EXHIBIT 99.4
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of
this ___ day of __________, 2004, by and between the STI Classic Funds (the
"Trust"), a Massachusetts business trust, with its principal place of business
at 000 Xxxxxxx Xxxxxx, Xxxxxx, XX 00000, with respect to its STI Classic
Institutional Core Bond Fund, STI Classic Institutional Intermediate Bond Fund,
Seix Institutional High Yield Fund and STI Classic Institutional Limited
Duration Fund, each a separate series of the Trust (each an "Acquiring Fund"
and, together, the "Acquiring Funds"), and Seix Funds, Inc. (the "Corporation"),
a Maryland corporation, with its principal place of business at [200 Xxxxxxxxx
Xxxxxx, Xxxxxx, XX 00000], with respect to its Core Bond Fund, Intermediate Bond
Fund, High Yield Fund and Limited Duration Fund, each a separate series of the
Corporation (each a "Selling Fund;" together, the "Selling Funds;" collectively
with the Acquiring Funds, the "Funds").
This Agreement is intended to be, and is adopted as, a Plan of
Reorganization within the meaning of Section 368(a) of the United States
Internal Revenue Code of 1986, as amended (the "Code"). The reorganization will
consist of: (i) the transfer of all of the assets of each Selling Fund in
exchange for, as applicable, Institutional Shares and A Shares of beneficial
interest, no par value per share, of its respective Acquiring Fund ("Acquiring
Fund Shares") as set forth on Schedule A attached hereto; (ii) the assumption by
each Acquiring Fund of all liabilities of each Selling Fund; and (iii) the
distribution, after the Closing Date hereinafter referred to, of the Acquiring
Fund Shares to the shareholders of each Selling Fund and the termination of each
Selling Fund as provided herein, all upon the terms and conditions set forth in
this Agreement (the "Reorganization"). Notwithstanding anything to the contrary
contained herein, the obligations, agreements, representations and warranties
with respect to each Fund shall be the obligations, agreements, representations
and warranties of that Fund only, and in no event shall any other Fund or the
assets of any other Fund be held liable with respect to the breach or other
default by an obligated Fund of its obligations, agreements, representations and
warranties as set forth herein.
WHEREAS, each Acquiring Fund and each Selling Fund is a separate series of
the Trust and the Corporation, respectively, and the Trust and the Corporation
are open-end, registered management investment companies and each Selling Fund
owns securities that generally are assets of the character in which its
respective Acquiring Fund is permitted to invest;
WHEREAS, each Fund is authorized to issue its shares of beneficial
interest or shares of common stock, as the case may be;
WHEREAS, the Directors of the Corporation have determined that the
Reorganization, with respect to each Selling Fund, is in the best interests of
the Selling Fund's shareholders and that the interests of the existing
shareholders of the Selling Fund will not be diluted as a result of the
Reorganization;
NOW, THEREFORE, in consideration of the premises, covenants, and
agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
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ARTICLE I
TRANSFER OF ASSETS OF THE SELLING FUNDS IN EXCHANGE FOR ACQUIRING FUND
SHARES AND THE ASSUMPTION OF THE SELLING FUNDS'LIABILITIES AND
TERMINATION OF THE SELLING FUNDS
1.1 THE EXCHANGE. Subject to the terms and conditions contained herein and
on the basis of the representations and warranties contained herein, each
Selling Fund agrees to transfer all of its assets and liabilities, as set forth
in paragraph 1.2, to its respective Acquiring Fund. In exchange, each Acquiring
Fund agrees (i) to deliver to its respective Selling Fund (a) the number of full
and fractional shares of Institutional Shares of the Acquiring Fund equal in
number and value to the number and value of full and fractional shares of Class
I shares of the Selling Fund then outstanding and (b) the number of full and
fractional shares of A Shares of the Acquiring Fund equal in number and value of
full and fractional shares of Class P shares of the Selling Fund then
outstanding and (ii) to assume the liabilities of the Selling Fund, as set forth
in paragraph 1.3. Such transactions shall take place at the closing date
provided for in paragraph 3.1.
1.2 ASSETS TO BE ACQUIRED. The assets of each Selling Fund to be acquired
by its respective Acquiring Fund shall consist of all property, including,
without limitation, all cash, securities, commodities, interests in futures and
dividends or interest receivables, owned by the Selling Fund and any deferred or
prepaid expenses shown as an asset on the books of such Selling Fund on the
Closing Date.
Each Selling Fund has provided its respective Acquiring Fund with its most
recent audited financial statements, which contain a list of all of the Selling
Fund's assets as of the date of such statements. Each Selling Fund hereby
represents that as of the date of the execution of this Agreement, there have
been no changes in its financial position as reflected in such financial
statements other than those occurring in the ordinary course of business in
connection with the purchase and sale of securities and the payment of normal
operating expenses and the payment of dividends, capital gains distributions and
redemption proceeds to shareholders.
Each Selling Fund will, within a reasonable period of time prior to the
Closing Date, furnish its respective Acquiring Fund with a list of the Selling
Fund's portfolio securities and other investments. Each Acquiring Fund will,
within a reasonable time prior to the Closing Date, furnish its respective
Selling Fund with a list of the securities, if any, on the Selling Fund's list
referred to above that do not conform to the Acquiring Fund's investment
objectives, policies, and restrictions.
1.3 LIABILITIES TO BE ASSUMED. Each Selling Fund will endeavor to
discharge all of its known liabilities and obligations to the extent possible
prior to the Closing Date. Each Acquiring Fund shall assume only those
liabilities, expenses, costs, charges and reserves reflected on a Statement of
Assets and Liabilities of its respective Selling Fund prepared on behalf of the
Selling Fund, as of the Valuation Date (as defined in paragraph 2.1), in
accordance with generally accepted accounting principles consistently applied
from the prior audited period. Each Acquiring Fund shall assume all of the
liabilities of its respective Selling Fund, whether accrued or contingent, known
or unknown, existing at the Valuation Date.
In addition, upon completion of the Reorganization, for purposes of
calculating the maximum amount of sales charges (including asset based sales
charges) permitted to be imposed by an Acquiring Fund under the National
Association of Securities Dealers, Inc. ("NASD") Conduct Rule 2830 (the "Maximum
Amount"), each Acquiring Fund will add to the Maximum Amount immediately prior
to the Reorganization, the Maximum Amount of each Selling Fund immediately prior
to the Reorganization,
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calculated in accordance with NASD Conduct Rule 2830.
1.4 Prior to the Closing Date, the Trust and the Corporation shall file
appropriate Articles of Transfer pursuant to the laws of the State of Maryland,
effective as of the Closing Date.
1.5 LIQUIDATION AND DISTRIBUTION. On or as soon after the Closing Date as
is conveniently practicable (the "Liquidation Date"): (a) each Selling Fund will
make a liquidating distribution, pro rata to its shareholders of record (the
"Selling Fund Shareholders"), determined as of the close of business on the
Valuation Date (as defined in paragraph 2.1), of all of the Acquiring Fund
Shares received by the Selling Fund pursuant to paragraph 1.1; and (b) the
Selling Fund will thereupon proceed to terminate as set forth in paragraph 1.9
below. Such distribution will be accomplished by the transfer of Acquiring Fund
Shares credited to the account of the Selling Fund on the books of the Acquiring
Fund to open accounts on the share records of the Acquiring Fund in the name of
the Selling Fund Shareholders, and representing the respective pro rata number
of Acquiring Fund Shares due such shareholders. All issued and outstanding
shares of the Selling Fund will simultaneously be canceled on the books of the
Selling Fund. The Acquiring Fund shall not issue certificates representing
Acquiring Fund Shares in connection with such transfer. Each Selling Fund
Shareholder shall have the right to receive any unpaid dividends or other
distributions that were declared by the Selling Fund before the Effective Time
(as defined in paragraph 3.1) with respect to Selling Fund shares that are held
of record by a Selling Fund Shareholder at the Effective Time on the Closing
Date.
1.6 OWNERSHIP OF SHARES. Ownership of Acquiring Fund Shares will be shown
on the books of each Acquiring Fund's transfer agent. Shares of each Acquiring
Fund will be issued simultaneously to its corresponding Selling Fund, in an
amount equal in value to the net asset value of each Selling Fund's shares, to
be distributed to shareholders of each class of each Selling Fund.
1.7 TRANSFER TAXES. Any transfer taxes payable upon the transfer of
Acquiring Fund Shares in a name other than the registered holder of the Selling
Fund shares on the books of the Selling Fund as of that time shall, as a
condition of such issuance and transfer, be paid by the person to whom such
Acquiring Fund Shares are to be transferred.
1.8 REPORTING RESPONSIBILITY. Any reporting responsibility of each Selling
Fund is and shall remain the responsibility of the Selling Fund, up to and
including the Closing Date, and such later date on which the Selling Fund is
terminated.
1.9 TERMINATION. Each Selling Fund shall be terminated promptly following
the Closing Date and the making of all distributions pursuant to paragraph 1.5.
1.10 Subject to the conditions set forth in this Agreement, the failure of
one of the Selling Funds to consummate the transactions contemplated hereby
shall not affect the consummation or validity of the Reorganization with respect
to any other Selling Fund, and the provisions of this Agreement shall be
construed to effect this intent, including, without limitation, as the context
requires, construing the terms "Acquiring Fund" and "Selling Fund" as meaning
only those series of the Trust and the Corporation, respectively, which are
involved in the Reorganization as of the Closing Date.
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ARTICLE II
VALUATION
2.1 VALUATION OF ASSETS. The value of a Selling Fund's assets to be
acquired by its respective Acquiring Fund hereunder shall be the value of such
assets computed as of the close of regular trading on the New York Stock
Exchange ("NYSE") on the business day immediately prior to the Closing Date
(such time and date being hereinafter called a "Valuation Date"), using the
valuation procedures set forth in the Corporation's Articles of Incorporation
and each Selling Fund's then current prospectus and Statement of Additional
Information or such other valuation procedures as shall be mutually agreed upon
by the parties. Each Acquiring Fund and Selling Fund agrees, however, to use all
commercially reasonable efforts to resolve any material pricing differences
between the prices of portfolio securities determined in accordance with the
pricing policies and procedures of an Acquiring Fund and those determined in
accordance with the pricing policies and procedures of its respective Selling
Fund.
2.2 VALUATION OF SHARES. The net asset value per share of Acquiring Fund
Shares shall be the net asset value per share computed as of the close of normal
trading on the NYSE on the Valuation Date, using the valuation procedures set
forth in the Trust's Agreement and Declaration of Trust and each Acquiring
Fund's then current prospectus and Statement of Additional Information.
2.3 SHARES TO BE ISSUED. The number of each Acquiring Fund's shares of
each class to be issued (including fractional shares) shall be equal in number
and net asset value to each corresponding Selling Fund's shares of each class
then outstanding. Upon the Selling Fund's liquidating distribution (i) each
holder of Class I shares of the Selling Fund will receive Institutional Shares
of the corresponding Acquiring Fund equal in number and net asset value to the
number and net asset value of Class I shares held by such holder immediately
prior to such liquidating distribution and (ii) each holder of Class P shares of
the Selling Fund will receive A Shares of the corresponding Acquiring Fund equal
in number and net asset value to the number and net asset value of Class P
shares held by such holder immediately prior to such liquidating distribution.
2.4 DETERMINATION OF VALUE. Except with respect to a Selling Fund's
assets, which shall be valued by Investors Bank & Trust Company, all
computations of value shall be made by BISYS Fund Services Ohio, Inc. in
accordance with its regular practice in pricing the shares and assets of each
Acquiring Fund.
ARTICLE III
CLOSING AND CLOSING DATE
3.1 CLOSING DATE. The closing (the "Closing") will be on or about
September 23, 2004 or such other date(s) as the parties may agree to in writing.
All acts taking place at the Closing shall be deemed to take place immediately
prior to the Closing Date unless otherwise provided. The Closing shall be held
as of 9:00 a.m. (the "Effective Time") at the offices of Seix Investment
Advisors, Inc., 000 Xxxx Xxxxxxxxx, Xxxxxxxxx Xxxx, Xxx Xxxxxx, 00000-0000, or
at such other time and/or place as the parties may agree.
3.2 CUSTODIAN'S CERTIFICATE. Investors Bank & Trust Company, as custodian
for each Selling Fund, shall deliver at the Closing a certificate of an
authorized officer stating that: (a) each Selling Fund's portfolio securities,
cash, and any other assets shall have been delivered in proper form to its
respective Acquiring Fund on the Closing Date; and (b) all necessary taxes
including all applicable federal and state stock transfer stamps, if any, shall
have been paid, or provision for payment shall have
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been made, in conjunction with the delivery of portfolio securities by the
Selling Fund.
3.3 EFFECT OF SUSPENSION IN TRADING. In the event that on the Valuation
Date, either: (a) the NYSE or another primary exchange on which the portfolio
securities of an Acquiring Fund or a Selling Fund are purchased or sold, shall
be closed to trading or trading on such exchange shall be restricted; or (b)
trading or the reporting of trading on the NYSE or elsewhere shall be disrupted
so that accurate appraisal of the value of the net assets of an Acquiring Fund
or a Selling Fund is impracticable, the Valuation Date shall be postponed until
the first business day after the day when trading is fully resumed and reporting
is restored.
3.4 TRANSFER AGENT'S CERTIFICATE. Investors Bank & Trust Company, as
transfer agent for each Selling Fund as of the Closing Date, shall deliver at
the Closing a certificate of an authorized officer stating that its records
contain the names and addresses of Selling Fund Shareholders, and the number and
percentage ownership of outstanding shares owned by each such shareholder
immediately prior to the Closing. Each Acquiring Fund shall issue and deliver or
cause BISYS Fund Services Ohio, Inc., its transfer agent, to issue and deliver a
confirmation evidencing Acquiring Fund Shares to be credited on the Closing Date
to the Secretary of the Corporation or provide evidence satisfactory to the
Selling Fund that such Acquiring Fund Shares have been credited to the Selling
Fund's account on the books of the Acquiring Fund. At the Closing, each party
shall deliver to the other such bills of sale, checks, assignments, share
certificates, receipts and other documents, if any, as such other party or its
counsel may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS OF THE SELLING FUNDS. Each Selling Fund represents and
warrants to its respective Acquiring Fund as follows:
(a) The Selling Fund is a separate series of a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Maryland.
(b) The Selling Fund is a separate series of a Maryland corporation
that is registered as an open-end management investment company, and such
corporation's registration with the U.S. Securities and Exchange Commission (the
"Commission") as an investment company under the Investment Company Act of 1940
(the "1940 Act") is in full force and effect.
(c) The current prospectus and Statement of Additional Information
of the Selling Fund conform in all material respects to the applicable
requirements of the Securities Act of 1933 (the "1933 Act") and the 1940 Act,
and the rules and regulations thereunder, and do not include any untrue
statement of a material fact or omit to state any material fact required to be
stated or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) The Selling Fund is not, and the execution, delivery, and
performance of this Agreement (subject to shareholder approval) will not result
in the violation of any material provision of the Corporation's Articles of
Incorporation or By-Laws or of any material agreement, indenture, instrument,
contract, lease, or other undertaking to which the Selling Fund is a party or by
which it is bound.
(e) The Selling Fund has no material contracts or other commitments
(other than this Agreement) that will be terminated with liability to it prior
to the Closing Date, except for liabilities, if
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any, to be discharged or reflected in the Statement of Assets and Liabilities as
provided in paragraph 1.3 hereof.
(f) Except as otherwise disclosed in writing to and accepted by the
Acquiring Fund, no litigation, administrative proceeding, or investigation of or
before any court or governmental body is presently pending or to its knowledge
threatened against the Selling Fund or any of its properties or assets, which,
if adversely determined, would materially and adversely affect its financial
condition, the conduct of its business, or the ability of the Selling Fund to
carry out the transactions contemplated by this Agreement. The Selling Fund
knows of no facts that might form the basis for the institution of such
proceedings and are not a party to or subject to the provisions of any order,
decree, or judgment of any court or governmental body that materially and
adversely affects the Selling Fund's business or its ability to consummate the
transactions contemplated herein.
(g) The financial statements of the Selling Fund are in accordance
with generally accepted accounting principles, and such statements (copies of
which have been furnished to the Acquiring Funds) fairly reflect the financial
condition of the Selling Fund as of [April 30, 2004] in all material respects as
of that date, and there are no known contingent liabilities of the Selling Fund
as of that date not disclosed in such statements.
(h) [Since April 30, 2004], there have been no material adverse
changes in the Selling Fund's financial condition, assets, liabilities for
business (other than changes occurring in the ordinary course of business), or
any incurrence by the Selling Fund of indebtedness maturing more than one year
from the date such indebtedness was incurred, except as otherwise disclosed to
and accepted by the Acquiring Fund. For the purposes of this subparagraph (h), a
decline in the net asset value of the Selling Fund shall not constitute a
material adverse change.
(i) At the Closing Date, all federal and other tax returns and
reports of the Selling Fund required by law to be filed by such date, shall have
been filed, and all federal and other taxes shown due on such returns and
reports shall have been paid, or provision shall have been made for the payment
thereof. To the best of the Selling Fund's knowledge, no such return is
currently under audit, and no assessment has been asserted with respect to such
returns.
(j) All issued and outstanding shares of the Selling Fund are, and
at the Closing Date, will be duly and validly issued and outstanding, fully paid
and non-assessable by the Selling Fund. All of the issued and outstanding shares
of the Selling Fund will, at the time of the Closing Date, be held by the
persons and in the amounts set forth in the records of the Selling Fund's
transfer agent as provided in paragraph 3.4. The Selling Fund has no outstanding
options, warrants, or other rights to subscribe for or purchase any of the
Selling Fund shares, and has no outstanding securities convertible into any of
the Selling Fund shares.
(k) At the Closing Date, the Selling Fund will have good and
marketable title to the Selling Fund's assets to be transferred to the Acquiring
Fund pursuant to paragraph 1.2, and full right, power, and authority to sell,
assign, transfer, and deliver such assets hereunder, and, upon delivery and
payment for such assets, and the filing of Articles of Transfer pursuant to the
laws of the State of Maryland, the Acquiring Fund will acquire good and
marketable title, subject to no restrictions on the full transfer of such
assets, including such restrictions as might arise under the 1933 Act, other
than as disclosed to and accepted by the Acquiring Fund.
(l) The execution, delivery, and performance of this Agreement have
been duly authorized by all necessary action on the part of the Selling Fund.
Subject to approval by the Selling Fund Shareholders, this Agreement constitutes
a valid and binding obligation of the Selling Fund,
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enforceable in accordance with its terms, subject as to enforcement, bankruptcy,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights and to general equity principles.
(m) The information to be furnished by the Selling Fund for use in
no-action letters, applications for orders, registration statements, proxy
materials, and other documents that may be necessary in connection with the
transactions contemplated herein shall be accurate and complete in all material
respects and shall comply in all material respects with federal securities laws
and other laws and regulations.
(n) From the effective date of the Registration Statement (as
defined in paragraph 5.7), through the time of the meeting of the Selling Fund
Shareholders and on the Closing Date, any written information furnished by the
Selling Fund with respect to the Selling Fund for use in the Prospectus/Proxy
Statement (as defined in paragraph 5.7), the Registration Statement or any other
materials provided in connection with the Reorganization, does not and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated or necessary to make the statements, in light of the
circumstances under which such statements were made, not materially misleading.
(o) The Selling Fund has elected to qualify and has qualified as a
"regulated investment company" (a "RIC") under the Code as of and since its
first taxable year; has been a RIC under the Code at all times since the end of
its first taxable year when it so qualified; and qualifies and shall continue to
qualify as a RIC under the Code for its taxable year ending upon its
liquidation.
(p) No governmental consents, approvals, authorizations or filings
are required under the 1933 Act, the Securities Exchange Act of 1934 (the "1934
Act"), the 1940 Act or Maryland law for the execution of this Agreement by the
Corporation, for itself and on behalf of each Selling Fund, except for the
effectiveness of the Registration Statement and the filing of Articles of
Transfer pursuant to Maryland law, and except for such other consents,
approvals, authorizations and filings as have been made or received, and such
consents, approvals, authorizations and filings as may be required subsequent to
the Closing Date, it being understood, however, that this Agreement and the
transactions contemplated herein must be approved by the shareholders of the
Selling Fund as described in paragraph 5.2.
4.2 REPRESENTATIONS OF THE ACQUIRING FUNDS. Each Acquiring Fund represents
and warrants to its respective Selling Fund as follows:
(a) The Acquiring Fund is a separate series of a business trust,
duly organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts.
(b) The Acquiring Fund is a separate series of a Massachusetts
business trust that is registered as open-end management investment company, and
such Massachusetts business trust's registration with the Commission as an
investment company under the 1940 Act is in full force and effect.
(c) The current prospectus and Statement of Additional Information
of the Acquiring Fund conform in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and regulations
thereunder, and do not include any untrue statement of a material fact or omit
to state any material fact required to be stated or necessary to make such
statements therein, in light of the circumstances under which they were made,
not misleading.
(d) The Acquiring Fund is not, and the execution, delivery and
performance of this Agreement will not result in a violation of any material
provision the Trust's Agreement and Declaration
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of Trust or By-Laws or of any material agreement, indenture, instrument,
contract, lease, or other undertaking to which the Acquiring Fund is a party or
by which it is bound.
(e) Except as otherwise disclosed in writing to the Selling Fund and
accepted by the Selling Fund, no litigation, administrative proceeding or
investigation of or before any court or governmental body is presently pending,
or to its knowledge, threatened against the Acquiring Fund or any of its
properties or assets, which, if adversely determined, would materially and
adversely affect its financial condition and the conduct of its business or the
ability of the Acquiring Fund to carry out the transactions contemplated by this
Agreement. The Acquiring Fund knows of no facts that might form the basis for
the institution of such proceedings and it is not a party to or subject to the
provisions of any order, decree, or judgment of any court or governmental body
that materially and adversely affects its business or its ability to consummate
the transaction contemplated herein.
(f) All issued and outstanding Acquiring Fund Shares are, and at the
Closing Date will be, duly and validly issued and outstanding, fully paid and
non-assessable by the Acquiring Fund. The Acquiring Fund has no outstanding
options, warrants, or other rights to subscribe for or purchase any Acquiring
Fund Shares, and there are no outstanding securities convertible into any
Acquiring Fund Shares.
(g) The execution, delivery, and performance of this Agreement have
been duly authorized by all necessary action on the part of the Acquiring Fund,
and this Agreement constitutes a valid and binding obligation of the Acquiring
Fund, enforceable in accordance with its terms, subject as to enforcement, to
bankruptcy, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights and to general equity principles.
(h) Acquiring Fund Shares to be issued and delivered to the Selling
Fund for the account of the Selling Fund Shareholders pursuant to the terms of
this Agreement will, at the Closing Date, have been duly authorized. When so
issued and delivered, such shares will be duly and validly issued Acquiring Fund
Shares, and will be fully paid and non-assessable.
(i) The information to be furnished by the Acquiring Fund for use in
no-action letters, applications for orders, registration statements, proxy
materials, and other documents that may be necessary in connection with the
transactions contemplated herein shall be accurate and complete in all material
respects and shall comply in all material respects with federal securities laws
and other laws and regulations.
(j) From the effective date of the Registration Statement (as
defined in paragraph 5.7), through the time of the meeting of the Selling Fund
Shareholders and on the Closing Date, any written information furnished by the
Trust with respect to the Acquiring Fund for use in the Prospectus/Proxy
Statement (as defined paragraph 5.7), the Registration Statement or any other
materials provided in connection with the Reorganization, does not and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated or necessary to make the statements, in light of the
circumstances under which such statements were made, not materially misleading.
(k) The Acquiring Fund agrees to use all reasonable efforts to
obtain the approvals and authorizations required by the 1933 Act, the 1940 Act,
and any state blue sky or securities laws as it may deem appropriate in order to
continue its operations after the Closing Date.
(l) No governmental consents, approvals, authorizations or filings
are required under the 1933 Act, the 1934 Act, the 1940 Act or Massachusetts law
for the execution of this Agreement by the Trust, for itself and on behalf of
the Acquiring Fund, or the performance of the Agreement by the Trust,
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for itself and on behalf of the Acquiring Fund, except for the effectiveness of
the Registration Statement and such other consents, approvals, authorizations
and filings as have been made or received, and except for such consents,
approvals, authorizations and filings as may be required subsequent to the
Closing Date.
(m) The Acquiring Fund intends to qualify as a RIC under the Code.
ARTICLE V
COVENANTS OF EACH ACQUIRING FUND AND EACH SELLING FUND
5.1 OPERATION IN ORDINARY COURSE. Subject to paragraph 8.5, each Acquiring
Fund and Selling Fund will operate its respective business in the ordinary
course between the date of this Agreement and the Closing Date, it being
understood that such ordinary course of business will include customary
dividends and distributions and shareholder redemptions.
5.2 APPROVAL OF SHAREHOLDERS. The Corporation will call a special meeting
of Selling Fund Shareholders to consider and act upon this Agreement and to take
all other action necessary to obtain approval of the transactions contemplated
herein.
5.3 INVESTMENT REPRESENTATION. Each Selling Fund covenants that the
Acquiring Fund Shares to be issued pursuant to this Agreement are not being
acquired for the purpose of making any distribution, other than in connection
with the Reorganization and in accordance with the terms of this Agreement.
5.4 ADDITIONAL INFORMATION. Each Selling Fund will assist its respective
Acquiring Fund in obtaining such information as the Acquiring Fund reasonably
requests concerning the beneficial ownership of the Selling Fund's shares.
5.5 FURTHER ACTION. Subject to the provisions of this Agreement, each
Acquiring Fund and its respective Selling Fund 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, including any actions required to be taken after
the Closing Date.
5.6 STATEMENT OF EARNINGS AND PROFITS. As promptly as practicable, but in
any case within sixty days after the applicable Closing Date, each Selling Fund
shall furnish its respective Acquiring Fund, in such form as is reasonably
satisfactory to the Acquiring Fund, a statement of the earnings and profits of
the Selling Fund for federal income tax purposes that will be carried over by
the Acquiring Fund as a result of Section 381 of the Code, and which will be
reviewed by Deloitte & Touche LLP and certified by the Corporation's Treasurer.
5.7 PREPARATION OF FORM N-14 REGISTRATION STATEMENT. The Trust will
prepare and file with the Commission a registration statement on Form N-14 (the
"Registration Statement"), under the 1933 Act, relating to the Acquiring Fund
Shares, which, without limitation, shall include a proxy statement of each
Selling Fund and the prospectus of each Acquiring Fund relating to the
transaction contemplated by this Agreement (the "Prospectus/Proxy Statement").
The Registration Statement shall be in compliance with the 1933 Act, the 1934
Act and the 1940 Act. Each Selling Fund will provide its respective Acquiring
Fund with the materials and information necessary to prepare the
Prospectus/Proxy Statement for inclusion in the Registration Statement in
connection with the meeting of the Selling Funds Shareholders to consider the
approval of this Agreement and the transactions contemplated herein.
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5.8 INDEMNIFICATION.
(a) The Trust will assume certain liabilities and obligations of the
Corporation relating to any obligation of the Corporation to indemnify its
current and former Directors and officers, acting in their capacities as such,
to the fullest extent permitted by law and the Corporation's Articles of
Incorporation, as in effect as of the date of this Agreement. Without limiting
the foregoing, the Trust agrees that all rights to indemnification and all
limitations of liability existing in favor of the current and former Directors
and officers, acting in their capacities as such, under the Corporation's
Articles of Incorporation as in effect as of the date of this Agreement shall
survive the Reorganization and shall continue in full force and effect, without
any amendment thereto, and shall constitute rights that may be asserted against
the Trust, its successors or assigns.
(b) Each Acquiring Fund agrees to indemnify and hold harmless its
respective Selling Fund and each of the Selling Fund's Directors and officers
from and against any and all losses, claims, damages, liabilities or expenses
(including, without limitation, the payment of reasonable legal fees and
reasonable costs of investigation) to which jointly and severally, the Selling
Fund or any of its Directors or officers may become subject, insofar as any such
loss, claim, damage, liability or expense (or actions with respect thereto)
arises out of or is based on any breach by the Acquiring Fund of any of its
representations, warranties, covenants or agreements set forth in this
Agreement.
(c) Each Selling Fund agrees to indemnify and hold harmless its respective
Acquiring Fund and each of the Acquiring Fund's Trustees and officers from and
against any and all losses, claims, damages, liabilities or expenses (including,
without limitation, the payment of reasonable legal fees and reasonable costs of
investigation) to which jointly and severally, the Acquiring Fund or any of its
Trustees or officers may become subject, insofar as any such loss, claim damage
liability or expense (or actions with respect thereto) arises out of or is based
on any breach by the Selling Fund of any of its representations, warranties,
covenants or agreements set forth in this Agreement.
ARTICLE VI
CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH SELLING FUND
The obligations of each Selling Fund to consummate the transactions
provided for herein shall be subject, at its election, to the performance by its
respective Acquiring Fund of all the obligations to be performed by it pursuant
to this Agreement on or before the Closing Date, and, in addition, subject to
the following conditions:
6.1 All representations, covenants, and warranties of the Acquiring Fund
contained in this Agreement shall be true and correct in all material respects
as of the date hereof and as of the Closing Date, with the same force and effect
as if made on and as of that Closing Date. Each Acquiring Fund shall have
delivered to its respective Selling Fund a certificate executed in the Acquiring
Fund's name by the Trust's President or Vice President and its Treasurer or
Assistant Treasurer, in form and substance satisfactory to the Selling Fund and
dated as of the Closing Date, to such effect and as to such other matters as the
Selling Fund shall reasonably request.
6.2 The Selling Funds shall have received on the Closing Date an opinion
from Xxxxxx, Xxxxx & Xxxxxxx LLP, counsel to the Trust, dated as of such Closing
Date, in a form reasonably satisfactory to the Selling Funds, covering the
following points:
(a) The Trust is a business trust duly organized, validly existing
and in good standing
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under the laws of the Commonwealth of Massachusetts, and, to such counsel's
knowledge, has the power to own all of its properties and assets and to carry on
its business as presently conducted.
(b) The Trust is registered as an investment company under the 1940
Act, and, to such counsel's knowledge, such registration with the Commission is
in full force and effect.
(c) This Agreement has been duly authorized, executed, and delivered
by the Trust on behalf of each Acquiring Fund and, assuming due authorization,
execution and delivery of this Agreement by the Selling Funds, is a valid and
binding obligation of the Acquiring Funds enforceable against each Acquiring
Fund in accordance with its terms, subject as to enforcement, bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and to general equity
principles.
(d) Assuming that a consideration of not less than the net asset
value of Acquiring Fund Shares has been paid, Acquiring Fund Shares to be issued
and delivered to each Selling Fund on behalf of the Selling Fund Shareholders,
as provided by this Agreement, are duly authorized and upon such delivery will
be legally issued and outstanding and fully paid and non-assessable, and no
shareholder of an Acquiring Fund has any preemptive rights with respect to
Acquiring Fund Shares.
(e) The Registration Statement has been declared effective by the
Commission and to such counsel's knowledge, no stop order under the 1933 Act
pertaining thereto has been issued, and to the knowledge of such counsel, no
consent, approval, authorization or order of any court or governmental authority
of the United States or the Commonwealth of Massachusetts is required for
consummation by the Acquiring Funds of the transactions contemplated herein,
except as have been obtained under the 1933 Act, the 1934 Act and the 1940 Act,
and as may be required under state securities laws.
(f) The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated herein will not, result in a
violation of the Trust's Agreement and Declaration of Trust or By-Laws or any
provision of any material agreement, indenture, instrument, contract, lease or
other undertaking (in each case known to such counsel) to which an Acquiring
Fund is a party or by which an Acquiring Fund or any of its properties may be
bound or, to the knowledge of such counsel, result in the acceleration of any
obligation or the imposition of any penalty, under any agreement, judgment, or
decree to which an Acquiring Fund is a party or by which it is bound.
(g) In the ordinary course of such counsel's representation of the
Acquiring Funds, and without having made any investigation, such counsel does
not know of any legal or governmental proceedings (only insofar as they relate
to an Acquiring Fund) existing on or before the effective date of the
Registration Statement or the Closing Date that are required to be described in
the Registration Statement or to be filed as exhibits to the Registration
Statement that are not described or filed as required.
(h) In the ordinary course of such counsel's representation of the
Acquiring Funds, and without having made any investigation, and except as
otherwise disclosed, such counsel is not aware of any litigation or
administrative proceeding or investigation of or before any court or
governmental body that is presently pending or threatened as to an Acquiring
Fund or any of its properties or assets. In the ordinary course of such
counsel's representation of the Acquiring Funds, and without having made any
investigation, to the knowledge of such counsel, the Acquiring Funds are 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 the Acquiring
Funds' business, other than as previously disclosed in the Registration
Statement.
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Such counsel shall also state that it has participated in conferences with
officers and other representatives of each Acquiring Fund at which the contents
of the Prospectus/Proxy Statement and related matters were discussed. Although
such counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Prospectus/Proxy Statement, on the basis of the foregoing (relying as to
materiality exclusively upon the opinions of the Trust's officers and other
representatives of each Acquiring Fund) and without such counsel having made any
investigations of the statements made in the Prospectus/Proxy Statement, no
facts have come to its attention that lead it to believe that the
Prospectus/Proxy Statement as of its date, as of the date of each Selling Fund's
shareholders meeting, and as of the Closing Date, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
regarding an Acquiring Fund or necessary, in the light of the circumstances
under which they were made, to make such statements regarding an Acquiring Fund
not misleading. Such opinion may state that such counsel does not express any
opinion or belief as to the financial statements or any financial or statistical
data, or as to the information relating to each Selling Fund, contained in the
Prospectus/Proxy Statement or the Registration Statement, and that such opinion
is solely for the benefit of the Corporation and each Selling Fund. Such opinion
shall contain such other assumptions and limitations as shall be in the opinion
of Xxxxxx, Xxxxx & Bockius LLP appropriate to render the opinions expressed
therein.
In this paragraph 6.2, references to the Prospectus/Proxy Statement
include and relate to only the text of such Prospectus/Proxy Statement and not
to any exhibits or attachments thereto or to any documents incorporated by
reference therein.
6.3 As of the Closing Date with respect to the Reorganization of the
Selling Fund, there shall have been no material change in the investment
objective, policies and restrictions nor any material change in the investment
management fees, fee levels payable pursuant to the 12b-1 plan of distribution,
other fees payable for services provided to each Acquiring Fund, fee waiver or
expense reimbursement undertakings, or sales loads of the Acquiring Funds from
those fee amounts, undertakings and sales load amounts of the Acquiring Fund
described in the Prospectus/Proxy Statement.
6.4 For the period beginning at the Closing Date and ending not less than
six years thereafter, the Trust, its successor or assigns shall provide, or
cause to be provided, liability coverage at least as comparable to the liability
coverage currently applicable to both former and current Directors and officers
of the Corporation, covering the actions of such Directors and officers of the
Corporation for the period they served as such.
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH ACQUIRING FUND
The obligations of each Acquiring Fund to consummate the transactions
provided for herein shall be subject, at their election, to the performance by
each corresponding Selling Fund of all the obligations to be performed by the
Selling Fund pursuant to this Agreement, on or before the Closing Date and, in
addition, shall be subject to the following conditions:
7.1 All representations, covenants, and warranties of a Selling Fund
contained in this Agreement shall be true and correct in all material respects
as of the date hereof and as of the Closing Date, with the same force and effect
as if made on and as of such Closing Date. Each Selling Fund shall have
delivered to its respective Acquiring Fund on such Closing Date a certificate
executed in the Selling Fund's name by the Corporation's President or Vice
President and the Treasurer or Assistant Treasurer, in form and substance
satisfactory to the Acquiring Fund and dated as of such Closing Date, to such
effect and as to such other matters as the Acquiring Fund shall reasonably
request.
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7.2 The Selling Fund shall have delivered to its respective Acquiring Fund
a statement of the Selling Fund's assets and liabilities, together with a list
of the selling Fund's portfolio securities showing the tax costs of such
securities by lot and the holding periods of such securities, as of the Closing
Date, certified by the Treasurer of the Corporation.
7.3 The Acquiring Fund shall have received on the Closing Date an opinion
of Dechert LLP, counsel to each Selling Fund, dated as of such Closing Date in a
form satisfactory to the Acquiring Fund covering the following points:
(a) The Corporation is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland and, to
such counsel's knowledge, has the power to own all of its properties and assets
and to carry on its business as presently conducted.
(b) The Corporation is registered as an investment company under the
1940 Act, and, to such counsel's knowledge, such registration with the
Commission is in full force and effect.
(c) This Agreement has been duly authorized, executed and delivered
by the Corporation on behalf of each Selling Fund and, assuming due
authorization, execution and delivery of this Agreement by the Trust on behalf
of each Acquiring Fund is a valid and binding obligation of the Selling Fund
enforceable against the Selling Fund in accordance with its terms, subject as to
enforcement, bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other laws relating to or affecting creditors' rights generally
and to general equity principles.
(d) Assuming that a consideration of not less than the net asset
value of Selling Fund Shares has been paid, and assuming that such shares were
issued in accordance with the terms of each Selling Fund's registration
statement, or any amendment thereto, in effect at the time of such issuance, and
assuming that all such shares were duly authorized by appropriate action of the
Corporation's Board of Directors, all issued and outstanding shares of the
Selling Fund are legally issued and fully paid and non-assessable.
(e) To the knowledge of such counsel, except for the filing of
Articles of Transfer pursuant to Maryland law, no consent, approval,
authorization or order of any court or governmental authority of the United
States or the State of Maryland is required for consummation by a Selling Fund
of the transactions contemplated herein, except as have been obtained under the
1933 Act, the 1934 Act and the 1940 Act, and as may be required under state
securities laws.
(f) The execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated hereby will not result in a
violation of the Corporation's Articles of Incorporation or By-laws, or any
provision of any material agreement, indenture, instrument, contract, lease or
other undertaking (in each case known to such counsel) to which a Selling Fund
is a party or by which it or any of its properties may be bound or, to the
knowledge of such counsel, result in the acceleration of any obligation or the
imposition of any penalty, under any agreement, judgment, or decree to which the
Selling Fund is a party or by which it is bound.
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(g) In the ordinary course of such counsel's representation of the
Selling Funds, and without having made any investigation, such counsel does not
know of any legal or governmental proceedings (insofar as they relate to a
Selling Fund) existing on or before the date of mailing of the Prospectus/Proxy
Statement and the Closing Date that are required to be described in the
Prospectus/Proxy Statement or to be filed as an exhibit to the Registration
Statement that are not described or filed as required.
(h) In the ordinary course of such counsel's representation of the
Selling Funds, and without having made any investigation, and except as
otherwise disclosed, such Counsel in not aware of any litigation or
administrative proceeding or investigation of or before any court or
governmental body that is presently pending or threatened as to a Selling Fund
or any of its respective properties or assets. In the ordinary course of such
counsel's representation of the Selling Funds, and without having made any
investigation, to the knowledge of such counsel, no Selling Fund is 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 the Selling Fund's
business other than as previously disclosed in the Prospectus/Proxy Statement.
Such counsel shall also state that it has participated in conferences with
officers and other representatives of each Selling Fund at which the contents of
the Prospectus/Proxy Statement and related matters were discussed. Although such
counsel is not passing upon and do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Prospectus/Proxy Statement, on the basis of the foregoing (relying as to
materiality exclusively upon the opinions of the Corporation's officers and
other representatives of each Selling Fund) and without such counsel having made
any investigations of the statements made in the Prospectus/Proxy Statement, no
facts have come to its attention that lead it to believe that the
Prospectus/Proxy Statement as of its date, as of the date of each Selling Fund's
shareholders meeting, and as of the Closing Date, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein regarding a Selling Fund or necessary, in the light of the circumstances
under which they were made, to make the statements therein regarding the Selling
Fund not misleading. Such opinion may state that such counsel does not express
any opinion or belief as to the information relating to each Acquiring Fund
contained in the Prospectus/Proxy Statement or Registration Statement, and that
such opinion is solely for the benefit of the Trust and each Acquiring Fund.
Such opinion shall contain such other assumptions and limitations as shall be in
the opinion of Dechert LLP appropriate to render the opinions expressed therein,
and shall indicate, with respect to matters of Maryland law, that such opinions
are based either upon the review of published statutes, cases and rules and
regulations of the State of Maryland or upon an opinion of Maryland counsel.
In this paragraph 7.3, references to the Prospectus/Proxy Statement
include and relate to only the text of such Prospectus/Proxy Statement and not
to any exhibits or attachments thereto or to any documents incorporated by
reference therein.
ARTICLE VIII
FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH
ACQUIRING FUND AND SELLING FUND
If any of the conditions set forth below do not exist on or before the
Closing Date with respect to each Selling Fund or its respective Acquiring Fund,
the other party to this Agreement shall, at its option, not be required to
consummate the transactions contemplated by this Agreement:
8.1 This Agreement and the transactions contemplated herein, with respect
to each Selling
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Fund, shall have been approved by the requisite vote of the holders of the
outstanding shares of the respective Selling Fund in accordance with Maryland
law and the provisions of the Corporation's Articles of Incorporation and
By-Laws. Certified copies of the resolutions evidencing such approval shall have
been delivered to the respective Acquiring Fund. Notwithstanding anything herein
to the contrary, neither an Acquiring Fund nor a Selling Fund may waive the
conditions set forth in this paragraph 8.1.
8.2 On the Closing Date, the Commission shall not have issued an
unfavorable report under Section 25(b) of the 1940 Act, or instituted any
proceeding seeking to enjoin the consummation of the transactions contemplated
by this Agreement under Section 25(c) of the 1940 Act. Furthermore, no action,
suit or other proceeding shall be threatened or pending 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 required consents of other parties and all other consents, orders,
and permits of federal, state and local regulatory authorities (including those
of the Commission and of state blue sky securities authorities, including any
necessary "no-action" positions and exemptive orders from such federal and state
authorities) to permit consummation of the transactions contemplated herein
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 an Acquiring Fund or a Selling Fund, provided that
either party hereto may waive any such conditions for itself.
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. To the best knowledge of the parties to this Agreement, no investigation
or proceeding for that purpose shall have been instituted or be pending,
threatened or contemplated under the 1933 Act.
8.5 Each Selling Fund shall have declared and paid a dividend or
dividends, which, together with all previous such dividends, shall have the
effect of distributing to its shareholders all of the Selling Fund's net
investment company taxable income for all taxable periods ending on or prior to
the Closing Date (computed without regard to any deduction for dividends paid)
and all of its net capital gains realized in all taxable periods ending on or
prior to such Closing Date (after reduction for any capital loss carry forward).
8.6 The parties shall have received a favorable opinion of Xxxxxx, Xxxxx &
Xxxxxxx LLP addressed to each Acquiring Fund and Selling Fund substantially to
the effect that for federal income tax purposes with respect to each Selling
Fund:
(a) The transfer of all of the Selling Fund's assets in exchange for
Acquiring Fund Shares and the assumption by the Acquiring Fund of the
liabilities of the Selling Fund (followed by the distribution of Acquiring Fund
Shares to the Selling Fund Shareholders and the termination of the Selling Fund)
will constitute a "reorganization" within the meaning of Section 368(a) of the
Code and the Acquiring Fund and the Selling 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 Acquiring Fund upon
the receipt of the assets of the Selling Fund solely in exchange for Acquiring
Fund Shares and the assumption by the Acquiring Fund of the identified
liabilities of the Selling Fund.
(c) No gain or loss will be recognized by the Selling Fund upon the
transfer of the Selling Fund's assets to the Acquiring Fund in exchange for
Acquiring Fund Shares and the assumption by the Acquiring Fund of the identified
liabilities of the Selling Fund or upon the distribution (whether
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actual or constructive) of Acquiring Fund Shares to Selling Fund Shareholders in
exchange for such shareholders' shares of the Selling Fund.
(d) No gain or loss will be recognized by the Selling Fund
Shareholders upon the exchange of their Selling Fund shares for Acquiring Fund
Shares in the Reorganization.
(e) The aggregate tax basis for Acquiring Fund Shares received by
each Selling Fund Shareholder pursuant to the Reorganization will be the same as
the aggregate tax basis of the Selling Fund shares exchanged therefor by such
shareholder. The holding period of Acquiring Funds Shares to be received by each
Selling Fund Shareholder will include the period during which the Selling Fund
shares exchanged therefore were held by such shareholder, provided the Selling
Fund shares are held as capital assets at the time of the Reorganization.
(f) The tax basis of the Selling Fund's assets acquired by the
Acquiring Fund will be the same as the tax basis of such assets to the Selling
Fund immediately prior to the Reorganization. The holding period of the assets
of the Selling Fund in the hands of the Acquiring Fund will include the period
during which those assets were held by the Selling Fund.
Such opinion shall be based on customary assumptions and such
representations as Xxxxxx, Xxxxx & Bockius LLP may reasonably request, and each
Selling Fund and Acquiring Fund will cooperate to make and certify the accuracy
of such representations. Notwithstanding anything herein to the contrary,
neither an Acquiring Fund nor a Selling Fund may waive the conditions set forth
in this paragraph 8.6.
ARTICLE IX
EXPENSES
9.1 Except as otherwise provided for herein, expenses related to the
Reorganization that are incurred by will be borne by Trusco or an affiliate
thereof. Reorganization expenses include, without limitation: (a) expenses
associated with the preparation and filing of the Registration Statement/Proxy
Statement on Form N-14 under the 1933 Act covering Acquiring Fund Shares to be
issued pursuant to the provisions of this Agreement; (b) postage; (c) printing;
(d) accounting fees; (e) legal fees; and (f) solicitation costs of the
transaction.
ARTICLE X
ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1 The Trust, on behalf of each Acquiring Fund, and the Corporation, on
behalf of each Selling Fund, agrees that neither party has made to the other
party any representation, warranty and/or covenant not set forth herein and that
this Agreement constitutes the entire agreement between the parties.
10.2 Except as specified in the next sentence set forth in this section
10.2, the representation, warranties, and covenants contained in this Agreement
or in any document delivered pursuant to or in connection with this Agreement,
shall not survive the consummation of the transactions contemplated hereunder.
The covenants to be performed after the Closing Date, and the obligations of
each of the Acquiring Funds in sections 5.8 and 6.4, shall continue in effect
beyond the consummation of the transactions contemplated hereunder.
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ARTICLE XI
TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of the Trust
and the Corporation. In addition, either the Trust or the Corporation may at its
option terminate this Agreement at or prior to either Closing Date due to:
(a) a breach by the other of any representation, warranty, or
agreement contained herein to be performed at or prior to the Closing Date, if
not cured within 30 days;
(b) a condition herein expressed to be precedent to the obligations
of the terminating party that has not been met and it reasonably appears that it
will not or cannot be met; or
(c) a determination by the parties' Board of Directors or Board of
Trustees, as appropriate, that the consummation of the transactions contemplated
herein is not in the best interest of the Corporation or the Trust,
respectively, and to give notice to the other party hereto.
11.2 In the event of any such termination, in the absence of willful
default, there shall be no liability for damages on the part of either an
Acquiring Fund, a Selling Fund, the Trust, the Corporation, the respective
Trustees, Directors or officers, to the other party or its Trustees, Directors
or officers.
ARTICLE XII
AMENDMENTS
12.1 This Agreement may be amended, modified, or supplemented in such
manner as may be mutually agreed upon in writing by the authorized officers of
each Selling Fund and Acquiring Fund; provided, however, that following the
meeting of the Selling Fund Shareholders called by a Selling Fund pursuant to
paragraph 5.2 of this Agreement, no such amendment may have the effect of
changing the provisions for determining the number of Acquiring Fund Shares to
be issued to the Selling Fund Shareholders under this Agreement to the detriment
of such shareholders without their further approval.
ARTICLE XIII
HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT;
LIMITATION OF LIABILITY
13.1 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.
13.2 This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
13.3 This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Massachusetts, without giving effect to the
conflicts of laws provisions thereof; provided, however, that the due
authorization, execution and delivery of this Agreement, in the case of each
Selling Fund, shall be governed and construed in accordance with the laws of the
State of Maryland, without giving effect to the conflicts of laws provisions
thereof.
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13.4 This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but, except as provided in
this paragraph, 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.
13.5 It is expressly agreed that the obligations of each Acquiring Fund
hereunder shall not be binding upon any of the Trustees, shareholders, nominees,
officers, agents, or employees of the Trust personally, but shall bind only the
trust property of the Acquiring Fund, as provided in the Agreement and
Declaration of Trust of the Trust. The execution and delivery of this Agreement
have been authorized by the Trustees of the Trust on behalf of each Acquiring
Fund and signed by authorized officers of the Trust, acting as such. Such
authorization by such Trustees nor such 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 each Acquiring Fund as provided in the Trust's Agreement and Declaration of
Trust.
IN WITNESS WHEREOF, the parties have duly executed this Agreement, all as
of the date first written above.
STI CLASSIC FUNDS
By: _________________________________
Name: [Insert Name]
Title: [Insert Title]
SEIX FUNDS, INC.
By: _________________________________
Name: [Insert Name]
Title: [Insert Title]
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SCHEDULE A
SUMMARY OF THE REORGANIZATION
(shareholders of each Selling Fund will receive shares of the
class of the Acquiring Fund opposite their current class)
SEIX FUND (SELLING FUND) STI CLASSIC FUND (ACQUIRING FUND)*
------------------------- ----------------------------------
Core Bond Fund STI Classic Institutional Core Bond Fund
Class I Institutional Shares
Class P A Shares
Intermediate Bond Fund STI Classic Institutional Intermediate Bond Fund
Class I Institutional Shares
High Yield Fund Seix Institutional High Yield Fund
Class I Institutional Shares
Class P A Shares
Limited Duration Fund STI Classic Institutional Limited Duration Fund
Class I Institutional Shares
* The Acquiring Funds are newly created series of the STI Classic Funds.
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