Each series of RS Investment Trust (the "Trust") was reorganized
into newly created corresponding series of Victory Portfolios, a
registered investment company, effective July 29, 2016,
following approval by the shareholders and Board of Trustees of the
Trust.
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is
made as of June 1, 2016, by and among Victory Portfolios,
a Delaware statutory trust (the "Acquiring Trust"), on behalf of each
series portfolio set forth on Schedule A (each, an "Acquiring Fund"),
and RS Investment Trust, a Massachusetts business trust (the
"Acquired Trust"), on behalf of each series portfolio set forth on
Schedule A (each, an "Acquired Fund"), and, for purposes of Section
9.2 only, Victory Capital Management Inc. ("Victory Capital") and
RS Investment Management Co. LLC ("RSIM"). The capitalized terms
used herein shall have the meaning ascribed to them in this Agreement.
This Agreement applies to each reorganization between an
Acquired Fund and its corresponding Acquiring Fund as if each
reorganization is the subject of a separate agreement. Each
Acquired Fund and the Acquired Trust, acting for itself and on
behalf of each Acquired Fund, and each Acquiring Fund and the
Acquiring Trust, acting for itself and on behalf of each Acquiring
Fund, is acting separately from all of the other parties and their
series, and not jointly or jointly and severally with any other party.
This Agreement is intended to be, and is adopted as, a plan
of reorganization and liquidation within the meaning of Section 368(a)
of the United States Internal Revenue Code of 1986, as amended (the
"Code"). The reorganization (the "Reorganization") will consist of:
(i) the transfer of all of the assets of the Acquired
Fund in exchange solely for Class A shares of the
Acquiring Fund ("Class A Acquisition Shares"), Class
C shares of the Acquiring Fund ("Class C Acquisition
shares"), Class R shares of the Acquiring Fund ("Class
R Acquisition shares") and Class Y shares of the
Acquiring Fund ("Class Y Acquisition shares, and,
collectively with the Class A Acquistion shares, the
Class C Acquisition shares, and the Class R Acquisition
shares, the "Acquiring Fund Shares") of beneficial
interest, $0.001 par value per share, of Acquiring Fund;
(ii) the assumption by the Acquiring Fund of all of the
liabilities (as hereinafter defined) of the Acquired
Fund; and
(iii) the distribution, after the closing date provided in
Section 3.1 (the "Closing Date"), of, as applicable,
each of the Class A Acquisition Shares pro rata to
each of the Class A shareholders of the Acquired Fund,
each of the Class C Acquisition Shares pro rata to
each of the Class C shareholders of the Acquired Fund,
each of the Class R Acquisition Shares pro rata to
each of the Class K shareholder of the Acquired Fund,
and each of the Class Y Acquisition Shares pro rata to
each of of the Class Y shareholders of the Acquired Fund,
and the termination, dissolution and complete
liquidation of the Acquired Fund as provided herein,
all upon the terms and conditions hereinafter set forth
in this Agreement.
WHEREAS, each of the Acquired Fund and the Acquiring
Fund is a separate series of an open-end, registered
investment company of the management type;
WHEREAS, the Board of Trustees of the Acquiring Trust
has determined that the exchange of all of the assets
of the Acquired Fund for the Acquiring Fund Shares and
the assumption of all of the liabilities of the Acquired
Fund by the Acquiring Fund on the terms and conditions
hereinafter set forth are in the best interests of the
Acquiring Fund and that the interests of the Acquiring
Fund's existing shareholders will not be diluted as a
result of the transactions contemplated hereby; and
WHEREAS, the Board of Trustees of the Acquired Trust
has determined that such exchange is in the best
interests of the Acquired Fund and that the interests
of the Acquired Fund's existing shareholders will not
be diluted as a result of the transactions contemplated
herein;
NOW, THEREFORE, in consideration of the premises and of
the covenants and agreements hereinafter set forth, the
parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR
ASSUMPTION OF LIABILITIES AND THE ACQUIRING FUND SHARES AND
LIQUIDATION OF THE ACQUIRED FUND.
1.1. Subject to the terms and conditions hereof and on the basis of
the representations and warranties contained herein:
(a) The Acquired Fund will sell, assign, convey, transfer and
deliver to the Acquiring Fund, and the Acquiring Fund will
acquire, on the Closing Date, all of the properties and
assets of the Acquired Fund as set forth in Section 1.2.
(b) In consideration therefor, the Acquiring Fund shall, on the
Closing Date, (i) issue and deliver to the Acquired Fund,
as applicable, shares of a corresponding class of the
Acquiring Fund (including fractional shares of any),
having a net asset value equal to the net asset
value of, as applicable, the corresponding Acquiring Fund
Class, computed in the manner and as of the time and date
set forth in Section
2.2., as follow:
Acquired Fund Class Acquiring Fund Class
A A
C C
R K
Y Y
and and (ii) assume all of the liabilities of the Acquired
Fund as of the Closing Date (as defined in Section 3.1).
Such transactions shall take place at the closing provided
for in Section 3 (the "Closing").
(c) Upon consummation of the transactions described in subsections
(a) and (b) above, the Acquired Fund in complete liquidation
shall distribute to its shareholders of record as of the
Closing Date the Acquiring Fund Shares received by it, each
shareholder being entitled to receive that number of, as
applicable, Class A Acquisition Shares, Class C Acquisition
Shares, Class R Acquisition Shares or Class Y Acquisition
Shares equal to the total of (i) the number of Class A,
Class C, Class K or Class Y shares, as applicable, of the
Acquired Fund (the "Acquired Fund Shares") held by
such shareholder divided by the number of such Class A,
Class C, Class K shares or Class Y shares, as applicable, of
the Acquired Fund outstanding on such date multiplied by (ii)
the total number of Class A Acquisition Shares, Class C
Acquisition Shares, Class R Acquisition Shares, or Class
Y Acquisition Shares, as applicable, as of the Closing Date.
1.2. The assets of the Acquired Fund to be acquired by the
Acquiring Fund shall consist of all cash, securities, dividends and
interest receivable, receivables for shares sold and all other
properties and assets which are owned by the Acquired Fund on the
Closing Date and any deferred expenses, other than any unamortized
organizational expenses, shown as an asset on the books of the
Acquired Fund on the Closing Date.
1.3. As provided in Section 3.4, as soon after the Closing Date
as is conveniently practicable (the "Liquidation Date"), the
Acquired Fund will liquidate and distribute pro rata, as applicable,
to its Class A shareholders of record the Class A Acquisition Shares
received by the Acquired Fund as contemplated by Section 1.1; to its
Class C shareholders of record the Class C Acquisition Shares received
by the Acquired Fund as contemplated by Section 1.1; to its Class K
shareholders of record the Class R Acquisition Shares received by the
Acquired Fund as contemplated by Section 1.1.; and to its Class Y
shareholders of record the Class Y Acquisition Shares received by the
Acquired Fund as contemplated by Section 1.1. Such liquidation and
distribution will be accomplished by the transfer of the Acquiring
Fund Shares then credited to the account of the Acquired Fund on the
books of the Acquiring Fund to open accounts on the share records of
the Acquiring Fund in the names of Acquired Fund shareholders and
representing the respective pro rata number of the Acquiring Fund
Shares due to such shareholders. The Acquiring Fund shall not be
obligated to issue certificates representing the Acquiring Fund
Shares in connection with such exchange.
1.4. With respect to the Acquiring Fund Shares distributable
pursuant to Section 1.3 to an Acquired Fund shareholder holding a
certificate or certificates for shares of the Acquired Fund, if any,
on the Valuation Date, the Acquiring Fund will not permit such
shareholder to receive Acquiring Fund Share certificates therefor,
exchange such Acquiring Fund Shares for shares of other series of
the Acquiring Trust, effect an account transfer of such Acquiring Fund
Shares, or pledge or redeem such Acquiring Fund Shares until the
Acquiring Fund has been notified by the Acquired Fund or its agent
that such Acquired Fund shareholder has surrendered all his or her
outstanding certificates for Acquired Fund Shares or, in the event of
lost certificates, posted adequate bond.
1.5. As soon as practicable after the Closing Date, the Acquired
Fund shall make all filings and take all other steps as shall be
necessary and proper to effect its complete liquidation. As promptly
as practicable after the liquidation of the Acquired Fund and the
liquidation of all other outstanding series of shares of the Acquired
Trust, the Acquired Trust shall be dissolved pursuant to the provisions
of the Acquired Trust's Declaration of Trust and Bylaws, as amended,
and applicable law, and its legal existence terminated. Any reporting
responsibility of the Acquired Fund is and shall remain the
responsibility of the Acquired Fund up to and including the Closing
Date and thereafter.
1.6. Any and all obligations or liabilities arising under or in
respect of this Agreement shall be those of the Acquired Fund or the
Acquiring Fund, as the case may be, and shall not otherwise be
obligations or liabilities of the Acquired Trust or the Acquiring
Trust, and, for clarity, under no circumstances will any other series
of the Acquired Trust or the Acquiring Trust have any obligation or
liability under or in respect of this Agreement or the transactions
contemplated hereby.
2. VALUATION.
2.1. On the Closing Date, the Acquiring Fund will deliver to
the Acquired Fund a number of, as applicable, Class A Acquisition
Shares, Class C Acquisition Shares, Class R Acquisition Shares and
Class Y Acquisition Shares (including fractional shares, if any)
having a net asset value equal to the value of the assets acquired
by the Acquiring Fund on the Closing Date attributable to, as
applicable, the Class A, Class C, Class K and Class Y shares,
respectively, of the Acquired Fund, less the value of the
liabilities of the Acquired Fund attributable to, as applicable,
the Class A, Class C, Class K shares and Class Y shares,
respectively, of the Acquired Fund, determined as hereafter
provided in this Section 2.
2.2. The value of the Acquired Fund's net assets will be computed
as of the Valuation Date using the valuation procedures for the
Acquiring Fund set forth in the Acquiring Trust's currently-effective
Agreement and Declaration of Trust (the "Acquiring Trust's Trust
Instrument") and the Acquiring Fund's then current prospectus or
prospectuses and statement of additional information (collectively,
as amended or supplemented from time to time, the "Acquiring Fund
Prospectus").
2.3. The Valuation Date shall be 4:00 p.m. Eastern time on the
Closing Date, or such other date and time as may be mutually agreed
upon in writing by the parties hereto (the "Valuation Date").
2.4. The Acquiring Fund shall issue the Acquiring Fund Shares
to the Acquired Fund on one share deposit receipt registered in
the name of the Acquired Fund. The Acquired Fund shall distribute
in liquidation, as applicable, the Class A Acquisition Shares, Class
C Acquisition Shares, Class R Acquisition Shares and Class Y
Acquisition Shares received by it hereunder pro rata to, as
applicable, its Class A, Class C, Class K and Class Y shareholders,
respectively, by redelivering such share deposit receipt to the
Acquiring Trust's transfer agent which will as soon as practicable
set up open accounts for Acquired Fund shareholders in
accordance with written instructions furnished by the Acquired Fund.
2.5. The Acquired Fund will pay or cause to be paid to the
Acquiring Fund any interest, cash or such dividends, rights and
other payments received by it on or after the Closing Date with
respect to the Investments and other properties and assets of the
Acquired Fund, whether accrued or contingent, received by it on or
after the Closing Date. Any such distribution shall be deemed
included in the assets transferred to the Acquiring Fund at the
Closing Date and shall not be separately valued unless the securities
in respect of which such distribution is made shall have gone
"ex-dividend" prior to the Valuation Date, in which case any such
distribution which remains unpaid at the Closing Date shall be
included in the determination of the value of the assets of the
Acquired Fund acquired by the Acquiring Fund.
2.6. All computations of value shall be made by the pricing
agent for the Acquiring Fund, in accordance with its regular
practice in pricing the shares and assets of the Acquiring Fund
using the valuation procedures set forth in the Acquiring Trust's
Trust Instrument and the Acquiring Fund Prospectus.
3. CLOSING AND CLOSING DATE.
3.1. The Closing Date shall be July 29, 2016, at such time after
4:00 p.m. Eastern time as the parties may agree, or at such other
date and time to which the parties may agree. The Closing shall be
held at the offices of Victory Capital or at such other place as
the parties may agree.
3.2. The portfolio securities of the Acquired Fund shall be
made available by the Acquired Fund to State Street Bank and Trust
Company as custodian for the Acquiring Fund (the "Custodian"), for
examination no later than five business days preceding the
Valuation Date. On the Closing Date, such portfolio securities
and all the Acquired Fund's cash shall be delivered by the
Acquired Fund to the Custodian for the account of the Acquiring
Fund, such portfolio securities to be duly endorsed in proper form
for transfer in such manner and condition as to constitute good
delivery thereof in accordance with the custom of brokers or, in
the case of portfolio securities held in the U.S. Treasury
Department's book-entry system or by The Depository Trust Company,
Participants Trust Company or other third party depositories, by
transfer to the account of the Custodian in accordance with Rule
17f-4, Rule 17f-5 or Rule 17f-7, as the case may be, under the
Investment Company Act of 1940, as amended (the "1940 Act"), and
accompanied by all necessary federal and state stock transfer
stamps or a check for the appropriate purchase price thereof.
The cash delivered shall be in the form of currency or certified
or official bank checks, payable to the order of "State
Street Bank and Trust Company custodian for [?] Fund."
3.3. In the event that on the Valuation Date (a) the New York
Stock Exchange shall be closed to trading or trading thereon
shall be restricted, or (b) trading or the reporting of trading
on said Exchange or elsewhere shall be disrupted so that accurate
appraisal of the value of the net assets of the Acquired Fund or the
Acquiring Fund is impracticable, the Closing Date shall be postponed
until the first business day after the day when trading shall have
been fully resumed and reporting shall have been restored; provided
that if trading shall not be fully resumed and reporting restored
within three business days after the Valuation Date, this Agreement
may be terminated by the Acquiring Fund or the Acquired Fund upon
the giving of written notice to the other parties.
3.4. At the Closing, the Acquired Fund, or its transfer agent,
shall deliver to the Acquiring Fund, or its designated agent, a
list of the names and addresses of the Acquired Fund shareholders
and the number of outstanding shares of the Acquired Fund owned by
each Acquired Fund shareholder, all as of the close of business on
the Valuation Date, certified by any duly elected officer of the
Acquired Trust on behalf of the Acquired Fund. The Acquiring Fund
will provide to the Acquired Fund evidence reasonably satisfactory
to the Acquired Fund that the Acquiring Fund Shares issuable
pursuant to Section 1.1 have been credited to the Acquired Fund's
account on the books of the Acquiring Fund. On the Liquidation
Date, the Acquiring Fund will provide to the Acquired Fund evidence
reasonably satisfactory to the Acquired Fund that such Acquiring Fund
Shares have been credited pro rata to open accounts in the names of
Acquired Fund shareholders as provided in Section 1.3.
3.5. At the Closing, each party shall deliver to the other such
bills of sale, instruments of assumption of liabilities, checks,
assignments, stock certificates, receipts or other documents as such
other party or its counsel may reasonably request in connection with
the transfer of assets, assumption of liabilities and liquidation
contemplated by Section 1.
4. REPRESENTATIONS AND WARRANTIES.
4.1. Representations and Warranties of the Acquired Trust, on
behalf of the Acquired Fund.
The Acquired Trust, on behalf of the Acquired Fund, represents and
warrants the following to the Acquiring Fund as of the date hereof
and agrees to confirm the continuing accuracy and completeness in
all material respects of the following on the
Closing Date:
(a) The Acquired Trust is a business trust duly organized and
validly existing under the laws of The Commonwealth of
Massachusetts and has power to own all of its properties
and assets and to carry out its obligations under this
Agreement. The Acquired Trust is not required to qualify as
a foreign entity in any jurisdiction where it is not so
qualified and the failure to so qualify would have a material
adverse effect on the Acquired Fund. The Acquired Fund has
all necessary federal, state and local authorizations to
carry on its business as now being conducted.
(b) The Acquired Trust is duly registered under the 1940 Act, as
a management company of the open-end type, and such
registration has not been revoked or rescinded and is in full
force and effect, and the Acquired Fund is a separate series
thereof duly designated in accordance with the applicable
provisions of the Declaration of Trust of the Acquired Trust,
as amended, and the 1940 Act.
(c) The Acquired Fund is not in violation in any material respect
of any provisions of the Acquired Trust's Declaration of Trust
or Bylaws, each as amended, or any agreement, indenture,
instrument, contract, lease or other undertaking to which the
Acquired Fund is a party or by which the Acquired Fund or its
assets are bound, and the execution, delivery and performance of
this Agreement will not result in any such violation.
(d) The Acquired Fund's current prospectuses and statements of
additional information (collectively, as amended or supplemented
from time to time, the "Acquired Fund Prospectus") conform in
all material respects to the applicable requirements of the
Securities Act of 1933, as amended (the "1933 Act"), and the
1940 Act and the rules and regulations of the Securities and
Exchange Commission (the "Commission") thereunder and do not
include any untrue statement of a material fact or omit to state
any material fact relating to either the Acquired Trust or the
Acquired Fund required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading.
(e) At the Closing Date, the Acquired Fund will have good and
marketable title to the Acquired Fund's assets to be transferred
to the Acquiring Fund pursuant to Section 1.2.
(f) No material litigation, administrative or other proceedings or
investigation is presently pending or, to the knowledge of the
Acquired Trust or the Acquired Fund, threatened as to the
Acquired Fund or any of its properties or assets or any
person whom the Acquired Fund may be obligated to directly or
indirectly indemnify in connection with such litigation,
proceedings or investigation. Neither the Acquired Trust nor
the Acquired Fund knows of any facts which might form the
basis for the institution of such proceedings and neither the
Acquired Trust nor the Acquired 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 its business or its ability to consummate the
transactions contemplated hereby.
(g) The statements of assets and liabilities, statements of
operations, statements of changes in net assets and
schedules of portfolio investments (indicating their market
values) of the Acquired Fund at, as of and for the
fiscal year ended December 31, 2015, audited by
PricewaterhouseCoopers, independent registered public
accounting firm to the Acquired Fund, copies of which have
been furnished to the Acquiring Fund, fairly reflect the
financial condition and results of operations of the
Acquired Fund as of such date and for the period then ended
in accordance with accounting principles generally accepted
in the United States consistently applied, and the Acquired
Fund has no known liabilities of a material amount,
contingent or otherwise, other than those shown on the
statements of assets and liabilities referred to above or
those incurred in the ordinary course of its business since
December 31, 2015. Prior to the Closing Date, the Acquired
Fund will endeavor to quantify and reflect on its statements
of assets and liabilities all of its material known
liabilities and will advise the Acquiring Fund of all material
liabilities, contingent or otherwise, incurred by it subsequent
to December 31, 2015, whether or not incurred in the ordinary
course of business.
(h) Since December 31, 2015, there has not been any material
adverse change in the Acquired Fund's financial condition,
assets, liabilities or business (other than changes occurring
in the ordinary course of business).
(i) As of the Closing Date, all federal and other tax returns and
reports of the Acquired Fund required by law to have been
filed by such date (giving effect to extensions) shall have
been timely filed and were true, correct and complete in all
material respects as of the time of their filing, and all
taxes of the Acquired Fund which are due and payable shall
have been timely paid. The Acquired Fund is not liable for
taxes of any person other than itself and is not a party to
any tax sharing or allocation agreement. All of the Acquired
Fund's tax liabilities will have been adequately provided
for on its books. To the best of the Acquired Trust's or the
Acquired Fund's knowledge, the Acquired Fund has not had any
tax deficiency or liability asserted against it or question
with respect thereto raised, and it is not under audit by the
Internal Revenue Service or by any state or local tax
authority for taxes in excess of those already paid.
(j) The Acquired Fund has met the requirements of subchapter M of
the Code for treatment as a "regulated investment company"
within the meaning of Section 851 of the Code in respect of
each taxable year since the commencement of operations, and
will continue to meet such requirements at all times through
the Closing Date treating the Closing Date as the close of
its tax year if the year does not otherwise close on such
date. The Acquired Fund has not at any time since its
inception been liable for nor is now liable for any material
income or excise tax pursuant to Section 852 or 4982 of the
Code. There is no other tax liability (foreign, state, local)
except as accrued on the Acquired Fund's books. The Acquired
Fund has no earnings and profits accumulated with respect
to any taxable year in which the provisions of Subchapter M
of the Code did not apply. The Acquired Fund will not be
subject to corporate-level taxation on the sale of any assets
currently held by it as a result of the application of Section
337(d) of the Code and the regulations thereunder. All
dividends paid by the Acquired Fund at any time prior to the
Closing Date shall have been deductible pursuant to the
dividends paid deduction under Section 562 of the Code.
Except as otherwise disclosed in writing to the Acquiring Fund,
the Acquired Fund is in compliance in all material
respects with applicable regulations of the Internal Revenue
Service pertaining to the reporting of dividends and other
distributions on and redemptions of its capital stock and has
withheld in respect of dividends and other distributions and
paid to the proper taxing authority all taxes required to be
withheld, and is not liable for any penalties which could be
imposed thereunder.
(k) The Acquired Fund has not received written notification from
any tax authority that asserts a position contrary to any of
the above representations.
(l) The authorized capital of the Acquired Trust consists of an
unlimited number of shares of beneficial interest, no par
value, of such number of different series as the Board of
Trustees of the Acquired Trust may authorize from time to
time. The outstanding shares of beneficial interest of the
Acquired Fund are divided into, as applicable, Class A,
Class C, Class K, and Class Y each having the
characteristics described in the Acquired Fund Prospectus and
will, at the time of the Closing Date, be held by the persons
and in the amounts set forth in the records of the transfer
agent as provided in Section 3.4. All issued and outstanding
shares of the Acquired Fund are, and at the Closing Date will
be, duly and validly issued and outstanding, fully paid and
non-assessable by the Acquired Fund (except as set forth in
the Acquired Fund Prospectus), and will have been issued in
compliance with all applicable registration or qualification
requirements of federal and state securities laws. No options,
warrants or other rights to subscribe for or purchase, or
securities convertible into, any shares of the Acquired Fund
are outstanding.
(m) The execution, delivery and performance of this Agreement
have been duly authorized by the Board of Trustees of the
Acquired Trust and by all other necessary trust action on the
part of the Acquired Trust and the Acquired Fund, other than
shareholder approval as required by Section 8.1 hereof, and
subject to such shareholder approval, this Agreement
constitutes the valid and binding obligation of the Acquired
Trust and the Acquired Fund enforceable in accordance with its
terms, except as the same may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally and other equitable
principles.
(n) The Acquiring Fund Shares to be issued to the Acquired Fund
pursuant to the terms of this Agreement will not be acquired
for the purpose of making any distribution thereof other than
to Acquired Fund shareholders as provided in Section 1.1(c).
(o) The information relating to the Acquired Trust and the
Acquired Fund furnished in writing by the Acquired Trust and
the Acquired Fund to the Acquiring Trust 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 hereby is and
will be accurate and complete in all material respects and
complies in all material respects with federal securities
laws and regulations thereunder applicable thereto.
(p) As of the date of this Agreement, the Acquired Trust and the
Acquired Fund have provided the Acquiring Fund with information
relating to the Acquired Trust and the Acquired Fund reasonably
necessary for the preparation of prospectuses, including the
proxy statement of the Acquired Fund (the "Prospectus/Proxy
Statement"), to be included in a Registration Statement on Form
N-14 of the Acquiring Trust (the "Registration Statement"), in
compliance with the 1933 Act, the Securities Exchange Act of
1934, as amended, (the "1934 Act") and the 1940 Act in
connection with the meeting of shareholders of the Acquired
Fund to approve this Agreement and the transactions
contemplated hereby. As of the effective date of the
Registration Statement, the date of the meeting of shareholders
of the Acquired Fund and the Closing Date, the Prospectus/Proxy
Statement, including the documents contained or incorporated
therein by reference, insofar as it contains information
relating to the Acquired Trust or the Acquired Fund furnished
to the Acquiring Trust in writing for inclusion therein, will
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances
under which such statements were made, not misleading.
(q) There are no material contracts outstanding to which the
Acquired Fund is a party, other than as disclosed in the
Acquired Fund Prospectus or in the Registration Statement.
(r) No consent, approval, authorization or order of any court or
governmental authority is required for the consummation by the
Acquired Fund of the transactions contemplated by this Agreement,
except such as may be required under the 1933 Act, the 1934 Act,
the 1940 Act, state securities or blue sky laws (which term as
used herein shall include the laws of the District of Columbia
and of Puerto Rico).
(s) As of both the Valuation Date and the Closing Date, the Acquired
Fund will have full right, power and authority to sell, assign,
transfer and deliver the Investments (as defined below) and any
other assets and liabilities of the Acquired Fund to be
transferred to the Acquiring Fund pursuant to this Agreement.
At the Closing Date, subject only to the delivery of the
Investments and any such other assets and liabilities as
contemplated by this Agreement, the Acquiring Fund will acquire
the Investments and any such other assets subject to no
encumbrances, liens or security interests in favor of any third
party creditor of the Acquired Fund, and without any
restrictions upon the transfer thereof. As used in this
Agreement, the term "Investments" shall mean the Acquired
Fund's investments shown on the audited schedule of its
portfolio investments as of December 31, 2015, referred to
in Section 4.1(g) hereof, as supplemented with such changes as
the Acquired Fund shall make after December 31, 2015, which
changes shall be disclosed to the Acquiring Fund in an updated
schedule of investments, and changes resulting from stock
dividends, stock split-ups, mergers and similar corporate
actions through the Closing Date.
(t To the best of the Acquired Trust's and the Acquired Fund's
knowledge, all of the issued and outstanding shares of the
Acquired Fund shall have been offered for sale and sold in
conformity with all applicable federal and state securities
laws (including any applicable exemptions therefrom), or
the Acquired Fund has taken any action necessary to remedy
any prior failure to have offered for sale and sold such
shares in conformity with such laws.
4.2. Representations and Warranties of the Acquiring Trust and
the Acquiring Fund.
The Acquiring Trust, on behalf of the Acquiring Fund, represents and
warrants the following to the Acquired Fund as of the date hereof and
agrees to confirm the continuing accuracy and completeness in all
material respects of the following on the Closing Date:
(a) The Acquiring Trust is a statutory trust duly organized and
validly existing under the laws of the state of Delaware and
has power to own all of its properties and assets and to
carry out its obligations under this Agreement. The Acquiring
Trust is not required to qualify as a foreign entity in any
jurisdiction where it is not so qualified and the failure so
to qualify would have a material adverse effect on the
Acquiring Fund. The Acquiring Fund has all necessary federal,
state and local authorizations to carry on its business as
now being conducted.
(b) The Acquiring Trust is duly registered under the 1940 Act, as
a management company of the open-end type, and such
registration has not been revoked or rescinded and is in full
force and effect, and the Acquiring Fund is a separate series
thereof duly designated in accordance with the applicable
provisions of the Acquiring Trust's Trust Instrument and the
1940 Act.
(c) The Acquiring Fund is not in violation in any material respect
of any provisions of the Acquiring Trust's Trust Instrument or
Bylaws, each as amended, or any agreement, indenture,
instrument, contract, lease or other undertaking to which the
Acquiring Fund is a party or by which the Acquiring Fund or
its assets are bound, and the execution, delivery and
performance of this Agreement will not result in any such
violation.
(d) As of the Closing Date, the Acquiring Fund Prospectus will
conform in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules
and regulations of the Commission thereunder and will not
include any untrue statement of a material fact or omit to
state any material fact relating to the Acquiring Trust or
the Acquiring Fund required to be stated therein or necessary
to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(e) No material litigation, administrative or other proceedings
or investigation is presently pending or, to the knowledge
of the Acquiring Trust or the Acquiring Fund, threatened as
to the Acquiring Fund or any of its properties or assets or
any person whom the Acquiring Fund may be obligated to
directly or indirectly indemnify in connection with such
litigation, proceedings or investigation. Neither the
Acquiring Trust nor the Acquiring Fund knows of any facts
which might form the basis for the institution of such
proceedings and neither the Acquiring Trust nor the
Acquiring 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 its business or
its ability to consummate the transactions contemplated
hereby.
(f) The Acquiring Fund has not yet commenced investment
operations and has no known liabilities of a material nature,
contingent or otherwise.
(g) The Acquiring Fund was established in order to effect the
transactions described in this Agreement, and, prior to the
Closing Date, will not have carried on any business activities
(other than such activities as are customary to the
organization of a new series of a registered investment
company prior to its commencement of operations). It has not
yet filed its first federal income tax return and, thus, has
not yet elected to be treated as a "regulated investment
company" for federal income tax purposes. However, upon filing
its first federal income tax return following the completion of
its first taxable year, the Acquiring Fund will elect to be a
"regulated investment company" and until such time will take all
steps necessary to ensure that it qualifies for treatment as a
"regulated investment company" under Sections 851 and 852 of the
Code.
(h) The authorized capital of the Acquiring Trust consists of an
unlimited number of shares of beneficial interest, $0.001 par
value, of such number of different series as the Board of
Trustees of the Acquiring Trust may authorize from time to time.
As of the date of this Agreement, the Acquiring Fund has no
outstanding shares of any class. As of the Closing Date, the
outstanding shares of beneficial interest of the Acquiring Fund
will be divided into, as applicable, Class A, Class C, Class R
and Class Y shares, each having the characteristics
described in the Acquiring Fund Prospectus. No options,
warrants or other rights to subscribe for or purchase, or
securities convertible into, any shares of the Acquiring Fund
are outstanding.
(i) The execution, delivery and performance of this Agreement has
been duly authorized by the Board of Trustees of the Acquiring
Trust and by all other necessary trust action on the part of
the Acquiring Trust and the Acquiring Fund, and constitute the
valid and binding obligation of the Acquiring Trust and the
Acquiring Fund enforceable in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement
of creditors'rights generally and other equitable principles.
(j) The Acquiring Fund Shares to be issued and delivered to the
Acquired Fund pursuant to the terms of this Agreement will at
the Closing Date have been duly authorized and, when so issued
and delivered, will be duly and validly issued, as applicable,
Class A, Class C, Class R and Class Y shares of beneficial
interest in the Acquiring Fund, and will be fully paid and
non-assessable (except as set forth in the Acquiring Fund
Prospectus) by the Acquiring Fund and will have
been issued in compliance with all applicable registration or
qualification requirements of federal and state securities laws,
and no shareholder of the Acquiring Fund will have any
preemptive right of subscription or purchase in respect thereof.
(k) The information furnished by the Acquiring Trust and 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 hereby is and will be accurate and
complete in all material respects and complies in all material
respects with federal securities laws and regulations thereunder
applicable thereto.
(l) As of the effective date of the Registration Statement, the
date of the meeting of shareholders of the Acquired Fund and
the Closing Date, the Prospectus/Proxy Statement, including
the documents contained or incorporated therein by reference,
insofar as it relates to the Acquiring Trust and the Acquiring
Fund, will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which such statements were made, not
misleading.
(m) There are no material contracts outstanding to which the
Acquiring Fund is a party, other than as disclosed in the
Acquiring Fund Prospectus and the Registration Statement.
(n) The books and records of the Acquiring Fund made available
to the Acquired Fund and/or its counsel are substantially
true and correct and contain no material misstatements or
omissions with respect to the operations of the Acquiring
Fund.
(o) No consent, approval, authorization or order of any court
or governmental authority is required for the consummation
by the Acquiring Fund of the transactions contemplated by
this Agreement, except such as may be required under the
1933 Act, the 1934 Act, the 1940 Act, state securities
or blue sky laws.
5. COVENANTS OF THE PARTIES.
5.1. The Acquired Trust and the Acquiring Trust, and the Acquired
Fund and the Acquiring Fund each will operate its business in the
ordinary course between the date hereof and the Closing Date, it
being understood that, with respect to the Acquired Fund, such
ordinary course of business will include purchases and sales
of portfolio securities, sales and redemptions of Acquired Fund
Shares, and regular and customary periodic dividends and distributions,
and with respect to the Acquiring Fund, it shall be limited to such
actions as are customary to the organization of a new series prior to
its commencement of investment operations.
5.2. The Acquired Trust will call a meeting of the Acquired Fund
shareholders as soon as practicable after the date of filing the
Registration Statement to be held prior to the Closing Date for the
purpose of considering the sale of all of its assets to and the
assumption of all of its liabilities by the Acquiring Fund as herein
provided, adopting this Agreement and authorizing the liquidation of
the Acquired Fund, and taking all other action necessary to obtain
the required shareholder approval of the transactions contemplated
hereby.
5.3. In connection with the Acquired Fund shareholders' meeting
referred to in Section 5.2, the Acquiring Trust will prepare the
Registration Statement and Prospectus/Proxy Statement for such meeting,
which the Acquiring Trust will file for the registration under the
1933 Act of the Acquiring Fund Shares to be distributed to Acquired
Fund shareholders pursuant hereto, all in compliance with the
applicable requirements of the 1933 Act, the 1934 Act and the ▇▇▇▇ ▇▇▇.
5.4. Each of the Acquired Trust, the Acquired Fund, the Acquiring
Trust and the Acquiring Fund will cooperate with the others, and each
will furnish to the others the information relating to itself required
by the 1933 Act, the 1934 Act and the 1940 Act and the rules and
regulations thereunder to be set forth in the Registration Statement,
including the Prospectus/Proxy Statement.
5.5. The Acquiring Fund shall, on behalf of the Acquired Fund,
cause to be timely filed tax returns (taking into account extensions)
required to be filed with respect to the Acquired Fund for the taxable
year ending on December 31, 2015 and shall cause to be paid any taxes
shown as due thereon. The parties shall reasonably cooperate with each
other in connection with the tax preparation and filing of tax returns
with respect to the Acquired Fund that are due after the Closing Date.
5.6. The Acquiring Fund will use all reasonable efforts to obtain
the approvals and authorizations required by the 1933 Act, the 1940 Act
and such of the state securities or blue sky laws as it may deem
appropriate in order to continue its operations after the Closing Date.
5.7. The Acquired Trust and the Acquired Fund agree that the
liquidation of the Acquired Fund will be effected in the manner provided
in the Acquired Trust's Declaration of Trust and Bylaws, each as
amended, in accordance with applicable law, and that on and after the
Closing Date, the Acquired Fund shall not conduct any business except
in connection with its liquidation.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND.
The obligations of the Acquiring Trust and the Acquiring Fund to
complete the transactions provided for herein shall be subject, at their
election, to the performance by the Acquired Trust and the Acquired Fund
of all the obligations to be performed by them hereunder on or before
the Closing Date and, in addition thereto, to the following further
conditions:
6.1. The Acquired Trust and the Acquired Fund shall have delivered to
the Acquiring Fund a certificate executed on their behalf by the
Acquired Trust's duly authorized officer, in form and substance
reasonably satisfactory to the Acquiring Fund and dated as of the
Closing Date, to the effect that the representations and warranties of
the Acquired Trust and the Acquired Fund made in this Agreement are true
and correct at and as of the Closing Date, except as they may be affected
by the transactions contemplated by this Agreement, and that the Acquired
Trust and the Acquired Fund have complied with all the covenants and
agreements and satisfied all of the conditions on their parts to be
performed or satisfied under this Agreement at or prior to the Closing
Date.
6.2. The Acquired Fund shall have furnished to the Acquiring Fund a
statement of the Acquired Fund's assets and liabilities, with values
determined as provided in Section 2 of this Agreement, together with a
list of Investments with their respective tax costs, all as of the
Valuation Date, certified on the Acquired Fund's behalf by the Acquired
Trust's duly authorized officer, and a certificate of both such officers,
dated the Closing Date, to the effect that as of the Valuation Date
and as of the Closing Date there has been no material adverse change in
the financial position of the Acquired Fund since December 31, 2015.
6.3. The assets of the Acquired Fund to be acquired by the Acquiring
Fund will include no assets which the Acquiring Fund, by reason of
limitations contained in the Acquiring Trust's Trust Instrument or of
investment restrictions disclosed in the Acquiring Fund Prospectus in
effect on the Closing Date, may not properly acquire.
6.4. All proceedings taken by the Acquired Trust or the Acquired
Fund in connection with the transactions contemplated by this Agreement
and all material documents related thereto shall be reasonably
satisfactory in form and substance to the Acquiring Fund.
6.5. The Acquired Fund shall have furnished to the Acquiring Fund a
certificate, signed on its behalf by a duly authorized officer of the
Acquired Trust, as to the adjusted tax basis in the hands of the
Acquired Fund of the securities delivered to the Acquiring Fund
pursuant to this Agreement, together with any such other evidence as
to such adjusted tax basis as the Acquiring Fund may reasonably
request.
6.6. The Acquired Fund's custodian shall have delivered to the
Acquiring Fund a certificate identifying all of the assets of the
Acquired Fund held by such custodian as of the Valuation Date.
6.7. The Acquired Fund's transfer agent shall have provided to the
Acquiring Fund's transfer agent (i) the originals or true copies of
all of the records of the Acquired Fund in the possession of the
Acquired Fund's transfer agent as of the Closing Date, (ii) a record
specifying the number of Acquired Fund Shares outstanding as of the
Valuation Date and (iii) a record specifying the name and address of
each holder of record of any Acquired Fund Shares and the number of
Acquired Fund Shares held of record by each such shareholder as of the
Valuation Date. The Acquired Fund's transfer agent shall also have
provided the Acquiring Fund with a certificate confirming that the
acts specified in the preceding sentence have been taken and that the
information so supplied is complete and accurate to the best
knowledge of the transfer agent.
6.8. The Acquiring Fund shall have received a favorable opinion of
Ropes & ▇▇▇▇, LLP, counsel to the Acquired Fund, dated the Closing
Date, with such assumptions and limitations as shall be in the opinion
of such firm appropriate to render the opinions expressed therein, and
in a form satisfactory to the Acquiring Fund, to the following effect:
(a) The Acquired Trust is an unincorporated voluntary association
with transferable shares of beneficial interest (commonly
referred to as a "Massachusetts business trust") validly
existing under the laws of The Commonwealth of Massachusetts
and has power as a business trust to own all of its
properties and assets and to carry on its business, in each
case as described in the Registration Statement, and the
Acquired Fund is a separate series thereof duly established
in accordance with the Declaration of Trust and Bylaws, each
as amended, of the Acquired Trust and applicable law.
(b) This Agreement has been duly authorized, executed and
delivered by the Acquired Trust, on behalf of the Acquired
Fund, and assuming the due authorization, execution and
delivery of this Agreement by the Acquiring Trust, on behalf
of the Acquiring Fund, is a valid and binding obligation
of the Acquired Trust and the Acquired Fund enforceable
against the Acquired Trust and the Acquired Fund in accordance
with its terms, except as the same may be limited by
bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and
other equitable principles.
(c) The Acquired Fund has the power as a series of a business
trust to sell, assign, transfer and deliver the assets to be
transferred by it hereunder.
(d) The execution and delivery of this Agreement by the Acquired
Trust on behalf of the Acquired Fund did not, and the
performance by the Acquired Trust and the Acquired Fund of
their obligations hereunder will not, violate the Acquired
Trust's Declaration of Trust or Bylaws, each as amended, or
any provision of any agreement specified in a Certificate of
Officer of the Acquired Trust to which the Acquired Trust or
the Acquired Fund is a party, or by which it is bound or,
result in the acceleration of any obligation or the
imposition of any penalty under any such agreement, or
any judgment or decree to which the Acquired Trust or the
Acquired Fund is a party or by which it is bound, specified
in a Certificate of Officer of the Acquired Trust.
(e) No consent, approval, authorization or order of any
Commonwealth of Massachusetts or federal governmental
authority is required for the consummation by the Acquired
Trust or the Acquired Fund of the transactions contemplated
by this Agreement, except such as may be required under state
securities or blue sky laws or such as have been obtained.
(f) Such counsel has not represented and is not representing the
Acquired Fund or the Acquired Trust in any legal or
governmental proceedings on or before the date of mailing of
the Prospectus/Proxy Statement referred to in Section 5.3 or
the Closing Date required to be described in the
Registration Statement which are not described as required.
(g) The Acquired Trust is registered with the Commission as an
investment company under the 1940 Act.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND.
The obligations of the Acquired Trust and the Acquired Fund to
complete the transactions provided for herein shall be subject, at
their election, to the performance by the Acquiring Trust and the
Acquiring Fund of all the obligations to be performed by them
hereunder on or before the Closing Date and, in addition thereto, to
the following further conditions:
7.1. The Acquiring Trust and the Acquiring Fund shall have
delivered to the Acquired Fund a certificate executed on their
behalf by the Acquiring Trust's duly authorized officer, in
form and substance satisfactory to the Acquired Fund and dated
as of the Closing Date, to the effect that the representations
and warranties of the Acquiring Trust and the Acquiring Fund
made in this Agreement are true and correct at and as of the
Closing Date, except as they may be affected by the
transactions contemplated by this Agreement, and that the
Acquiring Trust and the Acquiring Fund have complied with all
the covenants and agreements and satisfied all of the
conditions on their parts to be performed or satisfied under
this Agreement at or prior to the Closing Date.
7.2. The Acquiring Trust, on behalf of the Acquiring Fund, shall
have executed and delivered to the Acquired Fund an Assumption of
Liabilities dated as of the Closing Date pursuant to which the
Acquiring Fund will assume all of the liabilities of the Acquired
Fund existing at the Closing Date in connection with the
transactions contemplated by this Agreement.
7.3. All proceedings taken by the Acquiring Trust or the
Acquiring Fund in connection with the transactions contemplated by
this Agreement and all documents incidental thereto shall be
reasonably satisfactory in form and substance to the Acquired Fund.
7.4. The Acquired Fund shall have received a favorable opinion
of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Acquiring Trust,
dated the Closing Date, with such assumptions and limitations as
shall be in the opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP appropriate to
render the opinions expressed therein, and in a form reasonably
satisfactory to the Acquired Fund, to the following effect:
(a) The Acquiring Trust is a "Delaware statutory trust"
validly existing under the laws of the State of Delaware
and the Acquiring Fund is a separate series thereof duly
constituted in accordance with the Trust Instrument and
the Bylaws of the Trust, each as amended, and applicable
law.
(b) This Agreement has been duly authorized, executed and
delivered by the Acquiring Trust, on behalf of the
Acquiring Fund, and assuming the due authorization,
execution and delivery of this Agreement by the Acquired
Trust, on behalf of the Acquired Fund, is the valid and
binding obligation of the Acquiring Trust and the
Acquiring Fund enforceable against the Acquiring Trust
and the Acquiring Fund in accordance with its terms,
except as the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights
generally and other equitable principles.
(c) The execution and delivery of this Agreement by the
Acquiring Trust on behalf of the Acquiring Fund did not,
and the performance by the Acquiring Trust and the
Acquiring Fund of their obligations hereunder will not,
violate the Acquiring Trust's Trust Instrument or Bylaws,
each as amended, or any provision of any agreement
specified in a Certificate of Officer of the Acquiring
Trust to which the Acquiring Trust or the Acquiring Fund
is a party, or by which it is bound, or result in the
acceleration of any obligation or the imposition of any
penalty under any such agreement, or any judgment, or
decree to which the Acquiring Trust or the Acquiring Fund
is a party, or by which it is bound, specified in a
Certificate of Officer of the Acquiring Trust.
(d) No consent, approval, authorization or order of any New
York State or federal governmental authority is
required for the consummation by the Acquiring Trust or
the Acquiring Fund of the transactions contemplated
by this Agreement, except such as may be required under
state securities or blue sky laws or such as have been
obtained.
(e) Such counsel has not represented and is not representing
the Acquiring Fund or the Acquiring Trust in any legal or
governmental proceedings relating to the Acquiring Fund
existing on or before the date of mailing of the
Prospectus/Proxy Statement referred to in Section 5.3 or
the Closing Date required to be described in the
Registration Statement which are not described as
required.
(f) The Acquiring Trust is registered with the Commission as
an investment company under the 1940 Act.
(g) Assuming that a consideration not less than the net
asset value thereof has been paid, the Acquiring Fund
Shares to be issued for transfer to the Acquired Fund
Shareholders as provided by the Agreement are duly
authorized and upon such transfer and delivery will be
validly issued and outstanding and fully paid and,
except as set forth in the Acquiring Fund Prospectus,
nonassessable Class A, class C, Class R and Class Y
shares, as applicable of beneficial interest in
the Acquiring Fund.
(h) The Registration Statement has become effective and, to
the knowledge of such counsel, no stop order suspending
the effectiveness thereof has been issued.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE
PARTIES.
The respective obligations of the Acquiring Trust, the Acquiring
Fund, the Acquired Trust and the Acquired Fund hereunder are
subject to the further conditions that on or before the Closing
Date:
8.1. This Agreement shall have been approved by a majority of
the outstanding shares of the Acquired Fund in the manner
required by the Acquired Trust's Declaration of Trust, Bylaws,
each as amended, and applicable law, and the parties shall have
received reasonable evidence of each such approval.
8.2. On the Closing Date, the Commission shall not have
issued an unfavorable report under Section 25(b) of the 1940 Act,
nor instituted any proceeding seeking to enjoin the consummation
of the transactions contemplated by this Agreement under Section
25(c) of the 1940 Act and 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 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 and securities authorities) deemed necessary by the Acquired
Trust, the Acquired Fund, the Acquiring Trust or the Acquiring
Fund to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except
where failure to obtain any such consent, order or permit would
not involve a risk of a material adverse effect on the assets or
properties of the Acquiring Fund or the Acquired Fund.
8.4. The Registration Statement shall have become effective
under the 1933 Act and no stop order suspending the effectiveness
thereof shall have been issued and, to the best knowledge of the
parties hereto, no investigation or proceeding for that
purpose shall have been instituted or be pending, threatened or
contemplated under the ▇▇▇▇ ▇▇▇.
8.5. The post-effective amendment to the registration statement
of the Acquiring Trust on Form N-1A relating to shares of the
Acquiring Fund shall have become effective and no stop order
suspending the effectiveness thereof shall have been issued.
8.6. The Acquired Fund and the Acquiring Fund shall have
received a favorable opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP dated on
the Closing Date (which opinion will be subject to certain
qualifications) satisfactory to both parties substantially
to the effect that, on the basis of the existing provisions of
the Code, Treasury regulations promulgated thereunder, current
administrative rules, and court decisions, generally for federal
income tax purposes:
(a) The acquisition by the Acquiring Fund of the assets of
the Acquired Fund in exchange for the Acquiring Fund's
assumption of the liabilities of the Acquired Fund and
issuance of the Acquiring Fund Shares, followed by
the distribution by the Acquired Fund of such Acquiring
Fund Shares to the shareholders of the Acquired Fund in
exchange for their shares of the Acquired Fund, all as
provided in Section 1 hereof, will constitute a
reorganization within the meaning of Section 368(a) of
the Code, and the Acquired Fund and the Acquiring 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 Acquired Fund
(i) upon the transfer of its assets to the Acquiring
Fund in exchange for the Acquiring Fund Shares and the
assumption by the Acquiring Fund of the liabilities of
the Acquired Fund or (ii) upon the distribution of the
Acquiring Fund Shares by the Acquired Fund to its
shareholders in liquidation, as contemplated in Section
1 hereof.
(c) No gain or loss will be recognized by the Acquiring
Fund upon the receipt of the assets of the Acquired
Fund in exchange for the assumption of the liabilities
of the Acquired Fund and issuance of the Acquiring Fund
Shares as contemplated in Section 1 hereof.
(d) The tax basis of the assets of the Acquired Fund
acquired by the Acquiring Fund will be the same as the
tax basis of such assets in the hands of the Acquired
Fund immediately prior to the transfer.
(e) The holding periods of the assets of the Acquired Fund
in the hands of the Acquiring Fund will include the
periods during which such assets were held by the
Acquired Fund.
(f) No gain or loss will be recognized by Acquired Fund
shareholders upon the exchange of all of their Acquired
Fund Shares for the Acquiring Fund Shares.
(g) The aggregate tax basis of the Acquiring Fund Shares to
be received by each shareholder of the Acquired Fund
will be the same as the aggregate tax basis of Acquired
Fund Shares exchanged therefor.
(h) An Acquired Fund shareholder's holding period for the
Acquiring Fund Shares to be received will include the
period during which Acquired Fund Shares exchanged
therefor were held, provided that the shareholder
Acquired Fund Shares as a capital asset on the date
of the exchange.
(i) The Acquiring Fund will succeed to and take into
account the items of the corresponding Acquired Fund
described in Section 381(c) of the Code (including
capital loss carryovers), subject to the conditions and
limitations specified in the Code, the regulations
thereunder, and existing court decisions and published
interpretations of the Code and Regulations. The opinion
will be based on certain factual certifications made by
officers of the Acquired Trust and the Acquiring Trust
and will also be based on customary assumptions. The
opinion is not a guarantee that the tax consequences of
the Reorganization will be as described above. There
is no assurance that the Internal Revenue Service or a
court would agree with the opinion.
8.7. At any time prior to the Closing, any of the foregoing
conditions of this Section 8 (except for Section 8.1) may be
jointly waived by the Board of Trustees of the Acquired Trust
and the Board of Trustees of the Acquiring Trust, if, in the
judgment of the Board of Trustees of the Acquired Trust, such
waiver will not have a material adverse effect on the interests
of the shareholders of the Acquired Fund and, if, in the judgment
of the Board of Trustees of the Acquiring Trust, such waiver will
not have a material adverse effect on the interests of the
shareholders of the Acquiring Fund.
9. BROKERAGE FEES; EXPENSES.
9.1. Each of the Acquired Trust, the Acquired Fund, the
Acquiring Trust and the Acquiring Fund represents that there is no
person who has dealt with it who by reason of such dealings is
entitled to any broker's or finder's or other similar fee
or commission arising out of the transactions contemplated by this
Agreement.
9.2. As separately agreed between Victory Capital and RSIM,
Victory Capital and RSIM agree to assume and to pay all expenses
incurred by the Acquiring Trust, the Acquiring Fund, the Acquired
Trust, and the Acquired Fund in connection with the transaction
contemplated by this Agreement.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES.
10.1. This Agreement supersedes all previous correspondence and
oral communications between the parties regarding the subject matter
hereof, constitutes the only understanding with respect to such
subject matter and may not be changed except by a letter of agreement
signed by each party hereto.
10.2. The representations, warranties and covenants contained in
this Agreement or in any other document delivered pursuant hereto or
in connection herewith shall not survive the consummation of the
transactions contemplated hereunder except
Sections 1.1, 1.3, 1.5, 9, 14 and 15.
11. TERMINATION.
11.1. This Agreement may be terminated by the mutual agreement of
the Acquired Trust, on behalf of the Acquired Fund, and the
Acquiring Trust, on behalf of the Acquiring Fund, prior to the
Closing Date.
11.2. In addition, either of the Acquired Trust or the Acquiring
Trust may at its option terminate this Agreement at or prior to the
Closing Date because:
(a) With respect to a termination by the Acquired Trust, of a
material breach by the Acquiring Trust or the Acquiring
Fund of any representation, warranty, covenant or agreement
contained herein to be performed by the Acquiring Trust or
the Acquiring Fund at or prior to the Closing Date; or
with respect to a termination by the Acquiring Trust, of a
material breach by the Acquired Trust or Acquired Fund of
any representation, warranty, covenant or agreement herein
to be performed by the Acquired Trust or the Acquired Fund
at or prior to the Closing Date;
(b) A condition herein expressed to be precedent to the
obligations of the terminating party has not been met and
it reasonably appears that it will not or cannot be met; or
(c) Any governmental authority of competent jurisdiction shall
have issued any judgment, injunction, order, ruling or
decree or taken any other action restraining, enjoining or
otherwise prohibiting this Agreement or the consummation
of any of the transactions contemplated herein and such
judgment, injunction, order, ruling, decree or other action
becomes final and non-appealable; provided that the party
seeking to terminate this Agreement pursuant to this
Section 11.2(c) shall have used its reasonable efforts to
have such judgment, injunction, order, ruling, decree or
other action lifted, vacated or denied.
11.3. If the transactions contemplated by this Agreement have not
been substantially completed by December 31, 2016, this
Agreement shall automatically terminate on that date unless
a later date is agreed to by all of the parties to this
Agreement.
11.4. In the event of the termination of this Agreement and
abandonment of the transactions contemplated hereby pursuant to
this Section 11, this Agreement shall become void and have no
effect except that (a) Sections 9.1, 9.2, 11.4, 14 and 15 shall
survive any termination of this Agreement, and (b) notwithstanding
anything to the contrary contained in this Agreement, no party
shall be relieved or released from any liability or damages
arising out of any breach of any provision of this Agreement by
any party prior to the date of termination, unless the
termination is effected pursuant to Section 11.1.
12. TRANSFER TAXES.
Any transfer taxes payable upon issuance of the Acquiring
Fund Shares in a name other than the registered holder of the
Acquired Fund Shares on the books of the Acquired 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 issued and transferred.
13. AMENDMENTS.
This Agreement may be amended, modified or supplemented
in such manner as may be mutually agreed upon in writing by the
authorized officers of the Acquiring Trust and the Acquired Trust;
provided, however, that following the shareholders' meeting called
by the Acquired Fund pursuant to Section 5.2 no such amendment may
have the effect of changing the provisions for determining the
number of Acquiring Fund Shares to be issued to shareholders of
the Acquired Fund under this Agreement to the detriment of such
shareholders without their further approval.
14. NOTICES.
Any notice, report, statement or demand required or
permitted by any provisions of this Agreement shall be in writing
and shall be given by, telecopy or certified mail addressed to the
Acquired Trust or the Acquired Fund at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇ ▇▇▇▇▇, with a copy to
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, Ropes & ▇▇▇▇ LLP, Prudential Tower, ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or the Acquiring Trust or the
Acquiring Fund at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attn: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, with a copy to ▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
15. MISCELLANEOUS.
15.1. The article and Section headings contained in this
Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement.
15.2. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
15.3. This Agreement shall be governed by and construed in
accordance with the domestic substantive laws of the State of
Delaware, without giving effect to any choice or conflicts of
law rule or provision that would result in the application of
the domestic substantive laws of any other jurisdiction.
15.4. This Agreement shall bind and inure to the benefit of
the parties hereto and their respective successors and assigns,
but no assignment or transfer hereof or of any rights or
obligations hereunder shall be made by any party without the
written consent of the other party. Nothing herein expressed or
implied is intended or shall be construed to confer upon or give
any person, firm or corporation, other than the parties hereto
and their respective successors and assigns, any rights or
remedies under or by reason of this Agreement.
15.5. All covenants, agreements, representations and warranties
made under this Agreement and any certificates delivered pursuant
to this Agreement shall be deemed to have been material and
relied upon by each of the parties, notwithstanding any
investigation made by them or on their behalf.
15.6. A copy of the Acquired Trust's Amended and Restated
Agreement and Declaration of Trust dated March 13, 1997, as amended,
to which reference is hereby made is on file at the office of the
Secretary of The Commonwealth of Massachusetts and elsewhere as
required by law. This Agreement was executed or made by or on
behalf of the Acquired Trust and the Acquired Fund by the
Trustees or officers of the Acquired Trust as Trustees or officers
and not individually and the obligations of this Agreement are not
binding upon any of them or the shareholders of the Acquired Fund
individually but are binding only upon the assets and property of
the Acquired Trust or upon the assets belonging to the series or
class for the benefit of which the Trustees have caused this
Agreement to be made.
15.7. A copy of the Acquiring Trust's Certificate of Trust, to
which reference is hereby made, is on file at the office of the
Secretary of State of the State of Delaware and elsewhere as
required by law. This Agreement was executed or made by or on
behalf of the Acquiring Trust and the Acquiring Fund by the
Trustees or officers of the Acquiring Trust as Trustees or officers
and not individually and the obligations of this Agreement are not
binding upon any of them or the shareholders of the Acquiring Fund
individually but are binding only upon the assets and property of
the Acquiring Trust or upon the assets belonging to the series or
class for the benefit of which the Trustees have caused this
Agreement to be made.
15.8 It is expressly agreed that the obligations of the
Acquired Fund hereunder shall not be binding upon any of the
trustees, shareholders, nominees, officers, agents, or employees
of the Acquiring Trust personally, but shall bind only the
Acquiring Trust property of the Acquiring Fund, as provided in
the Acquiring Trust's Trust Instrument, as amended. The execution
and delivery of this Agreement have been authorized by the Board of
Trustees of the Acquiring Trust on behalf of the Acquiring Fund and
signed by authorized officers of the Acquiring Trust, acting
as such. Neither the authorization by the Board of Trustees of the
Acquiring Trust nor the execution and delivery by such officer shall
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
Acquiring Trust property of the Acquiring Fund as provided in the
Acquiring Trust's Trust Instrument, as amended.
IN WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be executed by its duly authorized officer.
RS INVESTMENT TRUST,
on behalf of each of its series portfolios listed on
Schedule A, individually and not jointly
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
VICTORY PORTFOLIOS,
on behalf of each of its series portfolios listed on
Schedule A, individually and not jointly
By:
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: President
For purposes of Section 9.2 only:
VICTORY CAPITAL MANAGEMENT INC.
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇
Title: Chief Operating Officer
For purposes of Section 9.2 only:
RS INVESTMENT MANAGEMENT CO. LLC
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
SCHEDULE A
RS Investment Trust Acquired Fund
Victory Portfolios Acquiring Fund
RS Focused Growth Opportunity Fund
Victory RS Focused Growth Opportunity Fund
RS Focused Opportunity Fund
Victory RS Focused Opportunity Fund
RS Growth Fund
Victory RS Growth Fund
RS Mid Cap Growth Fund
Victory RS Mid Cap Growth Fund
RS Select Growth Fund
Victory RS Select Growth Fund
RS Small Cap Equity Fund
Victory RS Small Cap Equity Fund
RS Small Cap Growth Fund
Victory RS Small Cap Growth Fund
RS Technology Fund
Victory RS Science and Technology Fund
RS Investors Fund
Victory RS Investors Fund
RS Large Cap Alpha Fund
Victory RS Large Cap Alpha Fund
RS Partners Fund
Victory RS Partners Fund
RS Value Fund
Victory RS Value Fund
RS Global Fund
Victory RS Global Fund
RS International Fund
Victory RS International Fund
RS China Fund
Victory ▇▇▇▇▇▇ China Fund
RS Emerging Markets Fund
Victory ▇▇▇▇▇▇ Emerging Markets Fund
RS Emerging Markets Small Cap Fund
Victory ▇▇▇▇▇▇ Emerging Markets Small Cap Fund
RS Global Natural Resources Fund
Victory Global Natural Resources Fund
RS Investment Quality Bond Fund
Victory INCORE Investment Quality Bond Fund
RS Low Duration Bond Fund
Victory INCORE Low Duration Bond Fund
RS High Yield Fund
Victory High Yield Fund
RS Tax-Exempt Fund
Victory Tax-Exempt Fund
RS High Income Municipal Bond Fund
Victory High Income Municipal Bond Fund
RS Floating Rate Fund
Victory Floating Rate Fund
RS Strategic Income Fund
Victory Strategic Income Fund
