Form POS EX Federated Hermes Income
File No. 333-257018
As filed with the SEC on September 24, 2021
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. __
Post-Effective Amendment No. 1
(Check appropriate box or boxes)
FEDERATED HERMES INCOME SECURITIES TRUST
(Exact Name of Registrant as Specified in Charter)
1-800-341-7400
(Area Code and Telephone Number)
4000 Ericsson Drive
Warrendale, PA 15086-7561
(Address of Principal Executive Offices)
Peter J. Germain, Esquire
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
Copies to:
Thomas Early, Esquire
Goodwin Procter LLP
601 S. Figueroa St.
41st Floor
Los Angeles, CA 90017
Approximate Date of Proposed Public Offering: As soon as
practicable after this Registration Statement becomes effective
under the Securities Act of 1933, as amended.
Title of Securities Being Registered:
Class A Shares and Institutional Shares,
without par value, of Federated Hermes Capital Income Fund
It is proposed that this filing will become effective
Immediately upon filing pursuant to Rule 485 (b).
No filing fee is due because Registrant is relying on Section 24(f) of the Investment Company Act of 1940, as amended.
The purpose of this Post-Effective Amendment No. 1 to the Registration Statement of the Registrant on Form N-14 (333-257018) is to file Exhibit 12, Conformed copy of Executed Opinion regarding Tax Consequences of the Reorganization, as discussed in the Registrant’s Form N-14 filing on June 11, 2021.
This Post-Effective Amendment No. 1 consists of the following:
Cover Sheet
Contents of the Registration Statement
Part C --- Other Information
Signature Page
Exhibits
Item 15. Indemnification |
Indemnification is provided to Officers and Trustees of the Registrant pursuant to the Registrant's By-Laws, as amended. This includes indemnification against: (a) any liabilities or expenses incurred in connection with the defense or disposition of any action, suit or proceeding in which an Officer or Trustee may be or may have been involved; and (b) any liabilities and expenses incurred by an Officer or Trustee as a result of having provided personally identifiable information to a regulator or counterparty by or with whom the Registrant (or its series, as applicable) is regulated or engages in business to satisfy a legal or procedural requirement of such regulator or counterparty. The Investment Advisory Contract, and Sub-advisory Agreement as applicable, (collectively, “Advisory Contracts”) between the Registrant and the investment adviser, and sub-adviser as applicable, (collectively, “Advisers”) of its series, provide that, in the absence of willful misfeasance, bad faith, gross negligence, or reckless disregard of the obligations or duties under the Advisory Contracts on the part of the Advisers, Advisers shall not be liable to the Registrant or to any shareholder for any act or omission in the course of or connected in any way with rendering services or for any losses that may be sustained in the purchase, holding, or sale of any security. The Registrant’s distribution contract contains provisions limiting the liability, and providing for indemnification, of the Officers and Trustees under certain circumstances. Registrant's Trustees and Officers are covered by an Investment Trust Errors and Omissions Policy. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to Trustees, Officers, and controlling persons of the Registrant by the Registrant pursuant to the By-Laws, as amended, or otherwise, the Registrant is aware that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Act and, therefore, is unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by Trustees), Officers, or controlling persons of the Registrant in connection with the successful defense of any act, suit, or proceeding) is asserted by such Trustees, Officers, or controlling persons in connection with the shares being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issues. Insofar as indemnification for liabilities may be permitted pursuant to Section 17 of the Investment Company Act of 1940 for Trustees, Officers, and controlling persons of the Registrant by the Registrant pursuant to the By-Laws, as amended, or otherwise, the Registrant is aware of the position of the Securities and Exchange Commission as set forth in Investment Company Act Release No. IC-11330. Therefore, the Registrant undertakes that in addition to complying with the applicable provisions of the By-Laws, as amended, or otherwise, in the absence of a final decision on the merits by a court or other body before which the proceeding was brought, that an indemnification payment will not be made unless in the absence of such a decision, a reasonable determination based upon factual review has been made (i) by a majority vote of a quorum of non-party Trustees who are not interested persons of the Registrant or (ii) by independent legal counsel in a written opinion that the indemnitee was not liable for an act of willful misfeasance, bad faith, gross negligence, or reckless disregard of duties. The Registrant further undertakes that advancement of expenses incurred in the defense of a proceeding (upon undertaking for repayment unless it is ultimately determined that indemnification is appropriate) against an Officer, Trustee or controlling person of the Registrant will not be made absent the fulfillment of at least one of the following conditions: (i) the indemnitee provides security for his undertaking; (ii) the Registrant is insured against losses arising by reason of any lawful advances; or (iii) a majority of a quorum of disinterested non-party Trustees or independent legal counsel in a written opinion makes a factual determination that there is reason to believe the indemnitee will be entitled to indemnification determination that there is reason to believe the indemnitee will be entitled to indemnification.
|
Item 16. Exhibits
Exhibit Number | DESCRIPTION |
(3) | Voting Trust Agreement |
Not applicable |
(4) | Agreement of Acquisition, Reorganization, Merger, Liquidation and any Amendments | |
Form of Agreements and Plans of Reorganization filed herein as Annex A to the Prospectus/Proxy Statement as filed via EDGAR on June 11, 2021 on Form N-14 (File Nos. 811-4577 and 333-257018). |
(5) | Instruments Defining Rights of Security Holders | |
5.1 | Copy of Specimen Certificate for Institutional Shares and Institutional Service Shares of Beneficial Interest for Federated Income Securities Trust, as filed via EDGAR in Post-Effective Amendment No. 21 on June 24, 1994 on Form N-1A (File Nos. 33-3164 and 811-4577) | |
As of September 1, 1997, Federated Securities Corp. stopped issuing share certificates. |
(8) | Bonus or Profit Sharing Contracts |
Not applicable |
(11) | Legal Opinion | |
Conformed Copy of Opinion and Consent of Counsel Regarding the Legality of Shares being Issued as filed via EDGAR on June 11, 2021 on Form N-14 (File Nos. 811-4577 and 333-257018). |
(12) | Tax Opinion | |
Conformed copy of Opinion regarding Tax Consequences of the Reorganization | + |
(15) | Omitted Financial Statements |
Not Applicable |
(17) | Form of Ballot as filed via EDGAR on June 11, 2021 on Form N-14 (File Nos. 811-4577 and 333-257018). |
+ | Exhibit is being filed electronically with registration statement; indicate by footnote |
Item 17. Undertakings
(1) The undersigned Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this Registration Statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the Registration Statement and will not be used until the amendment is effective, and that, in determining any liability under the Securities Act of 1933, each post-effective amendment shall be deemed to be a new Registration Statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them.
(3) The undersigned Registrant agrees to file by Post-Effective Amendment the opinion of counsel regarding the tax consequences of the proposed reorganization required by Item (16)(12) of Form N-14 prior to the closing date of the reorganization.
SIGNATURES As required by the Securities Act of 1933, this registration statement has been signed on behalf of the registrant, in the City of Pittsburgh and Commonwealth of Pennsylvania, on the 24th day of June 2021. |
FEDERATED HERMES INCOME SECURITIES TRUST |
BY: /s/ George F. Magera George F. Magera, Assistant Secretary |
As required by the Securities Act of 1933, this registration statement has been signed below by the following person in the capacity and on the date indicated: |
NAME | TITLE | DATE |
BY:/s/ George F. Magera George F. Magera, Assistant Secretary |
Attorney In Fact For the Persons Listed Below | September 24, 2021 |
J. Christopher Donahue* | President and Trustee (Principal Executive Officer) | |
John B. Fisher* | Trustee | |
Lori A. Hensler* | Treasurer (Principal Financial Officer/Principal Accounting Officer) | |
John T. Collins* | Trustee | |
G. Thomas Hough* | Trustee | |
Maureen Lally-Green* | Trustee | |
Thomas O’Neill* | Trustee | |
Madelyn A. Reilly* | Trustee | |
P. Jerome Richey* | Trustee | |
John S. Walsh* | Trustee | |
*By Power of Attorney |
Exhibit 12
September 24, 2021
Federated
Hermes Income Securities Trust
4000 Ericsson Drive
Warrendale, PA 15086-7561
The Advisors’ Inner Circle Fund II
One Freedom Valley Drive
Oaks, Pennsylvania 19456
Re: | Reorganization of Series of a Massachusetts Business Trust and a Massachusetts Business Trust |
Ladies and Gentlemen:
Federated Hermes Income Securities Trust, a Massachusetts business trust (“Surviving Fund Trust”), on behalf of its series, Federated Hermes Capital Income Fund (“Surviving Fund”), and The Advisors’ Inner Circle Fund II, a Massachusetts business trust (“Reorganizing Fund Trust”), on behalf of its series, Hancock Horizon Diversified Income Fund (“Reorganizing Fund”),1 have requested our opinion as to certain federal income tax consequences of the acquisition of all or substantially all of the assets of the Reorganizing Fund by the Surviving Fund pursuant to an Agreement and Plan of Reorganization (“Agreement”) dated as of July 12, 2021 by and among the Surviving Fund Trust, on behalf of the Surviving Fund, the Reorganizing Fund Trust, on behalf of the Reorganizing Fund, and, for purposes of paragraphs 1.3, 1.9, 3.3, 3.5, 4.3, 5.10, 7.4, and 10.2 and Articles VI, IX, XI, XII and XIII thereof only, Hancock Whitney Bank.2 The Agreement contemplates the Reorganizing Fund transferring all or substantially all of its assets to the Surviving Fund in exchange solely for shares in the Surviving Fund, followed by the Reorganizing Fund’s distribution of those shares pro rata to its Shareholders in liquidation thereof (all the foregoing transactions involving the Reorganizing Fund and the Surviving Fund being referred to herein individually as the “Reorganization”).
In rendering this opinion, we have examined (1) the Agreement and (2) the Proxy Statement/Prospectus dated July 12, 2021, regarding the Reorganization (“Proxy Statement”) (collectively, “Documents”). We have assumed, for those purposes, the accuracy and completeness of the information contained in all the Documents. As to various matters of fact material to this opinion, we have relied, exclusively and without independent verification (with your permission), on the representations and warranties made in the Agreement and on the statements and representations of officers and other representatives of the Funds (each, a “Representation” and collectively the “Representations”). We have assumed that any Representation made “to the knowledge and belief” (or similar qualification) of any person or party is, and at the Closing Date will be, correct without that qualification. We have also assumed that as to all matters for which a person or entity has represented that the person or entity is not a party to, does not have, or is not aware of any plan, intention, understanding, or agreement, there is and was no such plan, intention, understanding, or agreement. Finally, we have assumed that the Documents and the Representations present all the material and relevant facts relating to the Reorganization.
OPINION
With respect to the Reorganization and the Funds participating therein and the Shareholders thereof, it is our opinion that, based solely on the facts and Representations set forth in the Documents and the assumptions described above, and conditioned on all the Representations being true and complete on the Closing Date and the Reorganization being consummated in accordance with the Agreement (without the waiver or modification of any terms or conditions thereof and without taking into account any amendment thereof that we have not approved), for federal income tax purposes:
(1) As set forth in the Agreement, the transfer of all or substantially all of the Reorganizing Fund’s assets to the Surviving Fund solely in exchange for Surviving Fund Shares (followed by the distribution of Surviving Fund Shares to the Reorganizing Fund shareholders in dissolution, liquidation and termination of the Reorganizing Fund) will constitute a “reorganization” within the meaning of Section 368(a)3, and the Surviving Fund and the Reorganizing Fund will each be a “party to a reorganization” within the meaning of Section 368(b).
(2) No gain or loss will be recognized by the Surviving Fund upon the receipt of the assets of the Reorganizing Fund solely in exchange for Surviving Fund Shares.
(3) No gain or loss will be recognized by the Reorganizing Fund upon the transfer of the Reorganizing Fund’s assets to the Surviving Fund solely in exchange for Surviving Fund Shares or upon the distribution (whether actual or constructive) of Surviving Fund Shares to Reorganizing Fund Shareholders in exchange for their Reorganizing Fund Shares.
(4) No gain or loss will be recognized by Reorganizing Fund Shareholders upon the exchange of Reorganizing Fund Shares for Surviving Fund Shares (including fractional shares).
(5) The aggregate tax basis of the Surviving Fund Shares received by each Reorganizing Fund Shareholder pursuant to the Reorganization (including any fractional shares) will be the same as the aggregate tax basis of the Reorganizing Fund Shares held by such Reorganizing Fund Shareholder immediately prior to the Reorganization. The holding period of Surviving Fund Shares received by each Reorganizing Fund Shareholder (including any fractional shares) will include the period during which the Reorganizing Fund Shares exchanged therefor were held by such shareholder, provided the Reorganizing Fund Shares are held as capital assets at the time of the Reorganization.
(6) The tax basis of the Reorganizing Fund’s assets acquired by the Surviving Fund will be the same as the tax basis of such assets to the Reorganizing Fund immediately prior to the Reorganization. The holding period of the assets of the Reorganizing Fund in the hands of the Surviving Fund will include the period during which those assets were held by the Reorganizing Fund.
(7) The Surviving Fund will succeed to and take into account, as of the date of the transfer (as defined in Section 1.381(b)-1(b) of the Treasury Regulations), the items of the Reorganizing Fund described in Section 381(c), subject to the conditions and limitations specified in Sections 381, 382, 383 and 384 and the Regulations thereunder.
Notwithstanding anything herein to the contrary, we express no opinion as to the effect of the Reorganization on the Funds participating therein or the Shareholders thereof with respect to any asset as to which any unrealized gain or loss is required to be recognized for federal income tax purposes at the end of a taxable year (or on the termination or transfer thereof under a mark-to-market system of accounting).
Our opinion regarding the Reorganization is based on, and is conditioned on the continued applicability of, the provisions of the Code and Treasury Regulations, judicial decisions, and rulings and other pronouncements of the Internal Revenue Service (the “IRS”) in existence on the date hereof. All the foregoing authorities are subject to change or modification that can be applied retroactively and thus also could affect the conclusions expressed herein; we assume no responsibility to update our opinion after the date hereof with respect to any such change or modification. Our opinion represents our best judgment regarding how a court would decide the issues addressed herein and is not binding on the IRS or any court. Moreover, our opinion does not provide any assurance that a position taken in reliance thereon will not be challenged by the IRS, and although we believe that our opinion would be sustained by a court if challenged, there can be no assurances to that effect.
Our opinion addresses only the specific federal income tax consequences of the Reorganization set forth above and does not address any other federal, or any state, local, or foreign tax consequences of the Reorganization or any other action (including any taken in connection therewith). Our opinion also applies with respect to the Reorganization only to the extent each Fund is solvent, and we express no opinion about the tax treatment of the Reorganization if either Fund is insolvent. Finally, our opinion is solely for information and use of the addressees, the Funds and their Shareholders and may not be relied on for any purpose by any other person without our express written consent.
Very truly yours,
/s/ K&L Gates LLP
1 Each of Surviving Fund and Reorganizing Fund is sometimes referred to herein as a “Fund.”
2 Each capitalized term that is not defined herein has the meaning ascribed thereto in the Agreement.
3 “Section” references are to the Internal Revenue Code of 1986, as amended (the “Code”).
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