Shares, all upon
the terms and conditions hereinafter set forth in this Agreement.
In consideration of the promises and of the covenants and
agreements hereinafter set forth, the parties hereto covenant and
agree as follows.
1. Transfer of Assets of the Company in Exchange for
Assumption of Liabilities and Issuance of Class A Shares.
1.1. Subject to the terms and conditions set forth
herein and on the basis of the representations and warranties
contained herein, the Company agrees to transfer all of its
assets (as described in paragraph 1.2) and to assign and transfer
all of its liabilities to the Successor Fund which was organized
solely for the purpose of acquiring all of the assets and
assuming all of the liabilities of the Company. The Trust, on
behalf of its Successor Fund, agrees that in exchange for all of
the assets of the Company: (1) the Successor Fund shall assume
all of the liabilities of such Company, whether contingent or
otherwise, then existing, and (2) the Trust shall issue Class A
Shares of the Successor Fund to the Company. The number of Class
A Shares to be issued by the Trust on behalf of its Successor
Fund will be identical to the number of full and fractional
Shares of the Company outstanding on the Closing Date provided
for in paragraph 3.1. Such transactions shall take place at the
Closing provided for in paragraph 3.1.
1.2. The assets of the Company to be acquired by the
Successor Fund shall include, without limitation, all cash, cash
equivalents, securities, receivables (including interest and
dividends receivable), any tax operating losses, any claims or
rights of action or rights to register Shares under applicable
securities laws, any books or records of the Company and other
property owned by the Company and any deferred or prepaid
expenses shown as assets on the books of the Company on the
Closing Date provided for in paragraph 3.1.
1.3. On the Closing Date, the Company will distribute
in liquidation the Class A Shares of the Successor Fund to each
shareholder of record, determined as of the close of business on
the Closing Date, of the Company, pro rata in proportion to such
shareholder's beneficial interest and in exchange for that
shareholder's Shares. Such distribution will be accomplished by
the transfer of the Class A Shares then credited to the account
of the Company on the records of the Trust to open accounts on
those records in the names of such Company shareholders and
representing the respective pro rata number of Class A Shares
received from the Successor Fund which is due to such Company
shareholders. Fractional Class A Shares shall be rounded to the
third place after the decimal point.
1.4. Ownership of the Class A Shares by the Successor
Fund shareholders shall be recorded separately on the books of
BNY Mellon Investment Servicing (US) Inc., as the Successor
Fund's transfer agent.
1.5. Any transfer taxes payable upon the issuance of
Class A Shares in a name other than the registered holder of
Shares on the books of the Company shall be paid by the person to
whom such Class A Shares are to be distributed as a condition of
such transfer.
1.6. The legal existence of the Company shall be
terminated as promptly as reasonably practicable after the
Closing Date. After the Closing Date, the Company shall not
conduct any business except in connection with its liquidation
and termination.
2. Valuation.
2.1. The value of the Company's assets to be acquired
by the Trust on behalf of the Successor Fund shall be the net
asset value computed as of the valuation time provided in the
Company's prospectus on the Closing Date using the valuation
procedures set forth in the Company's current prospectus and
statement of additional information.
2.2. The value of full and fractional Class A Shares of
the Successor Fund to be issued in exchange for the Company's
assets shall be equal to the value of the net assets of the
Company on the Closing Date, and the number of such Class A
Shares shall equal the number of full and fractional Shares of
the Company outstanding on the Closing Date.
2.3. All computations of value shall be made by BNY
Mellon Investment Servicing (US) Inc., as fund accountant for the
Company and the Successor Fund.
3. Closing and Closing Date.
3.1. The transfer of the Company's assets in exchange
for the assumption by the Successor Fund of the Company's
liabilities and the issuance of Class A Shares to the Company, as
described above, together with related acts necessary to
consummate such acts (the "Closing"), shall occur at Bellevue
Park Corporate Center, 000 Xxxxxxxx Xxxxxxx, Xxxxxxxxxx, XX
00000, on October 24, 2014 (the "Closing Date"), or at such other
place or date as the parties may agree in writing.
3.2. At the Closing each party shall deliver to the
other such bills of sale, checks, assignments, stock
certificates, receipts or other documents as such other party or
its counsel may reasonably request.
4. Representations, Warranties and Covenants.
4.1. The Company represents and warrants as follows:
4.1.1. At the Closing Date, the Company will
have good and marketable title to the assets to be transferred to
the Trust, on behalf of the Successor Fund, pursuant to paragraph
1.1, and will have full right, power and authority to sell,
assign, transfer and deliver such assets hereunder. Upon
delivery and in payment for such assets, the Trust on behalf of
the Successor Fund will acquire good and marketable title thereto
subject to no restrictions on the full transfer thereof,
including such restrictions as might arise under the Securities
Act of 1933, as amended (the "1933 Act");
4.1.2. The execution, delivery and performance
of this Agreement will have been duly authorized prior to the
Closing Date by all necessary action on the part of the Company.
This Agreement constitutes a valid and binding obligation of the
Company enforceable in accordance with its terms, subject to the
approval of the Company's shareholders;
4.1.3. No consent, approval, authorization or
order of any court or governmental authority is required for the
consummation by the Company of the transactions contemplated
herein, except such as shall have been obtained prior to the
Closing Date;
4.1.4. Insofar as the following relates to the
Company, the registration statement filed by the Trust on Form N-
14 relating to the Class A Shares of the Successor Fund that will
be distributed to the Company pursuant to this Agreement, which,
without limitation, shall include a proxy statement of the
Company and the prospectus of the Successor Fund with respect to
the transactions contemplated by this Agreement, and any
supplement or amendment thereto, and the documents contained or
incorporated therein by reference (the "N-14 Registration
Statement"), on the effective date of the N-14 Registration
Statement, at the time of any shareholder's meeting referred to
herein and at the Closing Date: (i) shall comply in all material
respects with the provisions of the 1933 Act, the Securities and
Exchange Act of 1934 (the "1934 Act") and the Investment Company
Act of 1940, as amended (the "1940 Act"), the rules and
regulations thereunder, and state securities laws, and (ii) shall
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;
4.1.5. All U.S. federal, state, local and other
tax returns and reports of the Company required by law to be
filed by it (taking into account permitted extensions for filing)
have been timely filed and are correct in all material respects.
All U.S. federal, state, local and other taxes required to be
paid (whether or not shown on any such return or report) have
been paid, or provision shall have been made for the payment
thereof and any such unpaid taxes are properly reflected on its
financial statements. To the Company's knowledge, no tax
authority is currently auditing or preparing to audit the Company
and no assessment for taxes, interest, additions to tax, or
penalty has been asserted or threatened against the Company; and
4.1.6. For each taxable year of its operations
prior to the Closing Date, the Company (i) has elected to
qualify, and has qualified, as a "regulated investment company"
under Subchapter M of the Code (a "RIC"), (ii) has been eligible
to and has computed its U.S. federal income tax under Section 852
of the Code, and (iii) has been, and will be as of the Closing
Date treated as a separate corporation for U.S. federal income
tax purposes. The Company will qualify as a RIC as of the
Closing Date and will have satisfied as of the close of its most
recent prior quarter of its taxable year, the diversification
requirements of Section 851(b)(3) of the Code without regard to
the last sentence of Section 851(d) of the Code. The Company has
not taken any action, caused any action to be taken or caused any
action to fail to be taken which action or failure could cause
the Company to fail to qualify as a RIC under the Code.
4.2. The Trust represents and warrants, on behalf of
itself and the Successor Fund, as follows:
4.2.1. The Class A Shares issued in connection
with the transactions contemplated herein will be duly and
validly issued and outstanding and fully paid and non-assessable
by the Trust;
4.2.2. The execution, delivery and performance
of this Agreement has been duly authorized by all necessary
action on the part of the Trust, and this Agreement constitutes a
valid and binding obligation of the Trust and the Successor Fund
enforceable against the Trust and the Successor Fund in
accordance with its terms;
4.2.3. No consent, approval, authorization or
order of any court or governmental authority is required for the
consummation by the Trust or the Successor Fund of the
transactions contemplated herein, except such as shall have been
obtained prior to the Closing Date;
4.2.4. The Trust, on behalf of the Successor
Fund, shall use all reasonable efforts to obtain the approvals
and authorizations required by the 1933 Act, the 1940 Act and
such state securities laws as it may deem appropriate in order to
operate after the Closing Date;
4.2.5. Insofar as the following relates to the
Trust and the Successor Fund, the N-14 Registration Statement on
its effective date, at the time of any shareholder's meeting
referred to herein and at the Closing Date: (i) shall comply in
all material respects with the provisions of the 1933 Act, the
1934 Act and the 1940 Act, the rules and regulations thereunder,
and state securities laws, and (ii) shall 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;
4.2.6. The Successor Fund is a new separate
series of the Trust duly authorized in accordance with the
applicable provisions of the Trust's Agreement and Declaration of
Trust and Bylaws;
4.2.7. The Successor Fund was formed solely for
the purpose of effecting the Reorganization, has not commenced
operations or engaged in any business and will not do so until
after the Closing and except for nominal assets, has not owned
any assets and will not own any assets prior to the Closing.
There shall be no issued and outstanding shares of the Successor
Fund prior to the Closing Date;
4.2.8. The Successor Fund (i) will elect to be
taxed as a RIC, will qualify for the tax treatment afforded RICs
under the Code for its taxable year that includes the Closing
Date, and intends to continue to qualify for such treatment for
its subsequent taxable years, (ii) will be eligible to compute
its U.S. federal income tax under Section 852 of the Code for the
taxable year that includes the Closing Date, and (iii) will be
treated as a separate corporation for U.S. federal income tax
purposes for the taxable year that includes the Closing Date; and
4.2.9. The Trust will timely make an entity
classification election on IRS Form 8832 to be classified as a
corporation.
4.3. Covenants of the Trust, on behalf of the Successor
Fund and the Company:
4.3.1. With respect to the Reorganization:
(i) The Company will provide the Successor
Fund with (1) a statement of the respective tax
basis and holding period of all investments to be
transferred by the Company to the Successor Fund,
(2) a copy (which may be in electronic form) of
the shareholder ledger accounts including, without
limitation, the name, address and taxpayer
identification number of each shareholder of
record, the number of Shares held by each
shareholder, the dividend reinvestment elections
applicable to each shareholder, and the backup
withholding and non-resident alien withholding
certifications, notices or records on file with
the Company with respect to each shareholder,
including such information as the Trust may
reasonably request concerning Company Shares or
Company shareholders in connection with the
Successor Fund's cost basis reporting and related
obligations under Sections 1012, 6645, 6045A, and
6045B of the Code and related Treasury regulations
following the Closing for all of the shareholders
of record of the Company as of the close of
business on the Closing Date, who are to become
shareholders of the Successor Fund as a result of
the transfer of Assets (the "Company Shareholder
Documentation"), (3) the tax books and records of
the Company (including but not limited to any
income excise or information returns, as well as
any transfer statements (as described in Treas.
Reg. ?1.6045A-1 and ?1.6045B-1(a))) for purposes
of preparing any returns required by law to be
filed for tax periods ending after the Closing
Date, and (4) all FASB ASC 000-00-00 (formerly FIN
48) workpapers and supporting statements
pertaining to the Company (the "FIN 48
Workpapers"). The foregoing information to be
provided within such timeframes as is mutually
agreed by the parties; and
(ii) Promptly after the Closing, the Company
will make one or more liquidating distributions to
its shareholders consisting of all the Class A
Shares of the Successor Fund received at the
Closing;
(iii) It is the intention of the parties
that the Reorganization will qualify as a
reorganization with the meaning of Section
368(a)(1)(F) of the Code. None of the parties to
the Reorganization shall take any action or cause
any action to be taken (including, without
limitation the filing of any tax return) that is
inconsistent with such treatment or results in the
failure of such Reorganization to qualify as a
reorganization within the meaning of Section
368(a)(1)(F) of the Code; and
(iv) The Company shall deliver to the
Successor Fund copies of: (1) the federal, state
and local income tax returns filed by or on behalf
of the Company for the prior three (3) taxable
years; and (2) any of the following that have been
issued to or for the benefit of or that otherwise
affect the Company and which have continuing
relevance: (a) rulings, determinations, holdings
or opinions issued by any federal state, local or
foreign tax authority and (b) legal opinions.
5. Conditions Precedent to Obligations of the Company, the
Trust and the Successor Fund.
The obligations of the Company, the Trust and the Successor
Fund are each subject to the conditions that on or before the
Closing Date:
5.1. This Agreement and the transactions contemplated
herein shall have been approved by the directors of the Company
and the trustees of the Trust and by the requisite vote of the
Company's shareholders in accordance with applicable law;
5.2. The N-14 Registration Statement shall have become
effective under the 1933 Act and no stop order suspending such
effectiveness shall have been instituted, or, to the knowledge of
the Company or the Trust, contemplated by the U. S. Securities
and Exchange Commission, and all consents of other parties and
all other consents, orders and permits of federal, state and
local regulatory authorities (including those of the U. S.
Securities and Exchange Commission and of state securities
authorities) deemed necessary by the Company or the Trust to
permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except
where failure to obtain any such consent, order or permit would
not involve a risk of a material adverse effect on the assets or
properties of the Company, the Trust or the Successor Fund,
provided that either party hereto may waive any of such
conditions for itself or its respective series;
5.3. The Company and the Trust shall have received on
or before the Closing Date an opinion of Xxxxxxxxxx XxXxxxxxx
Xxxxxx & Xxxxxx, LLP satisfactory to them, substantially to the
effect that for federal income tax purposes:
5.3.1. The acquisition of all of the assets of
the Company by the Successor Fund solely in exchange for the
issuance of Class A Shares to the Company and the assumption by
the Successor Fund of all of the liabilities of the Company,
followed by the distribution in liquidation by the Company of
such Class A Shares to the Company shareholders in exchange for
their Shares and the termination of the Company, will constitute
a reorganization within the meaning of Section 368 (a) (1) (F) of
the Code, and the Company and the Successor Fund will each be "a
party to a reorganization" within the meaning of Section 368 (b)
of the Code;
5.3.2. In accordance with Sections 361 (a), 361
(c) (1) and 357 (a) of the Code, no gain or loss will be
recognized by the Company as a result of such transactions;
5.3.3. In accordance with Section 1032 (a) of
the Code, no gain or loss will be recognized by the Successor
Fund as a result of such transactions;
5.3.4. In accordance with Section 354 (a) (1)
of the Code, no gain or loss will be recognized by the
shareholders of the Company on the distribution to them by the
Company of Class A Shares of the Successor Fund in exchange for
their Shares of the Company;
5.3.5. In accordance with Section 358 (a) (1)
of the Code, the aggregate basis of the Class A Shares of the
Successor Fund received by each holder of Shares of the Company
will be the same as the aggregate basis of the Shares of the
Company held by such holder immediately prior to the
Reorganization;
5.3.6. In accordance with Section 362 (b) of
the Code, the basis of the assets to the Successor Fund will be
the same as the basis of the assets in the hands of the Company
immediately prior to the exchange;
5.3.7. In accordance with Section 1223 (1) of
the Code, a shareholder's holding period for Class A Shares in
the Successor Fund will be determined by including the period for
which the shareholder held the Shares of the Company exchanged
therefore, provided that the shareholder held such Shares of the
Company as a capital asset; and
5.3.8. In accordance with Section 1223 (2) of
the Code, the holding period of such Class A Shares of the
Successor Fund with respect to the assets will include the period
for which the assets were held by the Company.
The Company and the Trust each agree to make and provide
representations with respect to the Company and the Successor
Fund, respectively, which are reasonably necessary to enable
Xxxxxxxxxx XxXxxxxxx Xxxxxx & Xxxxxx, LLP to deliver an opinion
substantially as set forth in this paragraph 5.3, which opinion
may address such other federal income tax consequences, if any,
that Xxxxxxxxxx XxXxxxxxx Xxxxxx & Xxxxxx, LLP believes to be
material to the Reorganization.
6. Brokerage Fees.
The Company and the Trust, on behalf of the Successor Fund,
each represent and warrant to the other that there are no
broker's or finder's fees payable in connection with the
transactions contemplated hereby.
7. Termination.
This Agreement may be terminated by the mutual agreement of
the Company and the Trust, and the parties may abandon the
reorganization contemplated hereby, notwithstanding approval
thereof by the shareholders of the Company, at any time prior to
Closing, if circumstances should develop that, in the parties
judgment, make proceeding with the Agreement inadvisable.
8. Amendment.
This Agreement may be amended, modified or supplemented in
such manner as may be mutually agreed upon in writing by the
parties; provided, however, that following the approval of this
Agreement by the Company's shareholders, no such amendment may
have the effect of changing the provisions for determining the
number of Class A Shares of the Successor Fund to be paid to the
Company's shareholders under this Agreement to the detriment of
the Company's shareholders without their further approval.
9. Headings; Counterparts; Governing Law; Assignment;
Survival; Waiver.
9.1. The article and paragraph headings contained in
this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Agreement.
9.2. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
9.3. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.
9.4. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors
and assigns. 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.
9.5. All persons dealing with the Company, the Trust or
the Successor Fund must look solely to the property of the
Company, the Trust or the Successor Fund, respectively, for the
enforcement of any claims against the Company, the Trust or the
Successor Fund, as neither the directors, trustees, officers,
agents nor shareholders of the Company or the Trust assume any
personal liability for obligations entered into on behalf of the
Company or the Trust respectively. No series of the Trust, or
any class within a series, shall be responsible for any
obligations assumed by or on behalf of any other series, or class
within such series, of the Trust under this Agreement.
9.6. The representations, warranties, covenants and
agreements of the parties contained herein shall not survive the
Closing Date, except for the provisions of Paragraphs 1.6 and
9.8.
9.7. The Company or the Trust, after consultation with
their respective counsel and by consent of their respective
Boards of Directors, Trustees, Executive Committees or an officer
authorized by such Boards of Directors or Trustees, may waive any
condition to their respective obligations hereunder if, in their
or such officer's judgment, such waiver will not have a material
adverse effect on the interests of the shareholders of the
Company and the Trust.
9.8. From and after the Closing Date, the Trust will
assume and honor any obligation as provided for or permitted by
applicable federal and state law in effect immediately prior to
the Closing Date with respect to the indemnification of each
person who is now, or has been at any time prior to the date
hereof or who becomes prior to the Closing Date, a director or
officer of the Company (for the purposes of this Paragraph, the
"Indemnified Parties") to the maximum extent available and
permitted by applicable law or regulation against any and all
losses in connection with or arising out of any claim which is
based upon, arises out of or in any way relates to any actual or
alleged act or omission occurring at or prior to the Closing
Date, including any actions taken to approve and implement this
Agreement and the transactions contemplated hereby, in the
Indemnified Parties' capacities as director or officer (whether
elected or appointed), of the Company. This Paragraph 9.8 will
be construed as an agreement as to which the Indemnified Parties
are intended to be third-party beneficiaries.
10. Notices.
All notices required or permitted herein shall be in writing
and shall be deemed to be properly given when delivered
personally or by telecopier to the party entitled to receive the
notice or when sent by certified or registered mail, postage
prepaid, or delivered to a nationally recognized overnight
courier service, in each case properly addressed to the party
entitled to receive such notice at the address or telecopier
number stated below or to such other address or telecopier number
as may hereafter be furnished in writing by notice similarly
given by one party to the other party hereto and addressed to the
Company or the Trust, each at 000 Xxxxxxxxxxx Xxxx, Xxxxx XX0,
Xxxxxxxx, XX 00000, telecopies No. (000) 000-0000. Attention:
President.
[The Remainder of This Page is Intentionally Blank.]
IN WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be executed by its duly authorized officer.
NEW ALTERNATIVES FUND, INC.
By:
Name: Xxxxx X. Xxxxxxxxxx
Title: Chairperson of the
Board and President
NEW ALTERNATIVES FUND
By:
Name: Xxxxx X. Xxxxxxxxxx
Title: Chairperson of the
Board and President
New Alternatives Fund
12/31/14 N-SAR
Sub-Item 77Q(1)(d)
A-1
