AGREEMENT AND
PLAN OF
ACQUISITION
AND LIQUIDATION
As of
September 1, 2000
This Agreement and Plan of Acquisition and Liquidation (the "Plan") is
made as of this 1st day of September, 2000, by and between U.S. Government
Portfolio of Alliance Bond Fund, Inc., a Maryland corporation ("U.S.
Government"), and Alliance Limited Maturity Government Fund, Inc., a Maryland
corporation ("Limited Maturity").
WHEREAS, U.S. Government and Limited Maturity are open-end management
investment companies registered with the Securities and Exchange Commission
(the "SEC") under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the parties desire that U.S. Government acquire the assets and
assume the liabilities of Limited Maturity in exchange for shares of equal net
asset value of U.S. Government and the distribution of such shares of U.S.
Government to the stockholders of Limited Maturity (the "Acquisition") and
that Limited Maturity thereafter liquidate and dissolve; and
WHEREAS, the parties intend that the Acquisition qualify as a
"reorganization" within the meaning of section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), and that with respect to the
Acquisition, U.S. Government and Limited Maturity will each be a "party to a
reorganization" within the meaning of section 368(b) of the Code;
Now, therefore, U.S. Government and Limited Maturity agree as follows:
1. Definitions
In addition to the terms elsewhere defined herein, each of the
following terms shall have the meaning indicated for that term as follows:
1933 Act Securities Act of 1933, as amended.
1934 Act
Securities Exchange Act of 1934, as amended.
Assets
All assets of any kind and all interests, rights,
privileges and powers of or attributable to Limited
Maturity or any class of Limited Maturity's shares,
as appropriate, whether or not determinable at the
appropriate Effective Time and wherever located,
including, without limitation, all cash, cash
equivalents, securities, claims (whether absolute or
contingent, known or unknown, accrued or unaccrued
or conditional or unmatured), contract rights and
receivables (including dividend and interest
receivables) owned by Limited Maturity or
attributable to any class of Limited Maturity's
shares and any deferred or prepaid expense shown as
an asset on Limited Maturity's books.
Closing Date
Such date prior to July 1, 2001 as the parties agree
to.
Effective Time
5:00 p.m. Eastern time on the Closing Date, or such
other time as the parties may agree to in writing.
Financial Statements
The audited financial statements of the relevant
Fund for its most recently completed fiscal year
and, if applicable, the unaudited financial
statements of that Fund for its most recently
completed semi-annual period.
Fund
U.S. Government and/or Limited Maturity, as the case
may be.
Liabilities
All liabilities of Limited Maturity or any class
thereof, whether known or unknown, accrued or
unaccrued, absolute or contingent or conditional or
unmatured.
N-14 Registration
Statement
The Registration Statement of U.S. Government on
Form N-14 under the 1940 Act that will register the
shares of U.S. Government to be issued in the
Acquisition and will include the proxy materials
necessary for the stockholders of Limited Maturity
to approve the Acquisition.
Valuation Time
The time on the Closing Date, or the business day
immediately preceding the Closing Date if the
Closing Date is not a business day or such other
date as the parties may agree to in writing, when
for purposes of the Plan U.S. Government determines
its net asset value per share and Limited Maturity
determines the net value of the Assets.
2. Regulatory Filings
U.S. Government shall promptly prepare and file the N-14
Registration Statement with the SEC, and U.S. Government and Limited Maturity
also shall make any other required or appropriate filings with respect to the
actions contemplated hereby.
3. Stockholder Action
As soon as practicable after the effective date of the N-14
Registration Statement, Limited Maturity shall hold a stockholders meeting to
consider and approve the Acquisition and this Plan, and such other matters as
the Board of Directors of Limited Maturity may determine. Such approval by
the stockholders of Limited Maturity shall, to the extent necessary to permit
the consummation of the transactions contemplated herein without violating any
investment objective, policy or restriction of Limited Maturity, be deemed to
constitute approval by the stockholders of a temporary amendment of any
investment objective, policy or restriction that would otherwise be
inconsistent with or violated upon the consummation of such transactions
solely for the purpose of consummating such transactions.
4. Transfer of Limited Maturity's Assets. U.S. Government and
Limited Maturity shall take the following steps with respect to the
Acquisition, as applicable:
(a) On or prior to the Closing Date, Limited Maturity shall pay
or provide for the payment of all of the Liabilities, expenses, costs and
charges of or attributable to Limited Maturity that are known to Limited
Maturity and that are due and payable prior to or as of the Closing Date.
(b) Prior to the Effective Time, Limited Maturity shall declare
and pay to its stockholders on its normal monthly schedule a dividend and/or
other distribution in an amount such that it will have distributed
substantially all of its theretofore undistributed investment company taxable
income, if any (as defined in Code section 852), and net capital gain, if any
(as defined in Code section 1222).
(c) At the Effective Time, pursuant to Articles of Transfer
accepted for record by the State Department of Assessments and Taxation of
Maryland (the "SDAT"), Limited Maturity shall assign, transfer, deliver and
convey the Assets to U. S. Government, subject to the Liabilities. U.S.
Government shall then accept the Assets and assume the Liabilities such that
at and after the Effective Time (i) the Assets at or after the Effective Time
shall become and be assets of U. S. Government, and (ii) the Liabilities at
the Effective Time shall attach to U. S. Government, enforceable against U. S.
Government to the same extent as if initially incurred by U. S. Government.
(d) Within a reasonable time prior to the Closing Date, Limited
Maturity shall provide, if requested, a list of the Assets to U.S. Government.
Limited Maturity may sell any Asset on such list prior to the Effective Time.
After Limited Maturity provides such list, Limited Maturity will not acquire
any additional securities or permit to exist any encumbrances, rights,
restrictions or claims not reflected on such list, without the approval of
U.S. Government. Within a reasonable time after receipt of the list and prior
to the Closing Date, U.S. Government will advise Limited Maturity in writing
of any investments shown on the list that U.S. Government has determined to be
inconsistent with its investment objective, policies and restrictions.
Limited Maturity will dispose of any such securities prior to the Closing Date
to the extent practicable and consistent with applicable legal requirements,
including Limited Maturity's investment objectives, policies and restrictions.
In addition, if U.S. Government determines that, as a result of the
Acquisition, U.S. Government would own an aggregate amount of an investment
that would exceed a percentage limitation applicable to U. S. Government, U.S.
Government will advise Limited Maturity in writing of any such limitation and
Limited Maturity shall dispose of a sufficient amount of such investment as
may be necessary to avoid the limitation as of the Effective Time, to the
extent practicable and consistent with applicable legal requirements,
including Limited Maturity's investment objectives, policies and restrictions.
(e) Limited Maturity shall assign, transfer, deliver and convey
the Assets to U. S. Government at the Effective Time on the following basis:
(1) U.S. Government shall simultaneously issue and deliver
to Limited Maturity that number of full and fractional shares of common
stock of each class of U. S. Government, rounded to the third decimal
place or such other decimal place as the parties may agree to in
writing, determined by dividing the value of the Assets less the
Liabilities attributable to a class of Limited Maturity by the net asset
value per share of the corresponding class of U. S. Government.
(2) The net asset value of the shares of U. S. Government
to be delivered to Limited Maturity shall be determined as of the
Valuation Time in accordance with U.S. Government's then applicable
valuation procedures, and for this purpose, the net value of the Assets
to be conveyed to U.S. Government shall be determined as of the
Valuation Time in accordance with the then applicable valuation
procedures of Limited Maturity.
(3) Limited Maturity shall deliver the Assets with good
and marketable title to the custodian for the account of U. S.
Government. All cash shall be transferred in the form of immediately
available funds payable to the order of U.S. Government's custodian.
(f) Promptly after the Closing Date, Limited Maturity will
deliver to U.S. Government a Statement of Assets and Liabilities of Limited
Maturity as of the Closing Date.
5. Liquidation and Dissolution of Limited Maturity, Registration of
Shares of U.S. Government and Access to Records. Limited Maturity and U.S.
Government also shall take the following steps, as applicable:
(a) At or as soon as reasonably practical after the Effective
Time, Limited Maturity shall liquidate and dissolve by transferring to
stockholders of record of each class of Limited Maturity full and fractional
shares of common stock of the corresponding class of U. S. Government equal in
value to the shares of the class of Limited Maturity held by the stockholder.
Each stockholder also shall have the right to receive any unpaid dividends or
other distributions that Limited Maturity declared with respect to the class
of Limited Maturity's shares held by the stockholder before the Effective
Time. U.S. Government shall record on its books the ownership by Limited
Maturity's stockholders of U.S. Government shares so transferred to such
stockholders and Limited Maturity shall simultaneously redeem and cancel on
its books all of the issued and outstanding shares of each class of Limited
Maturity. U.S. Government shall issue certificates representing U.S.
Government shares in accordance with the then current U.S. Government
prospectus; provided, however, that U.S. Government shall not issue
certificates representing U.S. Government shares to replace certificates
representing Limited Maturity shares unless Limited Maturity share
certificates are first surrendered to U.S. Government. Following distribution
by Limited Maturity to its stockholders of all of the shares of U.S.
Government delivered to Limited Maturity, Limited Maturity shall wind up its
affairs and shall take all steps as are necessary and proper to dissolve as
soon as is reasonably possible after the Effective Time, including filing
Articles of Dissolution with the SDAT.
(b) At and after the Closing Date, Limited Maturity shall
provide U.S. Government and its transfer agent with immediate access to: (i)
all records containing the names, addresses and taxpayer identification
numbers of all of Limited Maturity's stockholders and the number and
percentage ownership of the outstanding shares of each class of Limited
Maturity owned by stockholders as of the Effective Time, and (ii) all original
documentation (including all applicable Internal Revenue Service forms,
certificates, certifications and correspondence) relating to Limited Maturity
stockholders' taxpayer identification numbers and their liability for or
exemption from back-up withholding. Limited Maturity shall preserve and
maintain, or shall direct its service providers to preserve and maintain,
records with respect to Limited Maturity as required by Section 31 of, and
Rules 31a-1 and 31a-2 under, the 1940 Act.
6. Certain Representations and Warranties of Limited Maturity.
Limited Maturity represents and warrants to U.S. Government as follows:
(a) Limited Maturity is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Maryland. The
Board of Directors of Limited Maturity duly established and designated each
class of Limited Maturity as a class of Limited Maturity. Limited Maturity is
registered with the SEC as an open-end management investment company under the
1940 Act, and such registration will be in full force and effect as of the
Effective Time.
(b) Limited Maturity has the power and all necessary federal,
state and local qualifications and authorizations to own all the Assets, to
carry on its business, to enter into this Plan and to consummate the
transactions contemplated herein.
(c) The Board of Directors of Limited Maturity has duly
authorized the execution and delivery of this Plan and the transactions
contemplated herein. Duly authorized officers of Limited Maturity have
executed and delivered the Plan. The Plan represents a valid and binding
contract, enforceable in accordance with its terms, subject as to enforcement
to bankruptcy, insolvency, reorganization, arrangement, moratorium, and other
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles. The execution and delivery of this
Plan does not, and, subject to the approval of its stockholders referred to in
Section 3 hereof, the consummation of the transactions contemplated by this
Plan will not, violate Limited Maturity's Charter, its By-Laws or any material
agreement to which Limited Maturity is subject. Except for the approval of
its stockholders, Limited Maturity does not need to take any other action to
authorize its officers to effectuate this Plan and the transactions
contemplated herein.
(d) Limited Maturity has qualified as a regulated investment
company under Part I of Subchapter M of Subtitle A, Chapter 1, of the Code, in
respect of each taxable year since the commencement of its operations and
intends to continue to qualify as a regulated investment company for its
taxable year ending upon its liquidation.
(e) The information pertaining to Limited Maturity included
within the N-14 Registration Statement when filed with the SEC, when Part A of
the N-14 Registration Statement is distributed to stockholders, at the time of
the stockholders meeting of Limited Maturity for approval of the Acquisition
and at the Effective Time shall (i) comply in all material respects with the
applicable provisions of the 1933 Act, the 1934 Act and the 1940 Act, and the
rules and regulations thereunder and applicable state securities laws, and
(ii) not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements made therein not misleading.
(f) Limited Maturity has duly authorized and validly issued all
of its issued and outstanding shares of common stock, and all such shares are
fully paid and non-assessable and were offered for sale and sold in conformity
with the registration requirements of all applicable federal and state
securities laws. There are no outstanding options, warrants or other rights
to subscribe for or purchase any of the shares of Limited Maturity, nor are
there any securities convertible into shares of Limited Maturity.
(g) Limited Maturity shall operate its business in the ordinary
course between the date hereof and the Effective Time. Such ordinary course
of business will include the declaration and payment of customary dividends
and distributions and any other dividends and distributions referred to in
Section 4(b) hereof.
(h) At the Effective Time, Limited Maturity will have good and
marketable title to the Assets and full right, power and authority to assign,
transfer, deliver and convey the Assets.
(i) The Financial Statements of Limited Maturity, a copy of
which has been previously delivered to U.S. Government, fairly present the
financial position of Limited Maturity as of Limited Maturity's most recent
fiscal year-end and the results of Limited Maturity's operations and changes
in Limited Maturity's net assets for the periods indicated.
(j) To the knowledge of Limited Maturity, Limited Maturity has
no liabilities, whether or not determined or determinable, other than the
Liabilities disclosed or provided for in its Financial Statements or
Liabilities incurred in the ordinary course of business subsequent to the date
of the most recent Financial Statement referencing Liabilities.
(k) Limited Maturity does not know of any claims, actions,
suits, investigations or proceedings of any type pending or threatened against
Limited Maturity. There are no facts that Limited Maturity has reason to
believe are likely to form the basis for the institution of any such claim,
action, suit, investigation or proceeding against Limited Maturity. Limited
Maturity is not a party to or subject to the provisions of any order, decree
or judgment of any court or governmental body that adversely affects, or is
reasonably likely to adversely affect, its financial condition, results of
operations, or the Assets or its ability to consummate the transactions
contemplated by the Plan.
(l) Except for agreements entered into or granted in the
ordinary course of its business, in each case under which no material default
exists, Limited Maturity is not a party to or subject to any material
contract, debt instrument, employee benefit plan, lease, franchise, license or
permit of any kind or nature whatsoever.
(m) Limited Maturity has filed its federal income tax returns,
copies of which have been previously made available to U.S. Government, for
all taxable years for which such returns are due and has paid all taxes
payable pursuant to such returns. No such return is currently under audit and
no unpaid assessment has been asserted with respect to such returns. Limited
Maturity will timely file its federal income tax return for each subsequent
taxable year including its current taxable year.
(n) Since the date of the Financial Statements of Limited
Maturity, there has been no material adverse change in its financial
condition, results of operations, business or Assets. For this purpose,
negative investment performance shall not be considered a material adverse
change.
7. Certain Representations and Warranties of U.S. Government.
Alliance Bond Fund, Inc. ("Bond Fund"), on behalf of U.S. Government,
represents and warrants to Limited Maturity as follows:
(a) Bond Fund is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Maryland. The
Board of Directors of Bond Fund duly established and designated U.S.
Government as a series of Bond Fund and each class of shares of U.S.
Government as a class of U.S. Government. Bond Fund is registered with the
SEC as an open-end management investment company under the 1940 Act, and such
registration will be in full force and effect as of the Effective Time.
(b) On behalf of U.S. Government, Bond Fund has the power and
all necessary federal, state and local qualifications and authorizations to
own all of its assets, to carry on its business, to enter into this Plan and
to consummate the transactions contemplated herein.
(c) On behalf of U.S. Government, the Board of Directors of Bond
Fund has duly authorized execution and delivery of this Plan and the
transactions contemplated herein. Duly authorized officers of Bond Fund have
executed and delivered the Plan. The Plan represents a valid and binding
contract, enforceable in accordance with its terms, subject as to enforcement
to bankruptcy, insolvency, reorganization, arrangement, moratorium and other
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles. The execution and delivery of this
Plan does not, and the consummation of the transactions contemplated by this
Plan will not, violate the Charter of Bond Fund, its By-Laws or any material
agreement to which U.S. Government is subject. Bond Fund does not need to
take any other action to authorize its officers to effectuate the Plan and the
transactions contemplated herein.
(d) U.S. Government has qualified as a regulated investment
company under Part I of Subchapter M of Subtitle A, Chapter 1, of the Code in
respect of each taxable year since the commencement of its operations and
qualifies and intends to continue to qualify as a regulated investment company
for its current taxable year.
(e) The N-14 Registration Statement, when filed with the SEC,
when Part A of the N-14 Registration Statement is distributed to stockholders,
at the time of the stockholder meeting of Limited Maturity for the approval of
the Acquisition and at the Effective Time, insofar as it relates to U.S.
Government shall (i) comply in all material respects with the applicable
provisions of the 1933 Act, the 1934 Act and the 1940 Act, and the rules and
regulations thereunder and applicable state securities laws, and (ii) not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements made
therein not misleading.
(f) On behalf of U.S. Government, Bond Fund has duly authorized
and validly issued all of the issued and outstanding shares of common stock of
U.S. Government, and all such shares are fully paid and non-assessable and
were offered for sale and sold in conformity with the registration
requirements of all applicable federal and state securities laws. Bond Fund
has duly authorized shares of U.S. Government to be issued and delivered to
Limited Maturity as of the Effective Time. When issued and delivered, such
shares of U.S. Government shall be validly issued, fully paid and non-
assessable, and no stockholder of U.S. Government shall have any preemptive
right of subscription or purchase in respect of any such share. There are no
outstanding options, warrants or other rights to subscribe for or purchase any
shares of U.S. Government, nor are there any securities convertible into
shares of U.S. Government.
(g) U.S. Government does not know of any claims, actions, suits,
investigations or proceedings of any type pending or threatened against U.S.
Government. There are no facts that U.S. Government currently has reason to
believe are likely to form the basis for the institution of any such claim,
action, suit, investigation or proceeding against U.S. Government. U.S.
Government is not a party to or subject to the provisions of any order, decree
or judgment of any court or governmental body that adversely affects, or is
reasonably likely to adversely affect, its financial condition, results of
operations, its assets or its ability to consummate the transactions
contemplated by the Plan.
(h) Except for agreements entered into or granted in the
ordinary course of its business, in each case under which no material default
exists, U.S. Government is not a party to or subject to any material contract,
debt instrument, employee benefit plan, lease, franchise, license or permit of
any kind or nature whatsoever.
(i) Bond Fund has filed its federal income tax returns, copies
of which have been previously made available to Limited Maturity, for all
taxable years for which such returns are due and has paid all taxes payable
pursuant to such returns. No such return is currently under audit and no
unpaid assessment has been asserted with respect to such returns. Bond Fund
will timely file its federal income tax return for each subsequent taxable
year including its current taxable year.
(j) Since the date of the Financial Statements of U.S.
Government, there has been no material adverse change in its financial
condition, results of operations, business or assets. Negative investment
performance shall not be considered a material adverse change.
8. Conditions to the Obligations of U.S. Government and Limited
Maturity. The obligations of U.S. Government and Limited Maturity with
respect to the Acquisition shall be subject to the following conditions
precedent:
(a) The stockholders of Limited Maturity shall have approved the
Acquisition in the manner required by the Charter of Limited Maturity, its By-
Laws and applicable law. If stockholders of Limited Maturity fail to approve
the Acquisition, that failure shall release the Funds of their obligations
under this Plan.
(b) U.S. Government and Limited Maturity shall have delivered to
the other party a certificate dated as of the Closing Date and executed in its
name by its Secretary or an Assistant Secretary, in a form reasonably
satisfactory to the receiving party, stating that the representations and
warranties of U.S. Government or Limited Maturity, as applicable, in this Plan
that apply to the Acquisition are true and correct in all material respects at
and as of the Valuation Time.
(c) Bond Fund, on behalf of U.S. Government, and Limited
Maturity shall have performed and complied in all material respects with each
of its representations and warranties required by this Plan to be performed or
complied with by it prior to or at the Valuation Time and the Effective Time.
(d) There has been no material adverse change in the financial
condition, results of operations, business, properties or assets of Limited
Maturity since May 31, 2000 or of U.S. Government since June 30, 2000.
Negative investment performance shall not be considered a material adverse
change.
(e) U.S. Government and Limited Maturity shall have received an
opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, in form and substance reasonably satisfactory
to each of them, based upon representations made in certificates provided by
the Funds, their affiliates and/or principal stockholders and dated as of the
Closing Date, substantially to the effect that, based on facts and assumptions
stated therein, for federal income tax purposes:
(1) the Acquisition will constitute a "reorganization"
within the meaning of section 368(a) of the Code and that
U.S. Government and Limited Maturity will each be "a
party to a reorganization" within the meaning of
section 368(b) of the Code;
(2) each stockholder of Limited Maturity will recognize no
gain or loss on such stockholder's receipt of shares of
U.S. Government (including any fractional share to which
the stockholder may be entitled) in exchange for the
stockholder's shares of Limited Maturity in connection
with the Acquisition;
(3) neither Limited Maturity nor U.S. Government will
recognize any gain or loss upon the transfer of all of
the Assets to U.S. Government in exchange for shares of
U.S. Government and the assumption by U.S. Government of
the Liabilities pursuant to this Plan or upon the
distribution of shares of U.S. Government to stockholders
of Limited Maturity in exchange for their respective
shares of Limited Maturity;
(4) the holding period and tax basis of the Assets acquired
by U.S. Government will be the same as the holding period
and tax basis that Limited Maturity had in such Assets
immediately prior to the Acquisition;
(5) the aggregate tax basis of U.S. Government shares
received in connection with the Acquisition by each
stockholder of Limited Maturity (including any
fractional share to which the stockholder may be
entitled) will be the same as the aggregate tax basis of
the shares of Limited Maturity surrendered in exchange
therefor;
(6) the holding period of U.S. Government shares received in
connection with the Acquisition by each stockholder of
Limited Maturity (including any fractional share to which
the stockholder may be entitled) will include the holding
period of the shares of Limited Maturity surrendered in
exchange therefor, provided that such Limited Maturity
shares constitute capital assets in the hands of the
stockholder as of the Closing Date; and
(7) U.S. Government will succeed to the capital loss
carryovers of Limited Maturity, if any, under Section 381
of the Code, but the use by U.S. Government of any such
capital loss carryovers (and of capital loss carryovers
of U.S. Government) may be subject to limitation under
section 383 of the Code.
(f) The N-14 Registration Statement shall have become effective
under the 1933 Act as to the shares of U.S. Government, and the SEC shall not
have instituted and to the knowledge of U.S. Government is not contemplating
instituting, any stop order suspending the effectiveness of the N-14
Registration Statement.
(g) 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,
the Acquisition.
(h) The SEC shall not have issued any unfavorable advisory
report under Section 25(b) of the 1940 Act nor instituted any proceeding
seeking to enjoin consummation of the Acquisition under Section 25(c) of the
1940 Act.
(i) Neither party shall have terminated this Plan with respect
to the Acquisition pursuant to Section 12 of this Plan.
9. Conditions to the Obligations of Limited Maturity. The
obligations of Limited Maturity with respect to the Acquisition shall be
subject to the following conditions precedent:
(a) Limited Maturity shall have received an opinion of ▇▇▇▇▇▇ &
▇▇▇▇▇▇ LLP, as counsel to U.S. Government, in form and substance reasonably
satisfactory to Limited Maturity and dated as of the Closing Date,
substantially to the effect that:
(1) Bond Fund is a corporation duly incorporated, validly
existing and in good standing under the laws of the
State of Maryland and is an open-end, management
investment company registered under the 1940 Act;
(2) This Plan has been duly authorized, executed and
delivered by U.S. Government and, assuming due
authorization, execution and delivery of this Plan by
Limited Maturity, represents a legal, valid and
binding contract, enforceable in accordance with its
terms, subject to the effect of bankruptcy,
insolvency, moratorium, fraudulent conveyance and
transfer and similar laws relating to or affecting
creditors' rights generally and court decisions with
respect thereto, and further subject to the
application of equitable principles in any proceeding,
whether at law or in equity or with respect to the
enforcement of provisions of the Plan and the effect
of judicial decisions which have held that certain
provisions are unenforceable when their enforcement
would violate an implied covenant of good faith and
fair dealing or would be commercially unreasonable or
when default under the Plan is not material;
(3) The shares of U.S. Government to be delivered as
provided for by this Plan are duly authorized and upon
delivery will be validly issued, fully paid and non-
assessable by U.S. Government;
(4) The execution and delivery of this Plan did not, and
the consummation of the Acquisition will not, violate
the Charter of Bond Fund, its By-Laws or any agreement
of U.S. Government known to such counsel, after
reasonable inquiry; and
(5) To the knowledge of such counsel, no consent,
approval, authorization or order of any federal or
state court or administrative or regulatory agency,
other than the acceptance of record of Articles of
Transfer by the SDAT, is required for U.S. Government
to enter into this Plan or carry out its terms, except
those that have been obtained under the 1933 Act, the
1940 Act and the rules and regulations under those
Acts or that may be required under state securities
laws, or subsequent to the Effective Time or when the
failure to obtain the consent, approval, authorization
or order would not have a material adverse effect on
the operation of U.S. Government.
In rendering such opinion, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP may (i) rely on the opinion of
other counsel to the extent set forth in such opinion, (ii) make assumptions
regarding the authenticity, genuineness and/or conformity of documents and
copies thereof without independent verification thereof, (iii) limit such
opinion to applicable federal and state law, (iv) define the word
"knowledge" and related terms to mean the knowledge of attorneys then with
such firm who have devoted substantive attention to matters directly related
to this Plan and (v) rely on certificates of officers or directors of Bond
Fund as to factual matters.
10. Conditions to the Obligations of U.S. Government. The obligations
of U.S. Government with respect to the Acquisition shall be subject to the
following conditions precedent:
(a) U.S. Government shall have received an opinion of ▇▇▇▇▇▇ &
▇▇▇▇▇▇ LLP, as counsel to Limited Maturity, in form and substance reasonably
satisfactory to U.S. Government and dated as of the Closing Date,
substantially to the effect that:
(1) Limited Maturity is a corporation duly incorporated,
validly existing and in good standing under the laws
of the State of Maryland and is an open-end,
management investment company registered under the
1940 Act;
(2) This Plan has been duly authorized, executed and
delivered by Limited Maturity and, assuming due
authorization, execution and delivery of this Plan by
Bond Fund, represents a legal, valid and binding
contract, enforceable in accordance with its terms,
subject to the effect of bankruptcy, insolvency,
moratorium, fraudulent conveyance and transfer and
similar laws relating to or affecting creditors'
rights generally and court decisions with respect
thereto, and further subject to the application of
equitable principles in any proceeding, whether at law
or in equity or with respect to the enforcement of
provisions of the Plan and the effect of judicial
decisions which have held that certain provisions are
unenforceable when their enforcement would violate an
implied covenant of good faith and fair dealing or
would be commercially unreasonable or when default
under the Plan is not material;
(3) The execution and delivery of this Plan did not, and
the consummation of the Acquisition will not, violate
the Charter of Limited Maturity, its By-Laws or any
agreement of Limited Maturity, known to such counsel,
after reasonable inquiry; and
(4) To the knowledge of such counsel, no consent,
approval, authorization or order of any federal or
state court or administrative or regulatory agency,
other than the acceptance of record of Articles of
Transfer by the SDAT, is required for Limited Maturity
to enter into the Plan or carry out its terms, except
those that have been obtained under the 1933 Act, the
1940 Act and the rules and regulations under those
Acts or that may be required under state securities
laws or subsequent to the Effective Time or when the
failure to obtain the consent, approval, authorization
or order would not have a material adverse effect on
the operation of Limited Maturity.
In rendering such opinion, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP may (i) rely on the opinion of
other counsel to the extent set forth in such opinion, (ii) make assumptions
regarding the authenticity, genuineness and/or conformity of documents and
copies thereof without independent verification thereof, (iii) limit such
opinion to applicable federal and state law, (iv) define the word
"knowledge" and related terms to mean the knowledge of attorneys then with
such firm who have devoted substantive attention to matters directly related
to this Plan and (v) rely on certificates of officers or directors of Limited
Maturity as to factual matters.
(b) Except to the extent prohibited by Rule 19b-1 under the 1940
Act, Limited Maturity shall have declared a dividend or dividends that,
together with all previous such dividends, shall have the effect of
distributing to the stockholders of Limited Maturity substantially all of its
investment company taxable income, if any (as defined in Code section 852),
and all of its net capital gain, if any, (as defined in Code section 1222).
11. Survival of Representations and Warranties. No representations,
warranties or covenants in or pursuant to this Plan (including certificates of
officers) hereto shall survive the completion of the transactions contemplated
herein.
12. Termination of Plan. A majority of either Fund's Board of
Directors may terminate this Plan with respect to that Fund at any time before
the applicable Effective Time if: (i) the Fund's conditions precedent set
forth in Sections 8, 9 or 10 as appropriate, are not satisfied; or (ii) the
Board of Directors determines that the consummation of the Acquisition is not
in the best interests of the Fund or its stockholders and gives notice of such
termination to the other party.
13. Governing Law. This Plan and the transactions contemplated hereby
shall be governed, construed and enforced in accordance with the laws of the
State of New York, except to the extent preempted by federal law, without
regard to conflicts of law principles.
14. Brokerage Fees. Each party represents and warrants that there are
no brokers or finders entitled to receive any payments in connection with the
transactions provided for in the Plan.
15. Amendments. The parties may, by agreement in writing authorized
by their respective Board of Directors, amend this Plan at any time before or
after the stockholders of Limited Maturity approve the Acquisition. However,
after stockholders of Limited Maturity approve the Acquisition, the parties
may not amend this Plan in a manner that materially alters the obligations of
either party. This Section shall not preclude the parties from changing the
Closing Date or the Effective Time by mutual agreement.
16. Waivers. At any time prior to the Closing Date, either party may
by written instrument signed by it (i) waive the effect of any inaccuracies in
the representations and warranties made to it contained herein and (ii) waive
compliance with any of the agreements, covenants or conditions made for its
benefit contained herein. Any waiver shall apply only to the particular
inaccuracy or requirement for compliance waived, and not any other or future
inaccuracy or lack of compliance.
17. Indemnification of Directors. On behalf of U.S. Government, Bond
Fund will assume all obligations of Limited Maturity to exculpate and
indemnify its current and former directors and officers, acting in their
capacities as such.
18. Cooperation and Further Assurances. Each party will cooperate
with the other in fulfilling its obligations under this Plan and will provide
such information and documentation as is reasonably requested by the other in
carrying out the Plan's terms. Each party will provide such further
assurances concerning the performance of its obligations hereunder and execute
all documents for or in connection with the consummation of the Acquisition
as, with respect to such assurances or documents, the other shall deem
necessary or appropriate.
19. Updating of N-14 Registration Statement. If at any time prior to
the Effective Time, a party becomes aware of any untrue statement of a
material fact or omission to state a material fact required to be stated
therein or necessary to make the statements made not misleading in the N-14
Registration Statement, the party discovering the item shall notify the other
party and the parties shall cooperate in promptly preparing, filing and
clearing with the SEC and, if appropriate, distributing to stockholders
appropriate disclosure with respect to the item.
20. Limitation on Liabilities. The obligations of Limited Maturity
and U.S. Government shall not bind any of the directors, stockholders,
nominees, officers, employees or agents of Limited Maturity or Bond Fund
personally, but shall bind only Limited Maturity or U.S. Government, as
appropriate. The execution and delivery of this Plan by an officer of either
party shall not be deemed to have been made by the officer individually or to
impose any liability on the officer personally, but shall bind only Limited
Maturity or Bond Fund, on behalf of U.S. Government, as appropriate.
21. Termination of Limited Maturity. If the parties complete the
Acquisition, Limited Maturity shall terminate its registration under the 1940
Act and liquidate and dissolve.
22. Notices. Any notice, report, statement, certificate or demand
required or permitted by any provision of the Plan shall be in writing and
shall be given in person or by telecopy, certified mail or overnight express
courier to:
For Limited Maturity:
Alliance Limited Maturity Government Fund, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
For U.S. Government:
U.S. Government Portfolio of Alliance Bond Fund, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
23. Expenses. Alliance Capital Management L.P., the investment
adviser to each party hereto, will bear all expenses incurred in connection
with this Agreement and Plan of Acquisition and Liquidation, and all
transactions contemplated hereby, whether or not the Acquisition is
consummated.
24. General. This Plan supersedes all prior agreements between the
parties with respect to the subject matter hereof and may be amended only in
writing signed by both parties. The headings contained in this Plan are for
reference only and shall not affect in any way the meaning or interpretation
of this Plan. Whenever the context so requires, the use in the Plan of the
singular will be deemed to include the plural and vice versa. Nothing in this
Plan, expressed or implied, confers upon any other person any rights or
remedies under or by reason of this Plan. Neither party may assign or
transfer any right or obligation under this Plan without the written consent
of the other party.
In Witness Whereof, the parties hereto have executed this Plan as of the
day and year first above written.
Alliance Limited Maturity Government Fund,
Inc.
Attest:
By:
Name: Name:
Title: Title:
U.S. Government Portfolio of Alliance Bond
Fund, Inc.
Attest:
By:
Name: Name:
Title: Title:
Accepted and agreed with respect to Section 23 only:
Alliance Capital Management L.P.
By: Alliance Capital Management
Corporation, its General Partner
By: ___________________________
Name: ______________________
Title: _______________________
00250.236 #194144
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