Exhibit 13.2
WITHDRAWAL AGREEMENT
THIS AGREEMENT is made and entered into as of the 4th day of February,
1997, by and between Signet Financial Services, Inc. ("Signet"); Xxxxxxxxx
Funds, a Massachusetts business trust ("Xxxxxxxxx"); Capital Growth
Portfolio, a New York trust (the "Portfolio"); and The Chase Manhattan Bank
("Chase"), with respect to the proposed withdrawal of Xxxxxxxxx Capital
Growth Fund (the "Fund"), a series of Xxxxxxxxx, of its investment in the
Portfolio.
WITNESSETH
WHEREAS, the parties hereto are also parties to an Agreement dated
August 23, 1994 (together with Exhibit A thereto, the "SpokeSM Agreement"),
whereunder, among other matters, the Fund agreed to invest all its
investable assets in the Portfolio in exchange for a beneficial interest in
the Portfolio equal in the value to the net value of the assets of the Fund
conveyed to the Portfolio; and
WHEREAS, the Fund has, at all times since October 31, 1994, invested
all its investable assets in the Portfolio and has since that date owned a
beneficial interest in the Portfolio; and
WHEREAS, the Fund desires to withdraw its investment from the
Portfolio in exchange for securities owned by the Portfolio having a value
at the closing date provided herein (the "Closing Date") equal to the value
of the Fund's beneficial interest in the Portfolio as of 4:00 p.m. E.S.T.
on the Closing Date (the "Closing"), and to terminate the SpokeSM
Agreement;
NOW, THEREFORE, in consideration of the foregoing, the mutual promises
herein made and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. The Closing Date shall be mutual selected by the Fund and the
Portfolio.
2. On the Closing Date, the Fund shall withdraw all its beneficial
interest in the Portfolio in exchange for certain securities owned by the
Portfolio at the Closing Date (the "Securities") and cash ("Cash"). The
Securities to be conveyed by the Portfolio to the Fund shall be mutually
selected by the Fund and the Portfolio at least five business days in
advance of the Closing Date (provided however, that, until the day
immediately preceding the Closing, the Fund shall have the right to change
the composition of the securities so selected to the extent of 20% of the
value thereof, such replacement securities to be mutually selected by the
Fund and the Portfolio), and need not mirror, security-for-security, the
composition of the Portfolio immediately prior to the Closing Date, but
will be composed of securities in number and identity which will enable the
Fund immediately following the Closing to comply with the portfolio
diversification tests (IRC Section368(a)(2)(F)(ii) and IRC
Section851(b)(4)) imposed by the Internal Revenue Code of 1986, as amended
(the "Code"). In addition, the amount of Cash to be conveyed by the
Portfolio to the Fund shall be mutually agreed upon by the Portfolio and
the Fund.
3. In addition, on the Closing Date: (a) the SpokeSM Agreement
shall terminate; and (b) Chase and the Portfolio, on the one hand, and
Xxxxxxxxx, the Fund and Signet, on the other hand, shall release one
another from all potential claims relating to the SpokeSM Agreement and the
relationship created thereby.
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4. The Portfolio represents and warrants to Xxxxxxxxx and the Fund,
which representations and warranties shall survive the Closing, that at the
Closing:
a. The Portfolio will have been at all times since its formation a
partnership for federal income tax purposes under the Code, and will
have never been a publicly traded partnership under Section7704 of
the Code.
b. The Portfolio will be an "investment partnership" within the
meaning of Section731(c) of the Code.
c. The Portfolio will not own any "unrealized receivables" within
the meaning of Section751(c) of the Code.
d. The Portfolio will not, at the Closing Date, own any "inventory
items" within the meaning of Section751(d) of the Code.
5. The Portfolio agrees to determine the Fund's taxable income for
the taxable year of the Portfolio which includes the Closing Date by using
the interim closing of the partnership books methods.
6. This Agreement shall be terminated without liability to any party
in the event that the proposed withdrawal by the Fund of its ownership
interest in the Portfolio shall not have been approved by the shareholders
of the Fund on or before April 30, 1997.
7. This Agreement may be executed in two or more counterparts, each
of which shall be an original, but all of which together shall constitute
one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the
date first written above.
SIGNET FINANCIAL SERVICES, INC.
By: /s/ Xxxxx Xxxx
XXXXXXXXX FUNDS
on behalf of itself and the Xxxxxxxxx
Capital Growth Fund
By: /s/ C. Xxxxx Xxxxxxxx
CAPITAL GROWTH PORTFOLIO
By: /s/ Xxxxxx X. Xxxx
THE CHASE MANHATTAN BANK
By: /s/ Xxxxxxx X. XxXxxxxxx
