s13d_092911-libertyallstar.htm

0000904454-11-000552.txt : 20110929 0000904454-11-000552.hdr.sgml : 20110929 20110929171804 ACCESSION NUMBER: 0000904454-11-000552 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20110929 DATE AS OF CHANGE: 20110929 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY ALL STAR GROWTH FUND INC. CENTRAL INDEX KEY: 0000786035 IRS NUMBER: 521452208 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-84682 FILM NUMBER: 111115219 BUSINESS ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: P.O. BOX 328 CITY: DENVER STATE: CO ZIP: 80201-0328 BUSINESS PHONE: 303.623.2577 MAIL ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: P.O. BOX 328 CITY: DENVER STATE: CO ZIP: 80201-0328 FORMER COMPANY: FORMER CONFORMED NAME: LIBERTY ALL STAR GROWTH FUND INC /MD/ DATE OF NAME CHANGE: 19960612 FORMER COMPANY: FORMER CONFORMED NAME: ALLMON CHARLES TRUST INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: GROWTH STOCK OUTLOOK TRUST INC DATE OF NAME CHANGE: 19910807 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: DST SYSTEMS INC CENTRAL INDEX KEY: 0000714603 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 431581814 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 333 WEST 11TH STREET STREET 2: 5TH FL CITY: KANSAS CITY STATE: MO ZIP: 64105-1594 BUSINESS PHONE: 8164356568 MAIL ADDRESS: STREET 1: 333 WEST 11TH STREET STREET 2: 5TH FL CITY: KANSAS CITY STATE: MO ZIP: 64105-1594 SC 13D 1 s13d_092911-libertyallstar.htm SCHED 13D FOR LIBERTY ALL-STAR GROWTH FUND BY DST SYSTEMS, INC. s13d_092911-libertyallstar.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


SCHEDULE 13D
Under the Securities Exchange Act of 1934
Liberty All-Star Growth Fund, Inc. (ASG)
(Name of Issuer)
Common Stock, $0.10 par value
(Title of Class of Securities)
529900102
(CUSIP Number)
DST Systems, Inc. Attn: DST Corporate Secretary 333 W. 11th Street, 5th Floor Kansas City, MO 64105 (816) 435-1000	Brian D. McCabe Ropes & Gray LLP Prudential Tower 800 Boylston Street Boston, MA 02199 (617) 951-7000
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
September 29, 2011
(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box: ¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP Number 529900102

SCHEDULE 13D

(1)	NAME OF REPORTING PERSON: DST Systems, Inc. I.R.S. Identification No. 43-1581814
(2)	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) ¨
(3)	SEC USE ONLY
(4)	SOURCE OF FUNDS WC
(5)	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) ¨
(6)	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		(7)	SOLE VOTING POWER 2,863,962
		(8)	SHARED VOTING POWER -0-
		(9)	SOLE DISPOSITIVE POWER 2,863,962
		(10)	SHARED DISPOSITIVE POWER -0-
(11)	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,863,962
(12)	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES ¨
(13)	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) 9.5%1
(14)	TYPE OF REPORTING PERSON CO

1 See Items 3 and 5

CUSIP Number 529900102

(1)	NAME OF REPORTING PERSON: West Side Investment Management, Inc. I.R.S. Identification No. 20-3477185
(2)	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ¨ (b) ¨
(3)	SEC USE ONLY
(4)	SOURCE OF FUNDS AF
(5)	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) ¨
(6)	CITIZENSHIP OR PLACE OF ORGANIZATION Nevada
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		(7)	SOLE VOTING POWER 2,863,962
		(8)	SHARED VOTING POWER -0-
		(9)	SOLE DISPOSITIVE POWER 2,863,962
		(10)	SHARED DISPOSITIVE POWER -0-
(11)	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,863,962
(12)	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES ¨
(13)	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) 9.5%2
(14)	TYPE OF REPORTING PERSON CO

2 See Items 3 and 5

CUSIP Number 529900102

Item 1.

Security and Issuer

The class of equity securities to which this Statement relates is the common stock (the “Common Stock”) of Liberty All-Star Growth Fund, Inc., a Maryland corporation (the “Fund” or the “Issuer”). The address of the Fund’s principal executive offices is 1290 Broadway, Suite 1100, Denver, Colorado 80203.

Item 2.

Identity and Background

This Statement is being filed jointly by (i) DST Systems, Inc. (“DST Systems”), a Delaware corporation and a publicly traded company on the New York Stock Exchange, and (ii) West Side Investment Management, Inc., a Nevada corporation and a wholly owned subsidiary of DST Systems (“West Side” and, together with DST Systems, the “Reporting Persons”).

The following is the address of the principal executive offices and principal business of DST Systems: 333 West 11th Street, Kansas City, Missouri 64105.

The following is the address of the principal executive offices and principal business of West Side: 400 South 4th Street, 3rd Floor, Las Vegas, NV 89101.

DST Systems provides sophisticated information processing and computer software products and services to support the mutual fund, investment management, insurance and healthcare industries. In addition to technology products and services, DST Systems provides integrated print and electronic statement and billing output solutions through a wholly owned subsidiary. West Side is a wholly owned subsidiary of DST Systems, and manages a portion of DST Systems’ passive investment portfolio.

During the last five years, none of the Reporting Persons have been (i) convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) party to a civil proceeding of a judicial or administrative body of competent jurisdiction resulting in their being subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3.

Source and Amount of Funds

The source of funds for the pending purchase by DST Systems of the shares of Common Stock described in Item 4 will be unrestricted working capital. DST Systems intends to contribute the shares of Common Stock to West Side concurrent with or promptly following such purchase.

Item 4.

Purpose of Transaction

ALPS Advisors, Inc. (“AAI”), a subsidiary of ALPS Holdings, Inc. (“ALPS”), serves as the investment adviser to the Fund. On July 19, 2011, ALPS entered into a merger agreement with DST Systems (the “Transaction Agreement”) providing for the acquisition of ALPS by DST Systems (the “Transaction”). Completion of the Transaction is subject to a number of conditions. ALPS and DST Systems currently expect to complete the Transaction in the fourth quarter of 2011, following which ALPS will become a wholly owned subsidiary of DST Systems. The directors of the Fund have approved a new advisory agreement with AAI under which AAI will continue to serve as the investment adviser to the Fund following the Transaction (the “New Advisory Agreement”). The New Advisory Agreement is subject to the approval of the Fund’s shareholders, as described in the Fund’s Proxy Statement filed with the Commission on August 19, 2011.

In connection with the Transaction, DST Systems has entered into agreements (the “Standstill Agreements”) with Karpus Management, Inc. (d/b/a Karpus Investment Management) and Brinker Capital, Inc. (the “Sellers”) for and on behalf of themselves and entities and accounts that they respectively control, or with respect to which they respectively exercise voting discretion to purchase shares of Common Stock of the Fund within thirty (30) days of the closing of the Transaction. The number of shares of Common Stock to be purchased will be based on a total purchase price of $12.0 million, and a price per share equal to 98% of the net asset value, or NAV, per share determined on the second business day preceding the date of purchase. DST Systems will also purchase shares of Liberty All-Star Equity Fund (USA), a separate fund managed by AAI, from the Sellers for a total purchase price of $3.0 million, and at a price per share equal to 98% of the NAV per share determined on the second business day preceding the date of purchase. The parties may agree to a different allocation between the two funds, so long as the total purchases do not exceed a total aggregate purchase price of $15.0 million. As part of the Standstill Agreements, the Sellers have agreed to vote or cause to be voted all shares of the Fund that the Sellers directly or indirectly have the power to vote or direct the vote of to be voted in favor of the New Advisory Agreement, and to not take certain actions with respect to shares of the Fund or with respect to the management of the Fund for a period of five years, and, in the case of Karpus Management, Inc., to withdraw a previously-filed preliminary proxy statement opposing the New Advisory Agreement. This summary of the Standstill Agreements is qualified in its entirety by reference to the full text of the Standstill Agreements filed as Exhibits to this Statement on Schedule 13D.

Item 5.

Interest in Securities of Issuer

(a) through (c)

Following the consummation of the Transaction described in Item 4 above and upon DST Systems’ subsequent purchase of shares of Common Stock pursuant to the Standstill Agreements and the contribution of such shares by DST Systems to West Side, West Side expects to be the beneficial owner of, and to have sole power to vote or to direct the vote or sole power to dispose or to direct the disposition of, 2,863,962 shares of Common Stock of the Fund, assuming a total purchase price of $12.0 million and a NAV of $4.19 per share (based on the closing NAV as of September 27, 2011). This would represent beneficial ownership of approximately 9.5% of the Fund’s total outstanding Common Stock. This calculation is based on 30,080,350 shares of Common Stock outstanding as of July 19, 2011, as reported in the Fund’s Schedule 14A Definitive Proxy Statement filed with the Commission on August 19, 2011. Such securities may be deemed to be indirectly beneficially owned by DST Systems by virtue of the fact that West Side is a wholly owned subsidiary of and is controlled by DST Systems.

	(d)	None.
	(e)	Not applicable.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer

See Item 4 above.

Item 7.

Materials to be Filed as Exhibits

The following documents are filed as exhibits to this Statement:

Exhibit 1		Standstill Agreement, dated as of September 14, 2011, by and between DST Systems, Inc. and Karpus Management, Inc.
Exhibit 2		Standstill Agreement, dated as of September 28, 2011, by and between DST Systems, Inc. and Brinker Capital, Inc.

CUSIP Number 529900102

Signature

After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this Statement is true, complete and correct.

DATED: September 29, 2011

	DST Systems, Inc.
	By:	/s/ Kenneth V. Hager
		Name: Kenneth V. Hager Title: Vice President, Chief Financial Officer and President
	West Side Investment Management, Inc.
	By:	/s/ Gerard M. Lavin
		Name: Gerard M. Lavin Title: President

EXHIBIT INDEX

Exhibit 1	Standstill Agreement, dated as of September 14, 2011, by and between DST Systems, Inc. and Karpus Management, Inc.
Exhibit 2	Standstill Agreement, dated as of September 28, 2011, by and between DST Systems, Inc. and Brinker Capital, Inc.

EX-99.1 2 exh1_092911-libertyallstar.htm EXHIBIT 1 TO SCHED 13D FOR LIBERTY ALL-STAR GROWTH FUND exh1_092911-libertyallstar.htm

Exhibit 1

STANDSTILL AGREEMENT

This Standstill Agreement (the “Agreement”) is made and entered into effective as of the 14th day of September 2011 by and between DST Systems, Inc. (“DST”) and Karpus Management, Inc. (d/b/a Karpus Investment Management), for and on behalf of itself and entities and accounts that it controls directly or indirectly, or with respect to which it exercises voting discretion, whether such entities or accounts now exist or are organized in the future, including any such entities and accounts holding shares that were reported in the Schedule 13D filed with respect to Liberty All-Star Growth Fund, Inc. (“Growth Fund”) by Karpus Investment Management, Inc. (collectively, “Karpus” and Karpus, together with DST, the “parties” and each, individually, a “party”).

WHEREAS, on July 19, 2011, DST announced that it had entered into an agreement to purchase ALPS Holdings Inc. (“ALPS Holdings”), that parent company of ALPS Advisors Inc. (“AAI”) (the “Transaction”);

WHEREAS, AAI is the investment adviser to Growth Fund and Liberty All-Star Equity Fund (“Equity Fund” and, together with Growth Fund, the “Funds” and, individually, a “Fund”);

WHEREAS, upon the closing of the Transaction (the “Closing”) the investment advisory agreements between AAI and the Funds, and among AAI, the Funds and their respective sub-advisers, will terminate and, as a result, each Fund is holding a special shareholder meeting at which shareholders will be asked to vote on new investment advisory agreements that would become effective upon the Closing (“New Advisory Agreements”);

WHEREAS, DST anticipates that the Closing will take place on or before December 31, 2011;

WHEREAS, Karpus is a shareholder of Growth Fund and Equity Fund;

WHEREAS, Karpus has filed a preliminary proxy statement for each Fund opposing the New Advisory Agreements;

WHEREAS, the parties wish to resolve matters relating to the Transaction;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, and for other good and valuable consideration that the parties hereby acknowledge, the parties agree as follows:

1. DST. Within 30 days after the Closing, DST shall purchase from Karpus shares of the Funds at a price per share equal to 98% of the net asset value per share, determined on the second business day preceding the date of purchase, and a total purchase price of $13.58 million. DST shall allocate purchases between the Funds such that $10.91 million of its purchases will be for Growth Fund shares and $2.67 million of its purchases will be for Equity Fund shares; provided, however, that the parties may agree in writing to a different allocation between the Fund shares so long as the total purchases do not exceed $13.58 million.

2. Karpus. Karpus hereby agrees to withdraw its preliminary proxy statements as soon as possible and, in any event, no later than two (2) business days after the date of this Agreement and shall take any steps necessary and/or reasonably requested by DST or AAI to document its withdrawal of the preliminary proxy statements, including, but not limited to, Karpus making any necessary filings with the U.S. Securities and Exchange Commission (“SEC”). In addition, Karpus shall vote or cause to be voted all shares of each Fund that Karpus directly or indirectly has the power to vote or direct the vote of to be voted in favor of the New Advisory Agreements as soon as possible and, in any event, no later than two (2) business days after the date of this Agreement, and further agrees not to change, alter, rescind or revoke any such vote in any manner.

For a period of five (5) years from the date of this Agreement (the “Restricted Period”), Karpus shall not directly or indirectly, with respect to either Fund: (i) submit any shareholder proposals for the vote or consent (collectively, “vote”) of shareholders (whether pursuant to Rule 14a8 under the Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise) or any proposal for consideration by either Fund’s Board; (ii) nominate any candidate for election as a director or trustee or otherwise seek appointment to or representation of the Board; (iii) solicit proxies or make, participate in or encourage any “solicitation” (as such terms is used in the proxy rules of the SEC) for proxies for any shareholder proposals or nominations of candidates for election as directors or trustees; or (iv) form or join in a partnership, syndicate or other group, including, without limitation, a “group” as defined under Section 13(d) of the Exchange Act, with respect to either Fund’s shares, or deposit any Fund shares in a voting trust, arrangement or agreement, or subject either Fund’s shares to a voting trust, arrangement or agreement. During the Restricted Period, Karpus shall not either directly or indirectly, explicitly or implicitly, publicly or privately: (i) encourage, recommend, advise, finance or urge others to put forward shareholder proposals or nominations with respect to directors/trustees of either Fund or otherwise have discussions or enter into any arrangements with any other person in connection with any of the foregoing as they relate to the Funds; (ii) indicate support or approval for any shareholder proposals or nominations relating to either Fund (other than voting in accordance with the immediately following clause (iii)); (iii) cause or permit any shares of either Fund that Karpus directly or indirectly has the power to vote or direct the vote of, to be voted on any matter in any way other than in accordance with the recommendations of the respective Fund’s Board, or to be withheld from or otherwise abstain from voting on any such matter; (iv) solicit or encourage others to vote against any matter recommended by either Fund’s Board; (v) otherwise act, alone or in concert with others, to seek to control the management, Board or policies of either Fund; (vi) threaten to bring or pursue or bring or pursue any suit, regulatory action or proceeding against DST or any of its subsidiaries or affiliates, either Fund, either Fund’s Board or either Fund’s investment adviser, other than for alleged violations of this Agreement; or (vii) take or seek to take, or cause or seek to cause or solicit others to take, any action inconsistent with any of the foregoing as they relate to the Funds.

3. No Disparagement. During the Restricted Period, each party, and their respective officers and directors, shall refrain from directly or indirectly disparaging or impugning, or taking any action reasonably likely to damage or impugn, the reputation of the other parties hereto or the Board, officers or investment adviser of either Fund. The foregoing shall not apply to any compelled testimony or production of information, by legal process, subpoena or as part of a response to a request for information from any governmental authority with jurisdiction over the party from whom information is sought, or to any pleading in defense of any legal or regulatory complaint, litigation or proceeding.

4. Confidentiality. Other than announcements made by DST, AAI, either Fund or otherwise made public by DST, AAI or either Fund, the existence of, and all terms and provisions of, this Agreement shall remain confidential; provided, however, that any other party hereto, ALPS Holdings, any member of either Fund’s Board, the Funds’ officers, or the officers or directors of Karpus, may make disclosure necessary to comply with all applicable laws, rules or regulations, including applicable rules of any regulatory or self regulatory body, including any filings pursuant to, among other matters, Section 13(d) of the Exchange Act and the rules thereunder of the SEC, having jurisdiction over any such person, or legal process including but not limited to deposition, interrogatory, civil investigation, demand or similar process, subject to the provisions of the immediately succeeding paragraph.

In the event that any party to this Agreement other than DST, or any person other than AAI, either Fund, ALPS Holdings, any member of either Fund’s Board or Funds’ officers, is requested or required to disclose any information regarding matters covered by this Agreement not already in the public domain (the “Information”), such person, if permitted, shall provide the parties with prompt written notice of such request or requirement so that such notified person may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. If, in the absence of a protective order or other remedy or the receipt of a waiver the disclosing party is nonetheless, in the opinion of its counsel, compelled by law or regulation to disclose some or all of the Information, the party required to make such disclosure may, without liability hereunder, disclose only that portion of the Information which such counsel advises is required by law or regulation to be disclosed, provided that the disclosing party exercises reasonable efforts to preserve the confidentiality of the Information, including, without limitation, by cooperating with the person seeking to protect the Information to obtain an appropriate protective order; provided, however, that all costs (including any reasonable legal fees incurred by the disclosing party) that relate to obtaining such protective order shall be borne by the person seeking to keep such Information confidential.

5. Notices. Any notices and other communications hereunder shall be delivered by email or facsimile, with a copy by personal delivery, overnight delivery or ordinary mail, directed as follows:

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To DST, by delivery to:

Randall D. Young

Vice President, General Counsel & Secretary

DST Systems, Inc.

333 W. 11th Street, 5th Floor

Kansas City, MO 64105

Email: rdyoung@dstsystems.com

Facsimile: (816) 435-8630

With copies to:

Brian D. McCabe

Ropes & Gray LLP

Prudential Tower

800 Boylston Street

Boston, MA 02199

Email: brian.mccabe@ropesgray.com

Facsimile: (617) 235-0425

To ALPS Holdings, AAI, either Fund and either Fund’s Board, by delivery to:

Bill Parmentier

Senior Vice President

ALPS Advisors Inc.

99 High Street, Suite 303

Boston, MA 02110

Email: william.parmentier@alpsinc.com

Facsimile: (617) 426-1962

With copies to:

Clifford Alexander, Esq.

Jennifer Gonzalez, Esq.

K&L Gates LLP

1601 K Street, NW

Washington DC 20006

Email: clifford.alexander@klgates.com

jennifer.gonzalez@klgates.com

Facsimile: (202) 778-9100

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To Karpus, by delivery to:

Karpus Management, Inc.

183 Sully’s Trail

Pittsford, New York 14534

Attention: Sharon Thornton

Email: sharon@karpus.com

Facsimile: (585) 586-4315

With copies to:

Edwin M. Larkin, Esq.

Hiscock & Barclay, LLP

100 Chestnut Street

2000 HSBC Plaza

Rochester, New York 14604

Email: elarkin@hblaw.com

Facsimile: (585) 295-8441

Such addresses may be changed from time to time by means of a notice given in the manner provided above. Delivery for all notices and other communications (other than legal process) hereunder shall be deemed effective upon receipt of such communication by personal delivery, overnight delivery or mail. Delivery solely to outside counsel shall not constitute duly given notice to any party hereto.

6. Enforcement. The parties agree that breach of this Agreement may cause immediate and irreparable harm and that, in the event of breach or threatened breach of this Agreement, each party shall be entitled to seek injunctive and other equitable relief without proof of actual damages in addition to any other remedies as may be available at law or in equity. Each party further agrees to waive any requirement for the securing or posting of any bond in connection with such remedy. All rights under this Agreement are cumulative, not exclusive, and will be in addition to all rights and remedies available to either party at law or in equity.

7. No Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective agents, executors, heirs, successors and permitted assigns. Neither this Agreement nor any of the benefits of this Agreement shall be assigned by a party without the prior written consent of the other parties hereto. No person not a party to this Agreement shall have any rights, benefits or obligations hereunder.

8. Amendments. No amendments, changes or modifications may be made to this Agreement without the express prior written consent of each of the parties hereto.

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9. Invalidity. If any term or provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms and provisions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

10. No Waiver. No failure or delay by a party in exercising any right hereunder or any partial exercise thereof shall operate as a waiver thereof or preclude any other or further exercise of any right hereunder. No waiver, express or implied, by any party of any breach or default by any other party in the performance by the other party of its obligations under this Agreement shall be deemed or construed to be a waiver of any other breach or default, whether prior, subsequent, or contemporaneous, under this Agreement. Any waiver must be in writing and executed by the party against whom the waiver is sought to be charged.

11. Counterparts. This Agreement may be executed in counterparts each of which shall be deemed an original, and when taken together all such counterparts shall be deemed to constitute one and the same document.

12. Applicable Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to applicable principles of conflicts of law or choice of laws of any state that would cause the application to this Agreement of the law of any state other than the State of New York. Each party hereto hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the State and Federal courts located in Monroe County or New York County, New York, United States of America in any action or proceeding arising out of or relating to this Agreement, and agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, such Federal court. A final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suits on the judgment or in any other manner provided by law. The parties hereto irrevocably and unconditionally waive any objection which they may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to the Agreement in any State or Federal court in the Counties referenced above and State of New York.

13. Default. In the event of an alleged breach by DST of its obligations pursuant to Section 1 of this Agreement, Karpus will send written notice to DST describing such alleged breach and, upon receiving such notice, DST shall have ten (10) business days (the “Cure Period”) to cure such breach or to provide information confirming the lack of such breach. In the event that after the Cure Period any litigation occurs between the parties because of an alleged breach by DST of its obligations pursuant to Section 1 of this Agreement, it is agreed that Karpus shall be entitled to require that DST specifically perform its obligations pursuant to Section 1, including but not limited to purchasing Fund shares in the amount and at the purchase price described in Section 1, without Karpus being required to prove irreparable damages or being required to post a bond or other security. In the event Karpus is the principal prevailing party in any such litigation, as determined in a judgment by the court, Karpus shall be entitled to recover all its fees and expenses relating to such litigation, including, but not limited to, court costs, reasonable attorneys fees, witness fees, expert fees and applicable travel expenses. In addition, in the event that Karpus is the principal prevailing party in the above-referenced litigation, Karpus shall be entitled to receive $1.5 million in liquidated damages. Only in the event that DST does not purchase all the Fund shares required to be purchased in any judgment by the court within 30 days of such judgment shall Karpus be relieved of its obligations under this Agreement, including but not limited to, its obligations pursuant to the second paragraph of Section 2 and the confidentiality provisions of Section 3 of the Agreement.

14. Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

15. Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto regarding the subject matter hereof. No representations, warranties, or inducements have been made by any party hereto concerning this Agreement other than those contained and memorialized herein. This Agreement integrates the whole of their agreements and understandings concerning the same. No prior oral or written representations or understandings concerning the subject matter hereof will operate to amend, supersede or replace any of the terms or conditions set forth in this Agreement, nor will they be relied upon.

[The remainder of this page left blank intentionally.]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above.


KARPUS MANAGEMENT, INC., d/b/a
Karpus Investment Management
By:	/s/ Sharon L. Thornton
Name:	Sharon L. Thornton
Title:	Senior Director of Investments
DST SYSTEMS, INC.
By:	/s/ Stephen C. Hooley
Name:	Stephen C. Hooley
Title:	President

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EX-99.2 3 exh2_092911-libertyallstar.htm EXHIBIT 2 TO SCHED 13D FOR LIBERTY ALL-STAR GROWTH FUND exh2_092911-libertyallstar.htm

Exhibit 2

STANDSTILL AGREEMENT

This Standstill Agreement (the “Agreement”) is made and entered into effective as of the 28th day of September 2011 by and between DST Systems, Inc. (“DST”) and Brinker Capital, Inc., for and on behalf of itself and entities and accounts that it controls directly or indirectly, or with respect to which it exercises voting discretion, whether such entities or accounts now exist or are organized in the future (collectively, “Brinker” and Brinker, together with DST, the “parties” and each, individually, a “party”).

WHEREAS, on July 19, 2011, DST announced that it had entered into an agreement to purchase ALPS Holdings Inc. (“ALPS Holdings”), the parent company of ALPS Advisors Inc. (“AAI”) (the “Transaction”);

WHEREAS, AAI is the investment adviser to Liberty All-Star Growth Fund, Inc. (“Growth Fund”) and Liberty All-Star Equity Fund (“Equity Fund” and, together with Growth Fund, the “Funds” and, individually, a “Fund”);

WHEREAS, DST anticipates that the Closing will take place on or before December 31, 2011;

WHEREAS, Brinker is a shareholder of Growth Fund and Equity Fund;

WHEREAS, the parties wish to resolve matters relating to the Transaction;

1. DST. Within 30 days after the Closing, DST shall purchase from Brinker shares of the Funds at a price per share equal to 98% of the net asset value per share, determined on the second business day preceding the date of purchase, and a total purchase price of $1.42 million. DST shall allocate purchases between the Funds such that $1.09 million of its purchases will be for Growth Fund shares and $0.33 million of its purchases will be for Equity Fund shares; provided, however, that the parties may agree in writing to a different allocation between the Fund shares so long as the total purchases do not exceed $1.42 million.

2. Brinker. Brinker shall vote or cause to be voted all shares of each Fund that Brinker directly or indirectly has the power to vote or direct the vote of to be voted in favor of the New Advisory Agreements as soon as possible and, in any event, no later than two (2) business days after the date of this Agreement, and further agrees not to change, alter, rescind or revoke any such vote in any manner.

3. For a period of five (5) years from the date of this Agreement (the “Restricted Period”), Brinker shall not directly or indirectly, with respect to either Fund: (i) submit any shareholder proposals for the vote or consent (collectively, “vote”) of shareholders (whether pursuant to Rule 14a 8 under the Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise) or any proposal for consideration by either Fund’s Board; (ii) nominate any candidate for election as a director or trustee or otherwise seek appointment to or representation of the Board; (iii) solicit proxies or make, participate in or encourage any “solicitation” (as such terms is used in the proxy rules of the U.S. Securities and Exchange Commission (“SEC”)) for proxies for any shareholder proposals or nominations of candidates for election as directors or trustees; or (iv) form or join in a partnership, syndicate or other group, including, without limitation, a “group” as defined under Section 13(d) of the Exchange Act, with respect to either Fund’s shares, or deposit any Fund shares in a voting trust, arrangement or agreement, or subject either Fund’s shares to a voting trust, arrangement or agreement. During the Restricted Period, Brinker shall not either directly or indirectly, explicitly or implicitly, publicly or privately: (i) encourage, recommend, advise, finance or urge others to put forward shareholder proposals or nominations with respect to directors/trustees of either Fund or otherwise have discussions or enter into any arrangements with any other person in connection with any of the foregoing as they relate to the Funds; (ii) indicate support or approval for any shareholder proposals or nominations relating to either Fund (other than voting in accordance with the immediately following clause (iii)); (iii) cause or permit any shares of either Fund that Brinker directly or indirectly has the power to vote or direct the vote of, to be voted on any matter in any way other than in accordance with the recommendations of the respective Fund’s Board, or to be withheld from or otherwise abstain from voting on any such matter; (iv) solicit or encourage others to vote against any matter recommended by either Fund’s Board; (v) otherwise act, alone or in concert with others, to seek to control the management, Board or policies of either Fund; (vi) threaten to bring or pursue or bring or pursue any suit, regulatory action or proceeding against DST or any of its subsidiaries or affiliates, either Fund, either Fund’s Board or either Fund’s investment adviser, other than for alleged violations of this Agreement; or (vii) take or seek to take, or cause or seek to cause or solicit others to take, any action inconsistent with any of the foregoing as they relate to the Funds.

4. No Disparagement. During the Restricted Period, each party, and their respective officers and directors, shall refrain from directly or indirectly disparaging or impugning, or taking any action reasonably likely to damage or impugn, the reputation of the other parties hereto or the Board, officers or investment adviser of either Fund. The foregoing shall not apply to any compelled testimony or production of information, by legal process, subpoena or as part of a response to a request for information from any governmental authority with jurisdiction over the party from whom information is sought, or to any pleading in defense of any legal or regulatory complaint, litigation or proceeding.

5. Confidentiality. Other than announcements made by DST, AAI, either Fund or otherwise made public by DST, AAI or either Fund, the existence of, and all terms and provisions of, this Agreement shall remain confidential; provided, however, that any other party hereto, ALPS Holdings, any member of either Fund’s Board, the Funds’ officers, or the officers or directors of Brinker, may make disclosure necessary to comply with all applicable laws, rules or regulations, including applicable rules of any regulatory or self regulatory body, including any filings pursuant to, among other matters, Section 13(d) of the Exchange Act and the rules thereunder of the SEC, having jurisdiction over any such person, or legal process including but not limited to deposition, interrogatory, civil investigation, demand or similar process, subject to the provisions of the immediately succeeding paragraph.

6. Notices. Any notices and other communications hereunder shall be delivered by email or facsimile, with a copy by personal delivery, overnight delivery or ordinary mail, directed as follows:

To DST, by delivery to:

Randall D. Young

Vice President, General Counsel & Secretary

DST Systems, Inc.

333 W. 11th Street, 5th Floor

Kansas City, MO 64105

Email: rdyoung@dstsystems.com

Facsimile: (816) 435-8630

With copies to:

Brian D. McCabe

Ropes & Gray LLP

Prudential Tower

800 Boylston Street

Boston, MA 02199

Email: brian.mccabe@ropesgray.com

Facsimile: (617) 235-0425

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To ALPS Holdings, AAI, either Fund and either Fund’s Board, by delivery to:

Bill Parmentier

Senior Vice President

ALPS Advisors Inc.

99 High Street, Suite 303

Boston, MA 02110

Email: william.parmentier@alpsinc.com

Facsimile: (617) 426-1962

With copies to:

Clifford Alexander, Esq.

Jennifer Gonzalez, Esq.

K&L Gates LLP

1601 K Street, NW

Washington DC 20006

Email: clifford.alexander@klgates.com

jennifer.gonzalez@klgates.com

Facsimile: (202) 778-9100

To Brinker, by delivery to:

1055 Westlakes Drive

Suite 250

Berwyn, PA 19312

Attention: Dan Acker

Email: dacker@brinkercapital.com

Facsimile: 610-407-5551

With copies to:

1055 Westlakes Dr

Suite 250

Berwyn, PA 19312

Attn: Brian Ferko

Email: Bferko@brinkercapital.com

Facsimile: 610-407-5407

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7. Enforcement. The parties agree that breach of this Agreement may cause immediate and irreparable harm and that, in the event of breach or threatened breach of this Agreement, each party shall be entitled to seek injunctive and other equitable relief without proof of actual damages in addition to any other remedies as may be available at law or in equity. Each party further agrees to waive any requirement for the securing or posting of any bond in connection with such remedy. All rights under this Agreement are cumulative, not exclusive, and will be in addition to all rights and remedies available to either party at law or in equity.

8. No Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective agents, executors, heirs, successors and permitted assigns. Neither this Agreement nor any of the benefits of this Agreement shall be assigned by a party without the prior written consent of the other parties hereto. No person not a party to this Agreement shall have any rights, benefits or obligations hereunder.

9. Amendments. No amendments, changes or modifications may be made to this Agreement without the express prior written consent of each of the parties hereto.

10. Invalidity. If any term or provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms and provisions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

11. No Waiver. No failure or delay by a party in exercising any right hereunder or any partial exercise thereof shall operate as a waiver thereof or preclude any other or further exercise of any right hereunder. No waiver, express or implied, by any party of any breach or default by any other party in the performance by the other party of its obligations under this Agreement shall be deemed or construed to be a waiver of any other breach or default, whether prior, subsequent, or contemporaneous, under this Agreement. Any waiver must be in writing and executed by the party against whom the waiver is sought to be charged.

12. Counterparts. This Agreement may be executed in counterparts each of which shall be deemed an original, and when taken together all such counterparts shall be deemed to constitute one and the same document.

13. Applicable Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to applicable principles of conflicts of law or choice of laws of any state that would cause the application to this Agreement of the law of any state other than the State of New York. Each party hereto hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the State and Federal courts located in New York County, New York, United States of America in any action or proceeding arising out of or relating to this Agreement, and agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, such Federal court. A final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suits on the judgment or in any other manner provided by law. The parties hereto irrevocably and unconditionally waive any objection which they may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to the Agreement in any State or Federal court in the County referenced above and State of New York.

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14. Default. In the event of an alleged breach by DST of its obligations pursuant to Section 1 of this Agreement, Brinker will send written notice to DST describing such alleged breach and, upon receiving such notice, DST shall have ten (10) business days (the “Cure Period”) to cure such breach or to provide information confirming the lack of such breach. In the event that after the Cure Period any litigation occurs between the parties because of an alleged breach by DST of its obligations pursuant to Section 1 of this Agreement, it is agreed that Brinker shall be entitled to require that DST specifically perform its obligations pursuant to Section 1, including but not limited to purchasing Fund shares in the amount and at the purchase price described in Section 1, without Brinker being required to prove irreparable damages or being required to post a bond or other security. In the event Brinker is the principal prevailing party in any such litigation, as determined in a judgment by the court, Brinker shall be entitled to recover all its fees and expenses relating to such litigation, including, but not limited to, court costs, reasonable attorneys fees, witness fees, expert fees and applicable travel expenses. In addition, in the event that Brinker is the prevailing party in the above-referenced litigation, Brinker shall be entitled to receive $150,000 in liquidated damages. Only in the event that DST does not purchase all the Fund shares required to be purchased in any judgment by the court within 30 days of such judgment shall Brinker be relieved of its obligations under this Agreement, including but not limited to, its obligations pursuant to the second paragraph of Section 2 and the confidentiality provisions of Section 3 of the Agreement.

15. Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

16. Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto regarding the subject matter hereof. No representations, warranties, or inducements have been made by any party hereto concerning this Agreement other than those contained and memorialized herein. This Agreement integrates the whole of their agreements and understandings concerning the same. No prior oral or written representations or understandings concerning the subject matter hereof will operate to amend, supersede or replace any of the terms or conditions set forth in this Agreement, nor will they be relied upon.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above.

Brinker Capital, Inc.
By:	/s/ Michael Kutsaya
Name:	Michael Kutsaya
Title:	Director of Operations
DST Systems, Inc.
By:	/s/ Randall D. Young
Name:	Randall D. Young
Title:	Vice President, General Counsel and Secretary

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