ALLIANCEBERNSTEIN HIGH INCOME FUND,
INC.
811-08188
Exhibit 77Q1
AGREEMENT AND PLAN OF ACQUISITION AND
LIQUIDATION
BETWEEN ALLIANCEBERNSTEIN HIGH YIELD FUND, INC.
AND ALLIANCEBERNSTEIN EMERGING MARKET DEBT
FUND, INC.
As of
August 15, 2007
This Agreement and Plan of Acquisition and Liquidation (the
?Acquisition Plan?) is made as of this 15th day of August, 2007, by and
between AllianceBernstein Emerging Market Debt Fund, Inc.
(?Acquiring Fund?), a Maryland corporation, and AllianceBernstein
High Yield Fund, Inc. (the ?Acquired Fund?), a Maryland corporation.
WHEREAS, Acquiring Fund and the Acquired Fund 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 the Acquired Fund transfer all
of the assets attributable to its Class A shares held by stockholders
(?Stockholders?) in exchange for Class A shares of equal net asset
value of Acquiring Fund (?Class A Acquisition Shares?), transfer all of
the assets attributable to its Class B shares held by Stockholders in
exchange for Class B shares of equal net asset value of Acquiring Fund
(?Class B Acquisition Shares?), transfer all of the assets attributable to
its Class C shares held by Stockholders in exchange for Class C shares
of equal net asset value of Acquiring Fund (?Class C Acquisition
Shares?), transfer all of the assets attributable to its Advisor Class
shares held by Stockholders in exchange for Advisor Class shares of
equal net asset value of Acquiring Fund (?Advisor Class Acquisition
Shares?), transfer all of the assets attributable to its Class R shares held
by Stockholders in exchange for Class R shares of equal net asset value
of Acquiring Fund (?Class R Acquisition Shares?), transfer all of the
assets attributable to its Class K shares held by Stockholders in
exchange for Class K shares of equal net asset value of Acquiring Fund
(?Class K Acquisition Shares?), transfer all of the assets attributable to
its Class I shares held by Stockholders in exchange for Class I shares of
equal net asset value of Acquiring Fund (?Class I Acquisition Shares?
and together with the Class A Acquisition Shares, Class B Acquisition
Shares, Class C Acquisition Shares, Advisor Class Acquisition Shares,
Class R Acquisition Shares, and Class K Acquisition Shares, the
?Acquisition Shares?) and distribute the Class A Acquisition Shares,
Class B Acquisition Shares, Class C Acquisition Shares, Advisor Class
Acquisition Shares, Class R Acquisition Shares, Class K Acquisition
Shares, and Class I Acquisition Shares to Stockholders of Class A,
Class B, Class C, Advisor Class, Class R, Class K, and Class I,
respectively, of the Acquired Fund (the ?Acquisition?); and
WHEREAS, the parties intend that the Acquisition qualify as a
?reorganization? within the meaning of Section 368(a) of the United
States Internal Revenue Code of 1986, as amended (the ?Code?), and
any successor provisions, and that with respect to the Acquisition,
Acquiring Fund and the Acquired Fund will each be a ?party to a
reorganization? within the meaning of Section 368(b) of the Code;
Now, therefore, Acquiring Fund and the Acquired Fund 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:
1934 Act
Securities Exchange Act of 1934, as amended
1933 Act
Securities Act of 1933, as amended.
Assets
All assets of any kind and all interests, rights, privileges and
powers of or attributable to the Acquired Fund or its 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 the Acquired Fund or attributable to
its shares and any deferred or prepaid expense, other than
unamortized organizational expenses, shown as an asset on
the Acquired Fund?s books.
Closing Date
Shall be on such other date following the date that
Stockholders of the Acquired Fund approve the
Acquisition Plan as the parties may agree.
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
Acquiring Fund and/or the Acquired Fund, as the case
may be.
Liabilities
All liabilities, expenses and obligations of any kind
whatsoever of the Acquired Fund, whether known or
unknown, accrued or unaccrued, absolute or contingent
or conditional or unmatured.
N-14
Registratio
n
Statement
The Registration Statement of Acquiring Fund on Form
N-14 under the 1940 Act that will register the
Acquisition Shares to be issued in the Acquisition and
will include the proxy materials necessary for the
Stockholders of the Acquired Fund to approve the
Acquisition.
Valuation
Time
The close of regular session trading on the New York
Stock Exchange (?NYSE?) on the Closing Date, when
for purposes of the Acquisition Plan, Acquiring Fund
determines its net asset value per Acquisition Share and
the Acquired Fund determines the net value of the
Assets.
NAV
A Fund?s net asset value is calculated by valuing and
totaling assets and then subtracting liabilities and then
dividing the balance by the number of shares that are
outstanding.
2. Regulatory Filings
Acquiring Fund shall promptly prepare and file the N-14
Registration Statement with the SEC, and Acquiring Fund and the
Acquired Fund 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, the Acquired Fund shall hold a Stockholders
meeting to consider and approve the Acquisition and this Acquisition
Plan and such other matters as the Board of Directors may determine.
Such approval by the Stockholders of the Acquired Fund shall, to the
extent necessary to permit the consummation of the transactions
contemplated herein without violating any investment objective, policy
or restriction of the Acquired Fund, 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 the Acquired Fund?s Assets
Acquiring Fund and the Acquired Fund shall take the following
steps with respect to the Acquisition, as applicable:
(a) On or prior to the Closing Date, the Acquired Fund shall
pay or provide for the payment of all of the Liabilities,
expenses, costs and charges of or attributable to the
Acquired Fund that are known to the Acquired Fund and
that are due and payable prior to or as of the Closing Date.
(b) Prior to the Effective Time, except to the extent prohibited
by Rule 19b-1 under the 1940 Act, the Acquired Fund will
declare to Acquired Fund Stockholders of record a
dividend or dividends which, together with all previous
such dividends, shall have the effect of distributing (i) all
the excess of (A) Acquired Fund?s investment income
excludable from gross income under Section 103(a) of the
Code over (B) Acquired Fund?s deductions disallowed
under Sections 265 and 171(a)(2) of the Code, (ii) all of
Acquired Fund?s investment company taxable income (as
defined in Code Section 852), (computed in each case
without regard to any deduction for dividends paid), and
(iii) all of Acquired Fund?s net realized capital gain (as
defined in Code Section 1222), if any (after reduction for
any capital loss carryover), in each case for both the
taxable year ending on September 30, 2007, and for the
short taxable year beginning on October 1, 2007 and
ending on the Closing Date. Such dividends will be
declared and paid to ensure continued qualification of the
Acquired Fund as a ?regulated investment company? for
tax purposes and to eliminate fund-level tax.
(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?), the
Acquired Fund shall assign, transfer, deliver and convey
the Assets to Acquiring Fund, subject to the Liabilities.
Acquiring Fund 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 Acquiring Fund, and (ii) the Liabilities at
the Effective Time shall attach to Acquiring Fund, and
shall be enforceable against Acquiring Fund to the same
extent as if initially incurred by Acquiring Fund.
(d) Within a reasonable time prior to the Closing Date, the
Acquired Fund shall provide, if requested, a list of the
Assets to Acquiring Fund. The Acquired Fund may sell any
asset on such list prior to the Effective Time. After the
Acquired Fund provides such list, the Acquired Fund 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 Acquiring Fund.
Within a reasonable time after receipt of the list and prior
to the Closing Date, Acquiring Fund will advise the
Acquired Fund in writing of any investments shown on the
list that Acquiring Fund has determined to be inconsistent
with its investment objective, policies and restrictions. The
Acquired Fund will dispose of any such securities prior to
the Closing Date to the extent practicable and consistent
with applicable legal requirements, including the Acquired
Fund?s investment objectives, policies and restrictions. In
addition, if Acquiring Fund determines that, as a result of
the Acquisition, Acquiring Fund would own an aggregate
amount of an investment that would exceed a percentage
limitation applicable to Acquiring Fund, Acquiring Fund
will advise the Acquired Fund in writing of any such
limitation and the Acquired Fund 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 the Acquired Fund?s investment
objectives, policies and restrictions.
(e) The Acquired Fund shall assign, transfer, deliver and
convey the Assets to Acquiring Fund at the Effective Time
on the following basis:
(i) The value of the Assets less the Liabilities of the
Acquired Fund attributable to shares of Class A
held by Stockholders, shares of Class B held by
Stockholders, shares of Class C held by
Stockholders, shares of Advisor Class held by
Stockholders, shares of Class R held by
Stockholders, shares of Class K held by
Stockholders, and shares of Class I held by
Stockholders, determined as of the Valuation Time,
shall be divided by the then NAV of one Class A,
Class B, Class C, Advisor Class, Class R, Class K
or Class I Acquisition Share, as applicable, and, in
exchange for the transfer of the Assets, Acquiring
Fund shall simultaneously issue and deliver to the
Acquired Fund the number of Class A, Class B,
Class C, Advisor Class, Class R, Class K, and Class
I Acquisition Shares so determined, rounded to the
second decimal place or such other decimal place
as the parties may agree to in writing;
(ii) The NAV of Class A, Class B, Class C, Advisor
Class, Class R, Class K, and Class I Acquisition
Shares to be delivered to the Acquired Fund shall
be determined as of the Valuation Time in
accordance with Acquiring Fund?s then applicable
valuation procedures, and the net value of the
Assets to be conveyed to Acquiring Fund shall be
determined as of the Valuation Time in accordance
with the then applicable valuation procedures of the
Acquired Fund; and
(iii) The portfolio securities of the Acquired Fund shall
be made available by the Acquired Fund to The
Bank of New York Mellon, as custodian for
Acquiring Fund (the ?Custodian?), for examination
no later than five business days preceding the
Valuation Time. On the Closing Date, such
portfolio securities and all the Acquired Fund?s
cash shall be delivered by the Acquired Fund to the
Custodian for the account of Acquiring Fund, such
portfolio securities to be duly endorsed in proper
form for transfer in such manner and condition as
to constitute good delivery thereof in accordance
with the custom of brokers or, in the case of
portfolio securities held in the U.S. Treasury
Department?s book-entry system or by The
Depository Trust Company, Participants Trust
Company or other third party depositories, by
transfer to the account of the Custodian in
accordance with Rule 17f-4, Rule 17f-5 or Rule
17f-7, as the case may be, under the 1940 Act and
accompanied by all necessary federal and state
stock transfer stamps or a check for the appropriate
purchase price thereof. The cash delivered shall be
in the form of currency or certified or official bank
checks, payable to the order of the Custodian, or
shall be wired to an account pursuant to instructions
provided by Acquiring Fund.
(f) Promptly after the Closing Date, the Acquired Fund will
deliver to Acquiring Fund a Statement of Assets and
Liabilities of the Acquired Fund as of the Closing Date.
5. Termination of the Acquired Fund, Registration of Acquisition
Shares and Access to Records
The Acquired Fund and Acquiring Fund also shall take the
following steps, as applicable:
(a) At or as soon as reasonably practical after the Effective
Time, the Acquired Fund shall terminate by transferring
pro rata to its Stockholders of Class A of record Class A
Acquisition Shares received by the Acquired Fund
pursuant to Section 4(e)(i) of this Acquisition Plan; to its
Stockholders of Class B of record Class B Acquisition
Shares received by the Acquired Fund pursuant to
Section 4(e)(i) of this Acquisition Plan; to its Stockholders
of Class C of record Class C Acquisition Shares received
by the Acquired Fund pursuant to Section 4(e)(i) of this
Acquisition Plan; to its Stockholders of Advisor Class of
record Advisor Class Acquisition Shares received by the
Acquired Fund pursuant to Section 4(e)(i) of this
Acquisition Plan; to its Stockholders of Class R of record
Class R Acquisition Shares received by the Acquired Fund
pursuant to Section 4(e)(i) of this Acquisition Plan; to its
Stockholders of Class K of record Class K Acquisition
Shares received by the Acquired Fund pursuant to
Section 4(e)(i) of this Acquisition Plan; and to its
Stockholders of Class I of record Class I Acquisition
Shares received by the Acquired Fund pursuant to
Section 4(e)(i) of this Acquisition Plan. Acquiring Fund
shall establish accounts on its share records and note on
such accounts the names of the former Acquired Fund
Stockholders and the types and amounts of Acquiring Fund
shares that former Acquired Fund Stockholders are due
based on their respective holdings of shares of the
Acquired Fund as of the close of business on the Closing
Date. Fractional Acquiring Fund shares shall be carried to
the second decimal place. Acquiring Fund shall not issue
certificates representing Acquiring Fund shares in
connection with such exchange. All issued and outstanding
shares in connection with such exchange will be
simultaneously cancelled on the books of the Acquired
Fund. Ownership of Acquiring Fund?s shares will be
shown on the books of Acquiring Fund?s transfer agent.
Following distribution by the Acquired Fund to its
Stockholders of all Acquisition Shares delivered to the
Acquired Fund, the Acquired Fund shall wind up its affairs
and shall take all steps as are necessary and proper to
terminate as soon as is reasonably possible after the
Effective Time.
(b) At and after the Closing Date, the Acquired Fund shall
provide Acquiring Fund and its transfer agent with
immediate access to: (i) all records containing the names,
addresses and taxpayer identification numbers of all of the
Acquired Fund?s Stockholders and the number and
percentage ownership of the outstanding shares of the
Acquired Fund 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 the Acquired
Fund Stockholders? taxpayer identification numbers and
their liability for or exemption from back-up withholding.
The Acquired Fund shall preserve and maintain, or shall
direct its service providers to preserve and maintain,
records with respect to the Acquired Fund as required by
Section 31 of, and Rules 31a-1 and 31a-2 under, the 1940
Act.
6. Certain Representations and Warranties of the Acquired Fund
The Acquired Fund represents and warrants to Acquiring Fund as
follows:
(a) The Acquired Fund is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Maryland. The Acquired Fund is registered with
the SEC as an open-end management investment company
under the 1940 Act and such registrations will be in full
force and effect as of the Effective Time.
(b) The Acquired Fund has the power and all necessary
federal, state and local qualifications and authorizations to
own all of the Assets, to carry on its business, to enter into
this Acquisition Plan and to consummate the transactions
contemplated herein.
(c) The Board of Directors of the Acquired Fund has duly
authorized the execution and delivery of this Acquisition
Plan and the transactions contemplated herein. Duly
authorized officers of the Acquired Fund have executed
and delivered this Acquisition Plan. This Acquisition 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
Acquisition Plan does not, and, subject to the approval of
Stockholders referred to in Section 3 hereof, the
consummation of the transactions contemplated by this
Acquisition Plan will not, violate the Acquired Fund?s
Charter, its Bylaws or any material agreement to which the
Acquired Fund is subject. Except for the approval of its
Stockholders, the Acquired Fund does not need to take any
other action to authorize its officers to effectuate this
Acquisition Plan and the transactions contemplated herein.
(d) The Acquired Fund 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 the Acquired Fund 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 Stockholder
meeting of the Acquired Fund for approval of the
Acquisition and at the Effective Time, insofar as it relates
to the Acquired Fund, shall (i) comply in all material
respects with the applicable provisions of the 1933 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) The Acquired Fund 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 the Acquired Fund, nor are there any securities
convertible into shares of the Acquired Fund.
(g) The Acquired Fund 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, the Acquired Fund 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 the Acquired Fund, a copy of
which has been previously delivered to Acquiring Fund,
fairly present the financial position of the Acquired Fund
as of the Acquired Fund?s most recent fiscal year-end and
the results of the Acquired Fund?s operations and changes
in the Acquired Fund?s net assets for the periods indicated.
(j) To the knowledge of the Acquired Fund, the Acquired
Fund 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) To the knowledge of the Acquired Fund, except as has
been disclosed in writing to Acquiring Fund, no claims,
actions, suits, investigations or proceedings of any type are
pending or threatened against the Acquired Fund or any of
its properties or assets or any person whom the Acquired
Fund may be obligated to indemnify in connection with
such litigation, proceeding or investigation. Subject to the
foregoing, there are no facts that the Acquired Fund has
reason to believe are likely to form the basis for the
institution of any such claim, action, suit, investigation or
proceeding against the Acquired Fund. The Acquired Fund
is not a party to nor 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 Acquisition 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, and this Acquisition Plan, the
Acquired Fund is not a party to or subject to any material
contract or other commitments that, if terminated, may
result in material liability to the Acquired Fund or under
which (whether or not terminated) any material payment
for periods subsequent to the Closing Date will be due
from the Acquired Fund.
(m) The Acquired Fund has filed its federal income tax returns,
copies of which have been previously made available to
Acquiring Fund, for all taxable years for which such
returns are due and has paid all taxes payable pursuant to
such returns. All of the Acquired Fund?s tax liabilities will
have been adequately provided for on its books. No such
return is currently under audit and no unpaid assessment
has been asserted with respect to such returns. To the best
of the Acquired Fund?s knowledge, it will not have any tax
deficiency or liability asserted against it or question with
respect thereto raised, and it will not be under audit by the
Internal Revenue Service or by any state or local tax
authority for taxes in excess of those already paid. The
Acquired Fund will timely file its federal income tax return
for each subsequent taxable year including its current
taxable year.
(n) For federal income tax purposes, the Acquired Fund
qualifies as a ?regulated investment company,? and the
provisions of Sections 851 through 855 of the Code apply
to the Acquired Fund for the remainder of its current
taxable year beginning November 1, 2007, and will
continue to apply through the Closing Date.
(o) Since the date of the Financial Statements of the Acquired
Fund, 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.
(p) The Acquired Fund?s investment operations from inception
to the date hereof have been in compliance in all material
respects with the investment policies and investment
restrictions set forth in its prospectus or prospectuses and
statement or statements of additional information as in
effect from time to time, except as previously disclosed in
writing to Acquiring Fund.
(q) The Acquisition Shares to be issued to the Acquired Fund
pursuant to paragraph 4(e)(i) will not be acquired for the
purpose of making any distribution thereof other than to
the Acquired Fund Stockholders as provided in paragraph
4(e)(i).
(r) The Acquired Fund, or its agents, (i) holds a valid Form
W-8Ben, Certificate of Foreign Status of Beneficial Owner
for United States Withholding (or other appropriate series
of Form W-8, as the case may be) or Form W-9, Request
for Taxpayer Identification Number and Certification, for
each Acquired Fund Stockholder of record, which Form
W-8 or Form W-9 can be associated with reportable
payments made by the Acquired Fund to such Stockholder,
and/or (ii) has otherwise timely instituted the appropriate
backup withholding procedures with respect to such
Stockholder as provided by Section 3406 of the Code and
the regulations thereunder.
7. Certain Representations and Warranties of Acquiring Fund
Acquiring Fund represents and warrants to the Acquired Fund as
follows:
(a) Acquiring Fund is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of
Maryland. Acquiring Fund is registered with the SEC as an
open-end management investment company under the 1940
Act and such registrations will be in full force and effect as
of the Effective Time.
(b) Acquiring Fund 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.
(c) Acquiring 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
Acquisition Plan and to consummate the transactions
contemplated herein.
(d) The Board of Directors of Acquiring Fund has duly
authorized execution and delivery of this Acquisition Plan
and the transactions contemplated herein. Duly authorized
officers of Acquiring Fund have executed and delivered the
Acquisition Plan. The Acquisition 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 Acquisition Plan does not,
and the consummation of the transactions contemplated by
this Acquisition Plan will not, violate the Charter of
Acquiring Fund, its Bylaws or any material agreement to
which Acquiring Fund is subject. Except for the approval
of its Board, Acquiring Fund does not need to take any
other action to authorize its officers to effectuate the
Acquisition Plan and the transactions contemplated herein.
(e) Acquiring Fund 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.
(f) 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 the Acquired Fund for approval of the
Acquisition and at the Effective Time, insofar as it relates
to Acquiring Fund, shall (i) comply in all material respects
with the applicable provisions of the 1933 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, in light of the
circumstances under which they were made, not
misleading.
(g) Acquiring Fund has duly authorized and validly issued all
issued and outstanding shares of common stock of
Acquiring Fund, 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. Acquiring Fund has duly
authorized the Class A, Class B, Class C, Advisor Class,
Class R, Class K and Class I shares of Acquiring Fund
referred to in Section 4(e) hereof to be issued and delivered
to the Acquired Fund as of the Effective Time. When
issued and delivered, such Class A, Class B, Class C,
Advisor Class, Class R, Class K, and Class I shares of
Acquiring Fund shall be validly issued, fully paid and non-
assessable, and no Stockholder of Acquiring Fund 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 Acquisition Shares, nor are there any
securities convertible into Acquisition Shares.
(h) To the knowledge of Acquiring Fund, except as has been
disclosed in writing to the Acquired Fund, no claims,
actions, suits, investigations or proceedings of any type are
pending or threatened against Acquiring Fund or any of its
properties or assets or any person whom Acquiring Fund
may be obligated to indemnify in connection with such
litigation, proceeding or investigation. Subject to the
foregoing, there are no facts that Acquiring Fund currently
has reason to believe are likely to form the basis for the
institution of any such claim, action, suit, investigation or
proceeding against Acquiring Fund. Acquiring Fund 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
this Acquisition Plan.
(i) Except for agreements entered into or granted in the
ordinary course of its business, in each case under which
no material default exists, Acquiring Fund 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.
(j) Acquiring Fund has filed its federal income tax returns,
copies of which have been previously made available to the
Acquired Fund, for all taxable years for which such returns
are due and has paid all taxes payable pursuant to such
returns. All of Acquiring Fund?s tax liabilities will have
been adequately provided for on its books. No such return
is currently under audit and no unpaid assessment has been
asserted with respect to such returns. To the best of
Acquiring Fund?s knowledge, it will not have any tax
deficiency or liability asserted against it or question with
respect thereto raised, and it will not be under audit by the
Internal Revenue Service or by any state or local tax
authority for taxes in excess of those already paid.
Acquiring Fund will timely file its federal income tax
return for each subsequent taxable year including its
current taxable year.
(k) For federal income tax purposes, Acquiring Fund qualifies
as a ?regulated investment company,? and the provisions of
Sections 851 through 855 of the Code apply to Acquiring
Fund for the remainder of its current taxable year
beginning November 1, 2007, and will continue to apply
through the Closing Date.
(l) The Financial Statements of Acquiring Fund, a copy of
which has been previously delivered to the Acquired Fund,
fairly present the financial position of Acquiring Fund at its
most recent fiscal year-end and the results of Acquiring
Fund?s operations and changes in Acquiring Fund?s net
assets for the period indicated.
(m) Since the date of the Financial Statements of Acquiring
Fund, 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.
(n) Acquiring Fund?s investment operations from inception to
the date hereof have been in compliance in all material
respects with the investment policies and investment
restrictions set forth in its prospectus or prospectuses and
statement or statements of additional information as in
effect from time to time, except as previously disclosed in
writing to the Acquired Fund.
(o) Acquiring Fund will use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the
1940 Act and such other state securities laws as it may
deem appropriate in order to continue its operations after
the Closing Date.
8. Conditions to the Obligations of Acquiring Fund and the
Acquired Fund
The obligations of Acquiring Fund and the Acquired Fund with
respect to the Acquisition shall be subject to the following conditions
precedent:
(a) The Stockholders of the Acquired Fund shall have
approved the Acquisition in the manner required by the
Charter of the Acquired Fund, its Bylaws and applicable
law. If Stockholders of the Acquired Fund fail to approve
the Acquisition as required, that failure shall release the
Funds of their obligations under this Acquisition Plan.
(b) Acquiring Fund and the Acquired Fund 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 Acquiring Fund or the Acquired Fund, as
applicable, in this Acquisition Plan that apply to the
Acquisition are true and correct in all material respects at
and as of the Valuation Time.
(c) Acquiring Fund and the Acquired Fund shall have
performed and complied in all material respects with each
of its representations and warranties required by this
Acquisition 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 Acquiring Fund or the Acquired Fund since the
date of the most recent Financial Statements. Negative
investment performance shall not be considered a material
adverse change.
(e) Acquiring Fund and the Acquired Fund shall have received
an opinion of Xxxxxx & Xxxxxx LLP reasonably satisfactory
to each of them, substantially to the effect that for federal
income tax purposes:
(i) the Acquisition will constitute a ?reorganization?
within the meaning of Section 368(a) of the Code
and that Acquiring Fund and the Acquired Fund
will each be ?a party to a reorganization? within the
meaning of Section 368(b) of the Code;
(ii) a Stockholder of the Acquired Fund will recognize
no gain or loss on the exchange of the
Stockholder?s shares of the Acquired Fund solely
for Acquisition Shares;
(iii) neither the Acquired Fund nor Acquiring Fund will
recognize any gain or loss upon the transfer of all
of the Assets to Acquiring Fund in exchange for
Acquisition Shares and the assumption by
Acquiring Fund of the Liabilities pursuant to this
Acquisition Plan or upon the distribution of
Acquisition Shares to Stockholders of the Acquired
Fund in exchange for their respective shares of the
Acquired Fund;
(iv) the holding period and tax basis of the Assets
acquired by Acquiring Fund will be the same as the
holding period and tax basis that the Acquired Fund
had in such Assets immediately prior to the
Acquisition;
(v) the aggregate tax basis of Acquisition Shares
received in connection with the Acquisition by each
Stockholder of the Acquired Fund (including any
fractional share to which the Stockholder may be
entitled) will be the same as the aggregate tax basis
of the shares of the Acquired Fund surrendered in
exchange therefor, and increased by any gain
recognized on the exchange;
(vi) the holding period of Acquisition Shares received
in connection with the Acquisition by each
Stockholder of the Acquired Fund (including any
fractional share to which the Stockholder may be
entitled) will include the holding period of the
shares of the Acquired Fund surrendered in
exchange therefor, provided that such Acquired
Fund shares constitute capital assets in the hands of
the Stockholder as of the Closing Date; and
(vii) Acquiring Fund will succeed to the capital loss
carryovers of the Acquired Fund, if any, under
Section 381 of the Code, but the use by Acquiring
Fund of any such capital loss carryovers (and of
capital loss carryovers of Acquiring Fund) may be
subject to limitation under Section 383 of the Code.
The opinion will be based on certain factual certifications
made by officers of the Funds and will also be based on
customary assumptions and subject to certain
qualifications. The opinion is not a guarantee that the tax
consequences of the Acquisition will be as described
above.
Notwithstanding this subparagraph (e), Xxxxxx & Xxxxxx
LLP will express no view with respect to the effect of the
Acquisition on any transferred asset as to which any
unrealized gain or loss is required to be recognized at the
end of a taxable year (or on the termination or transfer
thereof) under federal income tax principles. Each Fund
shall agree to make and provide additional factual
representations to Xxxxxx & Xxxxxx LLP with respect to the
Funds that are reasonably necessary to enable Xxxxxx &
Xxxxxx LLP to deliver the tax opinion. Notwithstanding
anything in this Acquisition Plan to the contrary, neither
Fund may waive in any material respect the conditions set
forth under this subparagraph (e).
(f) The N-14 Registration Statement shall have become
effective under the 1933 Act as to the Acquisition Shares,
and the SEC shall not have instituted and, to the knowledge
of Acquiring Fund, 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 Acquisition Plan
with respect to the Acquisition pursuant to Section 13 of
this Acquisition Plan.
9. Conditions to the Obligations of the Acquired Fund
The obligations of the Acquired Fund with respect to the
Acquisition shall be subject to the following conditions precedent:
(a) The Acquired Fund shall have received an opinion of
Xxxxxx & Xxxxxx LLP, counsel to Acquiring Fund, in form
and substance reasonably satisfactory to the Acquired Fund
and dated as of the Closing Date, substantially to the effect
that:
(i) Acquiring 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;
(ii) This Acquisition Plan has been duly authorized,
executed and delivered by Acquiring Fund and,
assuming the N-14 Registration Statement referred
to in Section 2 of this Acquisition Plan does not
contain any material misstatements or omissions,
and assuming due authorization, execution and
delivery of this Acquisition Plan by the Acquired
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 this Acquisition 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
this Acquisition Plan is not material;
(iii) The Class A, Class B, Class C, Advisor Class,
Class R, Class K and Class I Acquisition Shares to
be delivered as provided for by this Acquisition
Plan are duly authorized and upon delivery will be
validly issued, fully paid and non-assessable by
Acquiring Fund;
(iv) The execution and delivery of this Acquisition Plan
did not, and the consummation of the Acquisition
will not, violate the Charter of Acquiring Fund, its
Bylaws or any agreement of Acquiring Fund
known to such counsel, after reasonable inquiry;
and
(v) 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 Acquiring
Fund to enter into this Acquisition 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 Acquiring Fund.
In rendering such opinion, Xxxxxx & Xxxxxx LLP may
(i) rely on the opinion of Xxxxxxx LLP as to matters of
Maryland law 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 Acquisition Plan and (v) rely on certificates of officers
or directors of Acquiring Fund as to factual matters.
(b) Acquiring Fund shall have received a letter from
AllianceBernstein L.P. (the ?Adviser?) with respect to
insurance matters in form and substance satisfactory to the
Acquired Fund.
10. Conditions to the Obligations of Acquiring Fund
The obligations of Acquiring Fund with respect to the
Acquisition shall be subject to the following conditions precedent:
(a) Acquiring Fund shall have received an opinion of
Xxxxxx & Xxxxxx LLP, counsel to the Acquired Fund, in
form and substance reasonably satisfactory to Acquiring
Fund and dated as of the Closing Date, substantially to the
effect that:
(i) The Acquired 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;
(ii) This Acquisition Plan has been duly authorized,
executed and delivered by the Acquired Fund and,
assuming the N-14 Registration Statement referred
to in Section 2 of this Acquisition Plan does not
contain any material misstatements or omissions,
and assuming due authorization, execution and
delivery of this Acquisition Plan by Acquiring
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 this Acquisition 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
this Acquisition Plan is not material;
(iii) The execution and delivery of this Acquisition Plan
did not, and the consummation of the Acquisition
will not, violate the Charter of the Acquired Fund,
its Bylaws or any agreement of the Acquired Fund
known to such counsel, after reasonable inquiry,
and no approval of the Acquisition Plan by the
Stockholders of Acquiring Fund is required under
its Charter, Bylaws or applicable law; and
(iv) 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 the Acquired
Fund to enter into this Acquisition 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 the Acquired Fund.
In rendering such opinion, Xxxxxx & Xxxxxx LLP may
(i) rely on the opinion of Xxxxxxx LLP as to matters of
Maryland law, (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 Acquisition Plan and (v) rely on
certificates of officers or directors of the Acquired Fund as
to factual matters.
(b) Acquiring Fund shall have received a letter from the
Adviser agreeing to indemnify Acquiring Fund in respect
of certain liabilities of the Acquired Fund in form and
substance satisfactory to Acquiring Fund.
11. Closing
(a) The Closing shall be held at the offices of the Funds, 0000
Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or
at such other time or place as the parties may agree.
(b) In the event that at the Valuation Time (i) the NYSE shall
be closed to trading or trading thereon shall be restricted,
or (ii) trading or the reporting of trading on said Exchange
or elsewhere shall be disrupted so that accurate appraisal of
the value of the net assets of the Acquired Fund or
Acquiring Fund is impracticable, the Closing Date shall be
postponed until the first business day after the day when
trading shall have been fully resumed and reporting shall
have been restored; provided that if trading shall not be
fully resumed and reporting restored within three business
days of the Valuation Time, this Acquisition Plan may be
terminated by either the Acquired Fund or Acquiring Fund
upon the giving of written notice to the other party.
(c) Acquiring Fund will provide to the Acquired Fund
evidence satisfactory to the Acquired Fund that Acquisition
Shares issuable pursuant to the Acquisition have been
credited to the Acquired Fund?s account on the books of
Acquiring Fund. After the Closing Date, Acquiring Fund
will provide to the Acquired Fund evidence satisfactory to
the Acquired Fund that such Shares have been credited pro
rata to open accounts in the names of the Acquired Fund
Stockholders.
(d) At the Closing, each party shall deliver to the other such
bills of sale, instruments of assumption of liabilities,
checks, assignments, stock certificates, receipts or other
documents as such other party or its counsel may
reasonably request in connection with the transfer of assets,
assumption of liabilities and liquidation contemplated by
the Acquisition Plan.
12. Survival of Representations and Warranties
No representations, warranties or covenants in or pursuant to this
Acquisition Plan (including certificates of officers) hereto shall survive
the completion of the transactions contemplated herein.
13. Termination of Acquisition Plan
A majority of either Fund?s Board of Directors may terminate
this Acquisition Plan with respect to that Fund at any time before the
applicable Effective Time if: (a) the Fund?s conditions precedent set
forth in Sections 8, 9 or 10 as appropriate, are not satisfied; or (b) 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.
14. Governing Law
This Acquisition 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.
15. 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 this Acquisition Plan.
16. Amendments
The parties may, by agreement in writing authorized by their
respective Board of Directors, amend this Acquisition Plan at any time
before or after the Stockholders of the Acquired Fund approve the
Acquisition. However, after Stockholders of the Acquired Fund
approve the Acquisition, the parties may not amend this Acquisition
Plan in a manner that materially alters the obligations of the other party.
This Section shall not preclude the parties from changing the Closing
Date or the Effective Time by mutual agreement.
17. Waivers
At any time prior to the Closing Date, either party may by written
instrument signed by it (a) waive the effect of any inaccuracies in the
representations and warranties made to it contained herein and
(b) 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.
18. Indemnification of Directors
Acquiring Fund agrees that all rights to indemnification and all
limitations of liability existing in favor of the Acquired Fund?s current
and former Directors and officers, acting in their capacities as such,
under the Acquired Fund?s Charter and Bylaws as in effect as of the
date of this Acquisition Plan shall survive the Acquisition as
obligations of Acquiring Fund and shall continue in full force and
effect, without any amendment thereto, and shall constitute rights
which may be asserted against Acquiring Fund, its successors or
assigns.
19. Cooperation and Further Assurances
Each party will cooperate with the other in fulfilling its
obligations under this Acquisition Plan and will provide such
information and documentation as is reasonably requested by the other
in carrying out this Acquisition 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.
20. 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.
21. Limitation on Liabilities
The obligations of the Acquired Fund and Acquiring Fund shall
not bind any of the directors, Stockholders, nominees, officers, agents,
employees or agents of the Acquired Fund or Acquiring Fund
personally, but shall bind only the Acquired Fund or Acquiring Fund,
as appropriate. The execution and delivery of this Acquisition 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 the Acquired Fund or Acquiring Fund, as
appropriate.
22. Termination of the Acquired Fund
If the parties complete the Acquisition, the Acquired Fund shall
terminate its registration under the 1940 Act and the 1933 Act and will
terminate.
23. Notices
Any notice, report, statement, certificate or demand required or
permitted by any provision of this Acquisition Plan shall be in writing
and shall be given in person or by telecopy, certified mail or overnight
express courier to:
For the Acquired Fund:
AllianceBernstein Emerging Market Debt
Fund, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
For Acquiring Fund:
AllianceBernstein High Yield Fund, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
24. Expenses
The Acquisition expenses shall be paid by each of the Acquired
Fund and the Acquiring Fund on a relative net asset basis.
25. General
This Acquisition 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 Acquisition Plan are for reference only and shall not
affect in any way the meaning or interpretation of this Acquisition Plan.
Whenever the context so requires, the use in this Acquisition Plan of
the singular will be deemed to include the plural and vice versa.
Nothing in this Acquisition Plan, expressed or implied, confers upon
any other person any rights or remedies under or by reason of this
Acquisition Plan. Neither party may assign or transfer any right or
obligation under this Acquisition Plan without the written consent of
the other party.
In Witness Whereof, the parties hereto have executed this
Acquisition Plan as of the day and year first above written.
ALLIANCEBERNSTEIN EMERGING
MARKET DEBT FUND, INC.
Attest:
By:
Name:
Xxxxxx X. Xxxxxxx
Name:
Xxxx X. Xxxxx
Title:
Assistant Secretary
Title:
President
ALLIANCEBERNSTEIN HIGH YIELD
FUND, INC.
Attest:
By:
Name:
Xxxxxx X. Xxxxxxx
Name:
Xxxx X. Xxxxx
Title:
Assistant Secretary
Title:
Xxxxxxxxx
XX 00000 0455 836600
