Exhibit (e)(21)
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of
this 10th day of November, 2005, by and between ING Investors Trust, a
Massachusetts business trust with its principal place of business at 0000 Xxxx
Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx 00000-0000 ("Investors Trust"), on
behalf of its series, ING Liquid Assets Portfolio (the "Acquiring Portfolio"),
and USLICO Series Fund, a Massachusetts business trust with its principal place
of business at 0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx 00000-0000
("USLICO"), on behalf of its series, The Money Market Portfolio (the "Acquired
Portfolio").
This Agreement is intended to be and is adopted as a plan of
reorganization and liquidation within the meaning of Section 368(a)(1) of the
United States Internal Revenue Code of 1986, as amended (the "Code"). The
reorganization (the "Reorganization") will consist of the transfer of all of the
assets of the Acquired Portfolio to the Acquiring Portfolio in exchange solely
for the Institutional Class ("Class I") voting shares of beneficial interest of
the Acquiring Portfolio (the "Acquiring Portfolio Shares"), the assumption by
the Acquiring Portfolio of the liabilities of the Acquired Portfolio described
in paragraph 1.3, and the distribution of the Acquiring Portfolio Shares to the
shareholders of the Acquired Portfolio in complete liquidation of the Acquired
Portfolio as provided herein, all upon the terms and conditions hereinafter set
forth in this Agreement.
WHEREAS, the Acquired Portfolio and the Acquiring Portfolio are series of
open-end, registered investment companies of the management type, and the
Acquired Portfolio owns securities which generally are assets of the character
in which the Acquiring Portfolio is permitted to invest; and
WHEREAS, the Board of Trustees of Investors Trust has determined that the
exchange of all of the assets of the Acquired Portfolio for Acquiring Portfolio
Shares and the assumption of the liabilities of the Acquired Portfolio described
in paragraph 1.3 by the Acquiring Portfolio is in the best interests of the
Acquiring Portfolio and its shareholders and that the interests of the existing
shareholders of the Acquiring Portfolio would not be diluted as a result of this
transaction; and
WHEREAS, the Board of Trustees of USLICO has determined that the exchange
of all of the assets of the Acquired Portfolio for Acquiring Portfolio Shares
and the assumption of the liabilities described in paragraph 1.3 of the Acquired
Portfolio by the Acquiring Portfolio is in the best interests of the Acquired
Portfolio and its shareholders and that the interests of the existing
shareholders of the Acquired Portfolio would 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 PORTFOLIO TO THE ACQUIRING PORTFOLIO IN
EXCHANGE FOR THE ACQUIRING PORTFOLIO SHARES, THE ASSUMPTION OF ALL KNOWN
ACQUIRED PORTFOLIO LIABILITIES AND THE LIQUIDATION OF THE ACQUIRED
PORTFOLIO
1.1. Subject to the requisite approval of the Acquired Portfolio
shareholders and the other terms and conditions herein set forth and on the
basis of the representations and warranties contained herein, the Acquired
Portfolio agrees to transfer all of the Acquired Portfolio's assets, as set
forth in paragraph 1.2, to the Acquiring Portfolio, and the Acquiring Portfolio
agrees in exchange therefor: (i) to deliver to the Acquired Portfolio the number
of full and fractional Class I Acquiring Portfolio Shares determined by dividing
the value of the Acquired Portfolio's net assets, computed in the manner and as
of the time and date set forth in paragraph 2.1, by the net asset value of one
Class I Acquiring Portfolio Share, computed in the manner and as of the time and
date set forth in paragraph 2.2; and (ii) to assume the liabilities of the
Acquired Portfolio, as set forth in paragraph 1.3. Such transactions shall take
place at the closing provided for in paragraph 3.1 (the "Closing").
1.2. The assets of the Acquired Portfolio to be acquired by the Acquiring
Portfolio shall consist of all assets and property, including, without
limitation, all cash, securities, commodities and futures interests and
dividends or interests receivable that are owned by the Acquired Portfolio and
any deferred or prepaid expenses shown as an asset on the books of the Acquired
Portfolio on the closing date provided for in paragraph 3.1 (the "Closing Date")
(collectively, "Assets").
1.3. The Acquired Portfolio will endeavor to discharge all of its known
liabilities and obligations prior to the Closing Date. The Acquiring Portfolio
shall assume the liabilities of the Acquired Portfolio set forth in the Acquired
Portfolio's statement of assets and liabilities as of the Closing Date delivered
by USLICO, on behalf of the Acquired Portfolio, to Investors Trust, on behalf of
the Acquiring Portfolio, pursuant to paragraph 7.2 hereof. On or as soon as
practicable prior to the Closing Date, the Acquired Portfolio will declare and
pay to its shareholders of record one or more dividends and/or other
distributions so that it will have distributed substantially all (and in no
event less than 98%) of its investment company taxable income (computed without
regard to any deduction for dividends paid) and realized net capital gain, if
any, for the current taxable year through the Closing Date.
1.4. Immediately after the transfer of assets provided for in paragraph
1.1, the Acquired Portfolio will distribute to the Acquired Portfolio's
shareholders of record, determined as of immediately after the close of business
on the Closing Date (the "Acquired Portfolio Shareholders"), on a pro rata
basis, the Class I Acquiring Portfolio Shares received by the Acquired Portfolio
pursuant to paragraph 1.1, and will completely liquidate. Such distribution and
liquidation will be accomplished, with respect to the Acquired Portfolio's
shares, by the transfer of the Acquiring Portfolio Shares then credited to the
account of the Acquired Portfolio on the books of the Acquiring Portfolio to
open accounts on the share records of the Acquiring Portfolio in the names of
the Acquired Portfolio Shareholders. The aggregate net asset value of Class I
Acquiring Portfolio Shares to be so credited to Acquired Portfolio Shareholders
shall be equal to the aggregate net asset value of the initial class of Acquired
Portfolio shares owned by such shareholders on the Closing Date. All issued and
outstanding shares of the Acquired Portfolio will simultaneously be canceled on
the books of the Acquired Portfolio, although share certificates representing
interests in shares of the Acquired Portfolio will represent a number of the
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Class I Acquiring Portfolio Shares after the Closing Date, as determined in
accordance with Section 2.3. The Acquiring Portfolio shall not issue
certificates representing the Class I Acquiring Portfolio Shares in connection
with such exchange.
1.5. Ownership of Acquiring Portfolio Shares will be shown on the books of
the Acquiring Portfolio's transfer agent, as defined in paragraph 3.3.
1.6. Any reporting responsibility of the Acquired Portfolio including, but
not limited to, the responsibility for filing of regulatory reports, tax
returns, or other documents with the U.S. Securities and Exchange Commission
(the "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 Portfolio.
2. VALUATION
2.1. The value of the Assets shall be the value computed as of immediately
after the close of business of the New York Stock Exchange and after the
declaration of any dividends on the Closing Date (such time and date being
hereinafter called the "Valuation Date"), using the valuation procedures in the
then-current prospectus and statement of additional information with respect to
the Acquiring Portfolio, and valuation procedures established by the Acquiring
Portfolio's Board of Trustees.
2.2. The net asset value of a Class I Acquiring Portfolio Share shall be
the net asset value per share computed with respect to that class as of the
Valuation Date, using the valuation procedures set forth in the Acquiring
Portfolio's then-current prospectus and statement of additional information and
valuation procedures established by the Acquiring Portfolio's Board of Trustees.
2.3. The number of the Class I Acquiring Portfolio Shares to be issued
(including fractional shares, if any) in exchange for the Acquired Portfolio's
assets shall be determined by dividing the value of the net assets with respect
to shares of the Acquired Portfolio, determined using the same valuation
procedures referred to in paragraph 2.1, by the net asset value of an Acquiring
Portfolio Share, determined in accordance with paragraph 2.2.
2.4. All computations of value shall be made by the Acquired Portfolio's
designated record keeping agent and shall be subject to review by Acquiring
Portfolio's record keeping agent and by each Portfolio's respective independent
accountants.
3. CLOSING AND CLOSING DATE
3.1. The Closing Date shall be April 29, 2006, or such other date as the
parties may agree. All acts taking place at the Closing shall be deemed to take
place simultaneously as of immediately after 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 4:00 p.m., Eastern Time. The Closing shall be
held at the offices of the Acquiring Portfolio or at such other time and/or
place as the parties may agree.
3.2. The Acquired Portfolio shall direct The Bank of New York, as
custodian for the Acquired Portfolio (the "Custodian"), to deliver, at the
Closing, a certificate of an authorized officer stating that (i) the Assets
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shall have been delivered in proper form to the Acquiring Portfolio within two
business days prior to or on the Closing Date, and (ii) all necessary taxes in
connection with the delivery of the Assets, including all applicable federal and
state stock transfer stamps, if any, have been paid or provision for payment has
been made. The Acquired Portfolio's portfolio securities represented by a
certificate or other written instrument shall be presented for examination by
the Acquired Portfolio Custodian to the custodian for the Acquiring Portfolio no
later than five business days preceding the Closing Date, and shall be
transferred and delivered by the Acquired Portfolio as of the Closing Date for
the account of the Acquiring Portfolio duly endorsed in proper form for transfer
in such condition as to constitute good delivery thereof. The Custodian shall
deliver as of the Closing Date by book entry, in accordance with the customary
practices of the Custodian and any securities depository (as defined in Rule
17f-4 under the Investment Company Act of 1940, as amended (the "1940 Act")) in
which the Acquired Portfolio's Assets are deposited, the Acquired Portfolio's
portfolio securities and instruments deposited with such depositories. The cash
to be transferred by the Acquired Portfolio shall be delivered by wire transfer
of federal funds on the Closing Date.
3.3. The Acquired Portfolio shall direct DST Systems, Inc. (the "Transfer
Agent"), on behalf of the Acquired Portfolio, to deliver at the Closing a
certificate of an authorized officer stating that its records contain the names
and addresses of the Acquired Portfolio Shareholders and the number and
percentage ownership of outstanding shares owned by each such shareholder
immediately prior to the Closing. The Acquiring Portfolio shall issue and
deliver a confirmation evidencing the Acquiring Portfolio Shares to be credited
on the Closing Date to the Secretary of the Acquiring Portfolio, or provide
evidence satisfactory to the Acquired Portfolio that such Acquiring Portfolio
Shares have been credited to the Acquired Portfolio's account on the books of
the Acquiring Portfolio. At the Closing each party shall deliver to the other
such bills of sale, checks, assignments, share certificates, if any, receipts or
other documents as such 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 the
Acquiring Portfolio or the Acquired Portfolio 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, in the
judgment of the Board of Trustees of the Acquired Portfolio or the Board of
Trustees of the Acquiring Portfolio, accurate appraisal of the value of the net
assets of the Acquiring Portfolio or the Acquired Portfolio is impracticable,
the Closing Date shall be postponed until the first 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 disclosed to the Acquiring Portfolio in a written
instrument executed by an officer of USLICO, USLICO, on behalf of the Acquired
Portfolio, represents and warrants to Investors Trust as follows:
(a) The Acquired Portfolio is duly organized as a series of USLICO,
which is a business trust duly organized, validly existing and in good standing
under the laws of the Commonwealth of Massachusetts, with power under USLICO's
Declaration of Trust to own all of its properties and assets and to carry on its
business as it is now being conducted;
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(b) USLICO is a registered investment company classified as a
management company of the open-end type, and its registration with the
Commission as an investment company under the 1940 Act, and the registration of
shares of the Acquired Portfolio 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
Portfolio of the transactions contemplated herein, except such as have been
obtained under the 1933 Act, the Securities Exchange Act of 1934, as amended
(the "1934 Act") and the 1940 Act and such as may be required by state
securities laws;
(d) The current prospectus and statement of additional information
of the Acquired Portfolio and each prospectus and statement of additional
information of the Acquired Portfolio used during the three years previous 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 Portfolio will have good and
marketable title to the Assets and full right, power, and authority to sell,
assign, transfer and deliver such Assets hereunder free of any liens or other
encumbrances, and upon delivery and payment for such Assets, the Acquiring
Portfolio will acquire good and marketable title thereto, subject to no
restrictions on the full transfer thereof, including such restrictions as might
arise under the 1933 Act, other than as disclosed to the Acquiring Portfolio;
(f) The Acquired Portfolio is not engaged currently, and the
execution, delivery and performance of this Agreement will not result, in (i) a
material violation of USLICO's Declaration of Trust or By-Laws or of any
agreement, indenture, instrument, contract, lease or other undertaking to which
USLICO, on behalf of the Acquired Portfolio, is a party or by which it is bound;
or (ii) the acceleration of any obligation, or the imposition of any penalty,
under any agreement, indenture, instrument, contract, lease, judgment or decree
to which USLICO, on behalf of the Acquired Portfolio, is a party or by which it
is bound;
(g) All material contracts or other commitments of the Acquired
Portfolio (other than this Agreement and certain investment contracts including
options, futures and forward contracts) will terminate without liability to the
Acquired Portfolio prior to the Closing Date;
(h) Except as otherwise disclosed in writing to and accepted by
Investors Trust, on behalf of the Acquiring Portfolio, no litigation or
administrative proceeding or investigation of or before any court or
governmental body is presently pending or, to its knowledge, threatened against
the Acquired Portfolio or any of its properties or assets that, if adversely
determined, would materially and adversely affect its financial condition or the
conduct of its business. USLICO, on behalf of the Acquired Portfolio, knows of
no facts which might form the basis for the institution of such proceedings and
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 its
business or its ability to consummate the transactions herein contemplated;
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(i) The Statement of Assets and Liabilities, Statements of
Operations and Changes in Net Assets, and Schedule of Investments of the
Acquired Portfolio at December 31, 2004 have been audited by KPMG LLP,
independent accountants, and are in accordance with generally accepted
accounting principles ("GAAP") consistently applied, and such statements (copies
of which have been furnished to the Acquiring Portfolio) present fairly, in all
material respects, the financial condition of the Acquired Portfolio as of such
date in accordance with GAAP, and there are no known contingent liabilities of
the Acquired Portfolio required to be reflected on a balance sheet (including
the notes thereto) in accordance with GAAP as of such date not disclosed
therein;
(j) Since December 31, 2004, there has not been any material adverse
change in the Acquired Portfolio's financial condition, assets, liabilities or
business, other than changes occurring in the ordinary course of business, or
any incurrence by the Acquired Portfolio of indebtedness maturing more than one
year from the date such indebtedness was incurred, except as otherwise disclosed
to and accepted by the Acquiring Portfolio. For the purposes of this
subparagraph (j), a decline in net asset value per share of the Acquired
Portfolio due to declines in market values of securities in the Acquired
Portfolio's portfolio, the discharge of Acquired Portfolio liabilities, or the
redemption of Acquired Portfolio Shares by shareholders of the Acquired
Portfolio shall not constitute a material adverse change;
(k) On the Closing Date, all Federal and other tax returns, dividend
reporting forms, and other tax-related reports of the Acquired Portfolio
required by law to have been filed by such date (including any extensions) shall
have been filed and are or will be correct in all material respects, and all
Federal and other taxes shown as due or required to be shown as due on said
returns and reports shall have been paid or provision shall have been made for
the payment thereof, and to the best of the Acquired Portfolio's knowledge, no
such return is currently under audit and no assessment has been asserted with
respect to such returns;
(l) For each taxable year of its operation (including the taxable
year ending on the Closing Date), the Acquired Portfolio has met (or will meet)
the requirements of Sub-chapter M of the Code for qualification as a regulated
investment company, has been (or will be) eligible to and has computed (or will
compute) its federal income tax under Section 852 of the Code, and will have
distributed all of its investment company taxable income and net capital gain
(as defined in the Code) that has accrued through the Closing Date, and before
the Closing Date will have declared dividends sufficient to distribute all of
its investment company taxable income and net capital gain for the period ending
on the Closing Date;
(m) All issued and outstanding shares of the Acquired Portfolio are,
and on the Closing Date will be, duly and validly issued and outstanding, fully
paid and non-assessable, (recognizing that, under Massachusetts law, it is
theoretically possible that shareholders of the Acquiring Portfolio could, under
certain circumstances, be held personally liable for obligations of the
Acquiring Portfolio) and have been offered and sold in every state and the
District of Columbia in compliance in all material respects with applicable
registration requirements of the 1933 Act and state securities laws. All of the
issued and outstanding shares of the Acquired Portfolio 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 the Acquired Portfolio, as provided in
paragraph 3.3. The Acquired Portfolio does not have outstanding any options,
warrants or other rights to subscribe for or purchase any of the shares of the
Acquired Portfolio, nor is there outstanding any security convertible into any
of the Acquired Portfolio shares;
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(n) The execution, delivery and performance of this Agreement will
have been duly authorized prior to the Closing Date by all necessary action, if
any, on the part of the Trustees of USLICO, on behalf of the Acquired Portfolio,
and, subject to the approval of the shareholders of the Acquired Portfolio, this
Agreement will constitute a valid and binding obligation of the Acquired
Portfolio, 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 information to be furnished by the Acquired Portfolio for
use in registration statements, proxy materials and other documents filed or to
be filed with any federal, state or local regulatory authority (including the
National Association of Securities Dealers, Inc.), 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
(p) The proxy statement of the Acquired Portfolio (the "Proxy
Statement") to be included in the Registration Statement referred to in
paragraph 5.6, insofar as it relates to the Acquired Portfolio, will, on the
effective date of the Registration Statement and on the Closing Date (i) 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, in
light of the circumstances under which such statements were made, not materially
misleading provided, however, that the representations and warranties in this
subparagraph (p) shall not apply to statements in or omissions from the Proxy
Statement and the Registration Statement made in reliance upon and in conformity
with information that was furnished by the Acquiring Portfolio for use therein;
and (ii) comply in all material respects with the provisions of the 1933 Act,
the 1934 Act and the 1940 Act and the rules and regulations thereunder.
4.2. Except as has been disclosed to the Acquired Portfolio in a written
instrument executed by an officer of Investors Trust, Investors Trust, on behalf
of the Acquiring Portfolio, represents and warrants to USLICO as follows:
(a) The Acquiring Portfolio is duly organized as a series of
Investors Trust, which is a trust duly organized, validly existing and in good
standing under the laws of the commonwealth of Massachusetts, with power under
Investors Trust's Declaration of Trust to own all of its properties and assets
and to carry on its business as it is now being conducted;
(b) Investors Trust is a registered investment company classified as
a management company of the open-end type, and its registration with the
Commission as an investment company under the 1940 Act and the registration of
the shares of the Acquiring Portfolio under the 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 Acquiring
Portfolio of the transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act and the 1940 Act and such as may be
required by state securities laws;
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(d) The current prospectus and statement of additional information
of the Acquiring Portfolio and each prospectus and statement of additional
information of the Acquiring Portfolio used during the three years previous 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 Acquiring Portfolio will have good and
marketable title to the Acquiring Portfolio's assets, free of any liens of other
encumbrances, except those liens or encumbrances as to which the Acquired
Portfolio has received notice and necessary documentation at or prior to the
Closing;
(f) The Acquiring Portfolio is not engaged currently, and the
execution, delivery and performance of this Agreement will not result, in (i) a
material violation of Investors Trust's Declaration of Trust or By-Laws or of
any agreement, indenture, instrument, contract, lease or other undertaking to
which Investors Trust, on behalf of the Acquiring Portfolio, is a party or by
which it is bound; or (ii) the acceleration of any obligation, or the imposition
of any penalty, under any agreement, indenture, instrument, contract, lease,
judgment or decree to which Investors Trust, on behalf of the Acquiring
Portfolio, is a party or by which it is bound;
(g) Except as otherwise disclosed in writing to and accepted by
USLICO, on behalf of the Acquired Portfolio, no litigation or administrative
proceeding or investigation of or before any court or governmental body is
presently pending or, to its knowledge, threatened against Investors Trust, on
behalf of the Acquiring Portfolio, or any of the Acquiring Portfolio's
properties or assets that, if adversely determined, would materially and
adversely affect the Acquiring Portfolio's financial condition or the conduct of
the Acquiring Portfolio's business. Investors Trust, on behalf of the Acquiring
Portfolio, knows of no facts which might form the basis for the institution of
such proceedings and 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 its business or its ability to consummate the transactions
herein contemplated;
(h) The Statement of Assets and Liabilities, Statements of
Operations and Changes in Net Assets and Schedule of Investments of the
Acquiring Portfolio at December 31, 2004 have been audited by KPMG LLP,
independent accountants, and are in accordance with GAAP consistently applied,
and such statements (copies of which have been furnished to the Acquired
Portfolio) present fairly, in all material respects, the financial condition of
the Acquiring Portfolio as of such date in accordance with GAAP, and there are
no known contingent liabilities of the Acquiring Portfolio required to be
reflected on a balance sheet (including the notes thereto) in accordance with
GAAP as of such date not disclosed therein;
(i) Since December 31, 2004, there has not been any material adverse
change in the Acquiring Portfolio's financial condition, assets, liabilities or
business, other than changes occurring in the ordinary course of business, or
any incurrence by the Acquiring Portfolio of indebtedness maturing more than one
year from the date such indebtedness was incurred, except as otherwise disclosed
to and accepted by the Acquired Portfolio. For purposes of this subparagraph
(i), a decline in net asset value per share of the Acquiring Portfolio due to
declines in market values of securities in the Acquiring Portfolio's portfolio,
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the discharge of Acquiring Portfolio liabilities, or the redemption of Acquiring
Portfolio Shares by shareholders of the Acquiring Portfolio, shall not
constitute a material adverse change;
(j) On the Closing Date, all Federal and other tax returns, dividend
reporting forms, and other tax-related reports of the Acquiring Portfolio
required by law to have been filed by such date (including any extensions) shall
have been filed and are or will be correct in all material respects, and all
Federal and other taxes shown as due or required to be shown as due on said
returns and reports shall have been paid or provision shall have been made for
the payment thereof, and to the best of the Acquiring Portfolio's knowledge no
such return is currently under audit and no assessment has been asserted with
respect to such returns;
(k) For each taxable year of its operation (including the taxable
year that includes the Closing Date), the Acquiring Portfolio has met (or will
meet) the requirements of Sub-chapter M of the Code for qualification as a
regulated investment company, has been eligible to (or will be eligible to) and
has computed (or will compute) its federal income tax under Section 852 of the
Code, and has distributed all of its investment company taxable income and net
capital gain (as defined in the Code) for periods ending prior to the Closing
Date;
(l) All issued and outstanding shares of the Acquiring Portfolio
are, and on the Closing Date will be, duly and validly issued and outstanding,
fully paid and non-assessable by Investors Trust and have been offered and sold
in every state and the District of Columbia in compliance in all material
respects with applicable registration requirements of the 1933 Act and state
securities laws. The Acquiring Portfolio does not have outstanding any options,
warrants or other rights to subscribe for or purchase any Acquiring Portfolio
Shares, nor is there outstanding any security convertible into any Acquiring
Portfolio Shares;
(m) The execution, delivery and performance of this Agreement will
have been fully authorized prior to the Closing Date by all necessary action, if
any, on the part of the Trustees of Investors Trust, on behalf of the Acquiring
Portfolio, and this Agreement will constitute a valid and binding obligation of
the Acquiring Portfolio, 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;
(n) Class I Acquiring Portfolio Shares to be issued and delivered to
the Acquired Portfolio, for the account of the Acquired Portfolio Shareholders,
pursuant to the terms of this Agreement, will on the Closing Date have been duly
authorized and, when so issued and delivered, will be duly and validly issued
Acquiring Portfolio Shares, and will be fully paid and non-assessable;
(o) The information to be furnished by Investors Trust for use in
the registration statements, proxy materials and other documents that 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 applicable
thereto; and
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(p) That insofar as it relates to the Acquiring Portfolio, the
Registration Statement relating to the Acquiring Portfolio Shares issuable
hereunder, and the proxy materials of the Acquired Portfolio to be included in
the Registration Statement, and any amendment or supplement to the foregoing,
will, from the effective date of the Registration Statement through the date of
the meeting of shareholders of the Acquired Portfolio contemplated therein (i)
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,
in light of the circumstances under which such statements were made, not
misleading, provided, however, that the representations and warranties in this
subparagraph (p) shall not apply to statements in or omissions from the
Registration Statement made in reliance upon and in conformity with information
that was furnished by the Acquired Portfolio for use therein; and (ii) comply in
all material respects with the provisions of the 1933 Act, the 1934 Act and the
1940 Act and the rules and regulations thereunder.
5. COVENANTS OF THE ACQUIRING PORTFOLIO AND THE ACQUIRED PORTFOLIO
5.1. The Acquiring Portfolio and the Acquired Portfolio each will operate
its business in the ordinary course 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 distributions, and any other
distribution that may be advisable.
5.2. The Acquired Portfolio will call a meeting of the shareholders of the
Acquired Portfolio to consider and act upon this Agreement and to take all other
action necessary to obtain approval of the transactions contemplated herein.
5.3. The Acquired Portfolio covenants that the Class I Acquiring Portfolio
Shares to be issued hereunder are not being acquired for the purpose of making
any distribution thereof, other than in accordance with the terms of this
Agreement.
5.4. The Acquired Portfolio will assist the Acquiring Portfolio in
obtaining such information as the Acquiring Portfolio reasonably requests
concerning the beneficial ownership of the Acquired Portfolio shares.
5.5. Subject to the provisions of this Agreement, the Acquiring Portfolio
and the Acquired Portfolio will each 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.
5.6. The Acquired Portfolio will provide the Acquiring Portfolio with
information reasonably necessary for the preparation of a prospectus (the
"Prospectus"), which will include the Proxy Statement referred to in paragraph
4.1(p), all to be included in a Registration Statement on Form N-14 of the
Acquiring Portfolio (the "Registration Statement"), in compliance with the 1933
Act, the 1934 Act and the 1940 Act, in connection with the meeting of the
shareholders of the Acquired Portfolio to consider approval of this Agreement
and the transactions contemplated herein.
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5.7. As soon as is reasonably practicable after the Closing, the Acquired
Portfolio will make a liquidating distribution to its shareholders consisting of
the Class I Acquiring Portfolio Shares received at the Closing.
5.8. The Acquiring Portfolio and the Acquired Portfolio shall each 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.
5.9. USLICO, on behalf of the Acquired Portfolio, covenants that USLICO
will, from time to time, as and when reasonably requested by the Acquiring
Portfolio, 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 Investors Trust, on behalf of the Acquiring Portfolio, may
reasonably deem necessary or desirable in order to vest in and confirm (a)
USLICO's, on behalf of the Acquired Portfolio's, title to and possession of the
Acquiring Portfolio's Shares to be delivered hereunder; and (b) Investors
Trust's, on behalf of the Acquiring Portfolio's, title to and possession of all
the assets and otherwise to carry out the intent and purpose of this Agreement.
5.10. The Acquiring Portfolio 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 THE ACQUIRED PORTFOLIO
The obligations of USLICO, on behalf of the Acquired Portfolio, to
consummate the transactions provided for herein shall be subject, at USLICO's
election, to the performance by Investors Trust, on behalf of the Acquiring
Portfolio, of all the obligations to be performed by it hereunder on or before
the Closing Date, and, in addition thereto, the following further conditions:
6.1. All representations and warranties of Investors Trust, on behalf of
the Acquiring Portfolio, 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. Investors Trust shall have delivered to USLICO a certificate executed
in its name by its President or Vice President and its Treasurer or Assistant
Treasurer, in a form reasonably satisfactory to USLICO and dated as of the
Closing Date, to the effect that the representations and warranties of Investors
Trust, on behalf of the Acquiring Portfolio, made in this Agreement are true and
correct at and as of the Closing Date, except as they may be affected by the
transactions contemplated by this Agreement and as to such other matters as
USLICO shall reasonably request;
6.3. Investors Trust, on behalf of the Acquiring Portfolio, 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 Investors Trust, on behalf
of the Acquiring Portfolio, on or before the Closing Date; and
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6.4. The Acquired Portfolio and the Acquiring Portfolio shall have agreed
on the number of full and fractional Class I Acquiring Portfolio Shares of 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 THE ACQUIRING PORTFOLIO
The obligations of Investors Trust, on behalf of the Acquiring Portfolio,
to complete the transactions provided for herein shall be subject, at Investors
Trust's election, to the performance by USLICO, on behalf of the Acquired
Portfolio, of all of the obligations to be performed by it hereunder on or
before the Closing Date and, in addition thereto, the following conditions:
7.1. All representations and warranties of USLICO, on behalf of the
Acquired Portfolio, 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. USLICO shall have delivered to the Acquiring Portfolio a statement of
the Acquired Portfolio's assets and liabilities, as of the Closing Date,
certified by the Treasurer of USLICO;
7.3. USLICO shall have delivered to the Acquiring Portfolio on the Closing
Date a certificate executed in its name by its President or Vice President and
its Treasurer or Assistant Treasurer, in form and substance satisfactory to
Investors Trust and dated as of the Closing Date, to the effect that the
representations and warranties of USLICO, on behalf of the Acquired Portfolio,
made in this Agreement are true and correct at and as of the Closing Date,
except as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as Investors Trust shall reasonably
request;
7.4. USLICO, on behalf of the Acquired Portfolio, 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 USLICO, on behalf of the Acquired
Portfolio, on or before the Closing Date;
7.5. The Acquired Portfolio and the Acquiring Portfolio shall have agreed
on the number of full and fractional Class I Acquiring Portfolio Shares to be
issued in connection with the Reorganization after such number has been
calculated in accordance with paragraph 1.1; and
7.6. The Acquired Portfolio shall have declared and paid a distribution or
distributions prior to the Closing that, together with all previous
distributions, shall have the effect of distributing to its shareholders (i) all
of its investment company taxable income and all of its net realized capital
gains, if any, for the period from the close of its last fiscal year to 4:00
p.m. Eastern time on the Closing; and (ii) any undistributed investment company
taxable income and net realized capital gains from any period to the extent not
otherwise already distributed.
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8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING PORTFOLIO AND
THE ACQUIRED PORTFOLIO
If any of the conditions set forth below have not been satisfied on or
before the Closing Date with respect to USLICO, on behalf of the Acquired
Portfolio, or Investors Trust, on behalf of the Acquiring Portfolio, the other
party to this Agreement shall, at its option, not be required to consummate the
transactions contemplated by this Agreement:
8.1. The Agreement and the transactions contemplated herein shall have
been approved by the requisite vote of the holders of the outstanding shares of
the Acquired Portfolio in accordance with the provisions of USLICO's Declaration
of Trust, By-Laws, applicable Massachusetts law and the 1940 Act, and certified
copies of the resolutions evidencing such approval shall have been delivered to
the Acquiring Portfolio. Notwithstanding anything herein to the contrary,
neither Investors Trust nor USLICO may waive the conditions set forth in this
paragraph 8.1;
8.2. On the Closing Date no action, suit or other proceeding shall be
pending or, to its knowledge, threatened before any court or governmental agency
in which it is sought to restrain or prohibit, or obtain damages or other relief
in connection with, this Agreement or the transactions contemplated herein;
8.3. All consents of other parties and all other consents, orders and
permits of Federal, state and local regulatory authorities deemed necessary by
Investors Trust or USLICO 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 Acquiring Portfolio
or the Acquired Portfolio, provided that either party hereto may for itself
waive any of such conditions;
8.4. The Registration Statement 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, threatened
or contemplated under the 1933 Act; and
8.5. The parties shall have received the opinion of Dechert LLP addressed
to USLICO and Investors Trust substantially to the effect that, based upon
certain facts, assumptions, and representations, the transaction contemplated by
this Agreement shall constitute a tax-free reorganization for Federal income tax
purposes. The delivery of such opinion is conditioned upon receipt by Dechert
LLP of representations it shall request of Investors Trust and USLICO.
Notwithstanding anything herein to the contrary, neither Investors Trust nor
USLICO may waive the condition set forth in this paragraph 8.5.
9. BROKERAGE FEES AND EXPENSES
9.1. USLICO, on behalf of the Acquired Portfolio, and Investors Trust, on
behalf of the Acquiring Portfolio, 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.
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9.2 The expenses relating to the proposed Reorganization will be borne by
the investment adviser to the Acquiring Portfolio. The costs of the
Reorganization shall include, but not be limited to, costs associated with
obtaining any necessary order of exemption from the 1940 Act, preparation of the
Registration Statement, printing and distributing the Acquiring Portfolio's
prospectus and the Acquired Portfolio's proxy materials, legal fees, accounting
fees, securities registration fees, and expenses of holding shareholders'
meetings. Notwithstanding any of the foregoing, expenses will in any event be
paid by the party directly incurring such expenses if and to the extent that the
payment by another person of such expenses would result in the disqualification
of such party as a "regulated investment company" within the meaning of Section
851 of the Code.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1. Investors Trust and USLICO agree that neither party has made any
representation, warranty or covenant not set forth herein and that this
Agreement constitutes the entire agreement between the parties.
10.2. The representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in connection herewith
shall survive the consummation of the transactions contemplated hereunder. The
covenants to be performed after the Closing shall survive the Closing.
11. TERMINATION
This Agreement may be terminated and the transactions contemplated hereby
may be abandoned by either party by (i) mutual agreement of the parties; or (ii)
by either party if the Closing shall not have occurred on or before July 31,
2006, unless such date is extended by mutual agreement of the parties; or (iii)
by either party if the other party shall have materially breached its
obligations under this Agreement or made a material and intentional
misrepresentation herein or in connection herewith. In the event of any such
termination, this Agreement shall become void and there shall be no liability
hereunder on the part of any party or their respective Trustees or officers,
except for any such material breach or intentional misrepresentation, as to each
of which all remedies at law or in equity of the party adversely affected shall
survive.
12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner as
may be deemed necessary or advisable by the authorized officers of USLICO and
Investors Trust; provided, however, that following the meeting of the
shareholders of the Acquired Portfolio called by USLICO pursuant to paragraph
5.2 of this Agreement, no such amendment may have the effect of changing the
provisions for determining the number of the Class I Acquiring Portfolio Shares
to be issued to the Acquired Portfolio Shareholders under this Agreement to the
detriment of such shareholders without their further approval.
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13. 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, personal service or prepaid or certified mail addressed to Investors
Trust or USLICO, 0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx
00000-0000, attn: Xxxx X. Xxxxxxx, in each case with a copy to Dechert LLP, 0000
X Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, attn: Xxxxxxx X. Xxxxxx.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT; LIMITATION OF LIABILITY
14.1. 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.
14.2. This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original.
14.3. This Agreement shall be governed by and construed in accordance with
the laws of the commonwealth of Massachusetts without regard to its principles
of conflicts of laws.
14.4. 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 party. 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.
14.5. It is expressly agreed that the obligations of the parties hereunder
shall not be binding upon any of the Trustees, shareholders, nominees, officers,
agents, or employees of USLICO personally, but shall bind only the trust
property of the Acquired Portfolio, as provided in the Declaration of Trust of
USLICO. The execution and delivery by such officers shall not be deemed to have
been made by any of them individually or to impose any liability on any of them
personally, but shall bind only the trust property of such party.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by its Senior Vice President.
ING INVESTORS TRUST on behalf of
ING Liquid Assets Portfolio
By: /s/ Xxxxxx X. Naka
---------------------------------
Xxxxxx X. Naka
Senior Vice President
USLICO SERIES FUND on behalf of
The Money Market Portfolio
By: /s/ Xxxx Xxxxx
---------------------------------
Xxxx Xxxxx
Senior Vice President
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