AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization dated as of January 10, 2009 (the
"Agreement") is between each selling entity identified in Schedule A hereto
(each a "Selling Corporation")(1), on behalf of each series thereof identified
in Schedule A hereto as a Selling Fund (each a "Selling Fund"), each
corresponding buying entity identified in Schedule A hereto (each a "Buying
Corporation")(2), on behalf of each series thereof identified in Schedule A
hereto as the corresponding Buying Fund (each a "Buying Fund"), and RiverSource
Investments, LLC (solely for the purposes of Sections 3c and 11 of the
Agreement).
This Agreement shall be treated for all purposes as if each reorganization
between a Selling Fund and its corresponding Buying Fund contemplated hereby had
been the subject of a separate agreement. As context requires a Buying
Corporation or Selling Corporation that is not organized as a series fund and
that may not be considered or meet the definition of "Buying Fund" and "Selling
Fund" as set forth above, may be referred to as a "Buying Fund" or a "Selling
Fund," respectively, for purposes of this Agreement.
In consideration of their mutual promises, the parties agree as follows:
1. SHAREHOLDER APPROVAL. Each Selling Fund will call a meeting of its
shareholders for the purpose of approving the Agreement and the
transactions it contemplates (each a "Reorganization"). Each Buying Fund
agrees to furnish data and information, as reasonably requested, for the
proxy statement to be furnished to shareholders of the corresponding
Selling Fund.
2. REORGANIZATION.
a. Plan of Reorganization. Each Reorganization will be a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code of
1986, as amended (the "Code"). At the Closing, each Selling
Corporation will convey all of the assets of each Selling Fund to the
corresponding Buying Fund. Each Buying Fund will assume all
liabilities of the corresponding Selling Fund. At the Closing, each
Buying Corporation will deliver shares of each Buying Fund, including
fractional shares, to the corresponding Selling Corporation on behalf
of the corresponding Selling Fund. The number of shares will be
determined by dividing the value of the net assets attributable to
each class of shares of each Selling Fund, computed as described in
paragraph 3(a), by the net asset value of one share of the
corresponding class of the corresponding Buying Fund, computed as
described in paragraph 3(b). Each Selling Fund will not pay a sales
charge on the receipt of the corresponding Buying Fund's shares in
exchange for the assets of such Selling Fund. In addition, the
shareholders of each Selling Fund will not pay a sales charge on
distribution to them of shares of the corresponding Buying Fund.
b. Closing and Effective Time of the Reorganization. The Reorganization
and all related acts necessary to complete the Reorganization (the
"Closing") will occur on the first day on which the New York Stock
Exchange (the "NYSE") is open for business following approval of
shareholders of each Selling Fund and receipt of all necessary
regulatory approvals, or such later date as the officers of the
Selling Corporation and Buying Corporation may agree.
3. VALUATION OF NET ASSETS.
a. The net asset value of each Selling Fund will be computed as of the
close of regular trading on the NYSE on the business day immediately
preceding the day of Closing (the "Valuation Date") using the
valuation procedures set forth in the corresponding Buying Fund's then
current prospectus.
b. The net asset value per share of shares of each Buying Fund will be
determined as of the close of regular trading on the NYSE on the
Valuation Date, using the valuation procedures in each Buying Fund's
then current prospectus.
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(1) The Selling Corporation for the Reorganization of Xxxxxxxx Emerging Markets
Fund, Xxxxxxxx Global Growth Fund and Xxxxxxxx International Growth Fund is
a Maryland corporation. The Selling Corporation for the Reorganization of
Xxxxxxxx High-Yield Fund and Xxxxxxxx U.S. Government Securities Fund is a
Massachusetts business trust. Xxxxxxxx Core Fixed Income Fund, Inc. and
Xxxxxxxx Income and Growth Fund, Inc. are each Maryland Corporations.
(2) The Buying Corporation for each Buying Fund, RiverSource Diversified Bond
Fund, Threadneedle Emerging Markets Fund, Threadneedle Global Equity Fund,
RiverSource High Yield Bond Fund, RiverSource Balanced Fund, RiverSource
Partners International Select Growth Fund and RiverSource Short Duration
U.S. Government Fund, is a Minnesota corporation.
c. At the Closing, each Selling Fund will provide the corresponding
Buying Fund with a copy of the computation showing the valuation of
the net asset value per share of such Selling Fund on the Valuation
Date, and each Buying Fund will provide the corresponding Selling Fund
with a copy of the computation showing the determination of the net
asset value per share of such Buying Fund on the Valuation Date. Both
computations will be certified by an officer of RiverSource
Investments, LLC, the investment manager.
4. LIQUIDATION AND DISSOLUTION OF THE SELLING FUND.
a. On the date of the Closing, each Selling Corporation will liquidate
each Selling Fund and distribute shares of each class of the
corresponding Buying Fund to the shareholders of record of such
Selling Fund's corresponding class. Each Buying Fund will establish
shareholder accounts in the names of each corresponding Selling Fund
shareholder, representing the respective pro rata number of full and
fractional shares of such class of the Buying Fund due to each such
shareholder. All issued and outstanding shares of each Selling Fund
will simultaneously be cancelled on the books of each Selling
Corporation. Each Buying Fund or its transfer agent will establish
shareholder accounts in accordance with instructions from the
corresponding Selling Corporation.
b. Immediately after the close of business on the Valuation Date, the
share transfer books of each Selling Corporation relating to each
Selling Fund will be closed and no further transfer of shares will be
made.
c. Promptly after the Closing, each Buying Fund or its transfer agent
will notify each shareholder of the corresponding Selling Fund of the
number of shares distributed to the shareholder and confirm the
registration in the shareholder's name.
d. As promptly as practicable after the Closing, and in no event later
than twelve months from the date of the Closing, each Selling Fund
will be dissolved.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE BUYING CORPORATION.
With respect to each Reorganization, the Buying Corporation represents and
warrants to the Selling Fund as follows:
a. Organization, Existence, etc. The Buying Corporation is a corporation
duly organized, validly existing and in good standing under the laws
of the state of Minnesota and has the power to carry on its business
as it is now being conducted.
b. Registration as Investment Company. The Buying Corporation, or in the
case of separate series funds, the buying Corporation, of which the
Buying Fund is a series, is registered under the Investment Company
Act of 1940 (the "1940 Act") as an open-end, management investment
company.
c. Capitalization. The Buying Corporation has authorized capital of
10,000,000,000 shares of common stock, par value $0.01 per share. All
of the outstanding shares of the Buying Corporation have been duly
authorized and are validly issued, fully paid and non-assessable.
Since the Buying Fund is engaged in the continuous offering and
redemption of its shares, the number of outstanding shares may vary
daily.
d. Financial Statements. The Buying Fund's audited financial statements
as of the end of the last fiscal year, and the subsequent unaudited
semi-annual financial statements, if any (the "Buying Fund Financial
Statements"), fairly present the financial position of the Buying Fund
and the results of its operations and changes in its net assets for
the periods shown.
e. Shares to be Issued Upon Reorganization. The shares to be issued in
connection with the Reorganization will be duly authorized and, at the
time of the Closing, will be validly issued, fully paid and
non-assessable.
f. Authority Relative to the Agreement. The Buying Corporation has the
power to enter into and carry out the obligations described in this
Agreement. The Agreement and the transactions contemplated by it have
been duly authorized by the Board of Directors of the Buying
Corporation and no other proceedings by the Buying Corporation or the
Buying Fund are necessary.
g. No Violation. The Buying Corporation is not in violation of its
Articles of Incorporation or By-Laws (the "Articles") or in default in
the performance of any material agreement to which it is a party. The
execution of this Agreement and the completion of the transactions
contemplated by it will not conflict with, or constitute a breach of,
any material contract or other instrument to which the Buying Fund is
subject. The
transactions will not result in any violation of the provisions of the
Articles or any law, administrative regulation or administrative or
court decree applicable to the Buying Fund.
h. Liabilities. The Buying Fund has no known liabilities of a material
amount, contingent or otherwise, other than liabilities disclosed in
the Buying Fund Financial Statements, liabilities incurred in the
ordinary course of business subsequent to the date of the latest
annual or semi-annual financial statements, or liabilities previously
disclosed to the Selling Fund.
i. Litigation. There is no litigation, administrative proceeding or
investigation before any court or governmental body currently pending
or, to the knowledge of the Buying Fund, threatened, that would
materially and adversely affect the Buying Fund, its financial
condition or the conduct of its business, or that would prevent or
hinder completion of the transactions contemplated by this Agreement.
The Buying Fund knows of no facts that might form the basis for the
institution of any such litigation, proceeding or investigation and
the Buying Fund is not a party to or subject to the provisions of any
order, decree or judgment.
j. Contracts. Except for contracts and agreements previously disclosed to
the Selling Corporation, the Buying Fund is not a party to or subject
to any material contract, debt instrument, plan, lease, franchise,
license or permit.
k. Regulated Investment Company Qualification. The Buying Fund has
qualified and met the requirements for treatment as a "regulated
investment company" within the meaning of Section 851 of the Code with
respect to each taxable year since commencement of its operations and
will continue to meet such requirements and to so qualify at all times
through the Closing.
l. Taxes. As of the Closing, the Buying Fund will (i) have filed all
federal and other tax returns and reports that have been required to
be filed, (ii) have paid or provided for payment of all federal and
other taxes shown to be due on such returns or on any assessments
received, (iii) have adequately provided for all tax liabilities on
its books, (iv) except as disclosed to the Selling Fund, not have had
any tax deficiency or liability asserted against it or question with
respect thereto raised, and (v) except as disclosed to the Selling
Fund, not be under audit by the Internal Revenue Service or by any
state or local tax authority for taxes in excess of those already
paid.
m. Registration Statement. The Buying Fund will file a registration
statement on Form N-14 (the "Registration Statement") with the
Securities and Exchange Commission under the Securities Act of 1933
(the "1933 Act") relating to the shares to be issued in the
Reorganization. At the time the Registration Statement becomes
effective, at the time of the shareholders' meeting described in
paragraph 1 and at the Closing, the Registration Statement will not
contain an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein not misleading.
However, none of the representations and warranties in this subsection
apply to statements in, or omissions from, the Registration Statement
made in reliance on information furnished by the Selling Fund for use
in the Registration Statement.
n. Business Activities. The Buying Fund will operate its business in the
ordinary course between the date hereof and the date of the Closing,
it being understood that such ordinary course of business will include
regular and customary periodic dividends and distributions and any
other distribution that may be advisable.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLING CORPORATION.
With respect to each Reorganization, the Selling Corporation represents and
warrants to the Buying Fund as follows:
a. Organization, Existence, etc. For Xxxxxxxx Core Fixed Income Fund,
Inc., Xxxxxxxx Income and Growth Fund, Inc., Xxxxxxxx Emerging Markets
Fund, Xxxxxxxx Global Growth Fund and Xxxxxxxx International Growth
Fund, the Selling Corporation is a corporation duly organized, validly
existing and in good standing under the laws of the state of Maryland
and has the power to carry on its business as it is now being
conducted. For Xxxxxxxx High-Yield Fund and Xxxxxxxx U.S. Government
Securities Fund, the Selling Corporation is a business trust duly
organized, validly existing and in good standing under the laws of the
commonwealth of Massachusetts and has the power to carry on its
business as it is now being conducted.
b. Registration as Investment Company. The Selling Corporation, or in the
case of a separate series funds, the Selling Corporation, of which the
Selling Fund is a series, is registered under the 1940 Act as an
open-end, management investment company.
c. Capitalization. The Selling Corporation has authorized capital as
follows: Xxxxxxxx Core Fixed Income Fund, Inc. has 1,000,000,000
shares of common stock, par value $0.001 per share; Xxxxxxxx Global
Fund Series, Inc. has 2,000,000,000 shares of common stock, par value
$0.001, of which 400,000,000 shares are authorized for each of
Xxxxxxxx Emerging Markets Fund, Xxxxxxxx Global Growth Fund and
Xxxxxxxx International Growth Fund; Xxxxxxxx Income and Growth Fund,
Inc. has 500,000,000 shares of common stock, par value $1.00; and
Xxxxxxxx High-Yield Fund and Xxxxxxxx U.S. Government Securities Fund
each have an unlimited number of shares of common stock, par value
$0.001. All of the outstanding shares have been duly authorized and
are validly issued, fully paid and nonassessable. Since the Selling
Fund is engaged in the continuous offering and redemption of its
shares, the number of outstanding shares may vary daily.
d. Financial Statements. The Selling Fund's audited financial statements
as of the end of the last fiscal year, and the subsequent unaudited
semi-annual financial statements, if any (the "Selling Fund Financial
Statements"), fairly present the financial position of the Selling
Fund, and the results of its operations and changes in its net assets
for the periods shown.
e. Authority Relative to the Agreement. The Selling Corporation has the
power to enter into and to carry out its obligations under this
Agreement. The Agreement and the transactions contemplated by it have
been duly authorized by the Board of Directors of the Selling
Corporation and no other proceedings by the Selling Corporation or the
Selling Fund are necessary, other than the approval of shareholders
contemplated in paragraph 1.
f. No Violation. The Selling Corporation is not in violation of its
Articles or Declaration of Trust, as applicable, or in default in the
performance of any material agreement to which it is a party or in
default in the performance of any material agreement to which it is a
party). The execution of this Agreement and the completion of the
transactions contemplated by it will not conflict with or constitute a
breach of, any material contract to which the Selling Fund is subject.
The transactions will not result in any violation of the provisions of
the Articles or Declaration of Trust, as the case may be, or any law,
administrative regulation or administrative or court decree applicable
to the Selling Fund.
g. Liabilities. The Selling Fund has no known liabilities of a material
amount, contingent or otherwise, other than liabilities disclosed in
the Selling Fund Financial Statements, liabilities incurred in the
ordinary course of business subsequent to the date of the latest
annual or semi-annual financial statements, or liabilities previously
disclosed to the Buying Fund.
h. Litigation. There is no litigation, administrative proceeding or
investigation before any court or governmental body currently pending
or, to the knowledge of the Selling Fund, threatened, that would
materially and adversely affect the Selling Fund, its financial
condition or the conduct of its business, or that would prevent or
hinder completion of the transactions contemplated by this Agreement.
The Selling Fund knows of no facts that might form the basis for the
institution of any such litigation, proceeding or investigation and is
not a party to or subject to the provisions of any order, decree or
judgment.
i. Contracts. Except for contracts and agreements previously disclosed to
the Buying Corporation, the Selling Fund is not a party to or subject
to any material contract, debt instrument, plan, lease, franchise,
license or permit.
j. Regulated Investment Company Qualification. The Selling Fund has
qualified and met the requirements for treatment as a "regulated
investment company" within the meaning of Section 851 of the Code with
respect to each taxable year since commencement of its operations and
will continue to meet such requirements and to so qualify at all times
through the Closing.
k. Taxes. As of the Closing, the Selling Fund will (i) have filed all
federal and other tax returns and reports that have been required to
be filed, (ii) have paid or provided for payment of all federal and
other taxes shown to be due on such returns or on any assessments
received, (iii) have adequately provided for all tax liabilities on
its books, (iv) except as disclosed to the Buying Fund, not have had
any tax deficiency or liability asserted against it or question with
respect thereto raised, and (v) except as disclosed to the Buying
Fund, not be under audit by the Internal Revenue Service or by any
state or local tax authority for taxes in excess of those already
paid.
l. Fund Securities. All securities listed in the schedule of investments
of the Selling Fund as of the Closing will be owned by the Selling
Fund free and clear of any encumbrances, except as indicated in the
schedule.
m. Registration Statement. The Selling Fund will cooperate with the
Buying Fund and will furnish information relating to the Selling
Corporation and the Selling Fund required in the Registration
Statement. At the time the Registration Statement becomes effective,
at the time of the shareholders' meeting described in paragraph 1 and
at the Closing, the Registration Statement, as it relates to the
Selling Corporation or the Selling Fund, will not contain an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein not misleading. However, the
representations and warranties in this subsection apply only to
statements in or omissions from the Registration Statement made in
reliance upon information furnished by the Selling Corporation or the
Selling Fund for use in the Registration Statement.
n. Provision of Books and Records. The Selling Fund will provide its
books and records to the corresponding Buying Fund for purposes of
preparing any tax returns required by law to be filed after the
Closing date, including (1) the tax return for the period ending on
the Closing date, and (2) the tax return for the period beginning the
day after the Closing and ending the earlier of the current fiscal
year-end of the corresponding Buying Fund and the taxable year end
chosen by the corresponding Buying Fund following the Reorganization.
o. Business Activities. The Selling Fund will operate its business in the
ordinary course between the date hereof and the date of the Closing,
it being understood that such ordinary course of business will include
regular and customary periodic dividends and distributions and any
other distribution that may be advisable.
7. CONDITIONS TO OBLIGATIONS OF THE BUYING CORPORATION. The obligations of the
Buying Corporation with respect to each Reorganization are subject to the
satisfaction of the following conditions:
a. Shareholder Approval. This Agreement will have been approved by the
affirmative vote of the holders of the majority of the voting power of
all Selling Fund shares entitled to vote.
b. Representations, Warranties and Agreements. The Selling Corporation
and the Selling Fund will have complied with this Agreement and each
of the representations and warranties in this Agreement will be true
in all material respects as of the date of the Closing. An officer of
the Selling Corporation will provide a certificate to each Buying Fund
confirming that, as of the Closing, the representations and warranties
set forth in Section 6 are true and correct and that there have been
no material adverse changes in the financial condition, results of
operations, business, properties or assets of the corresponding
Selling Fund since the date of its last financial statement, except as
otherwise indicated in any financial statements, certified by an
officer of the Selling Corporation, and delivered to such Buying Fund
on the date of the Closing.
c. Regulatory Approvals.
- The Registration Statement referred to in Sections 5(m) and 6(m)
will be effective and no stop orders under the 1933 Act will have
been issued.
- All necessary approvals, consents and exemptions from federal and
state regulatory authorities will have been obtained.
d. Opinion of Counsel. The Buying Corporation will have received an
opinion of counsel for the Selling Corporation, dated as of the date
of the Closing, to the effect that: (i) the Selling Corporation is a
corporation duly organized and validly existing under the laws of the
state of Maryland; (ii) each Selling Fund is a series of the Selling
Corporation, an open-end management investment company registered
under the 1940 Act, as applicable; (iii) this Agreement and the
Reorganization has been duly authorized and approved by all requisite
action of the Selling Corporation and each Selling Fund and this
Agreement has been duly executed by, and is a valid and binding
obligation of, the Selling Corporation.
e. Declaration of Dividend. The Selling Fund will have declared, prior to
the Closing, a dividend or dividends, which, together with all
previous such dividends, shall have the effect of distributing to the
Selling Fund shareholders (i) all of the excess of (x) the Selling
Fund's investment income excludable from
gross income under Section 103 of the Code over (y) the Selling Fund's
deductions disallowed under Sections 265 and 171 of the Code, (ii) all
of the Selling Fund's investment company taxable income as defined in
Section 852 of the Code (in each case computed without regard to any
deduction for dividends paid) and (iii) all of the Selling Fund's net
capital gain realized (after reduction for any capital loss
carryover), in each case for the current taxable year (which will end
on the Closing date) and any preceding taxable years for which such a
dividend is eligible to be made under Section 855 of the Code.
8. CONDITIONS TO OBLIGATIONS OF THE SELLING CORPORATION. The obligations of
the Selling Corporation with respect to each Reorganization are subject to
the satisfaction of the following conditions:
a. Shareholder Approval. This Agreement will have been approved by the
affirmative vote of the holders of the majority of the voting power of
all Selling Fund shares entitled to vote.
b. Representations, Warranties and Agreements. The Buying Fund will have
complied with this Agreement and each of the representations and
warranties in this Agreement will be true in all material respects as
of the date of the Closing. An officer of the Buying Corporation will
provide a certificate to each Selling Fund confirming that, as of the
Closing, the representations and warranties set forth in Section 5 are
true and correct and that there have been no material adverse changes
in the financial condition, results of operations, business,
properties or assets of the corresponding Buying Fund since the date
of its last financial statement, except as otherwise indicated in any
financial statements, certified by an officer of the Buying
Corporation, and delivered to such Selling Fund on or prior to the
last business day before the Closing.
c. Regulatory Approvals.
- The Registration Statement referred to in Sections 5(m) and 6(m)
will be effective and no stop orders under the 1933 Act will have
been issued.
- All necessary approvals, consents and exemptions from federal and
state regulatory authorities will have been obtained.
d. Opinion of Counsel. The Selling Corporation will have received the
opinion of counsel for the Buying Corporation, dated as of the date of
the Closing, to the effect that: (i) the Buying Corporation is a
corporation duly organized and validly existing under the laws of the
state of Minnesota; (ii) each Buying Fund is a series of the Buying
Corporation, an open-end management investment company registered
under the 1940 Act; (iii) this Agreement and the Reorganization has
been authorized and approved by all requisite action of the Buying
Corporation and each Buying Fund and this Agreement has been duly
executed by, and is a valid and binding obligation of, the Buying
Corporation; and (iv) the shares to be issued in the Reorganization
are duly authorized and upon issuance in accordance with this
Agreement will be validly issued, fully paid and non-assessable shares
of each Buying Fund.
9. CONDITIONS TO OBLIGATIONS OF THE SELLING CORPORATION AND THE BUYING
CORPORATION. The obligations of each of the Selling Corporation and the
Buying Corporation with respect to each Reorganization are subject to the
satisfaction of the following conditions:
Tax Opinion. With respect to the Reorganization between a Selling Fund and
its corresponding Buying Fund, the Selling Fund shall have received an
opinion of Ropes & Xxxx LLP satisfactory to such Selling Fund, and the
Buying Fund shall have received an opinion of Ropes & Xxxx LLP satisfactory
to such Buying Fund, each substantially to the effect that, on the basis of
existing provisions of the Code, Treasury regulations promulgated
thereunder, current administrative rules, pronouncements and court
decisions, although the matter is not free from doubt, generally for
federal income tax purposes:
a. The acquisition by the Buying Fund of the assets of the Selling Fund
in exchange for the Buying Fund's assumption of all liabilities of the
Selling Fund and delivery to the Selling Fund of the acquisition
shares, followed by the distribution by the Selling Fund of the
acquisition shares to the shareholders of the Selling Fund in exchange
for their Selling Fund shares, all as provided in paragraph 2(a) and
4(a) hereof, will constitute a reorganization within the meaning of
Section 368(a) of the Code, and the Selling Fund and the Buying Fund
will each be "a party to a reorganization" within the meaning of
Section 368(b) of the Code;
b. No gain or loss will be recognized by the Selling Fund upon (i) the
transfer of its assets to the Buying Fund in exchange for the
acquisition shares and the assumption by the Buying Fund of all
liabilities of the
Selling Fund or (ii) the distribution of the acquisition shares by the
Selling Fund to its shareholders in liquidation, as contemplated in
paragraph 4(a) hereof;
c. No gain or loss will be recognized by the Buying Fund upon receipt of
the assets of the Selling Fund in exchange for acquisition shares and
the assumption by the Buying Fund of all liabilities of the Selling
Fund as contemplated in paragraph 2(a) hereof;
d. The tax basis in the hands of the Buying Fund of the assets of the
Selling Fund transferred to the Buying Fund in the Reorganization will
be the same as the tax basis of such assets in the hands of the
Selling Fund immediately prior to the transfer;
e. The holding periods of the assets of the Selling Fund in the hands of
the Buying Fund will include the periods during which such assets were
held by the Selling Fund;
f. No gain or loss will be recognized by the Selling Fund's shareholders
upon the exchange of their shares of the Selling Fund for the
acquisition shares;
g. The aggregate tax basis of the acquisition shares the Selling Fund
shareholder receives in the Reorganization will be the same as the
aggregate tax basis of his or her Selling Fund's shares exchanged
therefor;
h. The Selling Fund shareholder's holding period for the acquisition
shares will include the period for which he or she held the Selling
Fund's shares exchanged therefor, provided that the shareholder held
such Selling Fund's shares as capital assets on the date of the
exchange; and
i. The Buying Fund will succeed to and take into account the items of the
Selling Fund described in Section 381(c) of the Code, subject to the
conditions and limitations specified in Sections 381, 382, 383 and 384
of the Code and the regulations thereunder.
Ropes & Xxxx LLP will express no view with respect to the effect of the
Reorganization on any transferred asset as to which any unrealized gain or
loss is required to be recognized under federal income tax principles (i)
at the end of a taxable year or upon the termination thereof or (ii) upon
the transfer of such asset regardless of whether such a transfer would
otherwise be a non-taxable transaction.
Each opinion will be based on certain factual certifications made by
officers of the Selling Fund and the Buying Fund, and will also be based on
customary assumptions. The opinions are not guarantees that the tax
consequences of the Reorganizations will be as described above. The
opinions will note and distinguish certain published precedent. There is no
assurance that the Internal Revenue Service or a court would agree with the
opinions.
10. AMENDMENT; TERMINATION; NON-SURVIVAL OF COVENANTS, WARRANTIES AND
REPRESENTATIONS.
a. This Agreement may be amended in writing if authorized by the
respective Boards of Directors. The Agreement may be so amended at any
time before or after the shareholder approval contemplated by
paragraph 1 is obtained.
b. At any time prior to the Closing, any of the parties may waive in
writing (i) any inaccuracies in the representations and warranties
made to it and (ii) compliance with any of the covenants or conditions
made for its benefit.
c. Each party hereto may terminate this Agreement at any time prior to
the Closing by notice to the other party if a material condition to
its performance or a material covenant of the other party is not
fulfilled on or before the date specified for its fulfillment or a
material breach of this Agreement is made by the other party and is
not cured.
d. This Agreement may be terminated by any party at any time prior to the
Closing, whether before or after approval by the shareholders of each
Selling Fund, without any liability on the part of any party or its
respective directors, officers, or shareholders, on written notice to
the other party, and shall be terminated without liability as of the
close of business on April 30, 2010, or a later date agreed upon by
the officers of the Selling Corporation and the Buying Corporation, if
the Closing is not effected on or prior to that date.
e. The representations, warranties and covenants contained in this
Agreement, or in any document delivered in connection with this
Agreement, will survive the Reorganization.
11. EXPENSES. All fees paid to governmental authorities for the registration or
qualification of the acquisition shares and all transfer agency costs
related to the acquisition shares shall be borne by the relevant Buying
Fund. Certain non-recurring Reorganization costs and related Reorganization
expenses may be borne by a Selling Fund to the extent the Reorganization is
expected to result in a reduction to the expense ratio for such Selling
Fund. Reorganization costs and related Reorganization expenses include (i)
legal and auditor or accounting fees ("Professional Fees") associated with
the preparation and filing of the proxy statement/prospectus and (ii)
expenses associated with the printing and mailing of any shareholder
communications, including the proxy statement/prospectus that forms a part
of the Registration Statement, and fees and expenses of any proxy
solicitation firm retained in connection with the Reorganization ("Proxy
Vendor Expenses"). Professional Fees shall be allocated among each Selling
Fund on an equal weighted basis regardless of asset size or number of
accounts. Proxy Vendor Expenses shall be allocated among the Selling Funds
based on number of shareholder accounts. Notwithstanding the foregoing, the
fees and expenses borne by any Selling Fund will not exceed the excess of
(i) the total anticipated reduction in fees and expenses expected to be
borne by such Selling Fund over the first twelve months following its
Reorganization over (ii) the cost expected to be borne by such Selling Fund
related to the discontinuance of operations of Xxxxxxxx Data Corp. Any fees
and expenses that would have been eligible to be borne by a Selling Fund
but for the preceding sentence and all other Reorganization related costs
and expenses will be borne by RiverSource Investments, LLC. Each Selling
Fund will bear the full cost of any brokerage or other transaction costs
associated with the sale or purchase of portfolio securities in connection
with its Reorganization. Should any Reorganization fail to occur,
RiverSource Investments, LLC will bear all costs associated with the
Reorganization.
12. GENERAL.
a. Headings. The headings contained in this Agreement are for reference
purposes only and will not affect the meaning or interpretation of
this Agreement. Nothing in this Agreement is intended to confer upon
any other person any rights or remedies by reason of this Agreement.
b. Governing Law. This Agreement will be governed by the laws of the
state of Minnesota.
IN WITNESS WHEREOF, each of the parties, individually and not jointly, has
caused this Agreement to be signed.
XXXXXXXX CORE FIXED INCOME FUND, INC.
XXXXXXXX GLOBAL FUND SERIES, INC., on behalf of
Xxxxxxxx Emerging Markets Fund
Xxxxxxxx Global Growth Fund
Xxxxxxxx International Growth Fund
XXXXXXXX HIGH INCOME FUND SERIES, on behalf of
Xxxxxxxx High-Yield Fund
Xxxxxxxx U.S. Government Securities Fund
XXXXXXXX INCOME AND GROWTH FUND, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President
RIVERSOURCE DIVERSIFIED INCOME SERIES, INC., on behalf of
RiverSource Diversified Bond Fund
RIVERSOURCE GLOBAL SERIES, INC., on behalf of
Threadneedle Emerging Markets Fund
Threadneedle Global Equity Fund
RIVERSOURCE HIGH YIELD INCOME SERIES, INC., on behalf of
RiverSource High Yield Bond Fund
RIVERSOURCE INVESTMENT SERIES, INC., on behalf of
RiverSource Balanced Fund
RIVERSOURCE INTERNATIONAL MANAGERS SERIES, INC., on behalf of
RiverSource Partners International Select Growth Fund
RIVERSOURCE GOVERNMENT INCOME SERIES, INC., on behalf of
RiverSource Short Duration U.S. Government Fund
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President
The undersigned is a party to this Agreement for the purposes of Section 3c and
11 only.
RIVERSOURCE INVESTMENTS, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President
SCHEDULE A
SELLING ENTITY SELLING FUND BUYING ENTITY BUYING FUND
---------------------------- ------------------------- ------------------------- -------------------------
Xxxxxxxx Core Fixed Income Xxxxxxxx Core Fixed RiverSource Diversified RiverSource Diversified
Fund, Inc. Income Fund, Inc. Income Series, Inc. Bond Fund
Xxxxxxxx Global Fund Series, Xxxxxxxx Emerging Markets RiverSource Global Threadneedle Emerging
Inc. Fund Series, Inc. Markets Fund
Xxxxxxxx Global Fund Series, Xxxxxxxx Global Growth RiverSource Global Threadneedle Global
Inc. Fund Series, Inc. Equity Fund
Xxxxxxxx High Income Fund Xxxxxxxx High-Yield Fund RiverSource High Income RiverSource High Yield
Series (a Massachusetts Series, Inc. Bond Fund
business trust)
Xxxxxxxx Income and Growth Xxxxxxxx Income and RiverSource Investment RiverSource Balanced Fund
Fund, Inc. Growth Fund, Inc. Series, Inc.
Xxxxxxxx Global Fund Series, Xxxxxxxx International RiverSource International RiverSource Partners
Inc. Growth Fund Managers Series, Inc. International Select
Growth Fund
Xxxxxxxx High Income Fund Xxxxxxxx U.S. Government RiverSource Government RiverSource Short
Series (a Massachusetts Securities Fund Income Series, Inc. Duration U.S. Government
business trust) Fund
