\\FS29\SYS\LEGAL\WPDOC2\NSAR\2000\FMT-77q(g)2000.doc
7
NAME OF REGISTRANT
Franklin Managed Trust
File No. 811-4894
EXHIBIT ITEM No. 77q(g): Exhibit to accompany Exhibit No. 77M.
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the
Agreement) is made this 28th day of January, 2000 by and
between Franklin Managed Trust, a business trust created under
the laws of the Commonwealth of Massachusetts (the
Massachusetts Trust), and Franklin Managed Trust, a business
trust created under the laws of the State of Delaware (the
Delaware Trust).
In consideration of the mutual promises contained
herein, and intending to be legally bound, the parties hereto
agree as follows:
1. Plan of Reorganization.
(a) Upon satisfaction of the conditions precedent
described in Section 3 hereof, the Massachusetts Trust
will convey, transfer and deliver to the Delaware
Trust, on behalf of its Franklin Rising Dividends Fund
series (the New Fund), at the closing provided for
in Section 2 (hereinafter referred to as the
Closing) all of its then-existing assets, including
the assets underlying its single series of shares
designated as the Franklin Rising Dividends Fund
series (the Fund). In consideration thereof, the
Delaware Trust agrees at the Closing (i) to assume and
pay, to the extent that they exist on or after the
Effective Date of the Reorganization (as defined in
Section 2 hereof), all of the Massachusetts Trust's
obligations and liabilities, whether absolute,
accrued, contingent or otherwise, including all fees
and expenses in connection with the Agreement,
including without limitation costs of legal advice,
accounting, printing, mailing, proxy solicitation and
transfer taxes, if any, the obligations and
liabilities allocated to the Massachusetts Trust to
become the obligations and liabilities of the Delaware
Trust, and (ii) to deliver to the Massachusetts Trust
full and fractional shares of the New Fund equal in
number to the number of full and fractional shares
outstanding of the Fund. The transactions
contemplated hereby are intended to qualify as a
reorganization within the meaning of Section 368(a) of
the Internal Revenue Code of 1986, as amended
(Code).
(b) The Delaware Trust will effect such delivery by
establishing an open account for each shareholder of
the Fund and by crediting to such account, the exact
number of full and fractional shares of the
appropriate class of the New Fund such shareholder
held in the corresponding class of the Fund on the
Effective Date of the Reorganization. Fractional
shares of the New Fund will be carried to the third
decimal place. On the Effective Date of the
Reorganization, the net asset value per share of
beneficial interest of each class of the New Fund
shall be deemed to be the same as the net asset value
per share of each corresponding class of the Fund. On
such date, each certificate representing shares of a
class of the Fund will represent the same number of
shares of the corresponding class of the New Fund.
Each shareholder of the Fund will have the right to
exchange his (her) share certificates for share
certificates of the corresponding class of the New
Fund. However, a shareholder need not make this
exchange of certificates unless he (she) so desires.
Simultaneously with the crediting of the shares of the
New Fund to the shareholders of record of the Fund,
the shares of the Fund held by such shareholder shall
be canceled.
(c) As soon as practicable after the Effective Date
of the Reorganization, the Massachusetts Trust shall
take all necessary steps under Massachusetts law to
terminate the Massachusetts Trust.
2. Closing and Effective Date of the Reorganization.
The Closing shall commence at 2:00 Pacific time on January
31, 1999 or on such later date as the parties may agree,
and shall be effective on the business day following the
commencement of the Closing (the Effective Date). The
Closing will take place at the principal offices of the
Massachusetts and Delaware Trusts at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
3. Conditions Precedent. The obligations of the
Massachusetts Trust and the Delaware Trust to effectuate
the Reorganization hereunder shall be subject to the
satisfaction of each of the following conditions:
(a) Such authority and orders from the Securities and
Exchange Commission (the SEC) and state securities
commissions as may be necessary to permit the parties
to carry out the transactions contemplated by this
Agreement shall have been received;
(b) One or more post-effective amendments to the
Massachusetts Trust's Registration Statement on Form N-
1A under the Securities Act of 1933 and the Investment
Company Act of 1940, containing (i) such amendments to
such Registration Statement as are determined by the
Trustees of the Massachusetts Trust to be necessary
and appropriate as a result of the Agreement, and (ii)
the adoption by the Delaware Trust as its own of such
Registration Statement, as so amended, shall have been
filed with the SEC, and such post-effective amendment
or amendments to the Massachusetts Trust's
Registration Statement shall have become effective,
and no stop order suspending the effectiveness of the
Registration Statement shall have been issued, and no
proceeding for that purpose shall have been initiated
or threatened by the SEC (other than any such stop
order, proceeding or threatened proceeding which shall
have been withdrawn or terminated);
(c) Confirmation shall have been received from the
SEC or the Staff thereof that the Delaware Trust
shall, effective upon or before the Effective Date of
the Reorganization, be duly registered as an open-end
management investment company under the Investment
Company Act of 1940, as amended;
(d) Each party shall have received a ruling from the
Internal Revenue Service or an opinion from Messrs.
Stradley, Ronon, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, Philadelphia,
Pennsylvania, to the effect that the reorganization
contemplated by this Agreement qualifies as a
reorganization under Section 368(a) of the Code,
and, thus, will not give rise to the recognition of
income, gain or loss for federal income tax purposes
to the Massachusetts Trust, the Delaware Trust or
shareholders of the Massachusetts Trust or the
Delaware Trust;
(e) The Massachusetts Trust shall have received an
opinion from Messrs. Stradley, Ronon, ▇▇▇▇▇▇▇ & Young,
LLP, addressed to and in form and substance
satisfactory to it, to the effect that (i) this
Agreement and the reorganization provided for herein,
and the execution of this Agreement, has been duly
authorized and approved by the Delaware Trust and
constitutes a legal, valid and binding agreement of
the Delaware Trust in accordance with its terms; (ii)
the shares of the Delaware Trust to be issued pursuant
to the terms of this Agreement have been duly
authorized and, when issued and delivered as provided
in this Agreement, will have been validly issued and
fully paid and will be non-assessable by the Delaware
Trust; and (iii) the Delaware Trust is duly organized
and validly existing under the laws of the State of
Delaware;
(f) The Delaware Trust shall have received an opinion
from Messrs. Stradley, Ronon, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP,
Philadelphia, PA, addressed to and in form and
substance satisfactory to it, to the effect that (i)
this Agreement and the reorganization provided herein,
and the execution of this Agreement, has been duly
authorized and approved by the Massachusetts Trust and
constitutes a legal, valid and binding agreement of
the Massachusetts Trust in accordance with its terms;
and (ii) the Massachusetts Trust is duly organized,
validly existing and in good standing under the laws
of the Commonwealth of Massachusetts.
(g) The shares of the New Fund shall have been duly
qualified for offering to the public in all states of
the United States, the Commonwealth of Puerto Rico,
Guam, U.S. Virgin Islands, and the District of
Columbia so as to permit the transfers contemplated by
this Agreement to be consummated;
(h) This Agreement and the reorganization
contemplated hereby shall have been adopted by an
affirmative vote of at least a majority the
outstanding voting securities of the Massachusetts
Trust at a meeting of shareholders of such trust;
(i) The shareholders of the Massachusetts Trust shall
have voted to direct the Massachusetts Trust to vote,
and the Massachusetts Trust shall have voted, as sole
shareholder of each class of the Delaware Trust, to:
(1) Elect as Trustees of the Delaware Trust (the
Trustees) the following individuals: Messrs.
Lippman, Crohn, Rubens II and ▇▇▇▇▇;
(2) Select ▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ as the
independent public accountants for the Delaware
Trust for the fiscal year ending September 30,
2000; and
(3) Approve a new investment management
agreement between the Delaware Trust on behalf of
the New Fund, and Franklin Advisory Services,
LLC, which is substantially identical to the
current investment management agreement between
the Massachusetts Trust on behalf of the Fund,
and Franklin Advisory Services, LLC
(j) The Trustees shall have taken the following
action at a meeting duly called for such purposes:
(1) Approval of the Delaware Trust's Custodian
Agreement;
(2) Selection of ▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ as the
Delaware Trust's independent public accountants
for the fiscal year ending September 30, 2000;
(3) Approval of the investment management
agreement between the Delaware Trust on behalf of
the New Fund, and Franklin Advisory Services,
LLC, which is substantially identical to the
current investment management agreement between
the Massachusetts Trust on behalf of the Fund,
and Franklin Advisory Services, LLC;
(4) Authorization of the issuance by the
Delaware Trust, prior to the Effective Date of
the Reorganization, of one share of each class of
the New Fund, to the Massachusetts Trust in
consideration for the payment of the current
public offering price of each corresponding class
of the Fund, for the purpose of enabling the
Massachusetts Trust to vote on matters referred
to in paragraph (i) of this Section 3;
(5) Submission of the matters referred to in
paragraph (i) of this Section 3 to the
Massachusetts Trust as sole shareholder of the
Delaware Trust; and
(6) Authorization of the issuance by the
Delaware Trust of shares of the New Fund on the
Effective Date of the Reorganization in exchange
for the assets of the Fund pursuant to the terms
and provisions of this Agreement.
At any time prior to the Closing, any of the foregoing
conditions may be waived by the Board of Trustees of the
Massachusetts Trust if, in the judgment of the Trustees,
such waiver will not have a material adverse effect on the
benefits intended under this Agreement to the shareholders
of the Massachusetts Trust.
4. Termination. The Board of Trustees of the
Massachusetts Trust may terminate this Agreement and
abandon the reorganization contemplated hereby,
notwithstanding approval thereof by the shareholders of the
Fund, at any time prior to the Effective Date of the
Reorganization if, in the judgment of the Trustees, the
facts and circumstances make proceeding with the Agreement
inadvisable.
5. Entire Agreement. This Agreement embodies the entire
agreement between the parties and there are no agreements,
understandings, restrictions or warranties among the
parties other than those set forth herein or herein
provided for.
6. Further Assurances. The Massachusetts Trust and the
Delaware Trust shall take such further action as may be
necessary or desirable and proper to consummate the
transactions contemplated hereby.
7. Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which
shall be deemed an original, but all of which shall
constitute one and the same instrument.
8. Governing Law. This Agreement and the transactions
contemplated hereby shall be governed by and construed and
enforced in accordance with the laws of the State of
Delaware.
IN WITNESS WHEREOF, the Massachusetts Trust and the
Delaware Trust have each caused this Agreement and Plan of
Reorganization to be executed on its behalf by its Vice
President and attested by its Assistant Secretary, all as of the
day and year first-above written.
Attest: Franklin Managed Trust
(a Delaware business trust)
By: By:
Assistant Secretary ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President and Secretary
Attest: Franklin Managed Trust
(a Massachusetts business
trust)
By: By:
Assistant Secretary ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President and Secretary
