Exhibit 2.1


                PLAN OF TERMINATION, LIQUIDATION AND DISSOLUTION

           FIRST TRUST/VALUE LINE(R) & IBBOTSON EQUITY ALLOCATION FUND

         This PLAN OF TERMINATION, LIQUIDATION AND DISSOLUTION (the "Plan") is
made on November 17, 2006 by FIRST TRUST/VALUE LINE(R) & IBBOTSON EQUITY
ALLOCATION FUND (the "Fund"), a Massachusetts business trust and a closed-end
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act").

         WHEREAS, pursuant to Section 8.2 of the Declaration of Trust of the
Fund, dated February 20, 2004 (the "Declaration"), the Fund may be terminated at
any time by the Trustees by written notice to the Shareholders of the Fund;

         WHEREAS, the Board of Trustees (the "Board") of the Fund, after
substantial discussion and deliberation, has unanimously determined that it is
in the best interests of the Fund and the Shareholders of the Fund to terminate,
liquidate and dissolve the Fund;

         WHEREAS, this Plan is intended to accomplish the complete termination,
liquidation and dissolution of the Fund in accordance with the laws of the
Commonwealth of Massachusetts, the Declaration and the By-Laws of the Fund as
amended and restated on June 12, 2006 (the "By-Laws"); and

         WHEREAS, the Board has considered and approved this Plan as the method
of terminating, liquidating and dissolving the Fund; and

         WHEREAS, any capitalized terms used but not defined herein shall have
the meanings ascribed to such terms in the Declaration;

         NOW THEREFORE, the termination, liquidation and dissolution of the Fund
shall be carried out in the manner hereinafter set forth:

         1.       Effective Date of Plan.

         The Plan and the termination, liquidation and dissolution of the Fund
as contemplated therein, having been duly approved and adopted by the Board
pursuant to Section 8.2 of the Declaration, shall become effective upon the
sending of written notice to the Shareholders as soon as practicable (the date
upon which such notice is sent being referred to herein as the "Effective
Date"). The Fund shall cause such written notice to the Shareholders to be sent
to the Shareholders as soon as practicable.

         2.       Cessation of Business.

         At the close of business on the Effective Date, the Fund shall cease
its business as an investment company and shall thereafter carry on no business
except for the purpose of winding up its affairs, liquidating its assets,





paying, discharging or making reasonable provision for the payment of all of the
Fund's liabilities, whether accrued, contingent, expected or otherwise, as
provided in Section 4 hereof, distributing its remaining assets in complete
distribution of the Trust Property to the Shareholders, and doing all other acts
required to liquidate and wind up its business and affairs, and will dissolve,
all in accordance with this Plan and with the Declaration.

         3.       Fixing of Interests and Closing of Shareholder Register Books.

         The Fund shall provide the requisite notice or notices to the American
Stock Exchange ("AMEX") of its termination and liquidation and the date of the
First Distribution (as defined below), and shall provide any other de-listing
application as required by the AMEX in order to cease the trading of the Fund's
shares on the AMEX (the date provided in such notice as the date the shares of
the Fund shall cease trading on the AMEX being referred to herein as the "Notice
Date"). The proportionate interests of Shareholders in the assets of the Fund
shall be fixed on the basis of their respective holdings at the close of
business on the Notice Date. On the Notice Date, the stock transfer books of the
Fund shall be closed. Thereafter, the Shareholders' respective interests in the
Fund's assets shall not be transferable by the negotiation of share certificates
and the Fund's shares will cease to be traded on the AMEX.

         4.       Liquidation of Assets and Payments of Debts.

         As soon as is reasonable and practicable after the Effective Date, all
portfolio securities of the Fund shall be converted to cash or cash equivalents.
As soon as practicable after the Effective Date, the Fund shall determine and
pay or discharge, or make reasonable provision to pay or discharge in full, all
known or reasonably ascertainable unpaid liabilities or obligations of the Fund
incurred or expected to be incurred, prior to the date of the First Distribution
(as defined below) provided for in Section 5 below. If the Fund is unable to pay
or discharge any liabilities of the Fund prior to the date of the First
Distribution, the Fund shall retain cash or cash equivalents in an amount that
it estimates is necessary to pay or discharge such unpaid liabilities of the
Fund on the Fund's books on the date of the First Distribution and other
liabilities as described in Section 5 below.

         5.       Liquidating Distributions.

         The Fund's Trust Property is expected to be distributed by one or more
cash payments in complete cancellation of all of the outstanding shares of the
Fund. The first distribution of the Fund's Trust Property (the "First
Distribution") is expected to consist of cash representing a substantial portion
of the assets of the Fund, less an estimated amount necessary to pay or
discharge any (a) unpaid liabilities and obligations of the Fund on the Fund's
books on the date of the First Distribution, (b) liabilities as the Fund's
officers or Board shall reasonably deem to exist against the assets of the Fund
as of the date of the First Distribution, and (c) a reserve for contingent
liabilities as the Fund's officers or Board may reasonably deem appropriate. Any
subsequent distribution (each, a "Distribution" and, together with the First
Distribution, the "Liquidating Distributions") will consist of cash from any
assets remaining after accrual of expenses, the proceeds of any sale of assets
of the Fund under the Plan not sold prior to the earlier Distributions and any
other miscellaneous income of the Fund. The Board will set the payment date for





the First Distribution and each subsequent Distribution to Shareholders as
determined pursuant to Section 3 above. Cash or other assets held as provided
herein for the payment of contingent or unascertained liabilities in accordance
with this Plan in excess of the amounts ultimately required for the payment and
discharge of the Fund's liabilities and obligations shall be distributed to the
Shareholders at the time and under the conditions established with respect to
such reserves or other arrangements hereunder providing for the payment thereof
as determined by the Fund's officers or Trustees. Upon the Notice Date, all
stock certificates held by Shareholders will be deemed to be cancelled. Each
Shareholder of the Fund will receive Liquidating Distributions based upon the
net assets of the Fund. Shareholders not holding stock certificates of the Fund
will receive such Liquidating Distributions automatically. As Fund officers may
reasonably deem appropriate, Shareholders who hold stock certificates of the
Fund may or may not be required to return such stock certificates to receive
Liquidating Distributions. Thereafter, the stock certificates held by
Shareholders shall have no value. All Shareholders will receive information
concerning the sources of the Liquidating Distributions. Upon mailing of the
final Liquidating Distribution (the date of such mailing, the "Final Liquidation
Date"), all of the Trust Property shall be distributed as required under Section
8.2 of the Declaration.

         6.       Satisfaction of Tax Distribution Requirements.

         At or immediately prior to the mailing of the First Distribution, the
Fund shall, if necessary, have declared and paid a dividend or dividends which,
together with all previous such dividends, shall have the effect of distributing
to the Shareholders all of the Fund's investment company taxable income for
taxable years or portions thereof ending at or prior to the date of the First
Distribution (computed without regard to any deduction for dividends paid) and
all of the net capital gain, if any, realized in taxable years or portions
thereof ending at or prior to the date of the First Distribution (after
reduction for any capital loss carry-forward) and any additional amounts
necessary to avoid any excise tax for such periods.

         At or immediately prior to the Final Liquidation Date, the Fund shall,
if necessary, have declared and paid a dividend or dividends which, together
with all previous such dividends, shall have the effect of distributing to the
Shareholders all of the Fund's investment company taxable income for taxable
years ending at or prior to the Final Liquidation Date (computed without regard
to any deduction for dividends paid) and all of the net capital gain, if any,
realized in taxable years ending at or prior to the Final Liquidation Date
(after reduction for any capital loss carry-forward) and any additional amounts
necessary to avoid any excise tax for such periods.

         7.       Expenses of the Liquidation and Dissolution of the Fund.

         The Fund shall bear one half of all expenses incurred by it, with one
half of all expenses borne by First Trust Advisors L.P., in taking any actions
in furtherance of this plan.

         8.       Filings.

         As soon as practicable after the distributions of the Fund's Trust
Property, the Fund shall file a notice of liquidation and dissolution of the





Fund and any other documents as are necessary to effect the liquidation and
dissolution of the Fund in accordance with the requirements of the Declaration,
Massachusetts law, the Internal Revenue Code of 1986, as amended (the "Code"),
any applicable securities laws, and any rules and regulations of the AMEX, the
Securities and Exchange Commission (the "SEC") or any state securities
commission, including, without limitation, withdrawing any qualification to
conduct business in any state in which the Fund is so qualified, as well as the
preparation and filing of any tax returns, and a majority of the Board shall
execute and lodge among the records of the Fund an instrument in writing setting
forth the fact of the termination, liquidation and dissolution of the Fund.

         9.       Deregistration as an Investment Company and as a
Reporting Company.

         As soon as reasonably practicable after the Final Liquidation Date, the
Fund shall file applications with the SEC to de-register under the 1940 Act and
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
shall be authorized to file any amendments thereto as the officers of the Fund
deem necessary to effect such de-registration.

         10.      Dissolution and other Filings.

         As soon as reasonably practicable after the SEC has issued an order
granting de-registration of the Fund, the Fund shall be terminated under
Massachusetts law.

         11.      Power of Trustees.

         The Board, and, subject to the direction of the Board, the officers of
the Fund, shall have authority to do or authorize any or all acts and things as
they may consider necessary or desirable to carry out the purposes of this Plan,
including, without limitation, the execution and filing of all certificates,
documents, instruments, information returns, tax returns, forms and other papers
which may be necessary or appropriate to implement the Plan or which may be
required by the provisions of Massachusetts law, the 1940 Act, the Securities
Act of 1933, as amended, the Exchange Act, the Code, the AMEX, or other
applicable laws. The death, resignation or disability of any Trustee or officer
of the Fund shall not impair the authority of the surviving or remaining
Trustees or officers to exercise any of the powers provided for in this Plan.

         12.      Amendment or Abandonment.

         The Board shall have the authority to authorize such variations from,
or amendments of, the provisions of this Plan (other than the terms governing
Liquidating Distributions as contained in Section 5 above) solely as may be
necessary or appropriate to give effect to the liquidation and dissolution of
the Fund and the distribution of the Trust Property to Shareholders in
accordance with the purposes to be accomplished by this Plan. The Board may not
abandon this Plan at any time after the Effective Date and prior to the Final
Liquidation Date.

         13.      Further Assurances.





         The Fund, its Trustees and officers shall take such further action,
prior to, at, and after the Final Liquidation Date, as may be necessary or
desirable and proper to consummate the transactions contemplated by this Plan.

         14.      Governing Law.

         This Plan shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts.

         15.      Limitations on Liability.

         Notice is hereby given of the Fund's Declaration of Trust and all
amendments thereto, a copy of each of which is on file with the Secretary of the
Commonwealth of Massachusetts, and the limitations of Shareholder and Trustee
liability contained therein. The obligations imposed upon the Fund by this Plan
are not binding upon any of the Fund's Trustees, officers or Shareholders
individually, but are binding only upon the Fund's assets and property, and
persons dealing with the Fund must look solely to the assets and property of the
Fund for the enforcement of any claims.