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EXHIBIT 99.4
FORM OF AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of this
_____day of _____, 2001, by and between Alleghany Funds, a Delaware business
trust, with its principal place of business at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000 (the "Trust"), with respect to its ABN AMRO Money Market Fund,
ABN AMRO Government Money Market Fund, ABN AMRO Treasury Money Market Fund, ABN
AMRO Tax-Exempt Money Market Fund, ABN AMRO Value Fund, ABN AMRO Growth Fund,
ABN AMRO Small Cap Fund, ABN AMRO Real Estate Fund, ABN AMRO International
Equity Fund, ABN AMRO Europe Equity Growth Fund, ABN AMRO Asian Tigers Fund, ABN
AMRO Latin America Equity Fund, ABN AMRO Institutional Prime Money Market Fund,
and Alleghany/Chicago Trust Balanced Fund, Alleghany/Chicago Trust Bond Fund and
Alleghany/Chicago Trust Municipal Bond Fund (each an "Existing Acquiring Fund"),
each a separate series of the Trust (each an "Acquiring Fund" and, together, the
"Acquiring Funds"), and the ABN AMRO Funds, a Massachusetts business trust, with
its principal place of business at 0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxx,
Xxxxxxxxxxxxx 00000 ("ABN AMRO Funds"), with respect to its Money Market Fund,
Government Money Market Fund, Treasury Money Market Fund, Tax-Exempt Money
Market Fund, Value Fund, Growth Fund, Small Cap Fund, Real Estate Fund,
International Equity Fund, Europe Equity Growth Fund, Asian Tigers Fund, Latin
America Equity Fund, Institutional Prime Money Market Fund, Balanced Fund, Fixed
Income Fund and Tax-Exempt Fixed Income Fund, each a separate series of ABN AMRO
Funds (each a "Selling Fund" and, together the "Selling Funds" and, 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, Class N Shares, Class I Shares, Class S Shares,
Class Y Shares or Class YS Shares of beneficial interest, no par value per
share, of its corresponding Acquiring Fund ("Acquiring Fund Shares") as set
forth on Schedule A attached hereto; (ii) the assumption by each Acquiring Fund
of the identified liabilities of each Selling Fund; and (iii) the distribution,
after the Closing Dates hereinafter referred to, of the Acquiring Fund Shares to
the shareholders of each Selling Fund and the liquidation of each Selling Fund
as provided herein, all upon the terms and conditions set forth in this
Agreement (the "Reorganization").
WHEREAS, each Acquiring Fund and each Selling Fund is a separate series
of the Trust and ABN AMRO Funds, respectively, and the Trust and ABN AMRO Funds
are open-end, registered management investment companies and each Selling Fund
owns securities that generally are assets of the character in which its
corresponding Acquiring Fund is permitted to invest;
WHEREAS, each Fund is authorized to issue its shares of beneficial
interest;
WHEREAS, the Trustees of the Trust have determined that the
Reorganization, with respect to each Acquiring Fund, is in the best interests of
each Acquiring Fund's shareholders and that the interests of the existing
shareholders of the Acquiring Fund will not be diluted as a result of the
Reorganization;
WHEREAS, the Trustees of the ABN AMRO Funds 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;
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NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
ARTICLE I
TRANSFER OF ASSETS OF THE SELLING FUNDS IN EXCHANGE FOR ACQUIRING FUND SHARES
AND THE ASSUMPTION OF SELLING FUNDS' LIABILITIES AND LIQUIDATION 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 stated liabilities, as set
forth in paragraph 1.2, to its corresponding Acquiring Fund. In exchange, each
Acquiring Fund agrees: (i) to deliver to its corresponding Selling Fund the
number of full and fractional Acquiring Fund Shares, determined by (a)
multiplying the shares outstanding of each class of the Selling Fund by (b) the
ratio computed by dividing (x) the net asset value per share of each such class
of the Selling Fund by (y) the net asset value per share of the corresponding
class of Acquiring Fund Shares computed in the manner and as of the time and
date set forth in paragraph 2.2; and (ii) to assume the identified liabilities
of the Selling Fund, as set forth in paragraph 1.3. Such transactions shall take
place at the Closing Dates provided for in paragraph 3.1.
1.2 ASSETS TO BE ACQUIRED. The assets of each Selling Fund to be
acquired by its corresponding 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 its respective Closing Date.
Each Selling Fund has provided its corresponding 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 before its
respective Closing Date, furnish each Acquiring Fund with a list of the Selling
Fund's portfolio securities and other investments. Each Acquiring Fund will,
within a reasonable time before its respective Closing Date, furnish its
corresponding 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. A Selling Fund, if requested
by its Acquiring Funds, will dispose of securities on the Acquiring Fund's list
before its respective Closing Date. In addition, if it is determined that the
portfolios of a Selling Fund and its Acquiring Fund, when aggregated, would
contain investments exceeding certain percentage limitations imposed upon the
Acquiring Fund with respect to such investments, the Selling Fund, if requested
by the Acquiring Fund, will dispose of a sufficient amount of such investments
as may be necessary to avoid violating such limitations as of its respective
Closing Date. Notwithstanding the foregoing, nothing herein will require a
Selling Fund to dispose of any investments or securities if, in the reasonable
judgment of the Selling Fund's trustees or adviser, such
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disposition would adversely affect the tax-free nature of the Reorganization or
would violate their fiduciary duties to the Selling Fund's shareholders.
1.3 LIABILITIES TO BE ASSUMED. Each Selling Fund will endeavor to
discharge all of its known liabilities and obligations to the extent possible
before its respective 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 corresponding 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 only those
liabilities of its corresponding Selling Fund reflected in its Statement of
Assets and Liabilities and shall not assume any other liabilities, whether
absolute or contingent, known or unknown, accrued or unaccrued, all of which
shall remain the obligation of the Selling Fund.
1.4 Prior to each Closing Date, the Trust shall make any filings with
the State of Delaware that may be required under the laws of the State of
Delaware, effective as of each respective Closing Date.
1.5 LIQUIDATION AND DISTRIBUTION. On or as soon after its Closing Date
as is conveniently practicable (the "Liquidation Date"): (a) each Selling Fund
will distribute in complete liquidation of the Selling Fund, pro rata to its
shareholders of record, determined as of the close of business on the Valuation
Date (the "Selling Fund Shareholders"), 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 dissolve and 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
with respect to Selling Fund shares that are held of record by a Selling Fund
Shareholder at the Effective Time on its respective 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 Selling Fund.
1.7 TRANSFER TAXES. Any transfer taxes payable upon the issuance 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 issued and transferred.
1.8 REPORTING RESPONSIBILITY. Any reporting responsibility of each
Selling Fund is and shall remain the responsibility of the Selling Fund.
1.9 TERMINATION. Each Selling Fund shall be terminated promptly
following its respective Closing Date and the making of all distributions
pursuant to paragraph 1.5.
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1.10 All books and records of each Selling Fund, including all books
and records required to be maintained under the Investment Company Act of 1940
(the "1940 Act"), and the rules and regulations thereunder, shall be available
to the corresponding Acquiring Fund from and after its respective Closing Date
and shall be turned over to the Acquiring Fund as soon as practicable following
its respective Closing Date.
1.11 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 ABN AMRO Funds, respectively, which are
involved in the Reorganization as of the Closing Dates.
ARTICLE II
VALUATION
2.1 VALUATION OF ASSETS. The value of a Selling Fund's assets to be
acquired by its corresponding Acquiring Fund hereunder shall be the value of
such assets on the business day immediately prior to each respective Closing
Date (such time and date being hereinafter called a "Valuation Date"), using the
valuation procedures set forth in the ABN AMRO Funds' Declaration of Trust and
each Selling Fund's then current prospectuses and statements of additional
information or such other valuation procedures as shall be mutually agreed upon
by the parties. Each Acquiring Fund and Selling Fund agrees 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 corresponding Selling
Fund. Where a pricing difference results from a difference in pricing
methodology, the parties will eliminate such difference by using the Acquiring
Funds' methodology in valuing the Selling Funds' assets.
2.2 VALUATION OF SHARES. The net asset value per share of Acquiring
Fund Shares shall be the net asset value per share computed on the Valuation
Date, using the valuation procedures set forth in the Trust's Trust Instrument
and each Acquiring Fund's then current prospectuses and statements of additional
information, or such other valuation procedures as shall be mutually agreed upon
by the parties.
2.3 SHARES TO BE ISSUED. The number of each Acquiring Fund's shares of
each class to be issued (including fractional shares, if any) in exchange for
its corresponding Selling Fund's assets, shall be determined by (a) multiplying
the shares outstanding of each class of the Selling Fund by (b) the ratio
computed by (x) dividing the net asset value per share of the Selling Fund of
each of its classes by (y) the net asset value per share of the corresponding
classes of the Acquiring Fund determined in accordance with paragraph 2.2 [(a) x
(b), where (b)=(x)/(y)]. Holders of Common Shares, Investor Shares,
Institutional Shares and Institutional Service Shares of the Selling Funds will
receive Class N Shares, Class I Shares, Class S Shares, Class Y Shares or Class
YS Shares of the corresponding Acquiring Funds, as set forth on Schedule A
attached hereto.
2.4 DETERMINATION OF VALUE. All computations of value shall be made by
PFPC, Inc.
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ARTICLE III
CLOSINGS AND CLOSING DATES
3.1 CLOSING DATES. The closing (each a "Closing" and collectively, the
"Closings") shall occur in two steps. There will be a separate closing on or
about August 18, 2001 for the ABN AMRO Funds' Fixed Income Fund, Balanced
Fund and Tax-Exempt Fixed Income Fund and a separate closing on or about
August 25, 2001 for the ABN AMRO Funds' Money Market Fund, Government Money
Market Fund, Treasury Money Market Fund, Tax-Exempt Money Market Fund, Value
Fund, Growth Fund, Small Cap Fund, Real Estate Fund, International Equity Fund,
Europe Equity Growth Fund, Asian Tigers Fund, Latin America Equity Fund,
Institutional Prime Money Market Fund or such other date(s) as the parties may
agree to in writing (each a "Closing Date" and collectively, the "Closing
Dates"). All acts taking place at the Closings shall be deemed to take place
immediately prior to the Closing Dates unless otherwise provided. The Closings
shall be held as of 8:00 a.m. Eastern time (the "Effective Time") at the offices
of PFPC, Inc., 0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000, or at such
other time and/or place as the parties may agree.
3.2 CUSTODIAN'S CERTIFICATE. The Chase Manhattan Bank, as custodian
for each Selling Fund (the "Custodian"), shall deliver at the Closings 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 corresponding Acquiring Fund on the Closing Dates; 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 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. PFPC, Inc., as transfer agent for
each Selling Fund as of the Closing Dates, shall deliver at the Closings 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 Closings. Each Acquiring Fund shall issue and deliver or cause PFPC,
Inc., its transfer agent, to issue and deliver a confirmation evidencing
Acquiring Fund Shares to be credited on the Closing Dates to the Secretary of
ABN AMRO Funds 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 Closings, 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.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS OF THE SELLING FUNDS. Each Selling Fund
represents and warrants to its corresponding Acquiring Fund as follows:
(a) The Selling Fund is a legally designated, separate series
of a voluntary association duly organized, validly existing, and in good
standing under the laws of the Commonwealth of Massachusetts.
(b) ABN AMRO Funds is registered as an open-end management
investment company under the 1940 Act, and ABN AMRO Funds' registration with the
Securities and Exchange Commission (the "Commission") as an investment company
under the 1940 Act is in full force and effect.
(c) The current prospectuses and statements 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 provision of ABN AMRO Funds' Declaration of Trust 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 before its applicable Closing Date, except for liabilities, if 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 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 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 June 30, 2001 and there are no
known contingent liabilities of the Selling Fund as of such date that are not
disclosed in such statements.
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(h) Since the date of the financial statements referred to in
paragraph (g) above, there have been no material adverse changes in the Selling
Fund's financial condition, assets, liabilities or 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, free of any lien or other
encumbrances, except those liens or encumbrances to which the Acquiring Fund has
received notice, and, upon delivery and payment for such assets, and the filing
of a Certificate of Merger or Consolidation pursuant to the laws of the State of
Delaware, 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, 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 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 each Closing Date, any written information furnished by the
ABN AMRO Funds 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
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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 misleading.
(o) The Selling Fund has elected to qualify and has qualified
as a "regulated investment company" under the Code (a "RIC"), 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 Massachusetts law for the execution of this
Agreement by ABN AMRO Funds, for itself and on behalf of each Selling Fund,
except for the effectiveness of the Registration Statement, the necessary
exemptive relief requested from the Commission or its staff with respect to
Sections 17(a) and 17(b) of the 1940 Act, and the filing of a Certificate of
Merger or Consolidation pursuant to Delaware 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 corresponding Selling Fund as follows:
(a) The Acquiring Fund is a separate series of the Trust and
the Trust is a business trust, duly organized, validly existing and in good
standing under the laws of the State of Delaware.
(b) The Trust is registered as an open-end management
investment company under the 1940 Act, and the Trust's registration with the
Commission as an investment company under the 1940 Act is in full force and
effect.
(c) The current prospectuses and statements 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 the Trust's
Declaration 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 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, 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.
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(f) The financial statements of the Acquiring Fund are in
accordance with generally accepted accounting principles, and such statements
(copies of which have been furnished to the Selling Funds) fairly reflect the
financial condition of the Acquiring Fund as of April 30, 2001, and there are no
known contingent liabilities of the Acquiring Fund as of such date that are not
disclosed in such statements.
(g) Since the date of the financial statements referred to in
paragraph (f) above, there have been no material adverse changes in the
Acquiring Fund's financial condition, assets, liabilities or business (other
than changes occurring in the ordinary course of business), or any incurrence by
the Acquiring Fund of indebtedness maturing more than one year from the date
such indebtedness was incurred, except as otherwise disclosed to and accepted by
the Selling Fund. For the purposes of this subparagraph (g), a decline in the
net asset value of the Acquiring Fund shall not constitute a material adverse
change.
(h) At the Closing Date, all federal and other tax returns and
reports of the Acquiring Fund required by law to be filed by such date shall
have been filed. All federal and other taxes shown due on such returns and
reports shall have been paid or provision shall have been made for their
payment. To the best of the Acquiring Fund's knowledge, no such return is
currently under audit, and no assessment has been asserted with respect to such
returns.
(i) 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.
(j) 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, bankruptcy, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights and to general equity principles.
(k) 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.
(l) 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 and other laws and regulations.
(m) 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 each Closing Date, any written information furnished by the
Trust with respect to the Acquiring Fund for use in the Proxy Materials (as
defined paragraph 5.7), 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 misleading.
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(n) The Acquiring Fund intends to qualify as a RIC under the
Code, and with respect to each Acquiring Fund that has conducted material
investment operations before the Closing Date, the Acquiring Fund has elected to
qualify and has qualified as 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 current taxable year.
(o) No governmental consents, approvals, authorizations or
filings are required under the 1933 Act, the 1934 Act, the 1940 Act or Delaware
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, for
itself and on behalf of the Acquiring Fund, except for the effectiveness of the
Registration Statement, the necessary exemptive relief requested from the
Commission or its staff with respect to Sections 17(a) and 17(b) of the 1940
Act, and the filing of any articles, certificates or other documents that may be
required under Delaware law, 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.
(p) 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.
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 respective 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. ABN AMRO Funds will call a special
meeting of Selling Fund Shareholders to consider and act upon this Agreement (or
transactions contemplated thereby) and to take all other appropriate 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
corresponding 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 corresponding 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 applicable Closing Date.
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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 corresponding 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 KPMG LLP and certified by ABN AMRO Funds' Treasurer.
5.7 PREPARATION OF FORM N-14 REGISTRATION STATEMENT AND SCHEDULE 14A
PROXY STATEMENT. The Trust will prepare and file with the Commission a
registration statement on Form N-14 under the 1933 Act relating to the Acquiring
Fund Shares (the "Registration Statement"). ABN AMRO Funds will prepare and file
a proxy statement on Schedule 14A under the 1933 Act ("Proxy Statement"). The
Registration Statement shall include a proxy statement and a prospectus of each
Existing Acquiring Fund relating to the transaction contemplated by this
Agreement. The Registration Statement and the Proxy Statement shall be in
compliance with the 1933 Act, the 1934 Act and the 1940 Act, as applicable. Each
party will provide the other party with the materials and information necessary
to prepare the Registration Statement and Proxy Statement (the "Proxy
Materials"), as applicable, for inclusion therein, in connection with the
meeting(s) of the Selling Funds' Shareholders to consider the approval of this
Agreement and the transactions contemplated herein.
5.8 INDEMNIFICATION OF TRUSTEES. The Trust will assume certain
liabilities and obligations of the ABN AMRO Funds relating to any obligation of
the ABN AMRO Funds to indemnify its current and former Trustees and officers,
acting in their capacities as such, to the fullest extent permitted by law and
the ABN AMRO Funds' Declaration of Trust, 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 Trustees and officers, acting in their capacities as such,
under the ABN AMRO Funds' Declaration of Trust 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 which may
be asserted against the Trust, its successors or assigns.
5.9 The Trust shall take all action necessary so that at the Effective
Time Xx. Xxxxxx Brookstone and Xx. Xxxxxx Xxxxxxx, who have been selected and
nominated by the Trust's Nominating Committee to serve as independent trustees
(who are trustees who are not interested persons as defined by the 1940 Act),
shall become trustees of the Trust's Board of Trustees and shall serve in that
capacity in accordance with the Trust's declaration of trust and bylaws. The
Trust also shall take all action necessary so that at the Effective Time Messrs.
Brookstone and Feitler shall become members of each committee of the Board of
Trustees of the Trust that is then comprised of all independent trustees of the
Trust. The Trust shall also take all action necessary so that at the Effective
Time Xx. Xxxxx Xxxxxx shall become a trustee of the Trust's Board of Trustees
and shall serve in the capacity of interested trustee (who are trustees who are
interested persons as defined by the 1940 Act).
5.10 The Trust shall take all action necessary so that the Acquiring
Funds' total operating expenses after waivers and reimbursements do not exceed
the amounts set forth in Schedule B hereto for the periods set forth in such
Schedule following the Effective Time.
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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
corresponding Acquiring Fund of all the obligations to be performed by the
Acquiring Fund pursuant to this Agreement on or before the applicable 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 corresponding 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 Fund shall have received on the Closing Date an
opinion from Vedder, Price, Xxxxxxx & Kammholz, counsel to the Trust, dated as
of such Closing Date, in a form reasonably satisfactory to the Selling Fund,
covering the following points:
(a) Each Acquiring Fund is a legally designated, separate
series of the Trust, and the Trust is a business trust, duly organized, validly
existing and in good standing under the laws of the State of Delaware, which, 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 open-end management
investment company under the 1940 Act, and, to such counsel's knowledge, the
Trust's registration with the Commission as an investment company under the 1940
Act 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 ABN AMRO Funds,
is a valid and binding obligation of the Acquiring Funds enforceable against
each Acquiring Funds 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 State of Delaware is required for consummation by
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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 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 date(s) of mailing of the
Proxy Materials or the Closing Date, which are required to be described in the
Proxy Materials or to be filed as an exhibit thereto 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 Proxy Materials.
Such counsel shall also state that they have participated in
conferences with officers and other representatives of each Acquiring Fund at
which the contents of the Proxy Materials 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
Proxy Materials, 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 Proxy Materials, no facts have come to its
attention that leads it to believe that the Proxy Materials as of their dates,
as of the date of each Selling Fund 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 an Acquiring Fund or
necessary, in the light of the circumstances under which they were made, to make
such statements therein 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 Proxy Materials, and
that such opinion is solely for the benefit of the ABN AMRO Funds and each
Selling Fund. Such opinion shall contain such other assumptions and limitations
as shall be in the opinion of Vedder, Price, Xxxxxxx & Kammholz appropriate to
render the opinions expressed therein.
In this paragraph 6.2(h), references to the Proxy Materials include and
relate to only the text of such Proxy Materials and not to any exhibits or
attachments thereto or to any documents incorporated by reference therein.
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6.3 As of the Closing Date, 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 Proxy Materials.
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 Trustees
and officers of ABN AMRO Funds, covering the actions of such Trustees and
officers of ABN AMRO Funds for the period they served as such.
6.5 As of each respective Closing Date, the Trust's fidelity bond
for the Acquiring Funds shall meet all applicable requirements under the 1940
Act based on the level of the Acquiring Funds' assets immediately after the
Effective Time.
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 its 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 applicable 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 corresponding Acquiring Funds on such Closing Date a
certificate executed in the Selling Fund's name by ABN AMRO Funds' 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.
7.2 The Selling Fund shall have delivered to its corresponding
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 ABN AMRO Funds.
7.3 The Acquiring Fund shall have received on the applicable
Closing Date an opinion of Xxxxxx, Xxxxx & Bockius LLP, counsel to each Selling
Fund, dated as of such Closing Date, in a form reasonably satisfactory to the
Acquiring Fund, covering the following points:
(a) Each Selling Fund is a legally designated, separate series
of ABN AMRO Funds, and that ABN AMRO Funds is a voluntary association duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts, which, 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.
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(b) The ABN AMRO Funds 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 ABN AMRO Funds 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, all
issued and outstanding shares of the Selling Fund are legally issued and fully
paid and non-assessable, and no shareholder of a Selling Fund has any preemptive
rights with respect to the Selling Fund's shares.
(e) 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 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 ABN AMRO Funds' Declaration of Trust (assuming shareholder approval
has been obtained) 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 a Selling 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 the Selling Fund is a party or
by which it is bound.
(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 Proxy Materials
or the Closing Date, which are required to be described in the Proxy Materials
or to be filed as an exhibit thereto 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 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 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 Proxy Materials.
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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 Proxy Materials 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 Proxy
Materials, on the basis of the foregoing (relying as to materiality exclusively
upon the opinions of ABN AMRO Funds' officers and other representatives of each
Selling Fund) and without such counsel having made any investigations of the
statements made in the Proxy Materials, no facts have come to its attention that
leads it to believe that the Proxy Materials as of its date, as of the date of
each Selling Fund 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 such 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 financial
statements or any financial or statistical data, or as to the information
relating to each Acquiring Fund contained in the Proxy Materials, 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 Xxxxxx, Xxxxx & Xxxxxxx LLP appropriate to render the opinions
expressed therein.
In this paragraph 7.3(h), references to the Proxy Materials include and
relate to only the text of such Proxy Materials 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
applicable Closing Date with respect to each Selling Fund or its corresponding
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 Fund, shall have been approved by the requisite vote of
the holders of the outstanding shares of each Selling Fund in accordance with
Massachusetts law and the provisions of ABN AMRO Funds' Declaration of Trust and
By-Laws. Certified copies of the resolutions evidencing such approval shall have
been delivered to the corresponding 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 each 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.
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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 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 before
the applicable 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 before such Closing Date (after reduction for any capital loss
carry forward).
8.6 The parties shall have received an opinion of Xxxxxx, Xxxxx &
Bockius 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 identified liabilities of the Selling Fund (followed by the distribution of
Acquiring Fund Shares to the Selling Fund Shareholders in dissolution and
liquidation 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 Funds Share 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
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 Share to be received by each
Selling Fund Shareholder will include the period during which the Selling
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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 before 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 & Xxxxxxx 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 ABN AMRO Asset Management (USA) LLC and/or affiliates thereof
will pay the expenses associated with Selling Fund's participation in the
Reorganization. The investment adviser to the Acquiring Fund and/or affiliates
thereof will pay the expenses associated with Acquiring Fund's participation in
to the Reorganization. Reorganization expenses include, without limitation: (a)
expenses associated with the preparation and filing of the Registration
Statement and Proxy Statement; (b) postage; (c) printing; (d) accounting fees;
(e) legal fees incurred by each Fund; (f) solicitation costs of the transaction;
and (g) other related administrative or operational costs.
ARTICLE X
ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1 The Trust, on behalf of each Acquiring Fund, and ABN AMRO
Funds, on behalf of each Selling Fund, agree 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 each Closing Date, and the
obligations of each of the Acquiring Funds in sections 5.9 and 6.4, shall
continue in effect beyond the consummation of the transactions contemplated
hereunder.
ARTICLE XI
TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of
the Trust and the ABN AMRO Funds. In addition, either the Trust or the ABN AMRO
Funds may at their option terminate this Agreement at or before either Closing
Date due to:
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(a) a breach by the other of any representation, warranty, or
agreement contained herein to be performed at or before each 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 Trustees, as
appropriate, determine that the consummation of the transactions contemplated
herein are not in the best interest of the ABN AMRO Funds or the Trust,
respectively, and 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 ABN AMRO Funds, their
respective Trustees or officers, to the other party or its Trustees or officers,
but each shall bear the expenses incurred by it incidental to the preparation
and carrying out of this Agreement.
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 officers of the
Trust and the ABN AMRO Funds as specifically authorized by their respective
Board of Trustees; 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.
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.
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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 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. Neither the
authorization by such Trustees nor the execution and delivery by such officers
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 trust property of
each Acquiring Fund as provided in the Trust's Declaration of Trust.
IN WITNESS WHEREOF, the parties have duly executed this Agreement, all as of the
date first written above.
ALLEGHANY FUNDS
By:
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President
ABN AMRO FUNDS
By:
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
ACKNOWLEDGED:
By:
------------------------
Name:
---------------------
Title: of ABN AMRO Asset Management (USA) LLC
--------------------
20
21
SCHEDULE A TO THE AGREEMENT AND PLAN OF REORGANIZATION
SUMMARY OF THE REORGANIZATION
(shareholders of each Selling Fund will receive shares
of the class of the Acquiring Fund opposite their class)
----------------------------------------------------- --------------------------------------
ABN AMRO FUND (SELLING FUND) ALLEGHANY FUND (ACQUIRING FUND)
----------------------------------------------------- --------------------------------------
ABN AMRO Money Market Fund ABN Money Market Fund
- Common Shares - Class I Shares
- Investor Shares - Class S Shares
ABN AMRO Government Money Market Fund ABN Government Money Market Fund
- Common Shares - Class I Shares
- Investor Shares - Class S Shares
ABN AMRO Treasury Money Market Fund ABN Treasury Money Market Fund
- Common Shares - Class I Shares
- Investor Shares - Class S Shares
ABN AMRO Tax-Exempt Money Market Fund ABN Tax-Exempt Money Market Fund
- Common Shares - Class I Shares
- Investor Shares - Class S Shares
ABN AMRO Value Fund ABN Value Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Growth Fund ABN Growth Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Small Cap Fund ABN Small Cap Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Real Estate Fund ABN Real Estate Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO International Equity Fund ABN International Equity Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Europe Equity Growth Fund ABN Europe Equity Growth Fund
- Common Shares - Class N Shares
ABN AMRO Asian Tigers Fund ABN Asian Tigers Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
----------------------------------------------------- --------------------------------------
21
22
----------------------------------------------------- --------------------------------------------
ABN AMRO FUND (SELLING FUND) ALLEGHANY FUND (ACQUIRING FUND)
----------------------------------------------------- --------------------------------------------
ABN AMRO Latin America Equity Fund ABN Latin America Equity Fund
- Common Shares - Class N Shares
ABN AMRO Institutional Prime Money Market Fund ABN Institutional Prime Money Market Fund
- Institutional Shares - Class Y Shares
- Institutional Service Shares - Class YS Shares
ABN AMRO Balanced Fund Alleghany/Chicago Trust Balanced Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Fixed Income Fund Alleghany/Chicago Trust Bond Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
ABN AMRO Tax-Exempt Fixed Income Fund Alleghany/Chicago Trust Municipal Bond Fund
- Common Shares - Class N Shares
- Investor Shares - Class N Shares
----------------------------------------------------- --------------------------------------------
22
23
SCHEDULE B TO THE AGREEMENT AND PLAN OF REORGANIZATION
TOTAL NET FUND OPERATING EXPENSES
(as a percentage of net assets)
--------------------------------------------------------------------------------------------------------
FUND CLASS EXPENSE LIMIT
--------------------------------------------------------------------------------------------------------
ABN AMRO Asian Tigers Fund Class N Shares(1) 2.07%
ABN AMRO Europe Equity Growth Fund Class N Shares(1) 1.80%
ABN AMRO Growth Fund Class N Shares(1) 1.03%
ABN AMRO International Equity Fund Class N Shares(1) 1.34%
ABN AMRO Latin America Equity Fund Class N Shares(1) 2.02%
ABN AMRO Real Estate Fund Class N Shares(1) 1.32%
ABN AMRO Small Cap Fund Class N Shares(1) 1.15%
ABN AMRO Value Fund Class N Shares(1) 1.06%
ABN AMRO Government Money Market Fund Class I Shares(1) 0.29%
Class S Shares(1) 0.63%
ABN AMRO Money Market Fund Class I Shares(1) 0.35%
Class S Shares(1) 0.71%
ABN AMRO Tax-Exempt Money Market Fund Class I Shares(1) 0.32%
Class S Shares(1) 0.57%
ABN AMRO Treasury Money Market Fund Class I Shares(1) 0.35%
Class S Shares(1) 0.60%
ABN AMRO Institutional Prime Money Market Fund Class Y Shares(2) 0.18%
Class YS Shares(1) 0.43%
Alleghany/Chicago Trust Balanced Fund Class N Shares(1) [1.07%]
Alleghany/Chicago Trust Bond Fund Class N Shares(1) 0.74%
Alleghany/Chicago Trust Municipal Bond Fund Class N Shares(1) 1.00%
--------
(1) Expenses limited to the amount shown for eight full calendar quarters
following the Reorganization.
(2) Expenses limited to the amount shown for four full calendar quarters
following the Reorganization and 0.20% of its net assets for the following
four full calendar quarters.
23
