As filed with the Securities and Exchange
Commission on September 28, 2007
Registration No:
Investment Company Act Registration No. 811-5398
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No.
Post-Effective Amendment No.
--------------------------------------------
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC.
(Exact Name of Registrant as Specified in Charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of Principal Executive Office) (Zip Code)
Registrant's Telephone Number, including Area Code: (800) 221-5672
---------------------------------------------------------------
EMILIE D. WRAPP
AllianceBernstein L.P.
1345 Avenue of the Americas
New York, New York l0105
(Name and address of agent for service)
Copies of communications to:
Kathleen K. Clarke
Seward & Kissel LLP
1200 G Street, Nw
Suite 350
Washington, DC 20005
Approximate Date of Proposed Public Offering:
As soon as practicable after this Registration Statement becomes effective.
It is proposed that this filing will become effective on October 29, 2007
pursuant to Rule 488 under the Securities Act of 1933.
No filing fee is required because an indefinite number of shares has previously
been registered pursuant to Rule 24f-2 under the Investment Company Act of 1940,
as amended.
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC.
CONTENTS OF FORM N-14 REGISTRATION STATEMENT
This Registration Statement contains the following papers and documents:
- --------------------------------------------------------------------------------
o Cover Sheet
- --------------------------------------------------------------------------------
o Contents of Registration Statement
- --------------------------------------------------------------------------------
o Form N-14 Cross Reference Sheet
- --------------------------------------------------------------------------------
o Letter to Shareholders
- --------------------------------------------------------------------------------
o Notice of Special Meetings of Shareholders
- --------------------------------------------------------------------------------
o Part A - Proxy Statement/Prospectus
- --------------------------------------------------------------------------------
o Part B - Statement of Additional Information
- --------------------------------------------------------------------------------
o Part C - Other Information
- --------------------------------------------------------------------------------
o Signatures
- --------------------------------------------------------------------------------
o Exhibits
- --------------------------------------------------------------------------------
CROSS REFERENCE SHEET
- --------------------------------------------------------------------------------
ITEM NO. PROXY/PROSPECTUS
- --------------------------------------------------------------------------------
Part A
- --------------------------------------------------------------------------------
1. Beginning of Registration Statement and Cover Page/Questions & Answers
Outside Front Cover Page of Prospectus
- --------------------------------------------------------------------------------
2. Beginning of Outside Back Cover Page of Questions & Answers
Prospectus
- --------------------------------------------------------------------------------
3. Fee Table, Synopsis Information and Risk Summary, Appendix A
Factors
- --------------------------------------------------------------------------------
4. Information about the Transaction Letter to Shareholders, Questions
and Answers, Summary, Information
About the Proposed Transaction
- --------------------------------------------------------------------------------
5. Information about the Registrant Letters to Shareholders, Questions
and Answers, Summary, Information
About the Funds
- --------------------------------------------------------------------------------
6. Information about the Company Being Letters to Shareholders, Questions
Acquired and Answers, Summary, Information
About the Funds
- --------------------------------------------------------------------------------
7. Voting Information Voting Information
- --------------------------------------------------------------------------------
8. Interest of Certain Persons and Experts Experts
- --------------------------------------------------------------------------------
9. Additional Information Required for
Reoffering by Persons Deemed to be
Underwriters Not Applicable
- --------------------------------------------------------------------------------
Part B
- --------------------------------------------------------------------------------
10. Cover Page Cover Page
- --------------------------------------------------------------------------------
11. Table of Contents Table of Contents
- --------------------------------------------------------------------------------
12. Additional Information About the SAI
Registrant
- --------------------------------------------------------------------------------
13. Additional Information about the SAI
Company being Acquired
- --------------------------------------------------------------------------------
14. Financial Statements Incorporated by Reference to the
SAI
- --------------------------------------------------------------------------------
15-17. Information required to be included
in Part C is set forth under the
appropriate item, so numbered, in
Part C of this Registration
Statement.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. --
ALLIANCEBERNSTEIN INTERNATIONAL RESEARCH GROWTH PORTFOLIO
1345 Avenue of the Americas
New York, New York 10105
[__________], 2007
Dear Variable Annuity Contractholder:
We are sending this information to you because you hold an interest in a
separate account offered by an insurance company that funds a variable insurance
product. Certain of the purchase payments made under your contract by you as a
contractholder have been allocated to AllianceBernstein International Research
Growth Portfolio ("International Research Growth"), a series of
AllianceBernstein Variable Products Series Fund, Inc. ("AVP").
The Board of Directors (the "Directors") of AVP is pleased to announce the
acquisition of the assets and liabilities of International Research Growth by
AllianceBernstein International Growth Portfolio ("International"), another
series of AVP. We sometimes refer to each of International and International
Research Growth as a "Portfolio" and together, the "Portfolios". The
acquisition, which is expected to become effective late in the last quarter of
this year, is described in more detail in the attached Prospectus. You should
review the Prospectus carefully.
International Research Growth and International have identical investment
objectives, follow significantly similar investment strategies and their
investment portfolios overlap to a significant extent. We anticipate that the
acquisition will result in benefits to the shareholders of International
Research Growth as discussed more fully in the Prospectus. As a general matter,
we believe that the acquisition will provide a very similar investment
opportunity with a lower expense ratio for International Research Growth
shareholders.
In approving the acquisition, the Directors have considered, among other
things, the investment objectives and investment policies of the Portfolios, the
changes in the marketplace for variable annuity contracts since International
Research Growth commenced operations and its prospects for future sales, expense
ratio reductions expected to result from the acquisition, the continuity of the
portfolio management team, the comparison of fees for the Portfolios and the pro
forma combined portfolio, the significant overlap of the securities held by the
Portfolios, the costs of the acquisition and the allocation thereof, and the
tax-free nature of the acquisition and have concluded that the acquisition is in
the best interests of the Portfolios.
Upon the acquisition of International Research Growth by International,
insurance company shareholders of International Research Growth will receive
shares of International of the same class of shares as the shares they currently
own, which have an aggregate net asset value ("NAV") equal to the aggregate NAV
of the shareholder's shares in International Research Growth. International
Research Growth would then terminate. The contractholders of International
Research Growth will not be assessed any sales charges or other shareholder fees
in connection with the acquisition.
Sincerely,
Marc O. Mayer
President
PROSPECTUS
Acquisition of the Assets and Assumption of the Liabilities of
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. -
ALLIANCEBERNSTEIN INTERNATIONAL RESEARCH GROWTH PORTFOLIO
By, and in Exchange for Shares of,
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. -
ALLIANCEBERNSTEIN INTERNATIONAL GROWTH PORTFOLIO
[_________________], 2007
TABLE OF CONTENTS
Questions and Answers [_____]
Acquisition of International Research [_____]
Growth by International
Summary [_____]
Comparison of Fees [_____]
Comparison of Investment Advisory Fees [_____]
Comparison of Investment Objectives and Policies [_____]
Principal Risks [_____]
Federal Income Tax Consequences [_____]
Comparison of Distribution and Purchase Procedures [_____]
Service Providers [_____]
Comparison of Business Structures [_____]
Information about the Transaction [_____]
Description of the Plan [_____]
Reasons for the Acquisition [_____]
Description of Securities to be Issued [_____]
Dividends and Other Distributions [_____]
Federal Income Tax Consequences [_____]
Capitalization Information [_____]
Information about the Portfolios [_____]
Management of the Portfolios [_____]
Advisory Agreement and Fees [_____]
Distributor [_____]
Other Service Providers [_____]
Legal Matters [_____]
Experts [_____]
Financial Highlights [_____]
Appendix A - Fee Table [_____]
Appendix B - Comparison of Investment Objectives and Policies [_____]
Appendix C - Portfolio Performance [_____]
Appendix D - Description of Principal Risks of the Portfolios [_____]
Appendix E - Certain Information Applicable to Class A and [_____]
Class B Shares of International
Appendix F - Other Information [_____]
Appendix G - Form of Plan of Acquisition and Liquidation [_____]
Appendix H - Capitalization [_____]
Appendix I - Legal Proceedings [_____]
Appendix J - Share Ownership Information [_____]
Appendix K - Financial Highlights [_____]
QUESTIONS AND ANSWERS
The following questions and answers provide an overview of key features of the
acquisition and of the information contained in this Prospectus.
1. What is this document and why did we send this document to you?
This is a Prospectus that provides you with information about the acquisition
(the "Acquisition") of the assets and liabilities of AllianceBernstein
International Research Growth Portfolio ("International Research Growth"), a
series of AllianceBernstein Variable Products Series Fund, Inc. ("AVP"), by
AllianceBernstein International Growth Portfolio ("International"), a series of
AVP. (International and International Research Growth are each a "Portfolio"
and, collectively, the "Portfolios.")
On September 25, 2007, the Board of Directors ("Directors") of AVP approved and
declared advisable the Acquisition of International Research Growth by
International. The Acquisition does not require approval by International
Research Growth shareholders.
Shares of the Portfolios are not sold directly to individuals. The Portfolios
only offer their shares through the separate accounts of life insurance
companies ("Insurers"). As a contractholder, you hold a contract with an Insurer
that offers the Portfolios as an investment option. The Insurers are the
shareholders of record but the contractholders have a beneficial interest in the
Portfolios. References to "you" or "shareholders" in this prospectus include the
Insurers, as the shareholders of record, and contractholders.
Shareholders may contact a Portfolio at 1-800-221-5672 or write to a Portfolio
at 1345 Avenue of the Americas, New York, NY 10105.
2. How will the Acquisition work?
The Plan of Acquisition and Liquidation dated as of [________], 2007 (the
"Plan") provides for (i) the transfer of all the assets of International
Research Growth to International, (ii) the assumption by International of all
the liabilities of International Research Growth and the subsequent redemption
of shares of International Research Growth, (iii) the issuance to International
Research Growth shareholders of the equivalent class of shares of International,
equal in aggregate net asset value ("NAV") to the NAV of their former
International Research Growth shares, and (iv) the termination of International
Research Growth.
The shareholders of International Research Growth are insurance company separate
accounts ("Separate Accounts") used to fund variable life and annuity products
("Variable Products"). As a Variable Product owner, you have a beneficial
interest in the insurance company's shares of International Research Growth. The
insurance companies will receive shares of a class of International
corresponding to the class of shares of International Research Growth they now
own. The International shares that shareholders of International Research Growth
receive will have the same aggregate NAV as the shares of International Research
Growth held before the Acquisition. Shareholders of International Research
Growth will not be assessed any sales charges or other shareholder fees in
connection with the Acquisition. Class B shares of both International Research
Growth and International are subject to distribution fees.
3. Why is the Acquisition taking place?
After considering the recommendation of AllianceBernstein L.P. (the "Adviser"),
the Directors concluded that participation by International Research Growth in
the Acquisition is in the best interests of International Research Growth. The
Directors also concluded that the Acquisition would benefit International
Research Growth shareholders by resulting in, among other things, a reduction in
expenses, and would not dilute shareholders' interests. In reaching this
conclusion, the Directors considered, among other things, the investment
objectives and investment policies of the Portfolios, the changes in the
marketplace for Variable Products since International Research Growth commenced
operations, the expense ratio reductions expected to result from the
Acquisition, the continuity of portfolio management teams, the comparison of
fees for the Portfolios and the pro forma combined Portfolio, the costs of the
Acquisition and the allocation thereof, and the tax-free nature of the
Acquisition.
4. When will the Acquisition take place?
The Acquisition is expected to take place late in the last quarter of this year.
5. Who will bear the expenses of the Acquisition?
The expenses of the Acquisition will be borne by the Portfolios on a relative
net asset basis in the amounts of approximately $80,845 and $129,155 for
International Research Growth and International, respectively.
6. Where may I find additional information regarding the Portfolios?
Additional information about the Portfolios is available in the Statement of
Additional Information ("SAI") dated [__________], 2007 that has been filed with
the Securities and Exchange Commission ("SEC") in connection with this
Prospectus. The SAI and each Portfolio's Annual Report to Shareholders, which
contains audited financial statements for the Portfolios' fiscal year, are
incorporated by reference into this Prospectus. In addition, the Prospectus and
SAI for each Portfolio dated May 1, 2007 (the "Prospectuses") and each
Portfolio's Semi-Annual Report dated June 30, 2007 are also incorporated by
reference into this Prospectus.
Additional copies of the Annual and Semi-Annual Reports and the Prospectus for
each Portfolio are available at www.AllianceBernstein.com and are also
available, along with this Prospectus and SAI, upon request, without charge, by
writing to the address or calling the telephone number listed below.
By Mail: AllianceBernstein Investor Services, Inc.
P.O. Box 786003 San Antonio, TX 78278-6003
By Phone: For Information: 1-800-221-5672
For Literature: 1-800-227-4618
All of this additional information is also available in documents filed with the
SEC. You may view or obtain these documents from the SEC:
In Person: at the SEC's Public Reference Room in Washington, DC
By Phone: 1-202-551-8090 (for information on the operations of the
Public Reference Room only)
By Mail: Public Reference Section, Securities and Exchange
Commission, Washington, DC 20549-0102 (duplicating fee
required)
By Electronic Mail: publicinfo@sec.gov (duplicating fee required)
On the Internet: www.sec.gov
Other Important Things to Note:
o You may lose money by investing in the Portfolios.
o The SEC has not approved or disapproved these securities or passed
upon the adequacy of this Prospectus. Any representation to the
contrary is a criminal offense.
ACQUISITION OF INTERNATIONAL RESEARCH GROWTH BY INTERNATIONAL
On September 25, 2007, the Directors declared advisable and voted to
approve the Plan and the Acquisition. The Plan provides for (i) the transfer of
all the assets of International Research Growth to International, (ii) the
assumption by International of all the liabilities of International Research
Growth and the subsequent redemption of shares of International Research Growth,
(iii) the issuance to International Research Growth's shareholders of shares of
an equivalent class of International, equal in aggregate NAV to the NAV of their
former International Research Growth shares and (iv) the termination of
International Research Growth.
Each International Research Growth shareholder will receive the number of
full and fractional shares of an equivalent class of shares of International
having an aggregate NAV that, on the effective date of the Acquisition, is equal
to the aggregate NAV of the shareholder's shares of International Research
Growth. Shareholders of International Research Growth will recognize no gain or
loss. The Acquisition is expected to occur late in the last quarter of this
year. The Acquisition does not require shareholder approval.
The Directors concluded that participation by International Research Growth
in the Acquisition is in the best interests of the Portfolio. The Directors also
concluded that the Acquisition would not dilute stockholders' interests. In
reaching this conclusion, the Directors considered, among other things, the
investment objectives and investment policies of the Portfolios, the changes in
the marketplace for Variable Products since International Research Growth
commenced operations, expense ratio reductions for shareholders expected to
result from the Acquisition, the continuity of the portfolio management team,
the comparison of fees for the Portfolios and the pro forma combined Portfolio,
the costs of the Acquisition and the allocation thereof, and the tax-free nature
of the Acquisition. For a more complete discussion of the factors considered by
the Directors in approving the Acquisition, see "Reasons for the Acquisition" in
"Information About the Transaction."
SUMMARY
The following summary highlights differences between International and
International Research Growth. This summary is not complete; for more complete
information, please read this entire document. Note that certain information is
presented as of June 30, 2007. At the September 25, 2007 Special Board Meeting
(the "Board Meeting"), the Portfolio's Adviser, AllianceBernstein L.P.,
represented to the Directors that, if the information were updated, it would not
differ in any material respect.
International Research Growth is a diversified open-end fund, with assets,
as of June 30, 2007, of approximately $82 million, that invests primarily in an
international portfolio of equity securities of companies within various market
sectors selected by the Adviser for their growth potential. International is a
diversified open-end fund, with assets, as of June 30, 2007, of approximately
$131 million, that invests primarily in an international portfolio of equity
securities of companies located in both developed and emerging countries.
Although International has outperformed International Research Growth over
longer periods, recently the two Portfolios have had substantially similar
performance, as a result of the growing similarity of their portfolio holdings.
The average annual total returns for Class A shares of International, as of
December 31, 2006, was 27.04% for one year, 21.26% for five years, and 12.53%
for ten years as compared to International Research Growth's returns of 26.45%
for one year, 14.59% for five years, and 7.25% for ten years. These performance
numbers do not reflect charges associated with the Variable Products or
contractholders' accounts.
Comparison of Fees
The expense ratios of the International Class A and Class B shares are
lower than the expense ratios of the International Research Growth Class A and
Class B shares. Thus, the Acquisition would result in a significant reduction in
expenses for International Research Growth. The following table shows the
Portfolios' expense ratios and pro forma expense ratio of the combined portfolio
for Class A and Class B shares as of June 30, 2007.
Class A Class B
Total Annual Total Annual
Expense Ratio Expense Ratio
- -------------------------------------------------------------------------------
International Research Growth 1.25% 1.50%
International 1.13% 1.38%
International (pro forma) 1.04% 1.29%
As the table indicates, the expense per share would be reduced for both Class A
and Class B shares of International Research Growth by .21% after the
Acquisition (as of June 30, 2007). This expense information does not include any
fees and expenses that may be applied at the separate account level or contract
level for any charges that may be incurred under a contract. Inclusion of these
charges would increase the expenses reflected above. The Fee Table, attached
hereto as Appendix A, describes the fees and expense of each class of the
Portfolios as of each Portfolio's fiscal year end and includes pro forma
expenses for the combined Portfolio.
Comparison of Investment Advisory Fees
International Research Growth and International pay advisory fees to the
Adviser at the same annual rate of .75% of each Portfolio's average daily net
assets.
Comparison of Investment Objectives and Policies
The investment objectives of the Portfolios are the same and their
investment strategies are significantly similar as shown in the following table.
<table>
International Research Growth International
Investment Objective International Research Growth's International's investment
investment objective is objective is long-term growth of
long-term growth of capital. capital.
Principal Investment Strategies The Portfolio invests primarily The Portfolio invests primarily
in an international portfolio of in an international portfolio of
equity securities of companies equity securities of companies
within various market sectors located in both developed and
selected by the Adviser for emerging countries.
their growth potential.
Examples of the type of market The Portfolio's investments
sectors in which the Adviser may include investments in
invest the Portfolio's assets securities of companies that are
include, but are not limited to, established as a result of
telecommunications, information privatizations of state
technology, health care, enterprises.
financial services,
infrastructure, energy and
natural resources, and consumer
growth.
The Portfolio normally invests The Portfolio's portfolio
in approximately 100-125 consists of approximately
companies. 100-130 stocks.
</table>
As the table above shows, each Portfolio invests primarily in international
portfolio of equity securities. In addition, the Portfolios follow similar
investment strategies and have the same portfolio management team. Currently,
there is a substantial overlap between the portfolio holdings of the Portfolios
because both invest significantly in the same securities. The Adviser expects to
retain these holdings in the combined portfolio and anticipates there will be
little or no portfolio repositioning as a result of the Acquisition. A more
detailed comparison of the investment strategies and policies of the Portfolios
is provided in Appendix B and the historical performance of the Funds is
provided in Appendix C.
Principal Risks
Each Portfolio is subject to market risk, non-U.S. (foreign) risk, emerging
market risk and currency risk. In addition, International Research Growth is
subject to industry/sector risk because of its somewhat more sector-intensive
investment strategy. International Research Growth is also subject to
capitalization risk because it may invest in companies with smaller market
capitalizations. A description of each of these risks is provided in Appendix D.
Federal Income Tax Consequences
As long as the contracts funded through the separate accounts of the
insurance company shareholders qualify as annuity contracts under section 72 of
the Internal Revenue Code of 1986, as amended (the "Code"), the Acquisition will
not create any tax liability for contractholders.
No gain or loss will be recognized by International Research Growth or its
shareholders as a result of the Acquisition. The aggregate tax basis of the
shares of International received by a shareholder of International Research
Growth (including any fractional shares to which the shareholder may be
entitled) will be the same as the aggregate tax basis of the shareholder's
shares of International Research Growth. The holding period of the shares of
International received by a shareholder of International Research Growth
(including any fractional share to which the shareholder may be entitled) will
include the holding period of the shares of International Research Growth held
by the shareholder, provided that such shares are held as capital assets by the
shareholder of International Research Growth at the time of the Acquisition. The
holding period and tax basis of each asset of International Research Growth in
the hands of International as a result of the Acquisition will be the same as
the holding period and tax basis of each such asset in the hands of
International Research Growth prior to the Acquisition. Provided that
International Research Growth shares surrendered constitute capital assets in
the hands of the shareholder, such gain or loss realized by the shareholder will
be capital gain or loss upon disposition of the shares. This tax information is
based on the advice of Seward & Kissel LLP, counsel to each of the Portfolios.
It is a condition to the closing of the Acquisition that such advice be
confirmed in a written opinion of counsel. An opinion of counsel is not binding
on the Internal Revenue Service ("IRS").
No distribution of capital gains to International Research Growth
shareholders prior to the closing of the Acquisition is anticipated. Prior to
the closing of the Acquisition, International Research Growth will declare a
distribution to its shareholders which, together with all previous
distributions, will have the effect of distributing to its shareholders all of
its investment company taxable income (computed without regard to the deduction
for dividends paid) and net realized capital gains, if any, through the closing.
A portion of the assets of International Research Growth may be sold in
connection with the Acquisition. The actual tax impact of such sales will depend
on the difference between the price at which such portfolio assets are sold and
International Research Growth's basis in such assets. Any capital gains
recognized in these sales will be distributed to International Research Growth's
shareholders (but not contractholders) as capital gain dividends (to the extent
of the excess of net realized long-term capital gains over net realized
short-term capital losses) and ordinary dividends (to the extent of net realized
short-term capital gains) during or with respect to the year of sale, and such
distributions will be taxable to shareholders (but not to the contractholders).
Additional tax considerations are discussed under the section on "Federal
Income Tax Consequences" in Information About the Transaction.
Comparison of Distribution and Purchase Procedures
The purchase procedures for the Portfolios are the same. The Portfolios
offer their shares through the separate accounts of life insurance companies
(the "Insurers"). You may only purchase and sell shares through these separate
accounts. See the prospectus of the separate account of the participating
insurance company for information on the purchase and sale of the Portfolios'
shares. AllianceBernstein Investments, Inc. ("ABI") may from time to time
receive payments from Insurers in connection with the sale of the Portfolio's
shares through the Insurer's separate accounts. More information on distribution
and purchase procedures of International is provided in Appendix E.
Service Providers
The Portfolios have the same service providers, which will continue in
their capacity after the Acquisition.
Comparison of Business Structures
Each Portfolio is a series of AVP, which is organized as a Maryland
corporation and is governed by its Charter, Bylaws and Maryland law. For more
information on the comparison of the business structure of the Portfolios, see
Appendix F.
INFORMATION ABOUT THE TRANSACTION
Description of the Plan
As provided in the Plan, International will acquire all the assets and
assume all the liabilities, expenses and obligations of International Research
Growth at the effective time of the Acquisition (the "Effective Time"). In
return, International will issue, and International Research Growth will
distribute to its shareholders, a number of full and fractional shares of
International, determined by dividing the net value of all the assets of
International Research Growth by the NAV of one share of International. For this
purpose, the Plan provides the times for and methods of determining the net
value of the assets of each Portfolio. The Plan provides that shareholders of
International Research Growth will be credited with shares of International
corresponding to the aggregate NAV of International Research Growth's shares
that the shareholder holds of record at the Effective Time.
Following the distribution of International shares in full liquidation of
International Research Growth, International Research Growth will wind up its
affairs and terminate as soon as is reasonably possible after the Acquisition.
The projected expenses of the Acquisition, largely those for legal, accounting,
printing and proxy solicitation expenses, are estimated to total approximately
$210,000. The projected expenses will be borne by the Portfolios on a relative
net asset basis in the amounts of approximately $80,845 and $129,155 for
International Research Growth and International, respectively. The Acquisition
is expected to occur late in the last quarter of this year. Under applicable
legal and regulatory requirements, none of International Research Growth's
shareholders will be entitled to exercise objecting shareholders' appraisal
rights, i.e., to demand the fair value of their shares in connection with the
Acquisition. Therefore, shareholders will be bound by the terms of the
Acquisition under the Plan. However, any shareholder of International Research
Growth may redeem shares of common stock prior to the Acquisition.
Completion of the Acquisition is subject to certain conditions set forth in
the Plan. The Board of Directors may terminate the Plan under certain
circumstances. Among other circumstances, the Board of Directors may terminate
the Plan upon a determination that proceeding with the Plan is not in the best
interests of the Portfolio or of its shareholders.
A copy of a form of the Plan for the Acquisition is attached as Appendix G.
Reasons for the Acquisition
At the Board Meeting, the Adviser recommended that the Directors approve
the proposed Plan and Acquisition. The Directors considered the factors
discussed below from the point of view of the interests of International
Research Growth and its shareholders. After careful consideration, the Directors
(including all Directors who are not "interested persons" of the Portfolio, the
Adviser or its affiliates) determined that the Acquisition would be in the best
interests of International Research Growth and that the interests of existing
shareholders of the Portfolios would not be diluted as a result of the
Acquisition. The Directors have unanimously approved the Plan and Acquisition.
The Adviser presented the following reasons in favor of the Acquisition:
o The Adviser discussed with the Directors that there has been a shift
away from a multiple series fund, such as AVP as the preferred funding
vehicle for Variable Products, to a customized "private-labeled"
platform of investment options subadvised by a number of different
investment advisers. While AVP's core portfolios remain desirable for
some insurance companies, the Adviser believes that combining its
smaller and expensive non-core Portfolios, such as International
Research Growth and International, into core offerings will satisfy
the existing insurance company shareholders' needs and may attract new
issuers of Variable Products. The combination of the smaller
portfolios will allow insurance companies to benefit from lower
expense ratios.
o The Adviser also discussed with the Directors that it believes that
the Acquisition would benefit International Research Growth and its
shareholders by resulting in lower expenses.
At the Board Meeting, the Directors (with the advice and assistance of
independent counsel) also considered, among other things:
o potential shareholder benefits, including the fact that total expenses
of each class of shares of the combined Portfolio are expected to be
significantly lower than the current expenses of comparable classes of
shares of International Research Growth;
o the Adviser's plans with respect to the portfolio securities of
International Research Growth and International, including that (i)
there is currently a 77% overlap between the portfolio holdings of the
two Portfolios and that both Portfolios have approximately 60% of
their assets invested in privatizations and (ii) the Adviser expects
that there will be little or no portfolio repositioning as a result of
the Acquisition;
o the current asset level of International Research Growth and the
combined pro forma asset levels of the combined Portfolio;
o the historical performance of the Portfolios;
o the investment objectives and principal investment strategies of the
Portfolios, which are substantially the same; and
o the portfolio management teams for each of the Portfolios, which are
different, but similar in that both are overseen by the Adviser's
larger International Growth Oversight Portfolio Group with access to
the same research and that, following the Acquisition, both teams will
share responsibility for management of the combined Portfolio.
The Directors also considered, among other things:
o the fact that, because the Separate Accounts are not subject to
federal income tax on a current basis, there is no need to consider
the impact of the Acquisition on the Portfolios' capital loss
carryforwards ;
o the form of the Plan and the terms and conditions of the Acquisition;
o the fact that the Portfolios pay the same advisory fee rates;
o whether the Acquisition would result in the dilution of shareholders'
interests;
o the fact that no changes in service providers that would result from
the Acquisition;
o the benefits of the Acquisition to the Adviser, which will benefit
from the elimination of separate monitoring and administration of
International Research Growth;
o the fact that International will assume all the liabilities, expenses
and obligations of International Research Growth;
o the expected federal income tax consequences of the Acquisition;
o the costs of the Acquisition, which will be borne on a relative net
asset basis by the Portfolios; and
o the fact that the Adviser has agreed to indemnify International for a
three-year period against any undisclosed or other liabilities not
disclosed or not reflected in the NAV of International Research Growth
at the time of the Acquisition, to reimburse International for any
costs in connection with investigating any such liability, and to
continue certain insurance coverage for a six-year period.
Also at the Board Meeting, the Directors of AVP approved the Plan on behalf
of International.
Description of Securities to be Issued
Under the Plan, International will issue additional shares of its Class A
and Class B common stock for distribution to corresponding classes of shares of
International Research Growth. Under AVP's Charter, International may issue up
to 500,000,000 shares of common stock, par value $.001 per share, for each of
these Classes.
When the acquisition of International Research Growth by International is
consummated, Class A and Class B shareholders of International Research Growth
will receive shares of a corresponding class shares of International having an
aggregate NAV equal to the aggregate NAV of the shareholder's shares in
International Research Growth.
Each share of International represents an equal proportionate interest with
other shares of International. Each share has equal earnings, assets, and voting
privileges, and is entitled to dividends and other distributions out of the
income earned and gain realized on the assets belonging to International as
authorized by the Directors. Shares of International entitle their holders to
one vote per full share and fractional votes for fractional shares held. Shares
of International received by International Research Growth in the Acquisition
will be issued at NAV, without a sales charge, and will be fully paid and
non-assessable.
Dividends and Other Distributions
On or before the Closing Date, as defined in the Plan, International
Research Growth will, if necessary, declare and pay as a distribution
substantially all its undistributed net investment income, net short-term
capital gain, net long-term capital gain and net gains from foreign currency
transactions as applicable to maintain its treatment as a regulated investment
company.
Federal Income Tax Consequences
As long as the Contracts funded through the separate accounts of the
insurance company shareholders qualify as annuity contracts under section 72 of
the Code, the Acquisition will not create any tax liability for contractholders.
Subject to certain stated assumptions contained therein, International
Research Growth will receive an opinion of Seward & Kissel LLP, its counsel,
substantially to the following effect: (i)the Acquisition will constitute a
"reorganization" within the meaning of section 368(a) of the Code and that
International Research Growth and International will each be "a party to a
reorganization" within the meaning of section 368(b) of the Code; (ii) a
shareholder of International Research Growth will recognize no gain or loss on
the exchange of the shareholder's shares of International Research Growth solely
for shares of International; (iii) neither International Research Growth nor
International will recognize any gain or loss upon the transfer of all of the
assets of International Research Growth to International in exchange for shares
of International and the assumption by International of the liabilities of
International Research Growth pursuant to the Plan or upon the distribution of
shares of International to shareholders of International Research Growth in
exchange for their respective shares of International Research Growth; (iv) the
holding period and tax basis of the assets of International Research Growth
acquired by International will be the same as the holding period and tax basis
that International Research Growth had in such assets immediately prior to the
Acquisition; (v) the aggregate tax basis of shares of International received in
connection with the Acquisition by each shareholder of International Research
Growth (including any fractional share to which the shareholder may be entitled)
will be the same as the aggregate tax basis of the shares of International
Research Growth surrendered in exchange therefor; (vi) the holding period of
shares of International received in connection with the Acquisition by each
shareholder of International Research Growth (including any fractional share to
which the shareholder may be entitled) will include the holding period of the
shares of International Research Growth surrendered in exchange therefore,
provided that such International Research Growth shares constitute capital
assets in the hands of the shareholder as of the Closing Date; and (vii)
International will succeed to the capital loss carryovers of International
Research Growth but the use of International's existing capital loss carryovers
(as well as the carryovers of International Research Growth) may be subject to
limitation under section 383 of the Code after the Acquisition. This opinion of
counsel will not be binding on the IRS or a court and there is no assurance that
the IRS or a court will not take a view contrary to those expressed in the
opinion.
A portion of the assets of International Research Growth may be sold in
connection with the Acquisition. The actual tax impact of such sales will depend
on the difference between the price at which such portfolio assets are sold and
International Research Growth's basis in such assets. Any capital gains
recognized in these sales will be distributed to International Research Growth's
shareholders (but not to the contractholders) as capital gain dividends (to the
extent of the excess of net realized long-term capital gains over net realized
short-term capital losses) and ordinary dividends (to the extent of net realized
short-term capital gains) during or with respect to the year of sale, and such
distributions will be taxable to shareholders (but not to the contractholders).
No distribution of capital gains to International Research Growth's
shareholders prior to the closing of the Acquisition is anticipated. Prior to
the closing of the Acquisition, International Research Growth will declare a
distribution to its shareholders which, together with all previous
distributions, will have the effect of distributing to its shareholders all of
its investment company taxable income (computed without regard to the deduction
for dividends paid) and net realized capital gains, if any, through the closing.
Shareholders of International Research Growth are encouraged to consult
their tax advisers regarding the effect, if any, of the Acquisition in light of
their individual circumstances. Because the foregoing discussion only relates to
the federal income tax consequences of the Acquisition, those shareholders also
should consult their tax advisers as to state and local tax consequences, if
any, of the Acquisition.
Capitalization Information
For information on the existing capitalization of the Portfolios and the
pro forma capitalization of International, see Appendix H.
INFORMATION ABOUT THE PORTFOLIOS
International Research Growth and International are each a series of AVP,
an open-end management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act") and organized as a Maryland
corporation in 1987 under the name Alliance Variable Products Series Fund, Inc.
The company's name became AllianceBernstein Variable Products Series Fund, Inc.
on April 30, 2003.
Management of the Portfolios
The Directors of AVP direct the management of the business and affairs of
the Portfolios. The Directors approve all significant agreements between the
respective Portfolio and persons or companies furnishing services to it,
including a Portfolio's agreements with the Adviser and the Portfolio's
custodian, transfer and dividend disbursing agent. The day-to-day operations of
a Portfolio are delegated to its officers and the Portfolio's Adviser, subject
to the Portfolio's investment objective and policies and to general supervision
by the Portfolio's Directors.
Both Portfolios are overseen by the Adviser's International Growth
Portfolio Oversight Group and have access to the same research. Messrs. Michael
Levy, Christopher M. Toub, Gregory Eckersley and Robert W. Scheetz, the members
of the Global Emerging Growth Investment Team and the International Large Cap
Growth Investment Team, are primarily responsible for day-to-day management of
International's portfolios. Messrs. Levy, Eckersley and Scheetz are Senior Vice
Presidents of the Adviser, with which they have been associated in a
substantially similar capacity to their current positions since prior to 2002.
Mr. Toub is an Executive Vice President of the Adviser, with which he has been
associated in a substantially similar capacity to his current position since
prior to 2002.
Messrs. Hiromitsu Agata, William Johnston, David Robinson and Atsushi
Yamamoto and Mses. Isabel Buccellati, Michele Patri and Valli Srikanthapalan,
the Adviser's International Research Growth senior sector analysts, are
primarily responsible for day-to-day management of International Research
Growth's portfolios. Messrs. Agata and Yamamoto are Senior Vice Presidents of
AllianceBernstein Japan Ltd., with which they have been associated in a
substantially similar capacity to their current positions since prior to 2002.
Mr. Johnston and Ms. Srikanthapalan are Senior Vice Presidents of ABL, with
which they have been associated in a substantially similar capacity to their
current positions since prior to 2002. Mses. Buccelati and Patri are Vice
Presidents of ABL, with which they have been associated in a substantially
similar capacity to their current positions since prior to 2002. Mr. Robinson is
a Vice President of AllianceBernstein Australia Ltd., with which he has been
associated in a substantially similar capacity to his current position since May
2003. Prior thereto, Mr. Robinson was an equities analyst for Credit Suisse
First Boston since prior to 2002.
Subsequent to the consummation of the Acquisition, all individuals named
above will continue to be primarily responsible for day-to-day management of the
combined Portfolio. The SAI provide additional information about the portfolio
managers' compensation, other accounts managed by the portfolio managers, and
the portfolio managers' ownership of securities of the Portfolios.
Advisory Agreement and Fees
Each Portfolio's investment adviser is AllianceBernstein L.P., 1345 Avenue
of the Americas, New York, New York 10105. The Adviser is a leading
international investment adviser managing client accounts with assets as of June
30, 2007 totaling more than $792.9 billion (of which more than $99.6 billion
represented the assets of investment companies). As of June 30, 2007, the
Adviser managed retirement assets for many of the largest public and private
employee benefit plans (including 50 of the nation's FORTUNE 100 companies), for
public employee retirement funds in 37 states, for investment companies, and for
foundations, endowments, banks and insurance companies worldwide. The 41
registered investment companies managed by the Adviser, comprising 123 separate
investment portfolios, currently have approximately 4.3 million shareholder
accounts. The Adviser also serves as administrator for each Portfolio.
Under each Portfolio's advisory agreement with the Adviser (the "Advisory
Agreement"), the Adviser provides investment advisory services and order
placement facilities for the Portfolio and pays all compensation of directors
and officers of the Portfolio who are affiliated persons of the Adviser. Under
the Advisory Agreements of International Research Growth and International, each
Portfolio pays the Adviser an advisory fee at an annual rate of .75% of its
average daily net assets.
The Advisory Agreements, by their terms, continue in effect from year to
year if such continuance is specifically approved, at least annually, by a
majority vote of the Directors of a Portfolio who neither are interested persons
of the Portfolio nor have any direct or indirect financial interest in the
Advisory Agreement, cast in person at a meeting called for the purpose of voting
on such approval. A discussion regarding the basis for the Directors' approval
of the investment advisory contracts of International Research Growth and
International is available in each Portfolio's Annual Report to Shareholders for
the fiscal year ended December 31, 2006.
The Adviser is the subject of certain legal proceedings and a discussion of
those proceedings is presented in Appendix I.
Distributor
AllianceBernstein Investments, Inc. ("ABI" or the "Distributor"), a
wholly-owned subsidiary of the Adviser, serves as the distributor of
International Research Growth's and International's shares. Under a Distribution
Services Agreement, International Research Growth and International pay
distribution and service fees to the Distributor at an annual rate of up to .25%
of each Portfolio's average daily net assets attributable to their Class B
shares. The Distribution Agreement provides that the Distributor will use such
payments in their entirety for distribution assistance and promotional
activities.
Other Service Providers
The Portfolios will have the same service providers after the Acquisition.
ABIS, an affiliate of the Adviser, provides shareholder services for the
Portfolios. The Portfolios compensate ABIS for these services. The Bank of New
York, 1 Wall Street, New York, New York 10286, serves as custodian for the
Portfolios. ABIS, P.O. Box 786003, San Antonio, TX 78278-6003, serves as
transfer agent for the Portfolios. After the Acquisition, The Bank of New York
and ABIS will serve, respectively, as custodian and transfer agent for the
combined Portfolio. Ernst & Young LLP serves as the independent registered
public accounting firm for the Portfolios and will continue to serve in that
capacity for the combined Portfolio after the Acquisition.
LEGAL MATTERS
The validity of the shares of International offered hereby will be passed
upon for International Research Growth by Seward & Kissel LLP.
EXPERTS
The audited financial statements and financial highlights in the Prospectus
and the SAI have been included in reliance on the report of Ernst & Young LLP, 5
Times Square, New York, New York, 10036, the independent registered public
accounting firm for each of the Portfolios, given on its authority as experts in
auditing and accounting.
FINANCIAL HIGHLIGHTS
Financial highlights information for the Portfolios is available at
Appendix K.
APPENDIX A
FEE TABLE
The purpose of the tables below is to assist an investor in understanding
the various costs and expenses that a shareholder bears directly and indirectly
from an investment in the Portfolios. The tables allow you to compare the
expenses of each Portfolio and estimates for the pro forma combined Portfolio in
its first year following the Acquisition.
Shareholder Fees (fees paid directly from your investment)
N/A
Annual Portfolio Operating Expenses (expenses that are deducted from Portfolio
assets)
The operating expenses information below is designed to assist
contractholders of variable products that invest in the Portfolios in
understanding the fees and expenses that they may pay as an investor. Because
the information does not reflect deductions at the separate account level or
contract level for any charges that may be incurred under a contract,
contractholders that invest in a Portfolio should refer to the variable contract
prospectus for a description of fees and expenses that apply to contractholders.
Inclusion of these charges would increase the fees and expenses provided below.
International
Research International
Growth International pro forma)
Class A Class A Class A
------- ------- -------
Management Fees .75% .75% .75%
Other Expenses .50% .48% .29%
Total Portfolio Operating Expenses 1.25% 1.23% 1.04%
International
Research International
Growth International pro forma)
Class B Class B Class B
------- ------- -------
Management Fees .75% .75% .75%
Distribution and/or Service
(12b-1) Fees .25% .25% .25%
Other Expenses .50% .48% .29%
Total Portfolio Operating Expenses 1.50% 1.48% 1.29%
EXAMPLES
The Examples are to help you compare the cost of investing in each
Portfolio with the cost of investing in the combined Portfolio on a pro forma
combined basis. The Examples do not give effect to any separate account or
contract level fees that might be paid by a contractholder. They assume that you
invest $10,000 in a Portfolio for the time periods indicated and then redeem all
of your shares at the end of those periods. They also assume that your
investment has a 5% return each year, that a Portfolio's operating expenses stay
the same and that all dividends and distributions are reinvested.
International
Research International
Growth International (pro forma)
Class A Class A Class A
------- ------- -------
After 1 Year $127 $125 $106
After 3 Years $397 $390 $331
After 5 Years $686 $676 $574
After 10 Years $1,511 $1,489 $1,271
International
Research International
Growth International (pro forma)
Class B Class B Class B
------- ------- -------
After 1 Year $153 $151 $131
After 3 Years $474 $468 $409
After 5 Years $818 $808 $708
After 10 Years $1,791 $1,768 $1,556
The projected post-Acquisition pro forma Annual Portfolio Operating
Expenses and Examples presented above are based upon numerous material
assumptions. Although these projections represent good faith estimates, there
can be no assurance that any particular level of expenses or expense reductions
will be achieved, because expenses depend on a variety of factors, including the
future level of fund assets, many of which are beyond the control of
International and the Adviser.
<table>
APPENDIX B
COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES
International Research Growth International Differences
----------------------------- ------------- -----------
Investment Objective The Portfolio's investment objective Same. These objectives are
is long-term growth of capital. identical.
Investment Policies(1)
- -----------------------------------------------------------------------------------------------------------------------------------
Status The Portfolio is diversified. (F) Same. These policies are identical.
Principal Strategies The Portfolio invests primarily in The Portfolio invests primarily While both Portfolios invest
an international portfolio of in an international portfolio primarily in international
equity securities of companies of equity securities of equity securities,
within various market sectors companies located in both International Research Growth
selected by the Adviser for their developed and emerging focuses more specifically on
growth potential. countries. equity securities within market
sectors believed to have growth
potential.
Examples of the type of market The Portfolio's investments
sectors in which the Adviser may include investments in
invest the Portfolio's assets securities of companies that
include, but are not limited to, are established as a result of
telecommunications, information privatizations of state
technology, health care, financial enterprises.
services, infrastructure, energy
and natural resources, and consumer
growth.
The Portfolio normally invests in The Portfolio's portfolio
approximately 100-125 companies. consists of approximately
100-130 stocks.
Foreign Investments The Portfolio invests, under normal Same. These policies are identical.
circumstances, in the equity
securities of companies domiciled
in at least three countries (and
normally substantially more) other
than the United States.
The Portfolio invests in companies
in both developed and emerging
market countries.
Derivatives The Portfolio may, but is not Same. These policies are identical.
required to, use derivatives for
risk management purposes or as part
of its investment strategies. The
Portfolio may use forward
contracts, forward currency
exchange contracts, futures
contracts and options on futures
contracts, options, options on
foreign currencies, options on
securities, options on securities
indices, swap transactions,
currency swaps and synthetic
foreign equity securities.
Convertible The Portfolio may invest in Same. These policies are identical.
Securities convertible securities.
- ------------
(1) Policies with the notation "F" are fundamental policies.
Depositary Receipts The Portfolio may invest in Same. These policies are identical.
American Depositary Receipts
("ADRs"), European Depositary
Receipts ("EDRs"), Global
Depositary Receipts ("GDRs") or
other securities representing
securities of companies based in
countries other than the United
States.
Repurchase Agreements None. The Portfolio may invest in International may invest in
repurchase agreements. repurchase agreements.
Standby Commitments The Portfolio may invest in standby Same. These policies are identical.
commitments.
Forward Commitments The Portfolio may invest in forward Same. These policies are identical.
commitments.
Rights and Warrants The Portfolio may invest in rights Same. These policies are identical.
or warrants.
Short Sales The Portfolio may make short sales Same. These policies are identical.
as a part of overall portfolio
management or to offset a potential
decline in the value of a security.
Illiquid Securities The Portfolio will limit its Same. These policies are identical.
investment in illiquid securities
to no more than 15% of net assets
or such other amount permitted by
guidance regarding the 1940 Act.
Other Investment The Portfolio may invest in other Same. These policies are identical.
Companies investment companies, as permitted
by the 1940 Act or the rules and
regulations thereunder.
Securities Lending The Portfolio may lend portfolio Same. These policies are identical.
securities to the extent permitted
under the 1940 Act or the rules and
regulations thereunder (as such
statute, rules or regulations may
be amended from time to time) or by
guidance regarding, interpretations
of, or exemptive orders under, the
1940 Act.
Margin The Portfolio may not purchase Same. These policies are identical.
securities on margin, except (i) as
otherwise provided under rules
adopted by the SEC under the 1940
Act or by guidance regarding the
1940 Act, or interpretations
thereof, and (ii) that the
Portfolio may obtain such
short-term credits as are
necessary for the clearance of
portfolio transactions, and the
Portfolio may make margin payments
in connection with futures
contracts, options, forward
contracts, swaps, caps,
floors, collars and other
financial instruments.
Industry Concentration The Portfolio may not concentrate Same. These policies are identical.
investments in an industry, as
concentration may be defined under
the 1940 Act or the rules and
regulations thereunder (as such
statute, rules or regulations may
be amended from time to time) or by
guidance regarding, interpretations
of, or exemptive orders under, the
1940 Act or the rules or
regulations thereunder published by
appropriate regulatory
authorities. (F)
Borrowing The Portfolio may not issue any Same. These policies are identical.
senior security (as that term is
defined in the 1940 Act) or borrow
money, except to the extent
permitted by the 1940 Act or the
rules and regulations thereunder
(as such statute, rules or
regulations may be amended from
time to time) or by guidance
regarding, or interpretations of,
or exemptive orders under, the 1940
Act or the rules or regulations
thereunder published by appropriate
regulatory authorities. For the
purposes of this restriction,
margin and collateral arrangements,
including, for example, with
respect to permitted borrowings,
options, futures contracts, options
on futures contracts and other
derivatives such as swaps are not
deemed to involve the issuance of a
senior security. (F)
Lending The Portfolio may not make loans Same. These policies are identical.
except through (i) the purchase of
debt obligations in accordance with
its investment objective and
policies; (ii) the lending of
portfolio securities; (iii) the use
of repurchase agreements; or (iv)
the making of loans to affiliated
funds as permitted under the 1940
Act, the rules and regulations
thereunder (as such statutes, rule
or regulations may be amended from
time to time), or by guidance
regarding, and interpretations of,
or exemptive orders under, the 1940
Act. (F)
Real Estate The Portfolio may not purchase or Same. These policies are identical.
sell real estate except that it may
dispose of real estate acquired as
a result of the ownership of
securities or other instruments.
This restriction does not prohibit
the Portfolio from investing in
securities or other instruments
backed by real estate or in
securities of companies engaged in
the real estate business. (F)
Commodities The Portfolio may not purchase or Same. These policies are identical.
sell commodities regulated by the
Commodity Futures Trading
Commission under the Commodity
Exchange Act or commodities
contracts except for futures
contracts and options on futures
contracts. (F)
Underwriting The Portfolio may not act as an Same. These policies are identical.
underwriter of securities, except
that the Portfolio may acquire
restricted securities under
circumstances in which, if such
securities were sold, the Portfolio
might be deemed to be an
underwriter for purposes of the
Securities Act of 1933, as amended
(the "Securities Act"). (F)
</table>
APPENDIX C
PORTFOLIO PERFORMANCE
The charts below show the percentage gain or loss in each calendar year for
the ten-year period ended December 31, 2006, for Class A shares of International
Research Growth and Class A shares of International.
They should give you a general idea of how each Portfolio's return has
varied from year to year. The charts include the effects of Portfolio expenses
but do not reflect charges associated with the Variable Products or
contractholders' accounts. The calculations of annual total return assume the
reinvestment of all dividends and capital gain distributions on the reinvestment
date. [Performance results included the effect of expense reduction
arrangements, if any. If these arrangements had not been in place, the
performance results would have been lower.] As with all mutual funds, past
performance is not an indication of future results. No assurance can be given
that International will achieve any particular level of performance after the
Acquisition. Additional discussion of the manner of calculation of total return
is contained in the Prospectuses of each Portfolio.
Calendar Year Total Returns
International Research Growth
-----------------------------
The annual returns in the bar chart are for the Portfolio's Class A shares.
[The following table was depicted as a bar chart in the printed material.]
3.3 13.0 40.2 -19.9 -22.4 -15.3 31.6 17.6 19.2 26.5
- ---------------------------------------------------------------------
97 98 99 00 01 02 03 04 05 06
Calendar Year End
You should consider an investment in the Portfolio as a long-term investment.
The Portfolio's returns will fluctuate over long and short periods. For example,
during the period shown in the bar chart, the Portfolio's:
Best quarter was up 27.15% in the 4th quarter, 1999; and Worst quarter was down
- -22.27% in the 3rd quarter, 2002.
International
-------------
The annual returns in the bar chart are for the Portfolio's Class A shares.
[The following table was depicted as a bar chart in the printed material.]
10.8 10.8 58.8 -23.0 -17.3 -4.2 43.5 24.3 20.8 27.0
- ---------------------------------------------------------------------
97 98 99 00 01 02 03 04 05 06
Calendar Year End
You should consider an investment in the Portfolio as a long-term investment.
The Portfolio's returns will fluctuate over long and short periods. For example,
during the period shown in the bar chart, the Portfolio's:
Best quarter was up 34.70% in the 4th quarter, 1999; and Worst quarter was down
- -16.82% in the 3rd quarter, 2001.
The following tables list International Research Growth's and
International's average annual total returns for the one-year, five-year,
ten-year, and since inception periods ending December 31, 2006 for each
Portfolio. These tables are intended to provide you with some indication of the
risks of investing in the Portfolios. At the bottom of each table, you can
compare the Portfolios' performance with the performance of several broad-based
market indices.
Average Annual Total Returns
International Research Growth (Class A)
---------------------------------------
PERFORMANCE TABLE
Average Annual Total Returns
(For the periods ended December 31, 2006)
1 year 5 years 10 years
- --------------------------------------------------------------------------------
Class A 26.45% 14.59% 7.25%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Gross)+ 27.16% 16.87% 8.59%
- --------------------------------------------------------------------------------
MSCI EAFE Growth Index (Net)++ 22.33% 12.27% 5.07%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Net)++ 26.65% 16.42% N/A
- --------------------------------------------------------------------------------
+ The Adviser believes that the MSCI AC World Index (ex. U.S.) (Gross) is the
appropriate broad-based benchmark for the Portfolio in light of that
Index's relatively broader international and emerging markets exposure.
++ The MSCI EAFE Growth Index (Net) and the MSCI AC World Index (ex. U.S.)
(Net) reflect the reinvestment of dividends net of non-U.S. withholding
taxes.
International Research Growth (Class B)
---------------------------------------
PERFORMANCE TABLE
Average Annual Total Returns
(For the periods ended December 31, 2006)
Since
1 year 5 years Inception*
- --------------------------------------------------------------------------------
Class B 26.11% 14.28% 14.46%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Gross)+ 27.16% 16.87% 17.00%
- --------------------------------------------------------------------------------
MSCI EAFE Growth Index (Net)++ 22.31% 12.26% 12.46%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Net)++ 26.65% 16.42% 16.56%
- --------------------------------------------------------------------------------
* Since Class B inception on October 26, 2001.
+ The Adviser believes that the MSCI AC World Index (ex. U.S.) (Gross) is the
appropriate broad-based benchmark for the Portfolio in light of that
Index's relatively broader international and emerging markets exposure.
++ The MSCI EAFE Growth Index (Net) and the MSCI AC World Index (ex. U.S.)
(Net) reflect the reinvestment of dividends net of non-U.S. withholding
taxes.
International (Class A)
-----------------------
PERFORMANCE TABLE
Average Annual Total Returns
(For the periods ended December 31, 2006)
1 year 5 years 10 years
- --------------------------------------------------------------------------------
Class A 27.04% 21.26% 12.53%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Gross)+ 27.16% 16.87% 8.59%
- --------------------------------------------------------------------------------
MSCI World Index (ex. U.S.) (Net)++ 25.71% 15.25% 7.96%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Net)++ 26.65% 16.42% N/A
- --------------------------------------------------------------------------------
+ The Adviser believes that the MSCI AC World Index (ex. U.S.) (Gross) is the
appropriate broad-based benchmark for the Portfolio in light of that
Index's relatively broader international and emerging markets exposure.
++ The MSCI World Index (ex. U.S.) (Net) and the MSCI AC World Index (ex.
U.S.) (Net) reflect the reinvestment of dividends net of non-U.S.
withholding taxes.
International (Class B)
-----------------------
PERFORMANCE TABLE
Average Annual Total Returns
(For the periods ended December 31, 2006)
Since
1 year 5 years Inception*
- --------------------------------------------------------------------------------
Class B 26.70% 21.00% 9.00%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Gross)+ 27.16% 16.87% 6.89%
- --------------------------------------------------------------------------------
MSCI World Index (ex. U.S.) (Net)++ 25.71% 15.25% 5.62%
- --------------------------------------------------------------------------------
MSCI AC World Index (ex. U.S.) (Net)++ 26.65% 16.42% N/A
- --------------------------------------------------------------------------------
* Since Class B inception on July 3, 2000.
+ The Adviser believes that the MSCI AC World Index (ex. U.S.) (Gross) is the
appropriate broad-based benchmark for the Portfolio in light of that
Index's relatively broader international and emerging markets exposure.
++ The MSCI World Index (ex. U.S.) (Net) and the MSCI AC World Index (ex.
U.S.) (Net) reflect the reinvestment of dividends net of non-U.S.
withholding taxes.
APPENDIX D
DESCRIPTION OF PRINCIPAL RISKS OF THE PORTFOLIOS
Among the principal risks of investing in a Portfolio are market risk,
non-U.S. (foreign) risk, emerging market risk, currency risk, industry/sector
risk, capitalization risk, and management risk. Each of these risks is more
fully described below. Each Portfolio could become subject to additional risks
because the types of investments made by each Portfolio can change over time.
Market Risk This is the risk that the value of a Portfolio's investments
will fluctuate as the stock or bond markets fluctuate and
that prices overall will decline over shorter- or
longer-term periods.
Non-U.S. A Portfolio's investments in non-U.S. (foreign) securities
(Foreign) Risk may experience more rapid and extreme changes in value than
investments in securities of U.S. companies. The securities
markets of many non-U.S. countries are relatively small,
with a limited number of companies representing a small
number of securities. Non-U.S. companies usually are not
subject to the same degree of regulation as U.S. issuers.
Reporting, accounting, and auditing standards of non-U.S.
countries differ, in some cases significantly, from U.S.
standards. Nationalization, expropriation or confiscatory
taxation, currency blockage, political changes, or
diplomatic development could adversely affect a Portfolio's
investments in a non-U.S. country. These risks are
heightened for emerging market countries because there may
be more economic, political and social instability, and
investments in companies in emerging markets may have more
risk because these securities may be more volatile and less
liquid. To the extent a Portfolio invests in a particular
country or geographic region, the Portfolio may have more
significant risk due to market changes or other factors
affecting that country or region, including political
instability and unpredictable economic conditions.
Emerging Non-U.S. investment risk may be particularly high to the
Market Risk extent a Portfolio invests in emerging market securities of
issuers based in countries with developing economies. These
securities may present market, credit, currency, liquidity,
legal, political and other risks different from, or greater
than, the risk of investing in developed non-U.S. (foreign)
countries.
Currency Risk This is the risk that fluctuations in the exchange rates
between the U.S. Dollar and non-U.S. (foreign) currencies
may negatively affect the value of a Portfolio's investments
or reduce the returns of a Portfolio.
Industry/Sector This is the risk of investments in a particular industry or
Risk group of related industries, such as the real estate or
utility industry. Market or economic factors affecting that
industry could have a major effect on the value of a
Portfolio's investments.
Capitalization This is the risk of investments in small - to mid -
Risk capitalization companies. Investments in small- and mid-cap
companies may be more volatile than investments in large-cap
companies. Investments in small-cap companies tend to be
more volatile than investments in mid- or large-cap
companies. A Portfolio's investments in smaller
capitalization companies may have additional risks because
these companies often have limited product lines, markets or
financial resources.
Management Each Portfolio is subject to management risk because it is
Risk an actively managed investment portfolio. The Adviser will
apply its investment techniques and risk analyses in making
investment decisions for each Portfolio, but there can be no
guarantee that its decisions will produce the desired
results.
APPENDIX E
CERTAIN INFORMATION APPLICABLE TO
CLASS A AND CLASS B SHARES OF INTERNATIONAL
How to Buy and Sell Shares
The Portfolio offers its shares through the separate accounts of life
insurance companies (the "Insurers"). You may only purchase and sell shares
through these separate accounts. See the prospectus of the separate account of
the participating insurance company for information on the purchase and sale of
the Portfolio's shares. AllianceBernstein Investments, Inc. ("ABI") may from
time to time receive payments from Insurers in connection with the sale of the
Portfolio's shares through the Insurer's separate accounts.
The Insurers maintain omnibus account arrangements with the Portfolio in
respect of the Portfolio and place aggregate purchase, redemption and exchange
orders for shares of the Portfolio corresponding to orders placed by the
contractholders who have purchased contracts from the Insurers, in each case, in
accordance with the terms and conditions of the relevant contract. Omnibus
account arrangements maintained by the Insurers are discussed below under
"Limitations on Ability to Detect and Curtail Excessive Trading Practices."
ABI may refuse any order to purchase shares. The Portfolio reserves the
right to suspend the sale of its shares to the public in response to conditions
in the securities markets or for other reasons.
Payments to Financial Intermediaries
Financial intermediaries, such as the Insurers, market and sell shares of
the Portfolio and typically receive compensation for selling shares of the
Portfolio. This compensation is paid from various sources. Insurers or your
financial intermediary receive compensation from ABI and/or the Adviser in
several ways from various sources, which include some or all of the following:
o defrayal of costs for educational seminars and training;
o additional distribution support; and
o payments related to providing contractholder recordkeeping and/or
administrative services.
ABI and/or the Adviser may pay Insurers or other financial intermediaries
to perform record-keeping and administrative services in connection with the
Portfolio. Such payments will generally not exceed 0.35% of the average daily
net assets of the Portfolio attributable to the Insurer.
Other Payments for Distribution Services and Educational Support
In addition to the fees described above, ABI, at its expense, currently
provides additional payments to the Insurers that sell shares of the Portfolio.
These sums include payments to reimburse directly or indirectly the costs
incurred by the Insurers and their employees in connection with educational
seminars and training efforts about the Portfolio for the Insurers' employees
and/or their clients and potential clients. The costs and expenses associated
with these efforts may include travel, lodging, entertainment and meals.
For 2007, ABI's additional payments to these firms for educational support
and distribution assistance related to the Portfolios is expected to be
approximately $450,000. In 2006, ABI paid additional payments of approximately
$325,000 for the Portfolios.
If one mutual fund sponsor that offers shares to separate accounts of an
Insurer makes greater distribution assistance payments than another, the Insurer
may have an incentive to recommend or offer the shares of funds of one fund
sponsor over another.
Please speak with your financial intermediary to learn more about the total
amounts paid to your financial intermediary by the Adviser, ABI and by other
mutual fund sponsors that offer shares to Insurers that may be recommended to
you. You should also consult disclosures made by your financial intermediary at
the time of purchase.
ABI anticipates that the Insurers or their affiliates that will receive
additional payments for educational support include:
AIG SunAmerica
Ameriprise Financial
Genworth Financial
ING Reliastar Life
ING USA Annuity and Life Insurance Co.
Lincoln Financial Distributors
Merrill Lynch
Prudential Financial
RiverSource Distributors, Inc.
Transamerica Capital, Inc.
Although the Portfolio may use brokers and dealers who sell shares of the
Portfolio to effect Portfolio transactions, the Portfolio does not consider the
sale of AllianceBernstein Mutual Fund shares as a factor when selecting brokers
or dealers to effect Portfolio transactions.
Frequent Purchases and Redemptions of Portfolio Shares
The Portfolio's Board of Directors has adopted policies and procedures
designed to detect and deter frequent purchases and redemptions of Portfolio
shares or excessive or short-term trading that may disadvantage long-term
contractholders. These policies are described below. The Portfolio reserves the
right to restrict, reject or cancel, without any prior notice, any purchase or
exchange order for any reason, including any purchase or exchange order accepted
by any Insurer or a contractholder's financial intermediary.
Risks Associated With Excessive Or Short-term Trading Generally
- ---------------------------------------------------------------
While the Portfolio will try to prevent market timing by utilizing the
procedures described below, these procedures may not be successful in
identifying or stopping excessive or short-term trading in all circumstances. By
realizing profits through short-term trading, contractholders that engage in
rapid purchases and sales or exchanges of the Portfolio's shares dilute the
value of shares held by long-term contractholders. Volatility resulting from
excessive purchases and sales or exchanges of Portfolio shares, especially
involving large dollar amounts, may disrupt efficient portfolio management. In
particular, the Portfolio may have difficulty implementing its long-term
investment strategies if it is forced to maintain a higher level of its assets
in cash to accommodate significant short-term trading activity. Excessive
purchases and sales or exchanges of the Portfolio's shares may force the
Portfolio to sell portfolio securities at inopportune times to raise cash to
accommodate short-term trading activity. In addition, the Portfolio may incur
increased expenses if one or more contractholders engage in excessive or
short-term trading. For example, a Portfolio may be forced to liquidate
investments as a result of short-term trading and incur increased brokerage
costs and realization of taxable capital gains without attaining any investment
advantage. Similarly, the Portfolio may bear increased administrative costs due
to asset level and investment volatility that accompanies patterns of short-term
trading activity. All of these factors may adversely affect Portfolio
performance.
Investments in foreign securities may be particularly susceptible to
short-term trading strategies. This is because foreign securities are typically
traded on markets that close well before the time a Portfolio calculates its NAV
at 4:00 p.m., Eastern Time, which gives rise to the possibility that
developments may have occurred in the interim that would affect the value of
these securities. The time zone differences among international stock markets
can allow a contractholder engaging in a short-term trading strategy to exploit
differences in Portfolio share prices that are based on closing prices of
foreign securities established some time before the Portfolio calculates its own
share price (referred to as "time zone arbitrage"). The Portfolio has
procedures, referred to as fair value pricing, designed to adjust closing market
prices of foreign securities to reflect what is believed to be the fair value of
those securities at the time the Portfolio calculates its NAV. While there is no
assurance, the Portfolio expects that the use of fair value pricing, in addition
to the short-term trading policies discussed below, will significantly reduce a
contractholder's ability to engage in time zone arbitrage to the detriment of
other contractholders.
Contractholders engaging in a short-term trading strategy may also target a
Portfolio that does not invest primarily in foreign securities. If the Portfolio
invests in securities that are, among other things, thinly traded, traded
infrequently, or relatively illiquid, it has the risk that the current market
price for the securities may not accurately reflect current market values.
Contractholders may seek to engage in short-term trading to take advantage of
these pricing differences (referred to as "price arbitrage"). The Portfolio may
be adversely affected by price arbitrage, in particular, to the extent that it
significantly invests in small-cap securities or specific industry sector
securities.
Policy Regarding Short-term Trading
- -----------------------------------
Purchases and exchanges of shares of the Portfolio should be made for
investment purposes only. The Portfolio seeks to prevent patterns of excessive
purchases and sales or exchanges of Portfolio shares. The Portfolio will seek to
prevent such practices to the extent they are detected by the procedures
described below. The Portfolio reserves the right to modify this policy,
including any surveillance or account blocking procedures established from time
to time to effectuate this policy, at any time without notice.
Transaction Surveillance Procedures. The Portfolio, through its agents, ABI
and ABIS, maintains surveillance procedures to detect excessive or short-term
trading in Portfolio shares. This surveillance process involves several factors,
which include scrutinizing individual Insurers' omnibus transaction activity in
Portfolio shares in order to ascertain whether any such activity attributable to
one or more contractholders might constitute excessive or short-term trading.
Insurers' omnibus transaction activity identified by these surveillance
procedures, or as a result of any other information actually available at the
time, will be evaluated to determine whether such activity might indicate
excessive or short-term trading activity attributable to one or more
contractholders. These surveillance procedures may be modified from time to
time, as necessary or appropriate to improve the detection of excessive or
short-term trading or to address specific circumstances.
Account Blocking Procedures. If the Portfolio determines, in its sole
discretion, that a particular transaction or pattern of transactions identified
by the transaction surveillance procedures described above is excessive or
short-term trading in nature, the relevant Insurer's omnibus account(s) will be
immediately "blocked" and no future purchase or exchange activity will be
permitted, except to the extent the Portfolio, ABI or ABIS has been informed in
writing that the terms and conditions of a particular contract may limit the
Portfolio's ability to apply its short-term trading policy to contractholder
activity as discussed below. As a result, any contractholder seeking to engage
through an Insurer in purchase or exchange activity in shares of the Portfolio
under a particular contract will be prevented from doing so. However, sales of
Portfolio shares back to the Portfolio or redemptions will continue to be
permitted in accordance with the terms of the Portfolio's current Prospectus. In
the event an account is blocked, certain account-related privileges, such as the
ability to place purchase, sale and exchange orders over the internet or by
phone, may also be suspended. An Insurer's omnibus account that is blocked will
generally remain blocked unless and until the Insurer provides evidence or
assurance acceptable to the Portfolio one or more contractholders did not or
will not in the future engage in excessive or short-term trading.
Applications of Surveillance Procedures and Restrictions to Omnibus
Accounts. If an Insurer does not have the capabilities, or declines, to provide
individual account level detail to the Portfolio, the Portfolio will monitor
turnover of assets to purchases and redemptions of the omnibus account. If
excessive turnover, defined as annualized purchases and redemptions exceeding
50% of assets is detected, the Portfolio will notify the Insurer and request
that the Insurer review individual account transactions for excessive or
short-term trading activity and confirm to the Portfolio that appropriate action
has been taken to curtail the activity, which may include applying blocks to
accounts to prohibit future purchases and exchanges of shares of the Portfolio.
The Portfolio will continue to monitor the turnover attributable to an Insurer's
omnibus account and may consider whether to terminate the relationship if the
Insurer does not demonstrate that appropriate action has been taken.
Risks to Contractholders Resulting From Imposition of Account Blocks in
Response to Excessive Short-term Trading Activity
- ------------------------------------------------------------------------
A contractholder identified as having engaged in excessive or short-term
trading activity whose account is "blocked" and who may not otherwise wish to
redeem his or her shares effectively may be "locked" into an investment in
shares of the Portfolio that the contractholder did not intend to hold on a
long-term basis or that may not be appropriate for the contractholder's risk
profile. To rectify this situation, a contractholder with a "blocked" account
may be forced to redeem Portfolio shares, which could be costly if, for example,
these shares have declined in value. To avoid this risk, a contractholder should
carefully monitor the purchases, sales, and exchanges of Portfolio shares and
avoid frequent trading in Portfolio shares.
Limitations on Ability to Detect and Curtail Excessive Trading Practices
- -------------------------------------------------------------------------
Insurers utilizing omnibus account arrangements may not identify to the
Portfolio, ABI or ABIS contractholders' transaction activity relating to shares
of the Portfolio on an individual basis. Consequently, the Portfolio, ABI and
ABIS may not be able to detect excessive or short-term trading in shares of the
Portfolio attributable to a particular contractholder who effects purchase and
redemption and/or exchange activity in shares of the Portfolio through an
Insurer acting in an omnibus capacity. In seeking to prevent excessive or
short-term trading in shares of the Portfolio, including the maintenance of any
transaction surveillance or account blocking procedures, the Portfolio, ABI and
ABIS consider the information actually available to them at the time.
How the Portfolio Values Its Shares
The Portfolio's NAV is calculated at the close of regular trading on the
Exchange (ordinarily, 4:00 p.m., Eastern Time), only on days when the Exchange
is open for business. To calculate NAV, a Portfolio's assets are valued and
totaled, liabilities are subtracted, and the balance, called net assets, is
divided by the number of shares outstanding. If the Portfolio invests in
securities that are primarily traded on foreign exchanges that trade on weekends
or other days when the Portfolio does not price its shares, the NAV of the
Portfolio's shares may change on days when contractholders will not be able to
purchase or redeem their shares in the Portfolio.
The Portfolio values its securities at their current market value
determined on the basis of market quotations or, if market quotations are not
readily available or are unreliable, at "fair value" as determined in accordance
with procedures established by and under the general supervision of the
Portfolio's Board of Directors. When a Portfolio uses fair value pricing, it may
take into account any factors it deems appropriate. The Portfolio may determine
fair value based upon developments related to a specific security, current
valuations of non-U.S. (foreign) stock indices (as reflected in U.S. futures
markets) and/or U.S. sector or broader stock market indices. The prices of
securities used by the Portfolio to calculate its NAV may differ from quoted or
published prices for the same securities. Fair value pricing involves subjective
judgments and it is possible that the fair value determined for a security is
materially different than the value that could be realized upon the sale of that
security.
The Portfolio expects to use fair value pricing for securities primarily
traded on U.S. exchanges only under very limited circumstances, such as the
early closing of the exchange on which a security is traded or suspension of
trading in the security. The Portfolio may use fair value pricing more
frequently for securities primarily traded in non-U.S. (foreign) markets
because, among other things, most non-U.S. (foreign) markets close well before
the Portfolio values its securities at 4:00 p.m., Eastern Time. The earlier
close of these non-U.S. (foreign) markets gives rise to the possibility that
significant events, including broad market moves, may have occurred in the
interim. For example, the Portfolio believes that non-U.S. (foreign) security
values may be affected by events that occur after the close of non-U.S.
(foreign) securities markets. To account for this, the Portfolio may frequently
value many of its non-U.S. (foreign) equity securities using fair value prices
based on third party vendor modeling tools to the extent available.
Subject to the Board's oversight, the Portfolio's Board of Directors has
delegated responsibility for valuing the Portfolio's assets to the Adviser. The
Adviser has established a Valuation Committee, which operates under the policies
and procedures approved by the Board, to value the Portfolio's assets on behalf
of the Portfolio. The Valuation Committee values Portfolio assets as described
above.
Your order for purchase, sale, or exchange of shares is priced at the
next-determined NAV after your order is received in proper form by the
Portfolio.
APPENDIX F
OTHER INFORMATION
The following information provides only a summary of the key features of
the organizational structure and governing documents of the Portfolios. Each
Portfolio is organized as a series of the same Maryland corporation. The Charter
and Bylaw provisions that govern AVP apply to International and International
Research Growth. Accordingly, there are no differences between International
Research Growth and International in terms of their corporate organizational
structures.
General
Each Portfolio has procedures available to its respective shareholders for
calling shareholders' meetings and for the removal of directors. Under Maryland
law, unless the charter provides otherwise (which AVP's does not), a director
may be removed, either with or without cause, at a meeting duly called and at
which a quorum is present by the affirmative vote of the holders of a majority
of the votes entitled to be cast for the election of directors. Under the
Bylaws, shareholder-requested special meetings of shareholders for any other
purpose shall be called by AVP's Secretary only upon the written request of
shareholders entitled to cast not less than a majority of all the votes entitled
to be cast at the meeting.
For each Portfolio, the presence in person or by proxy of the holders of
one-third of the shares entitled to be cast constitutes a quorum at any meeting
of shareholders of the Portfolio. When a quorum is present at any meeting, the
affirmative vote of a majority of the votes (or with respect to the election of
directors, a plurality of votes) cast shall decide any question brought before
such meeting, except as otherwise required by law.
Shares of Common Stock of the Portfolios
The Portfolios' shares have no preemptive rights. Each share has equal
voting, dividend, distribution and liquidation rights. Shareholders are entitled
to one vote per share. All voting rights for the election of directors are
non-cumulative, which means that the holders of more than 50% of the shares of
common stock of AVP can elect 100% of the directors then nominated for election
if they choose to do so and, in such event, the holders of the remaining shares
of common stock will not be able to elect any directors. The Portfolios are
organized as series of the same Maryland corporation and thus their shareholders
have the same rights due to them under state law. The Portfolios are not
required to, and do not, hold annual meetings of shareholders and have no
current intention to hold such meetings, except as required by the 1940 Act.
Under the 1940 Act, International Research Growth and International are required
to hold a shareholder meeting if, among other reasons, the number of Directors
elected by shareholders is less than a majority of the total number of
Directors, or if a Portfolio seeks to change its fundamental investment
policies.
Dividends and Distributions
International Research Growth and International have the same dividends and
distributions policies. Both International Research Growth and International
declare dividends on their shares at least annually. The income and capital
gains distribution is made in shares of each Portfolio.
Indemnification and Liability of Directors and Officers
The charter of AVP generally provides for the indemnification of officers
and directors, as applicable, to the full extent permitted by Maryland law. This
indemnification does not protect any such person against any liability to a
Portfolio or any shareholder thereof to which such person would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the satisfaction of such person's
office.
Maryland law permits a Maryland corporation to include in its charter a
provision limiting the liability of its directors and officers to the
corporation and its shareholders for money damages except for liability
resulting from (a) actual receipt of an improper benefit or profit in money,
property or services or (b) active and deliberate dishonesty established by a
final judgment as being material to the cause of action. AVP's charter contains
such a provision that eliminates directors' and officers' liability to the
maximum extent permitted by Maryland law. This exculpation does not protect any
such person against any liability to a Portfolio or any shareholder thereof to
which such person would otherwise be subject by reason of willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
satisfaction of such person's office.
APPENDIX G
FORM OF PLAN OF ACQUISITION AND LIQUIDATION
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC.
WITH RESPECT TO ITS SERIES
ALLIANCEBERNSTEIN INTERNATIONAL RESEARCH GROWTH PORTFOLIO AND
ALLIANCEBERNSTEIN INTERNATIONAL GROWTH PORTFOLIO
As of
[___________________], 2007
This Plan of Acquisition and Liquidation (the "Plan") has been adopted by
the Board of Directors of AllianceBernstein Variable Products Series Fund, Inc.,
a Maryland corporation (the "Corporation"), as of this [__]th day of [______],
2007, to provide for the reorganization of AllianceBernstein International
Research Growth Portfolio (the "Acquired Portfolio") into AllianceBernstein
International Growth Portfolio (the "Acquiring Portfolio"). The Acquired
Portfolio and the Acquiring Portfolio (together, the "Portfolios") are each
separate series of the Corporation, an open-end management investment company
registered with the Securities and Exchange Commission (the "SEC") under the
Investment Company Act of 1940, as amended (the "1940 Act").
The Board of Directors (the "Board") has determined that it is in the best
interest of the stockholders of the Acquiring Portfolio and the Acquired
Portfolio that the Acquired Portfolio transfer all of the assets attributable to
its Class A shares held by its stockholders ("Stockholders") in exchange for
Class A shares of equal net asset value of the Acquiring Portfolio ("Class A
Acquisition Shares"), transfer all of the assets attributable to its Class B
shares held by its Stockholders in exchange for Class B shares of equal net
asset value of the Acquiring Portfolio ("Class B Acquisition Shares" and
together with Class A Acquisition Shares, the "Acquisition Shares") and
distribute Class A Acquisition Shares and Class B Acquisition Shares,
respectively, of the Acquired Portfolio and that the Corporation redeem the
outstanding shares (the "Acquired Portfolio Shares") of the Acquired Portfolio,
all as provided for below (the "Acquisition").
In this Plan of Acquisition, any references to a Portfolio taking action
shall mean and include all necessary actions of the Corporation on behalf of a
Portfolio, unless the context of this Plan of Acquisition or the 1940 Act
requires otherwise.
The Corporation intends 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, the Acquiring Portfolio and the Acquired Portfolio
will each be a "party to a reorganization" within the meaning of Section 368(b)
of the Code.
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.
Assets All assets of any kind and all interests, rights, privileges
and powers of or attributable to the Acquired Portfolio or
its shares, as appropriate, whether or not determinable at
the Effective Time (as defined herein) 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 Portfolio or
attributable to its shares and any deferred or prepaid
expense, other than unamortized organizational expenses,
shown as an asset on the Acquired Portfolio's books.
Closing Date Such date as the officers of the Corporation shall
designate.
Effective 5:00 p.m. Eastern time on the Closing Date, or such other
Time time as the officers of the Corporation shall designate.
Financial The audited financial statements of the relevant Portfolio
Statements for its most recently completed fiscal year and, if
applicable, the unaudited financial statements of that
Portfolio for its most recently completed semi-annual
period.
Liabilities All liabilities, expenses and obligations of any kind
whatsoever of the Acquired Portfolio, whether known or
unknown, accrued or unaccrued, absolute or contingent or
conditional or unmatured.
N-14 Registration The Registration Statement of the Acquiring Portfolio on
Statement Form N-14 under the 1940 Act that will register the
Acquisition Shares to be issued in the Acquisition.
Valuation The close of regular session trading on the New York Stock
Time Exchange ("NYSE") on the Closing Date, when for purposes of
the Plan, the Corporation determines the net asset value per
Acquisition Share of the Acquiring Portfolio and the net
value of the assets of the Acquired Portfolio.
NAV A Portfolio'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
------------------
The Acquiring Portfolio shall promptly prepare and file the N-14
Registration Statement with the SEC, and the Acquiring Portfolio and the
Acquired Portfolio also shall make any other required or appropriate filings
with respect to the actions contemplated hereby.
3. Transfer of the Acquired Portfolio's Assets
-------------------------------------------
The Acquiring Portfolio and the Acquired Portfolio shall take the following
steps with respect to the Acquisition, as applicable:
(a) On or prior to the Closing Date, the Acquired Portfolio shall pay or
provide for the payment of all of the Liabilities, expenses, costs and
charges of or attributable to the Acquired Portfolio that are known to
the Acquired Portfolio 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 Portfolio will declare to
Acquired Portfolio Stockholders of record a dividend or dividends
which, together with all previous such dividends, shall have the
effect of distributing (a) all the excess of (i) the Acquired
Portfolio's investment income excludable from gross income under
Section 103(a) of the Code over (ii) the Acquired Portfolio's
deductions disallowed under Sections 265 and 171(a)(2) of the Code,
(b) all of the Acquired Portfolio's investment company taxable income
(as defined in Code Section 852), (computed in each case without
regard to any deduction for dividends paid), and (c) all of the
Acquired Portfolio's net realized capital gain (as defined in Code
Section 1222), if any (after reduction for any capital loss
carryover), for the taxable year ending on December 31, 2007 and for
the short taxable year beginning on January 1, 2008, and ending on the
Closing Date. Such dividends will be declared and paid to ensure
continued qualification of the Acquired Portfolio as a "regulated
investment company" for tax purposes and to eliminate fund-level tax.
(c) At the Effective Time, the Acquired Portfolio shall assign, transfer,
deliver and convey the Assets to the Acquiring Portfolio, subject to
the Liabilities, and the Acquiring Portfolio shall then accept the
Assets and assume the Liabilities such that at and after the Effective
Time (i) the Assets at and after the Effective Time shall become and
be assets of the Acquiring Portfolio, and (ii) the Liabilities at the
Effective Time shall attach to the Acquiring Portfolio, and shall be
enforceable against the Acquiring Portfolio to the same extent as if
initially incurred by the Acquiring Portfolio. The Corporation shall
redeem the outstanding shares of the Acquired Portfolio by issuance of
shares of Acquiring Portfolio as described more fully below.
(d) Within a reasonable time prior to the Closing Date, the Acquired
Portfolio shall provide, if requested, a list of the Assets to the
Acquiring Portfolio. The Acquired Portfolio may sell any asset on such
list prior to the Effective Time. After the Acquired Portfolio
provides such list, the Acquired Portfolio 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 the Acquiring Portfolio. Within a reasonable time after
receipt of the list and prior to the Closing Date, the Acquiring
Portfolio will advise the Acquired Portfolio in writing of any
investments shown on the list that the Acquiring Portfolio has
determined to be inconsistent with its investment objective, policies
and restrictions. The Acquired Portfolio will dispose of any such
securities prior to the Closing Date to the extent practicable and
consistent with applicable legal requirements, including the Acquired
Portfolio's investment objectives, policies and restrictions. In
addition, if the Acquiring Portfolio determines that, as a result of
the Acquisition, the Acquiring Portfolio would own an aggregate amount
of an investment that would exceed a percentage limitation applicable
to the Acquiring Portfolio, the Acquiring Portfolio will advise the
Acquired Portfolio in writing of any such limitation and the Acquired
Portfolio 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 Portfolio's investment
objectives, policies and restrictions.
(e) The Acquired Portfolio shall assign, transfer, deliver and convey the
Assets to the Acquiring Portfolio at the Effective Time on the
following basis:
(1) The value of the Assets less the Liabilities of the Acquired
Portfolio attributable to shares of Class A held by Stockholders
and shares of Class B held by Stockholders, determined as of the
Valuation Time, shall be divided by the then NAV of one Class A
and Class B Acquisition Share, as applicable, and, in exchange
for the transfer of the Assets, the Acquiring Portfolio shall
simultaneously issue and deliver to the Acquired Portfolio the
number of Class A and Class B Acquisition Shares (including
fractional shares) so determined, rounded to the second decimal
place or such other decimal place as the officers of the
Corporation shall designate;
(2) The NAV of Class A and Class B Acquisition Shares to be delivered
to the Acquired Portfolio shall be determined as of the Valuation
Time in accordance with the Acquiring Portfolio's then applicable
valuation procedures, and the net value of the Assets to be
conveyed to the Acquiring Portfolio shall be determined as of the
Valuation Time in accordance with the then applicable valuation
procedures of the Acquired Portfolio; and
(3) The portfolio securities of the Acquired Portfolio shall be made
available by the Acquired Portfolio to The Bank of New York, as
custodian for the Acquiring Portfolio (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 Portfolio's cash shall be delivered by the
Acquired Portfolio to the Custodian for the account of the
Acquiring Portfolio, 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 the Acquiring
Portfolio.
(f) Promptly after the Closing Date, the Acquired Portfolio will deliver
to the Acquiring Portfolio a Statement of Assets and Liabilities of
the Acquired Portfolio as of the Closing Date.
4. Termination of the Acquired Portfolio, Registration of Acquisition Shares
and Access to Records
---------------------------------------------------------------------------
The Acquired Portfolio and the Acquiring Portfolio also shall take the
following steps, as applicable:
(a) At or as soon as reasonably practical after the Effective Time, the
Acquired Portfolio shall terminate by transferring pro rata to its
Class A Stockholders of record Class A Acquisition Shares received by
the Acquired Portfolio pursuant to Section 3(e)(1) of this Plan and to
its Class B Stockholders of record Class B Acquisition Shares received
by the Acquired Portfolio pursuant to Section 3(e)(1) of this Plan.
The Acquiring Portfolio shall establish accounts on its share records
and note on such accounts the names of the former Acquired Portfolio
Stockholders and the types and amounts of the Acquistion Shares that
former Acquired Portfolio Stockholders are due based on their
respective holdings of the Acquired Portfolio shares as of the close
of business on the Closing Date. Fractional Acquisition Shares shall
be carried to the second decimal place. The Acquisition Portfolio
shall not issue certificates representing the Acquisition Shares in
connection with such exchange. All issued and outstanding Acquired
Portfolio Shares will be simultaneously redeemed and cancelled on the
books of the Acquired Portfolio. Ownership of the Acquisition Shares
will be shown on the books of the Acquiring Portfolio's transfer
agent.
Following distribution by the Acquired Portfolio to its Stockholders
of all Acquisition Shares delivered to the Acquired Portfolio, the
Acquired Portfolio 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 Portfolio shall provide
the Acquiring Portfolio and its transfer agent with immediate access
to: (i) all records containing the names, addresses and taxpayer
identification numbers of all of the Acquired Portfolio's Stockholders
and the number and percentage ownership of the outstanding shares of
the Acquired Portfolio 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 Portfolio Stockholders'
taxpayer identification numbers and their liability for or exemption
from back-up withholding. The Acquired Portfolio shall preserve and
maintain, or shall direct its service providers to preserve and
maintain, records with respect to the Acquired Portfolio as required
by Section 31 of, and Rules 31a-1 and 31a-2 under, the 1940 Act.
5. Conditions to Consummation of the Acquisition
---------------------------------------------
The consummation of the Acquisition shall be subject to the following
conditions precedent:
(a) There shall have been no material adverse change in the financial
condition, results of operations, business, properties or assets of
the Acquiring Portfolio or the Acquired Portfolio since the date of
the most recent Financial Statements. Negative investment performance
shall not be considered a material adverse change.
(b) The Corporation shall have received an opinion of Seward & Kissel
LLP, substantially to the effect that for federal income tax
purposes:
(1) The Acquisition will constitute a "reorganization" within
the meaning of Section 368(a) of the Code and that the
Acquiring Portfolio and the Acquired Portfolio will each be
"a party to a reorganization" within the meaning of Section
368(b) of the Code;
(2) A Stockholder of the Acquired Portfolio will recognize no
gain or loss on the exchange of the Stockholder's shares of
the Acquired Portfolio solely for Acquisition Shares;
(3) Neither the Acquired Portfolio nor the Acquiring Portfolio
will recognize any gain or loss upon the transfer of all of
the Assets to the Acquiring Portfolio in exchange for
Acquisition Shares and the assumption by the Acquiring
Portfolio of the Liabilities pursuant to this Plan or upon
the distribution of Acquisition Shares to Stockholders of
the Acquired Portfolio in exchange for their respective
shares of the Acquired Portfolio;
(4) The holding period and tax basis of the Assets acquired by
the Acquiring Portfolio will be the same as the holding
period and tax basis that the Acquired Portfolio had in such
Assets immediately prior to the Acquisition;
(5) The aggregate tax basis of Acquisition Shares received in
connection with the Acquisition by each Stockholder of the
Acquired Portfolio (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 Portfolio
surrendered in exchange therefor, and increased by any gain
recognized on the exchange;
(6) The holding period of Acquisition Shares received in
connection with the Acquisition by each Stockholder of the
Acquired Portfolio (including any fractional share to which
the stockholder may be entitled) will include the holding
period of the shares of the Acquired Portfolio surrendered
in exchange therefor, provided that such Acquired Portfolio
shares constitute capital assets in the hands of the
Stockholder as of the Closing Date; and
(7) The Acquiring Portfolio will succeed to the capital loss
carryovers of the Acquired Portfolio but the use of the
Acquiring Portfolio's existing capital loss carryovers (as
well as the carryovers of the Acquired Portfolio) may be
subject to limitation under Section 383 of the Code after
the Acquisition.
The opinion will be based on certain factual certifications made by
officers of the Portfolios 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 (b), Seward & Kissel 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 Portfolio shall provide additional
factual representations to Seward & Kissel LLP with respect to the
Portfolios that are reasonably necessary to enable Seward & Kissel LLP to
deliver the tax opinion. Notwithstanding anything in this Plan to the
contrary, neither Portfolio may waive in any material respect the
conditions set forth under this subparagraph (b).
(c) 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 the Acquiring Portfolio, is not
contemplating instituting any stop order suspending the effectiveness
of the N-14 Registration Statement.
(d) 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.
(e) 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.
(f) The Acquired Portfolio shall have received a letter from
AllianceBernstein L.P. (the "Adviser") with respect to insurance
matters in form and substance satisfactory to the Acquired Portfolio.
(g) The Acquired Portfolio shall have received a letter from the Adviser
agreeing to indemnify the Acquiring Portfolio in respect of certain
liabilities of the Acquired Portfolio in form and substance
satisfactory to the Acquired Portfolio.
6. Closing
-------
(a) The Closing shall be held at the offices of the Corporation, 1345
Avenue of the Americas, New York, New York 10105, or at such other
place as the officers of the Corporation may designate.
(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 Portfolio or the Acquiring Portfolio 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 Plan may be terminated by the Board of Directors.
(c) The Acquiring Portfolio will provide to the Acquired Portfolio
evidence satisfactory to the Acquired Portfolio that Acquisition
Shares issuable pursuant to the Acquisition have been credited to the
Acquired Portfolio's account on the books of the Acquiring Portfolio.
After the Closing Date, the Acquiring Portfolio will provide to the
Acquired Portfolio evidence satisfactory to the Acquired Portfolio
that such Shares have been credited pro rata to open accounts in the
names of the Acquired Portfolio 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 this
Plan.
7. Termination of Plan
-------------------
A majority of the Corporation's Board of Directors may terminate this
Plan before the applicable Effective Time if: (i) any of the conditions
precedent set forth herein are not satisfied; or (ii) the Board of
Directors determines that the consummation of the Acquisition is not in the
best interests of either Portfolio or its Stockholders.
8. Termination of the Acquired Portfolio
-------------------------------------
If the Acquisition is consummated, the Acquired Portfolio shall
terminate its registration under the 1940 Act and the 1933 Act and will
terminate.
9. Expenses
--------
The Acquisition expenses shall be borne on a relative net asset basis by
the Portfolios.
APPENDIX H
CAPITALIZATION
The following table shows on an unaudited basis the capitalization of each
of International Research Growth and International as of June 30, 2007 and on a
pro forma combined basis, giving effect to the acquisition of the assets and
liabilities of International Research Growth by International at net asset value
as of June 30, 2007.
International
Research Pro Forma International
Growth International Adjustments (pro forma)(a)
------ ------------- ----------- --------------
Class A Class A Class A
------- ------- -------
Net Asset
Value $69,604,588 $91,592,069 (158,871) $161,037,786
Shares
outstanding 2,993,745 3,082,629 (650,946) 5,425,423
Net asset
value per
share $23.25 $29.71 $29.68
Class B Class B Class B
------- ------- -------
Net Asset
Value $12,171,179 $39,383,837 (51,129) $51,503,887
Shares
outstanding 528,316 1,332,976 (116,390) 1,744,902
Net asset
value per
share $23.04 $29.55 $29.52
- -----------------------------
(a) Assumes the Acquisition was consummated on June 30, 2007 and is for
information purposes only. No assurance can be given as to how many shares
of International will be received by the shareholders of International
Research Growth on the date the Acquisition takes place, and the foregoing
should not be relied upon to reflect the number of shares of International
that actually will be received on or after such date.
APPENDIX I
LEGAL PROCEEDINGS
On October 2, 2003, a purported class action complaint entitled Hindo, et
al. v. AllianceBernstein Growth & Income Fund, et al. ("Hindo Complaint") was
filed against the Adviser, AllianceBernstein Holding L.P. ("Holding"),
AllianceBernstein Corporation, AXA Financial, Inc., the AllianceBernstein Funds,
certain officers of the Adviser ("AllianceBernstein defendants"), and certain
other unaffiliated defendants, as well as unnamed Doe defendants. The Hindo
Complaint was filed in the United States District Court for the Southern
District of New York by alleged shareholders of two of the AllianceBernstein
Mutual Funds. The Hindo Complaint alleges that certain of the AllianceBernstein
defendants failed to disclose that they improperly allowed certain hedge funds
and other unidentified parties to engage in "late trading" and "market timing"
of AllianceBernstein Mutual Fund securities, violating Sections 11 and 15 of the
Securities Act of 1933, as amended, Sections 10(b) and 20(a) of the Securities
and Exchange Act of 1934, as amended, and Sections 206 and 215 of the Investment
Advisers Act of 1940, as amended. Plaintiffs seek an unspecified amount of
compensatory damages and rescission of their contracts with the Adviser,
including recovery of all fees paid to the Adviser pursuant to such contracts.
Following October 2, 2003, additional lawsuits making factual allegations
generally similar to those in the Hindo Complaint were filed in various federal
and state courts against the Adviser and certain other defendants. All state
court actions against the Adviser either were voluntarily dismissed or removed
to federal court. On February 20, 2004, the Judicial Panel on Multidistrict
Litigation transferred all federal actions to the United States District Court
for the District of Maryland (the "Mutual Fund MDL"). On September 29, 2004,
plaintiffs filed consolidated amended complaints with respect to four claim
types: mutual fund shareholder claims; mutual fund derivative claims; derivative
claims brought on behalf of Holding; and claims brought under ERISA by
participants in the Profit Sharing Plan for Employees of the Adviser. All four
complaints include substantially identical factual allegations, which appear to
be based in large part on the Order of the SEC dated December 18, 2003 as
amended and restated January 15, 2004 (the "SEC Order") and the New York State
Attorney General Assurance of Discontinuance dated September 1, 2004 (the "NYAG
Order").
On April 21, 2006, the Adviser and attorneys for the plaintiffs in the
mutual fund shareholder claims, mutual fund derivative claims, and ERISA claims
entered into a confidential memorandum of understanding ("MOU") containing their
agreement to settle these claims. The agreement will be documented by a
stipulation of settlement and will be submitted for court approval at a later
date. The settlement amount ($30 million), which we previously accrued and
disclosed, has been disbursed. The derivative claims brought on behalf of
Holding, in which plaintiffs seek an unspecified amount of damages, remain
pending.
On April 11, 2005, a complaint entitled The Attorney General of the State
of West Virginia v. AIM Advisors, Inc., et al. ("WVAG Complaint") was filed
against the Adviser, Holding, and various unaffiliated defendants. The WVAG
Complaint was filed in the Circuit Court of Marshall County, West Virginia by
the Attorney General of the State of West Virginia. The WVAG Complaint makes
factual allegations generally similar to those in the Hindo Complaint. On
October 19, 2005, the WVAG Complaint was transferred to the Mutual Fund MDL. On
August 30, 2005, the WV Securities Commissioner signed a Summary Order to Cease
and Desist, and Notice of Right to Hearing addressed to the Adviser and Holding.
The Summary Order claims that the Adviser and Holding violated the West Virginia
Uniform Securities Act, and makes factual allegations generally similar to those
in the SEC Order and the NYAG Order. On January 25, 2006, the Adviser and
Holding moved to vacate the Summary Order. In early September 2006, the court
denied this motion, and the Supreme Court of Appeals in West Virginia denied the
defendants' petition for appeal. On September 22, 2006, the Adviser and Holding
filed an answer and moved to dismiss the Summary Order with the WV Securities
Commissioner.
It is possible that these matters and/or other developments resulting from
these matters could result in increased redemptions of the AllianceBernstein
Mutual Funds' shares or other adverse consequences to the AllianceBernstein
Mutual Funds. This may require the AllianceBernstein Mutual Funds to sell
investments held by those funds to provide for sufficient liquidity and could
also have an adverse effect on the investment performance of the
AllianceBernstein Mutual Funds. However, the Adviser believes that these matters
are not likely to have a material adverse effect on its ability to perform
advisory services relating to the AllianceBernstein Mutual Funds.
APPENDIX J
SHARE OWNERSHIP INFORMATION
Shares Outstanding
As of September 21, 2007 each Portfolio had the following number of shares
of common stock outstanding.
Number of Outstanding
Shares of
Portfolio Class Common Stock
- --------- ----- ------------
International Research Growth A 2,812,112.599
B 505,158.657
International A 3,049,189.981
B 1,345,680.889
Ownership of Shares
As of September 21, 2007, the Directors and officers of each Portfolio as a
group beneficially owned less than 1% of the outstanding shares of common stock
of that Portfolio. To the knowledge of each Portfolio, the following table shows
the persons owning, as of September 21, 2007, either of record or beneficially,
5% or more of the outstanding shares of the Portfolio and the percentage of the
combined portfolio's shares to be owned by the persons if the Acquisition had
been consummated as of that date.
Percentage of
Outstanding
Number of Percentage of Shares of
Name and Outstanding Outstanding Combined
Portfolio and Address of Shares of Shares of Portfolio
Class Shareholder Class Owned Class Owned Class Owned
- ----- ----------- ----------- ----------- -----------
International
Research
Growth
Class A AMERICAN INTERNATIONAL LIFE 180,962.588 5.92% 3.41%
INSURANCE COMPANY OF NY
ATTN: ED BACON
2727 A-ALLEN PARKWAY
HOUSTON TX 77019-2115
AIG LIFE INSURANCE COMPANY 1,517,612.482 49.69% 28.64%
ATTN: ED BACON
2727A ALLEN PKWY #4D1
HOUSTON TX 77019-2107
GREAT WEST LIFE & ANNUITY 909,597.843 29.78% 17.16%
INSURANCE COMPANY
FBO SCHWAB ANNUITIES
8515 E ORCHARD RD
ATTN INVESTMENT DIV
ENGLEWOOD CO 80111-5002
GREAT WEST LIFE & ANNUITY 335,199.684 10.97% 6.33%
INSURANCE COMPANY
8515 E ORCHARD RD
GREENWOOD VLG CO 80111-5002
Class B SUN LIFE FINANCIAL FUTURITY 612,877.637 45.58% 35.06%
RETIREMENT PRODUCTS & SERVICES
PO BOX 9134
WELLESLEY HLS MA 02481-9134
SUN LIFE ASSURANCE COMPANY OF 235,806.478 17.54% 13.49%
CANADA (US)
ATTN: JAMES JOSEPH
PO BOX 9133
WELLESLEY HLS MA 02481-9133
ANCHOR NATIONAL LIFE INS CO 309,336.331 23.01% 17.69%
ATTN: VARIABLE ANNUITY ACCOUNTING
21650 OXNARD ST
WOODLAND HLS CA 91367-4901
International
Class A AMERICAN INTERNATIONAL LIFE 261,812.975 9.32% 4.94%
INSURANCE COMPANY OF NY
ATTN: ED BACON
2727 A-ALLEN PARKWAY
HOUSTON TX 77019-2115
AIG LIFE INSURANCE COMPANY 2,262,266.176 80.52% 42.69%
ATTN: ED BACON
2727A ALLEN PKWY #4D1
HOUSTON TX 77019-2107
Class B SUN LIFE ASSURANCE COMPANY OF 26,572.710 5.26% 1.52%
CANADA (US)
ATTN: JAMES JOSEPH
PO BOX 9133
WELLESLEY HLS MA 02481-9133
ANCHOR NATIONAL LIFE INS CO 477,223.861 94.38% 27.30%
ATTN: VARIABLE ANNUITY ACCOUNTING
21650 OXNARD ST
WOODLAND HLS CA 91367-4901
APPENDIX K
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand each
Portfolio's financial performance for the past 5 years (or, if shorter, the
period of the Portfolio's operations). Certain information reflects financial
results for a single share of each Portfolio. The total returns in the table
represent the rate that an investor would have earned (or lost) on an investment
in the Portfolio (assuming reinvestment of all dividends and distributions).
Except as otherwise indicated, this information has been audited by Ernst &
Young LLP, the independent registered public accounting firm for both
International and International Research Growth as of the end of the Portfolios'
last fiscal year, whose reports, along with each Portfolio's financial
statements, are included in the Portfolios' annual report and available upon
request.
<table>
International Research Growth
-----------------------------
Income from Investment Operations Less: Dividends and Distributions
----------------------------------------------------- ---------------------------------
Net Realized Distributions
and Unrealize from Net
Gain (Loss) Realized
on Net Increase Gain on
Net Asset Net Investment (Decrease) Dividends Investment
Value, Investment and Foreign in Net Asset from Net and Foreign
Beginning Income Currency Contribution Value from Investment Currency
Fiscal Year or Period of Period (Loss)(a) Transactions from Adviser Operations Income Transactions
- --------------------- --------- --------- ------------ ------------ ---------- ------ ------------
International Research
Growth
Class A
Six months ended 6/30/07
(unaudited) $ 22.78 $ .18 $2.51 $0.00 $2.69 $ (.17) $ (2.05)
Year Ended 12/31/06 18.09 .14 4.63 0.00 4.77 (.08) 0.00
Year Ended 12/31/05 15.26 .11 2.80 0.00 2.91 (.08) 0.00
Year Ended 12/31/04 13.01 .08(b) 2.20 .01 2.29 (.04) 0.00
Year Ended 12/31/03 9.90 .02 3.11 0.00 3.13 (.02) 0.00
Year Ended 12/31/02 11.69 0.00(b) (1.78) 0.00 (1.78) (.01) 0.00
Class B
Six months ended 6/30/07
(unaudited) $22.57 $.15 $2.48 -- $2.63 $(.11) $ (2.05)
Year Ended 12/31/06 17.94 .09 4.59 -- 4.68 (.05) 0.00
Year Ended 12/31/05 15.15 .06 2.79 -- 2.85 (.06) 0.00
Year Ended 12/31/04 12.93 .05(b) 2.20 -- 2.25 (.03) 0.00
Year Ended 12/31/03 9.87 (.02) 3.09 -- 3.07 (.01) 0.00
Year Ended 12/31/02 11.68 (.03)(b) (1.78) -- (1.81) 0.00 0.00
- -----------------------------
See footnotes on page 50.
</table>
<table>
Less: Dividends
and Distributions Total Return Ratios/Supplemental Data
- -------------------------- ------------- --------------------------------------------------------------------------------
Ratio to
Average
Total Ratio to Average Net Assets of Ratio to
Total Net Asset Investment Net Assets of Expenses, Average Net
Dividends Value, Return Based Net Assets, Expenses, Net of Before Waivers Assets of Net
and End of on Net Asset End of Period Waivers and and Investment Portfolio
Distributions Period Value(c) (000's Omitted Reimbursements Reimbursements Income (Loss) Turnover Rate
- ------------- ------ -------- -------------- -------------- -------------- ------------- -------------
$(2.22) $23.25 11.86% $69,605 1.25%(d) 1.25%(d) 1.56%(d) 48%
(.08) 22.78 26.45 67,982 1.25(e) 1.25(e) .71 (e) 79
(.08) 18.09 19.16 65,496 1.30 1.30 .67 93
(.04) 15.26 17.62 58,341 1.33 1.50 .63(b) 128
(.02) 13.01 31.59 53,425 1.80 1.80 .22 96
(.01) 9.90 (15.28) 46,478 1.36 1.66 .04(b) 70
$(2.16) $23.04 11.71% $12,171 1.50%(d) 1.50%(d) 1.30%(d) 48%
(.05) 22.57 26.11 12,016 1.50(e) 1.50(e) .46(e) 79
(.06) 17.94 18.85 10,083 1.56 1.56 .39 93
(.03) 15.15 17.41 7,065 1.56 1.73 .35(b) 128
(.01) 12.93 31.11 2,766 2.05 2.05 (.17) 96
0.00 9.87 (15.50) 467 1.63 1.92 (.25)(b) 70
- -----------------------------------------------
See footnotes on page 50.
</table>
<table>
International
-------------
Income from Investment Operations Less: Dividends and Distributions
------------------------------------------------- ---------------------------------
Distributions
Net Realized from Net
and Unrealized Realized
Gain (Loss) on Net Increase Gain on
Net Asset Investment and (Decrease) Dividends Investment
Value, Net Foreign in Net Asset from Net and Foreign
Beginning Investment Currency Value from Investment Currency
Fiscal Year or Period of Period Income (a) Transactions Operations Income Transactions
- --------------------- --------- ---------- ------------ ---------- ------ ------------
International
Class A
Six months ended 6/30/07
(unaudited) $ 30.37 $.26 $2.96 $3.22 $ (.31) $ (3.57)
Year Ended 12/31/06 24.27 .30 6.18 6.48 (.23) (.15)
Year Ended 12/31/05 20.18 .25 3.94 4.19 (.10) 0.00
Year Ended 12/31/04 16.28 .11(b) 3.83 3.94 (.04) 0.00
Year Ended 12/31/03 11.48 .04 4.91 4.95 (.15) 0.00
Year Ended 12/31/02 12.18 .07(b) (.56) (.49) (.21) 0.00
Class B
Six months ended 6/30/07
(unaudited) $30.20 $.22 $2.95 $3.17 $(.25) $ (3.57)
Year Ended 12/31/06 24.16 .22 6.16 6.38 (.19) (.15)
Year Ended 12/31/05 20.11 .21 3.91 4.12 (.07) 0.00
Year Ended 12/31/04 16.24 .07(b) 3.82 3.89 (.02) 0.00
Year Ended 12/31/03 11.47 .02 4.88 4.90 (.13) 0.00
Year Ended 12/31/02 12.17 .03(b) (.53) (.50) (.20) 0.00
- -----------------------------------------------
See footnotes on page 50.
</table>
<table>
Less: Dividends
and Distributions Total Return Ratios/Supplemental Data
- -------------------------- ------------- --------------------------------------------------------------------------------
Ratio to
Average
Total Ratio to Average Net Assets of Ratio to
Total Net Asset Investment Net Assets of Expenses, Average Net
Dividends Value, Return Based Net Assets, Expenses, Net of Before Waivers Assets of Net
and End of on Net Asset End of Period Waivers and and Investment Portfolio
Distributions Period Value(c) (000's Omitted Reimbursements Reimbursements Income (Loss) Turnover Rate
- ------------- ------ -------- -------------- -------------- -------------- ------------- -------------
$(3.88) $29.71 10.61% $91,592 1.14%(d) 1.14%(d) 1.68%(d) 41%
(.38) 30.37 27.04 81,655 1.23(e) 1.23(e) 1.11(e) 74
(.10) 24.27 20.84 58,438 1.41 1.41 1.16 43
(.04) 20.18 24.27 41,198 1.65 1.81 .65(b) 60
(.15) 16.28 43.46 34,302 2.17 2.17 .34 44
(.21) 11.48 (4.19) 27,136 1.54 1.98 .61(b) 46
$(3.82) $29.55 10.48% $39,384 1.39%(d) 1.39%(d) 1.43%(d) 41%
(.34) 30.20 26.70 35,321 1.48(e) 1.48(e) .81(e) 74
(.07) 24.16 20.55 25,215 1.66 1.66 .95 43
(.02) 20.11 23.97 14,501 1.90 2.06 .41(b) 60
(.13) 16.24 43.07 7,376 2.41 2.41 .13 44
(.20) 11.47 (4.26) 3,609 1.79 2.23 .28(b) 46
</table>
- -----------------------------------------------
(a) Based on average shares outstanding.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge or
contingent deferred sales charge, if applicable, is not reflected in the
calculation of total investment return. Total investment return does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Total investment returns
calculated for periods of less than one year are not annualized.
(d) Annualized.
(e) The ratio includes expenses attributable to costs of proxy solicitation.
ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC.
- ALLIANCEBERNSTEIN INTERNATIONAL GROWTH PORTFOLIO
1345 Avenue of the Americas
New York, New York
Toll Free (800) 221-5672
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION
September [________], 2007
This Statement of Additional Information (the "SAI") relates to the
acquisition (the "Acquisition") of all of the assets and liabilities of
AllianceBernstein International Research Growth Portfolio ("IRG"), a series of
AllianceBernstein Variable Products Series Fund, Inc., by AllianceBernstein
International Growth Portfolio ("International Growth").
This SAI contains information which may be of interest to shareholders but
which is not included in the Prospectus dated September [__], 2007 (the
"Prospectus") of International Growth which relates to the Acquisition. As
described in the Prospectus, the Acquisition would involve the transfer of all
the assets of IRG in exchange for shares of International Growth and the
assumption by International Growth of all the liabilities of IRG. IRG would
distribute the International Growth shares it receives to its shareholders in
complete liquidation of IRG. International Growth will be the survivor for
accounting purposes.
This SAI is not a prospectus and should be read in conjunction with the
Prospectus. The Prospectus has been filed with the Securities and Exchange
Commission (the "SEC") and is available upon request and without charge by
writing to IRG at 1345 Avenue of the Americas, New York, New York 10105, or by
calling 1-800-221-5672.
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
ADDITIONAL INFORMATION ABOUT INTERNATIONAL GROWTH AND IRG
FINANCIAL STATEMENTS
Additional Information about International Growth and IRG
Further information about International Growth and IRG is contained in
their Statements of Additional Information each dated May 1, 2007, which are
incorporated herein by reference and available upon request and without charge
by writing to IRG at 1345 Avenue of the Americas, New York, New York 10105, or
by calling 1-800-221-5672.
Financial Statements
The financial statements and Report of Independent Registered Public
Accounting Firm contained in the Annual Report for the twelve months ended
December 31, 2006, of International Growth, which report contains historical
financial information regarding International Growth, has been filed with the
SEC and is incorporated herein by reference.
The financial statements and Report of Independent Registered Public
Accounting Firm contained in the Annual Report for the twelve months ended
December 31, 2006, of IRG, which report contains historical financial
information regarding IRG, has been filed with the SEC and is incorporated
herein by reference.
Pro Forma Financial Information:
The following represents the pro forma financial information:
PRO FORMA
ALLIANCEBERNSTEIN
VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL STATEMENTS
ALLIANCEBERNSTEIN INTERNATIONAL GROWTH PORTFOLIO
ALLIANCEBERNSTEIN INTERNATIONAL RESEARCH GROWTH PORTFOLIO
September [__], 2007
(unaudited)
PORTFOLIO OF INVESTMENTS
PRO FORMA ALLIANCEBERNSTEIN VARIABLE
PRODUCTS SERIES FUND
INTERNATIONAL GROWTH PORTFOLIO AllianceBernstein Variable Products Series Fund International Growth Portfolio
June 30, 2007 (unaudited) AllianceBernstein Variable Products Series Fund International Research Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma Pro Forma
AllianceBernstein AllianceBernstein AllianceBernstein AllianceBernstein
Variable Products Variable Products Variable Products Variable Products
Series Fund Series Fund Series Fund Series Fund
International International International International
Growth Growth Research Growth Growth
Portfolio Portfolio Portfolio Portfolio
Company Shares (U.S. $ Value) (U.S. $ Value) Adjustments (U.S. $ Value)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 97.9%
FINANCIALS - 27.6%
CAPITAL MARKETS - 10.0%
3i Group PLC 56,766 $ 1,321,377 $ -0- $ -0- $ 1,321,377
BlueBay Asset Management/United
Kingdom (a) 59,876 -0- 591,734 -0- 591,734
Credit Suisse Group 87,077 3,110,829 3,070,861 -0- 6,181,690
Macquarie Bank Ltd. 52,293 1,558,176 2,197,781 -0- 3,755,957
Man Group PLC 80,333 -0- 977,164 -0- 977,164
Nomura Holdings, Inc. 171,400 2,478,421 850,743 -0- 3,329,164
Partners Group 7,553 -0- 1,013,473 -0- 1,013,473
UBS AG (Swiss Virt-X) 69,731 1,728,046 2,442,169 -0- 4,170,215
----------- ------------ ---------- ------------
10,196,849 11,143,925 -0- 21,340,774
----------- ------------ ---------- ------------
COMMERCIAL BANKS - 14.4%
Allied Irish Banks PLC 62,684 1,046,949 665,618 -0- 1,712,567
Anglo Irish Bank Corp. PLC (Dublin) 55,731 1,143,793 -0- -0- 1,143,793
Anglo Irish Bank Corp. PLC (London
Exchange) 45,102 -0- 917,201 -0- 917,201
Banco Bilbao Vizcaya Argentaria, SA 115,569 2,133,739 692,489 -0- 2,826,228
Banco Santander Chile, SA (ADR) 6,300 312,102 -0- -0- 312,102
Bank Central Asia Tbk PT 995,500 600,281 -0- -0- 600,281
Bank Hapoalim BM 120,758 588,321 -0- -0- 588,321
Bank Mandiri Persero Tbk PT 1,479,500 -0- 511,478 -0- 511,478
BNP Paribas, SA 20,720 1,865,140 596,056 -0- 2,461,196
China Construction Bank Corp.-Class H 1,453,000 -0- 999,152 -0- 999,152
Commerzbank AG 20,805 992,309 -0- -0- 992,309
Industrial & Commercial Bank of 4,151,000 1,496,369 810,996 -0- 2,307,365
China, Ltd.-Class H
Investimentos Itau, SA 455,617 2,282,153 549,806 -0- 2,831,959
Kookmin Bank (ADR) 14,308 1,255,098 -0- -0- 1,255,098
Malayan Banking Bhd 462,500 855,224 752,013 -0- 1,607,237
Mitsubishi UFJ Financial Group, Inc. 202 2,226,179 -0- -0- 2,226,179
Standard Chartered 38,798 -0- 1,265,489 -0- 1,265,489
Turkiye Is Bankasi-Class C 311,203 964,953 481,086 -0- 1,446,039
UniCredito Italiano SpA 504,373 2,889,374 1,615,486 -0- 4,504,860
VTB Bank OJSC (GDR) (a)(b) 10,500 115,290 -0- -0- 115,290
----------- ------------ ---------- ------------
20,767,274 9,856,870 -0- 30,624,144
----------- ------------ ---------- ------------
DIVERSIFIED FINANCIAL SERVICES - 1.5%
Deutsche Boerse AG 3,316 -0- 372,320 -0- 372,320
FirstRand Ltd. 383,559 1,219,265 -0- -0- 1,219,265
IG Group Holdings PLC 72,801 -0- 429,800 -0- 429,800
ING Groep NV 25,557 1,124,861 -0- -0- 1,124,861
----------- ------------ ---------- ------------
2,344,126 802,120 -0- 3,146,246
----------- ------------ ---------- ------------
INSURANCE - 1.7%
Prudential PLC 1,085 15,444 -0- -0- 15,444
QBE Insurance Group Ltd. 62,073 -0- 1,637,796 -0- 1,637,796
Swiss Reinsurance 22,419 1,360,979 683,636 -0- 2,044,615
----------- ------------ ---------- ------------
1,376,423 2,321,432 -0- 3,697,855
----------- ------------ ---------- ------------
34,684,672 24,124,347 -0- 58,809,019
----------- ------------ ---------- ------------
CONSUMER DISCRETIONARY - 12.0%
AUTO COMPONENTS - 0.8%
Denso Corp. 41,200 1,083,365 527,994 -0- 1,611,359
----------- ------------ ---------- ------------
AUTOMOBILES - 2.5%
Fiat SpA 130,432 2,511,230 1,362,976 -0- 3,874,206
Suzuki Motor Corp. 52,100 1,053,566 425,970 -0- 1,479,536
----------- ------------ ---------- ------------
3,564,796 1,788,946 -0- 5,353,742
----------- ------------ ---------- ------------
HOTELS, RESTAURANTS & LEISURE - 2.0%
Accor, SA 25,854 1,636,033 649,481 -0- 2,285,514
OPAP, SA 30,727 1,085,686 -0- -0- 1,085,686
Punch Taverns PLC 35,983 -0- 882,785 -0- 882,785
----------- ------------ ---------- ------------
2,721,719 1,532,266 -0- 4,253,985
----------- ------------ ---------- ------------
HOUSEHOLD DURABLES - 1.3%
Daiwa House Industry Co. Ltd. 37,000 528,840 -0- -0- 528,840
Gafisa, SA (ADR) (a) 6,800 -0- 212,160 -0- 212,160
Sony Corp. 19,300 651,914 338,790 -0- 990,704
Urbi Desarrollos Urbanos, SA de C.V. (a) 221,900 689,827 332,019 -0- 1,021,846
----------- ------------ ---------- ------------
1,870,581 882,969 -0- 2,753,550
----------- ------------ ---------- ------------
LEISURE EQUIPMENT & PRODUCTS - 0.2%
Largan Precision Co., Ltd. 37,000 -0- 518,372 -0- 518,372
----------- ------------ ---------- ------------
MEDIA - 3.4%
Eutelsat Communications 30,914 391,696 359,942 -0- 751,638
Grupo Televisa, SA (ADR) 52,200 853,149 588,093 -0- 1,441,242
Naspers Ltd.-Class N 43,353 1,113,842 -0- -0- 1,113,842
Pearson PLC 28,880 -0- 486,490 -0- 486,490
Premiere AG (a) 20,035 -0- 479,320 -0- 479,320
SES Global -FDR 27,855 601,541 -0- -0- 601,541
Societe Television Francaise 1 27,255 942,039 -0- -0- 942,039
WPP Group PLC 97,801 940,687 522,071 -0- 1,462,758
----------- ------------ ---------- ------------
4,842,954 2,435,916 -0- 7,278,870
----------- ------------ ---------- ------------
MULTILINE RETAIL - 0.5%
Lotte Shopping Co. Ltd. 2,765 1,077,158 -0- -0- 1,077,158
----------- ------------ ---------- ------------
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma Pro Forma
AllianceBernstein AllianceBernstein AllianceBernstein AllianceBernstein
Variable Products Variable Products Variable Products Variable Products
Series Fund Series Fund Series Fund Series Fund
International International International International
Growth Growth Research Growth Growth
Portfolio Portfolio Portfolio Portfolio
Company Shares (U.S. $ Value) (U.S. $ Value) Adjustments (U.S. $ Value)
- ------------------------------------------------------------------------------------------------------------------------------------
SPECIALTY RETAIL - 1.2%
Esprit Holdings Ltd. 31,369 $ -0- $ 398,558 $ -0- $ 398,558
Fast Retailing Co. Ltd. 8,100 576,521 -0- -0- 576,521
Inditex, SA 19,824 734,503 432,320 -0- 1,166,823
Praktiker Bau- und
Heimwerkermaerkte AG 8,574 347,768 -0- -0- 347,768
----------- ------------ ---------- ------------
1,658,792 830,878 -0- 2,489,670
----------- ------------ ---------- ------------
TEXTILES, APPAREL & LUXURY GOODS - 0.1%
Geox SpA 10,919 -0- 201,108 -0- 201,108
----------- ------------ ---------- ------------
16,819,365 8,718,449 -0- 25,537,814
----------- ------------ ---------- ------------
INDUSTRIALS - 10.2%
AEROSPACE & DEFENSE - 0.7%
BAE Systems PLC 172,381 776,640 614,387 -0- 1,391,027
----------- ------------ ---------- ------------
AIRLINES - 0.4%
easyJet PLC (a) 71,197 745,657 -0- -0- 745,657
----------- ------------ ---------- ------------
BUILDING PRODUCTS - 1.5%
Asahi Glass Co. Ltd. 70,000 647,204 296,635 -0- 943,839
Cie de Saint-Gobain 20,007 1,807,373 433,864 -0- 2,241,237
----------- ------------ ---------- ------------
2,454,577 730,499 -0- 3,185,076
----------- ------------ ---------- ------------
COMMERCIAL SERVICES & SUPPLIES - 0.9%
Capita Group PLC 93,365 1,355,365 -0- -0- 1,355,365
Michael Page International PLC 49,605 -0- 521,148 -0- 521,148
----------- ------------ ---------- ------------
1,355,365 521,148 -0- 1,876,513
----------- ------------ ---------- ------------
CONSTRUCTION & ENGINEERING- 1.1%
Vinci, SA 32,272 1,544,391 864,297 -0- 2,408,688
----------- ------------ ---------- ------------
ELECTRICAL EQUIPMENT - 0.5%
ABB Ltd. 14,588 -0- 328,927 -0- 328,927
Fuji Electric Holdings Co. Ltd. 140,000 552,883 157,242 -0- 710,125
----------- ------------ ---------- ------------
552,883 486,169 -0- 1,039,052
----------- ------------ ---------- ------------
INDUSTRIAL CONGLOMERATES - 0.3%
Barloworld Ltd. 26,031 723,306 -0- -0- 723,306
----------- ------------ ---------- ------------
MACHINERY - 2.4%
Atlas Copco AB 165,456 1,612,693 1,143,186 -0- 2,755,879
Hitachi Construction Machinery Co. Ltd. 22,100 767,885 -0- -0- 767,885
Komatsu Ltd. 26,300 -0- 762,255 -0- 762,255
NGK Insulators Ltd. 9,000 -0- 221,032 -0- 221,032
NSK Ltd. 23,000 -0- 237,783 -0- 237,783
Tata Motors Ltd. 17,660 290,857 -0- -0- 290,857
----------- ------------ ---------- ------------
2,671,435 2,364,256 -0- 5,035,691
----------- ------------ ---------- ------------
TRADING COMPANIES & DISTRIBUTORS - 1.9%
Mitsubishi Corp. 35,500 -0- 930,172 -0- 930,172
Mitsui & Co. Ltd. 120,000 1,337,119 1,057,722 -0- 2,394,841
Wolseley PLC 34,083 817,982 -0- -0- 817,982
----------- ------------ ---------- ------------
2,155,101 1,987,894 -0- 4,142,995
----------- ------------ ---------- ------------
TRANSPORTATION INFRASTRUCTURE - 0.5%
Cia de Concessoes Rodoviarias 24,400 453,215 -0- -0- 453,215
Fraport AG Frankfurt Airport Services
Worldwide 8,738 622,170 -0- -0- 622,170
----------- ------------ ---------- ------------
1,075,385 -0- -0- 1,075,385
----------- ------------ ---------- ------------
14,054,740 7,568,650 -0- 21,623,390
----------- ------------ ---------- ------------
ENERGY - 10.0%
ENERGY EQUIPMENT & SERVICES- 1.8%
Schlumberger, Ltd. 5,700 -0- 484,158 -0- 484,158
Technip, SA 10,224 845,039 -0- -0- 845,039
Tenaris, SA (ADR) 20,000 -0- 979,200 -0- 979,200
WorleyParsons Ltd. 48,556 -0- 1,396,718 -0- 1,396,718
----------- ------------ ---------- ------------
845,039 2,860,076 -0- 3,705,115
----------- ------------ ---------- ------------
OIL, GAS & CONSUMABLE FUELS - 8.2%
Addax Petroleum Corp. 6,892 -0- 257,758 -0- 257,758
China Shenhua Energy Co. Ltd.-Class H 338,500 -0- 1,181,150 -0- 1,181,150
Gazprom OAO (ADR) 65,078 1,391,373 1,335,395 -0- 2,726,768
LUKOIL (ADR) 12,420 -0- 952,614 -0- 952,614
MOL Hungarian Oil and Gas NyRt 4,281 645,049 -0- -0- 645,049
Oil Search Ltd. 259,601 -0- 921,838 -0- 921,838
Origin Energy Ltd. 60,675 -0- 510,194 -0- 510,194
Petro-Canada 21,605 1,150,982 -0- -0- 1,150,982
Petroleo Brasileiro, SA (NY) (ADR) 28,880 1,845,564 1,235,354 -0- 3,080,918
Royal Dutch Shell PLC-Class A 33,979 1,383,317 -0- -0- 1,383,317
Total, SA 58,018 3,103,756 1,600,241 -0- 4,703,997
----------- ------------ ---------- ------------
9,520,041 7,994,544 -0- 17,514,585
----------- ------------ ---------- ------------
10,365,080 10,854,620 -0- 21,219,700
----------- ------------ ---------- ------------
HEALTH CARE - 8.0%
BIOTECHNOLOGY - 1.1%
CSL Ltd./Australia 31,105 2,007,506 307,874 -0- 2,315,380
----------- ------------ ---------- ------------
HEALTH CARE EQUIPMENT & SUPPLIES - 1.8%
Essilor International, SA 22,165 1,747,282 892,698 -0- 2,639,980
Nobel Biocare Holding AG 3,733 856,882 361,686 -0- 1,218,568
----------- ------------ ---------- ------------
2,604,164 1,254,384 -0- 3,858,548
----------- ------------ ---------- ------------
PHARMACEUTICALS - 5.1%
Daiichi Sankyo Co. Ltd. 10,200 -0- 270,633 -0- 270,633
Merck KGaA 14,968 1,678,232 369,687 -0- 2,047,919
Novartis AG 54,883 1,976,822 1,104,341 -0- 3,081,163
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma Pro Forma
AllianceBernstein AllianceBernstein AllianceBernstein AllianceBernstein
Variable Products Variable Products Variable Products Variable Products
Series Fund Series Fund Series Fund Series Fund
International International International International
Growth Growth Research Growth Growth
Portfolio Portfolio Portfolio Portfolio
Company Shares (U.S. $ Value) (U.S. $ Value) Adjustments (U.S. $ Value)
- ------------------------------------------------------------------------------------------------------------------------------------
Roche Holding AG 15,267 $ 1,558,179 $ 1,146,929 $ -0- $ 2,705,108
Shionogi & Co. Ltd. 72,000 1,173,612 -0- -0- 1,173,612
Teva Pharmaceutical Industries,
Ltd. (ADR) 37,900 1,188,000 375,375 -0- 1,563,375
----------- ----------- ----------- -----------
7,574,845 3,266,965 -0- 10,841,810
----------- ----------- ----------- -----------
12,186,515 4,829,223 -0- 17,015,738
----------- ----------- ----------- -----------
CONSUMER STAPLES - 7.5%
BEVERAGES - 1.7%
Fomento Economico Mexicano SAB
de CV (ADR) 27,168 491,500 576,746 -0- 1,068,246
Pernod-Ricard, SA 11,176 1,605,566 861,954 -0- 2,467,520
----------- ----------- ----------- -----------
2,097,066 1,438,700 -0- 3,535,766
----------- ----------- ----------- -----------
FOOD PRODUCTS - 1.9%
Nestle, SA 10,634 2,640,816 1,399,823 -0- 4,040,639
----------- ----------- ----------- -----------
PERSONAL PRODUCTS - 1.3%
L'Oreal, SA 24,044 1,963,668 878,349 -0- 2,842,017
----------- ----------- ----------- -----------
TOBACCO - 2.6%
Altadis, SA 19,779 944,417 362,764 -0- 1,307,181
British American Tobacco PLC 64,288 1,301,533 891,040 -0- 2,192,573
Japan Tobacco, Inc. 432 1,873,114 256,321 -0- 2,129,435
----------- ----------- ----------- -----------
4,119,064 1,510,125 -0- 5,629,189
----------- ----------- ----------- -----------
10,820,614 5,226,997 -0- 16,047,611
----------- ----------- ----------- -----------
TELECOMMUNICATION SERVICES - 7.4%
DIVERSIFIED TELECOMMUNICATION SERVICES - 2.7%
Iliad, SA 3,560 -0- 358,591 -0- 358,591
Neuf Cegetel (a) 9,442 -0- 369,426 -0- 369,426
Telefonica, SA 112,830 1,520,910 990,017 -0- 2,510,927
Telekom Austria AG 54,433 864,053 491,482 -0- 1,355,535
Telekomunikasi Indonesia Tbk PT 1,120,500 1,215,506 -0- -0- 1,215,506
----------- ----------- ----------- -----------
3,600,469 2,209,516 -0- 5,809,985
----------- ----------- ----------- -----------
WIRELESS TELECOMMUNICATION SERVICES - 4.7%
America Movil SAB de CV
Series L (ADR) 41,700 2,018,918 563,563 -0- 2,582,481
Bharti Airtel Ltd. (a) 106,317 1,939,289 245,996 -0- 2,185,285
China Mobile Ltd. 14,271 -0- 153,542 -0- 153,542
MTN Group Ltd. 78,486 1,066,852 -0- -0- 1,066,852
NTT DoCoMo, Inc. 404 638,966 -0- -0- 638,966
Orascom Telecom Holding
SAE (GDR) (b) 15,151 688,200 295,100 -0- 983,300
Turkcell Iletisim Hizmet AS 0 3 -0- -0- 3
Vimpel-Communications (ADR) 12,895 1,053,600 305,017 -0- 1,358,617
Vodafone Group PLC 315,465 -0- 1,057,064 -0- 1,057,064
----------- ----------- ----------- -----------
7,405,828 2,620,282 -0- 10,026,110
----------- ----------- ----------- -----------
11,006,297 4,829,798 -0- 15,836,095
----------- ----------- ----------- -----------
MATERIALS - 6.4%
CHEMICALS - 0.8%
Bayer AG 8,099 -0- 610,067 -0- 610,067
Incitec Pivot Ltd. 4,852 -0- 327,849 -0- 327,849
Nitto Denko Corp. 15,500 488,914 292,340 -0- 781,254
----------- ----------- ----------- -----------
488,914 1,230,256 -0- 1,719,170
----------- ----------- ----------- -----------
METALS & MINING - 5.6%
Cia Vale do Rio Doce (ADR) 76,300 1,314,225 1,764,360 -0- 3,078,585
Cia Vale do Rio Doce
(Sponsored) (ADR) 23,600 889,720 -0- -0- 889,720
Minara Resources Ltd. 80,921 -0- 496,297 -0- 496,297
Rio Tinto PLC 44,666 1,364,828 2,052,291 -0- 3,417,119
Usinas Siderurgicas de Minas Gerais, SA 9,300 612,768 -0- -0- 612,768
Xstrata PLC 56,014 1,617,035 1,717,646 -0- 3,334,681
----------- ----------- ----------- -----------
5,798,576 6,030,594 -0- 11,829,170
----------- ----------- ----------- -----------
6,287,490 7,260,850 -0- 13,548,340
----------- ----------- ----------- -----------
INFORMATION TECHNOLOGY - 6.1%
COMMUNICATIONS EQUIPMENT- 1.7%
Delta Networks, Inc. (a) 25,000 -0- 14,388 -0- 14,388
Nokia OYJ 125,218 1,917,748 1,599,035 -0- 3,516,783
----------- ----------- ----------- -----------
1,917,748 1,613,423 -0- 3,531,171
----------- ----------- ----------- -----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.0%
AU Optronics Corp. 126,000 -0- 215,243 -0- 215,243
AU Optronics Corp. (ADR) 28,000 481,600 -0- -0- 481,600
Hoya Corp. 26,300 544,039 328,414 -0- 872,453
Integra Group Holdings (GDR) (a) 32,515 591,773 -0- -0- 591,773
----------- ----------- ----------- -----------
1,617,412 543,657 -0- 2,161,069
----------- ----------- ----------- -----------
IT SERVICES - 1.4%
Cap Gemini, SA 3,711 -0- 271,307 -0- 271,307
Indra Sistemas, SA 20,102 501,269 -0- -0- 501,269
Infosys Technologies Ltd. (ADR) 12,300 -0- 619,674 -0- 619,674
LogicaCMG PLC 266,999 809,117 -0- -0- 809,117
Otsuka Corp. 2,600 -0- 246,583 -0- 246,583
Tata Consultancy Services Ltd. 20,335 575,229 -0- -0- 575,229
----------- ----------- ----------- -----------
1,885,615 1,137,564 -0- 3,023,179
----------- ----------- ----------- -----------
OFFICE ELECTRONICS- 1.4%
Canon, Inc. 50,200 1,647,869 1,296,011 -0- 2,943,880
----------- ----------- ----------- -----------
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma
AllianceBernstein
Variable Products
Series Fund Pro Forma
International AllianceBernstein AllianceBernstein AllianceBernstein
Growth Variable Products Variable Products Variable Products
Portfolio Series Fund Series Fund Series Fund
Shares or International International International
Shares or Growth Research Growth Growth
Principal Portfolio Portfolio Portfolio
Company Amount (000) (U.S. $ Value) (U.S. $ Value) Adjustments (U.S. $ Value)
- ------------------------------------------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT - 0.6%
ASML Holding NV (a) 9,132 $ -0- $ 250,905 $ -0- $ 250,905
Chartered Semiconductor
Manufacturing, Ltd. (a) 450,000 -0- 395,781 -0- 395,781
Novatek Microelectronics Corp. Ltd. 119,000 323,932 297,809 -0- 621,741
------------ ------------ ------------ ------------
323,932 944,495 -0- 1,268,427
------------ ------------ ------------ ------------
7,392,576 5,535,150 -0- 12,927,726
------------ ------------ ------------ ------------
UTILITIES - 2.7%
ELECTRIC UTILITIES - 1.5%
CEZ 16,820 864,927 -0- -0- 864,927
Cia Energetica de Minas Gerais (ADR) 52,326 405,120 698,958 -0- 1,104,078
Fortum Oyj 37,378 1,167,969 -0- -0- 1,167,969
------------ ------------ ------------ ------------
2,438,016 698,958 -0- 3,136,974
------------ ------------ ------------ ------------
INDEPENDENT POWER PRODUCERS & ENERGY
TRADERS - 0.7%
International Power PLC 122,433 1,052,396 -0- -0- 1,052,396
NTPC Ltd. 138,000 -0- 518,030 -0- 518,030
------------ ------------ ------------ ------------
1,052,396 518,030 -0- 1,570,426
------------ ------------ ------------ ------------
MULTI-UTILITIES - 0.5%
National Grid PLC 68,517 1,010,989 -0- -0- 1,010,989
------------ ------------ ------------ ------------
4,501,401 1,216,988 -0- 5,718,389
------------ ------------ ------------ ------------
Total Common Stocks
(cost $154,509,868)
128,118,750 80,165,072 -0- 208,283,822
------------ ------------ ------------ ------------
SHORT-TERM INVESTMENTS - 1.3%
TIME DEPOSIT- 1.3%
The Bank of New York
4.25%, 7/02/07
(cost $2,761,000) $ 2,761 2,326,000 435,000 -0- 2,761,000
------------ ------------ ------------ ------------
TOTAL INVESTMENTS - 99.2%
(cost $157,270,868) 130,444,750 80,600,072 -0- 211,044,822
Other assets less liabilities - 0.8% 531,156 1,175,695 -0- 1,706,851
------------ ------------ ------------ ------------
NET ASSETS - 100.0% $130,975,906 $ 81,775,767 $ -0- $212,751,673
============ ============ ============ ============
(a) Non-income producing security.
(b) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. These securities are considered liquid and may be resold in
transactions exempt from registration, normally to qualified institutional
buyers. At June 30, 2007, the aggregate market value of these securities
amounted to $1,098,590 or 0.5% of net assets.
Glossary:
ADR - American Depositary Receipt
FDR - Fiduciary Depositary Receipt
GDR - Global Depositary Receipt
See notes to Pro Forma AllianceBernstein Variable Products Series Fund -
International Growth Portfolio financial statements.
STATEMENT OF ASSETS AND LIABILITIES
PRO FORMA ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND INTERNATIONAL GROWTH PORTFOLIO
AllianceBernstein Variable Products Series Fund International Growth Portfolio
June 30, 2007 (unaudited) AllianceBernstein Variable Products Series Fund International Research Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma
AllianceBernstein AllianceBernstein AllianceBernstein
Variable Products Variable Products Variable Products
Series Fund Series Fund Series Fund
International International International
Growth Research Growth
Portfolio Growth Portfolio Adjustments Portfolio
------------------ ----------------- ------------ -----------------
ASSETS
Investments in securities, at value
(cost $157,270,868) $130,444,750 $ 80,600,072 $ -0- $211,044,822
Cash 386 6,063 -0- 6,449
Foreign cash, at value (cost $1,808,787) 447,045 1,372,233 -0- 1,819,278
Dividends and interest receivable 269,000 267,864 -0- 536,864
Receivable for capital stock sold 172,175 23,079 -0- 195,254
Receivable for investment securities
sold and foreign currency contracts -0- 2,783,416 -0- 2,783,416
------------ ------------ ----------- ------------
Total assets 131,333,356 85,052,727 -0- 216,386,083
------------ ------------ ----------- ------------
LIABILITIES
Payable for capital stock redeemed 88,206 119,029 -0- 207,235
Advisory fee payable 82,887 52,147 -0- 135,034
Custodian fee payable 66,673 34,115 -0- 100,788
Payable for investment securities purchased
and foreign currency contracts 44,881 2,970,883 -0- 3,015,764
Printing fee payable 19,857 12,192 -0- 32,049
Administrative fee payable 19,261 19,185 -0- 38,446
Foreign capital gain tax payable 10,043 42,269 -0- 52,312
Distribution fee payable 8,306 2,585 -0- 10,891
Transfer Agent fee payable 59 59 -0- 118
Accrued expenses 17,277 24,496 -0- 41,773
------------ ------------ ----------- ------------
Total liabilities 357,450 3,276,960 -0- 3,634,410
------------ ------------ ----------- ------------
NET ASSETS $130,975,906 $ 81,775,767 $ -0- $212,751,673
============ ============ =========== ============
CLASS A SHARES
Net Assets $ 91,592,069 $ 69,604,588 $161,196,657
Shares of capital stock outstanding 3,082,629 2,993,745 (650,946) 5,425,428
------------ ------------ ----------- ------------
Net asset value per share $ 29.71 $ 23.25 $ 29.71
------------ ------------ ------------
CLASS B SHARES
Net Assets $ 39,383,837 $ 12,171,179 $ 51,555,016
Shares of capital stock outstanding 1,332,976 528,316 (116,390) 1,744,902
------------ ------------ ----------- ------------
Net asset value per share $ 29.55 $ 23.04 $ 29.55
------------ ------------ ------------
STATEMENT OF OPERATIONS
PRO FORMA ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND INTERNATIONAL GROWTH PORTFOLIO
Twelve Months Ended AllianceBernstein Variable Products Series Fund International Growth Portfolio
June 30, 2007 (unaudited) AllianceBernstein Variable Products Series Fund International Research Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Pro Forma
AllianceBernstein AllianceBernstein AllianceBernstein
Variable Products Variable Products Variable Products
Series Fund Series Fund Series Fund
International Growth International Research International Growth
Portfolio Growth Portfolio Adjustments Portfolio
-------------------- --------------------- ------------ -------------------
INVESTMENT INCOME
Dividends (net of foreign taxes
withheld of $451,834) $ 2,399,672 $ 1,543,520 $ -0- $ 3,943,192
Interest 113,861 52,737 -0- 166,598
------------- --------------- ------------ -------------
2,513,533 1,596,257 -0- 4,109,790
------------- --------------- ------------ -------------
EXPENSES
Advisory fee 864,345 584,959 86,899 1,536,203 (a)
Distribution fee - Class B 87,364 29,020 9,170 125,554 (b)
Transfer agency 4,403 3,985 (3,691) 4,697 (c)
Custodian 286,877 227,283 (111,482) 402,678 (c)
Administrative 93,081 93,006 (99,337) 86,750 (c)
Printing 50,002 23,303 (28,305) 45,000 (c)
Audit & legal 43,814 44,170 (34,984) 53,000 (c)
Directors' fees 1,988 1,703 (1,299) 2,392 (c)
Miscellaneous 10,199 4,761 (7,960) 7,000 (c)
------------- --------------- ------------ -------------
Total expenses 1,442,073 1,012,190 (190,989) 2,263,274
------------- --------------- ------------ -------------
Net investment income 1,071,460 584,067 190,989 1,846,516
------------- --------------- ------------ -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENT AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on:
Investment transactions 15,570,188 14,729,887 -0- 30,300,075
Foreign currency transactions (38,412) (24,257) -0- (62,669)
Net change in unrealized
appreciation/depreciation of:
Investments 13,208,049 5,268,517 -0- 18,476,566 (d)
Foreign currency denominated assets
and liabilities 32,021 2,377 -0- 34,398
------------- --------------- ------------ -------------
Net gain on investment and foreign
currency transactions 28,771,846 19,976,524 -0- 48,748,370
------------- --------------- ------------ -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 29,843,306 $ 20,560,591 $ 190,989 $ 50,594,886
------------- --------------- ------------ -------------
- ----------------
(a) Advisory fee based on an annual rate of .75% of the first $2.5 billion, .65% of the next $2.5 billion and .60% in excess of
$5 billion, of the Portfolio's average daily net assets.
(b) Distribution fee based on an annual rate of .25% of the Portfolio's average daily net assets attributable to Class B shares.
(c) Expenses are based on one fund.
(d) Net of accrued foreign capital loss tax of $44,900.
See Notes to Pro Forma AllianceBernstein Variable Product Series Fund International Growth Portfolio Financial Statements.
NOTES TO FINANCIAL STATEMENTS
PRO FORMA ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND
INTERNATIONAL GROWTH PORTFOLIO
June 30, 2007 (unaudited)
NOTE A: General
The Pro Forma AllianceBernstein Variable Products Series Fund International
Growth Portfolio Financial Statements give effect to the proposed acquisition
(the "Acquisition") of the assets and liabilities of AllianceBernstein Variable
Products Series Fund International Research Growth Portfolio (the "Acquired
Portfolio") by AllianceBernstein Variable Products Series Fund International
Growth Portfolio (the "Portfolio" or "Acquiring Portfolio") pursuant to
Agreement and Plan of Reorganization. The Acquisition would be accomplished by a
tax-free exchange of the assets and liabilities of AllianceBernstein Variable
Products Series Fund International Research Growth Portfolio for shares of the
Portfolio. After the proposed acquisition, the tax survivor would be
AllianceBernstein Variable Products Series Fund International Growth Portfolio.
The AllianceBernstein Variable Products Series Fund (the "Fund") was
incorporated under the laws in the state of Maryland on November 17, 1987. The
Portfolio's unaudited Pro Forma Portfolio of Investments, Statement of Assets
and Liabilities and Statement of Operations are prepared as though the
Acquisition was effective for the period July 1, 2006 - June 30, 2007. You
should read them in conjunction with the Portfolio's historical financial
statements, which are included in the Portfolio's Statement of Additional
Information. The Portfolio's Pro Forma Statement of Operations reflects the
assumption that certain expenses would be lower for the combined Portfolio as a
result of the Acquisition. Each Portfolio will bear the expenses of the
Acquisition on a relative net asset basis, including the cost of proxy
solicitation, except that AllianceBernstein Variable Products Series Fund
International Research Growth Portfolio will bear its own costs associated with
the disposition of any assets or liabilities not being transferred to the
Portfolio in connection with the Acquisition.
NOTE B: Significant Accounting Policies
The Portfolio's Pro Forma financial statements have been prepared in conformity
with U.S. generally accepted accounting principles, which require management to
make certain estimates and assumptions that affect the reported amounts of
assets and liabilities in the financial statements and amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
1. Security Valuation
Portfolio securities are valued at their current market value determined on the
basis of market quotations or, if market quotations are not readily available or
are deemed unreliable, at "fair value" as determined in accordance with
procedures established by and under the general supervision of the Fund's Board
of Directors.
In general, the market value of securities which are readily available and
deemed reliable are determined as follows. Securities listed on a national
securities exchange (other than securities listed on The NASDAQ Stock Market,
Inc. ("NASDAQ")) or on a foreign securities exchange are valued at the last sale
price at the close of the exchange or foreign securities exchange. If there has
been no sale on such day, the securities are valued at the mean of the closing
bid and asked prices on such day. Securities listed on more than one exchange
are valued by reference to the principal exchange on which the securities are
traded; securities listed only on NASDAQ are valued in accordance with the
NASDAQ Official Closing Price; listed put or call options are valued at the last
sale price. If there has been no sale on that day, such securities will be
valued at the closing bid prices on that day; open futures contracts and options
thereon are valued using the closing settlement price or, in the absence of such
a price, the most recent quoted bid price. If there are no quotations available
for the day of valuation, the last available closing settlement price is used;
securities traded in the over-the-counter market, ("OTC") are valued at the mean
of the current bid and asked prices as reported by the National Quotation Bureau
or other comparable sources; U.S. Government securities and other debt
instruments having 60 days or less remaining until maturity are valued at
amortized cost if their original maturity was 60 days or less; or by amortizing
their fair value as of the 61st day prior to maturity if their original term to
maturity exceeded 60 days; fixed-income securities, including mortgage backed
and asset backed securities, may be valued on the basis of prices provided by a
pricing service or at a price obtained from one or more of the major
broker/dealers. In cases where broker/dealer quotes are obtained,
AllianceBernstein L.P. (the "Adviser") may establish procedures whereby changes
in market yields or spreads are used to adjust, on a daily basis, a recently
obtained quoted price on a security; and OTC and other derivatives are valued on
the basis of a quoted bid price or spread from a major broker/dealer in such
security.
Securities for which market quotations are not readily available (including
restricted securities) or are deemed unreliable are valued at fair value.
Factors considered in making this determination may include, but are not limited
to, information obtained by contacting the issuer, analysts, analysis of the
issuer's financial statements or other available documents. In addition, the
Fund may use fair value pricing for securities primarily traded in non-U.S.
markets because, most foreign markets close well before the Fund values its
securities at 4:00 p.m., Eastern Time. The earlier close of these foreign
markets gives rise to the possibility that significant events, including broad
market moves, may have occurred in the interim and may materially affect the
value of those securities. To account for this, the Fund may frequently value
many of its foreign equity securities using fair value prices based on third
party vendor modeling tools to the extent available.
2. Currency Translation
Assets and liabilities denominated in foreign currencies and commitments under
forward currency exchange contracts are translated into U.S. dollars at the mean
of the quoted bid and asked prices of such currencies against the U.S. dollar.
Purchases and sales of portfolio securities are translated into U.S. dollars at
the rates of exchange prevailing when such securities were acquired or sold.
Income and expenses are translated into U.S. dollars at rates of exchange
prevailing when accrued.
Net realized gain or loss on foreign currency transactions represents foreign
exchange gains and losses from sales and maturities of foreign fixed income
investments, foreign currency exchange contracts, holding of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
foreign investment transactions, and the difference between the amounts of
dividends, interest and foreign withholding taxes recorded on the Portfolio's
books and the U.S. dollar equivalent amounts actually received or paid. Net
unrealized currency gains and losses from valuing foreign currency denominated
assets and liabilities at period end exchange rates are reflected as a component
of net unrealized appreciation or depreciation of investments and foreign
currency denominated assets and liabilities.
3. Taxes
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required. The Portfolio may be subject to taxes imposed by countries in which it
invests. Such taxes are generally based on income and/or capital gains earned or
repatriated. Taxes are accrued and applied to net investment income, net
realized gains and net unrealized appreciation/depreciation as such income
and/or gains are earned.
4. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date or as soon as the Portfolio
is informed of the dividend. Interest income is accrued daily. Investment
transactions are accounted for on the trade date securities are purchased or
sold. Investment gains and losses are determined on the identified cost basis.
The Portfolio amortizes premiums and accretes discounts as adjustments to
interest income.
5. Class Allocations
All income earned and expenses incurred by the Portfolio are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Portfolio represented by the net assets of such class, except for class
specific expenses which are allocated to the respective class. Realized and
unrealized gains and losses are allocated among the various share classes based
on their respective net assets.
6. Dividends and Distributions
The Portfolio declares and distributes dividends and distributions from net
investment income and net realized gains, respectively, if any, at least
annually. Income dividends and capital gains distributions to shareholders are
recorded on the ex-dividend date.
Income dividends and capital gains distributions are determined in accordance
with federal tax regulations and may differ from those determined in accordance
with U.S. generally accepted accounting principles. To the extent these
differences are permanent, such amounts are reclassified within the capital
accounts based on their federal tax basis treatment; temporary differences do
not require such reclassification.
NOTE C: Advisory Fee and Other Transactions with Affiliates
Under the terms of the investment advisory agreement, the Portfolio pays the
Adviser an advisory fee at an annual rate of .75% of the first $2.5 billion,
..65% of the next $2.5 billion and .60% in excess $5 billion, of the Portfolio's
average daily net assets. The fee is accrued daily and paid monthly.
Pursuant to the advisory agreement, the Portfolio paid $86,750 to the Adviser
representing the cost of certain legal and accounting services provided to the
Portfolio by the Adviser for the twelve months ended June 30, 2007.
The Portfolio compensates AllianceBernstein Investor Services, Inc., a
wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for the
Portfolio.
NOTE D: Distribution Plan
The Portfolio has adopted a Distribution Plan (the "Plan") for Class B shares
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Plan
the Portfolio pays distribution and servicing fees to AllianceBernstein
Investments, Inc. (the "Distributor"), a wholly owned subsidiary of the Adviser,
at an annual rate of up to .50% of the Portfolio's average daily net assets
attributable to Class B shares. The fees are accrued daily and paid monthly. The
Board of Directors currently limits payments under the Plan to .25% of the
Portfolio's average daily net assets attributable to Class B shares. The Plan
provides that the Distributor will use such payments in their entirety for
distribution assistance and promotional activities.
NOTE E: Capital Stock
The pro-forma combining net asset value per share assumes the issuance of
Acquiring Portfolio shares to Acquired Portfolio shareholders in connection with
the proposed merger. The number of shares assumed to be issued is equal to the
net asset value per share of the Acquired Portfolio divided by the net asset
value per share of the Acquiring Portfolio as of June 30, 2007. The pro-forma
number of shares outstanding, by class for the combined entity consists of the
following at June 30, 2007.
Shares of Additional Shares Total Shares
Acquiring Portfolio Assumed Issued Outstanding
Class of Shares Pre-Combination with Merger Post-Combination
- --------------------------------------------------------------------------------
Class A 3,082,629 2,342,799 5,425,428
Class B 1,332,976 411,926 1,744,902
PART C
OTHER INFORMATION
Item 15. Indemnification
It is the Registrant's policy to indemnify its directors and officers,
employees and other agents to the maximum extent permitted by Section 2-418 of
the General Corporation Law of the State of Maryland, which is incorporated by
reference herein and as set forth in Article EIGHTH of Registrant's Charter,
filed as Exhibit (a), Article IX of the Registrant's Amended and Restated
By-Laws filed as Exhibit (b) and Section 9 of the Distribution Services
Agreement filed as Exhibit (e)(1) and Class B Distribution Services Agreement
filed as Exhibit (e)(2) in response to Item 23 of the Registrant's Registration
Statement filed on Form N-1A (filed Nos. 33-18647 and 811-5398), as set forth
below. The Adviser's liability for any loss suffered by the Registrant or its
shareholders is set forth in Section 4 of the Advisory Agreement filed as
Exhibit (d)(1) in response to Item 23 of the Registrant's Registration Statement
filed on Form N-1A (filed Nos. 33-18647 and 811-5398), as set forth below.
Article EIGHTH of the Registrant's Charter reads as follows:
EIGHTH: (1) To the maximum extent that Maryland law in effect from
time to time permits limitation of the liability of directors and
officers of a corporation, no present or former director or officer of
the Corporation shall be liable to the Corporation or its stockholders
for money damages.
(2) The Corporation shall have the power, to the maximum extent
permitted by Maryland law in effect from time to time, to obligate
itself to indemnify, and to pay or reimburse reasonable expenses in
advance of final disposition of a proceeding to, (a) any individual
who is a present or former director or officer of the Corporation or
(b) any individual who, while a director or officer of the Corporation
and at the request of the Corporation, serves or has served as a
director, officer, partner or trustee of another corporation, real
estate investment trust, partnership, joint venture, trust, employee
benefit plan or any other enterprise from and against any claim or
liability to which such person may become subject or which such person
may incur by reason of his status as a present or former director or
officer of the Corporation. The Corporation shall have the power, with
the approval of the Board of Directors, to provide such
indemnification and advancement of expenses to a person who served a
predecessor of the Corporation in any of the capacities described in
(a) or (b) above and to any employee or agent of the Corporation or a
predecessor of the Corporation.
(3) The provisions of this Article EIGHTH shall be subject to the
limitations of the Investment Company Act..
(4) Neither the amendment nor repeal of this Article EIGHTH, nor the
adoption or amendment of any other provision of the Charter or Bylaws
inconsistent with this Article EIGHTH, shall apply to or affect in any
respect the applicability of the preceding sections of this Article
EIGHTH with respect to any act or failure to act which occurred prior
to such amendment, repeal or adoption.
The Advisory Agreement between the Registrant and AllianceBernstein
L.P. provides that AllianceBernstein L.P. will not be liable under
such agreements for any mistake of judgment or in any event whatsoever
except for lack of good faith and that nothing therein shall be deemed
to protect, or purport to protect, AllianceBernstein L.P. against any
liability to Registrant or its security holders to which it would
otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties thereunder, or by
reason of reckless disregard of its obligations or duties thereunder.
The Distribution Services Agreement between the Registrant and
AllianceBernstein Investments, Inc. ("ABI") provides that the
Registrant will indemnify, defend and hold ABI, and any person who
controls it within the meaning of Section 15 of the Securities Act of
1933, as amended (the "Securities Act"), free and harmless from and
against any and all claims, demands, liabilities and expenses which
ABI or any controlling person may incur arising out of or based upon
any alleged untrue statement of a material fact contained in
Registrant's Registration Statement or Prospectus or Statement of
Additional Information or arising out of, or based upon any alleged
omission to state a material fact required to be stated in either
thereof or necessary to make the statements in any thereof not
misleading, provided that nothing therein shall be so construed as to
protect ABI against any liability to Registrant or its security
holders to which it would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its
duties, or be reason of reckless disregard of its obligations or
duties thereunder. The foregoing summaries are qualified by the entire
text of Registrant's Articles of Incorporation, the Advisory Agreement
between the Registrant and AllianceBernstein L.P. and the Distribution
Services Agreement between the Registrant and ABI.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that, in the opinion of the
Securities and Exchange Commission, such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such indemnification
by it is against public policy as expressed in the Securities Act and
will be governed by the final adjudication of such issue.
In accordance with Release No. IC-11330 (September 2, 1980), the
Registrant will indemnify its directors, officers, investment manager
and principal underwriters only if (1) a final decision on the merits
was issued by the court or other body before whom the proceeding was
brought that the person to be indemnified (the indemnitee) was not
liable by reason or willful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in the conduct of his
office (disabling conduct) or (2) a reasonable determination is made,
based upon a review of the facts, that the indemnitee was not liable
by reason of disabling conduct, by (a) the vote of a majority of a
quorum of the directors who are neither interested persons of the
Registrant as defined in section 2(a)(19) of the Investment Company
Act of 1940 nor parties to the proceeding (disinterested, non-party
directors), or (b) an independent legal counsel in a written opinion.
The Registrant will advance attorneys fees or other expenses incurred
by its directors, officers, investment adviser or principal
underwriters in defending a proceeding, upon the undertaking by or on
behalf of the indemnitee to repay the advance unless it is ultimately
determined that he is entitled to indemnification and, as a condition
to the advance, (1) the indemnitee shall provide a security for his
undertaking, (2) the Registrant shall be insured against losses
arising by reason of any lawful advances, or (3) a majority of a
quorum of disinterested, non-party directors of the Registrant, or an
independent legal counsel in a written opinion, shall determine, based
on a review of readily available facts (as opposed to a full
trial-type inquiry), that there is reason to believe that the
indemnitee ultimately will be found entitled to indemnification.
ARTICLE IX of the Registrant's Amended and Restated By-laws reads as
follows:
ARTICLE IX. Indemnification.
To the maximum extent permitted by Maryland law in effect from time to
time, the Corporation shall indemnify and, without requiring a
preliminary determination of the ultimate entitlement to
indemnification, shall pay or reimburse reasonable expenses in advance
of final disposition of a proceeding to (a) any individual who is a
present or former director or officer of the Corporation and who is
made or threatened to be made a party to the proceeding by reason of
his or her service in any such capacity or (b) any individual who,
while a director or officer of the Corporation and at the request of
the Corporation, serves or has served as a director, officer, partner
or trustee of another corporation, real estate investment trust,
partnership, joint venture, trust, employee benefit plan or other
enterprise and who is made or threatened to be made a party to the
proceeding by reason of his or her service in any such capacity. The
Corporation may, with the approval of its Board of Directors or any
duly authorized committee thereof, provide such indemnification and
advance for expenses to a person who served a predecessor of the
Corporation in any of the capacities described in (a) or (b) above and
to any employee or agent of the Corporation or a predecessor of the
Corporation. The termination of any claim, action, suit or other
proceeding involving any person, by judgment, settlement (whether with
or without court approval) or conviction or upon a plea of guilty or
nolo contendere, or its equivalent, shall not create a presumption
that such person did not meet the standards of conduct required for
indemnification or payment of expenses to be required or permitted
under Maryland law, these Bylaws or the Charter. Any indemnification
or advance of expenses made pursuant to this Article shall be subject
to applicable requirements of the 1940 Act. The indemnification and
payment of expenses provided in these Bylaws shall not be deemed
exclusive of or limit in any way other rights to which any person
seeking indemnification or payment of expenses may be or may become
entitled under any bylaw, regulation, insurance, agreement or
otherwise.
Neither the amendment nor repeal of this Article, nor the adoption or
amendment of any other provision of the Bylaws or Charter inconsistent
with this Article, shall apply to or affect in any respect the
applicability of the preceding paragraph with respect to any act or
failure to act which occurred prior to such amendment, repeal or
adoption.
The Registrant participates in a joint directors and officers
liability insurance policy issued by the ICI Mutual Insurance Company.
Coverage under this policy has been extended to directors, trustees
and officers of the investment companies managed by AllianceBernstein
L.P. Under this policy, outside trustees and directors are covered up
to the limits specified for any claim against them for acts committed
in their capacities as trustee or director. A pro rata share of the
premium for this coverage is charged to each investment company and to
the Adviser.
ITEM 16. EXHIBITS:
(1) Articles of Amendment and Restatement of the Registrant dated
February 1, 2006 - Incorporated by reference to Exhibit (a)(2) to
Post-Effective Amendment No. 41 of Registrant's Registration
Statement on Form N-1A (File Nos. 33-18647 and 811-5398) filed
with the Securities and Exchange Commission on March 1, 2006.
(2) Amended and Restated By-Laws of the Registrant - Incorporated by
reference to Exhibit 99.77Q1 - Other Exhibits to Form NSAR-A for
the Registrant filed with the Securities and Exchange Commission
on August 29, 2006.
(3) Not applicable.
(4) Form of Agreement and Plan of Acquisiton and Liquidation between
AllianceBernstein International Research Growth Portfolio and
AllianceBernstein International Growth Portfolio, both series of
AllianceBernstein Variable Products Series Fund, Inc. -
Constitutes Appendix G to Part A hereof.
(5) Not applicable.
(6) (a) Form of Investment Advisory Agreement between Registrant and
AllianceBernstein L.P. - Incorporated by reference to Exhibit
(d)(1) to Post-Effective Amendment No. 40 of Registrant's
Registration Statement on Form N-1A (File Nos. 33-18647 and
811-5398) filed with the Securities and Exchange Commission on
April 27, 2005.
(b) Sub-Advisory Agreement between AllianceBernstein L.P. and Law,
Dempsey & Company Limited, relating to the Global Bond Portfolio
- Incorporated by reference to Exhibit (5)(b) to Post-Effective
Amendment No. 22 of Registrant's Registration Statement on Form
N-1A (File Nos. 33-18647 and 811-5398) filed with the Securities
and Exchange Commission on April 29, 1998.
(7) (a) Distribution Services Agreement between the Registrant and
AllianceBernstein Investments, Inc. - Incorporated by reference
to Exhibit (6) to Post-Effective Amendment No. 22 of Registrant's
Registration Statement on Form N-1A (File Nos. 33-18647 and
811-5398) filed with the Securities and Exchange Commission on
April 29, 1998.
(b) Class B Distribution Services Agreement between the Registrant
and AllianceBernstein Investments, Inc. - Incorporated by
reference to Exhibit (c)(2) to Post-Effective Amendment No. 27 of
Registrant's Registration Statement on Form N-1A (File Nos.
33-18647 and 811-5398) filed with the Securities and Exchange
Commission on May 3, 1999.
(8) Not applicable.
(9) Custody Agreement between the Registrant and The Bank of New York
- Incorporated by reference to Exhibit (g)(1) to Post-Effective
Amendment No. 42 of Registrant's Registration Statement on Form
N-1A (File Nos. 33-18647 and 811-5398) filed with the Securities
and Exchange Commission on April 28, 2006.
(10) (a) Rule 12b-1 Class B Distribution Plan - Incorporated by reference
to Exhibit (m) to Post-Effective Amendment No. 27 of Registrant's
Registration Statement on Form N-1A (File Nos. 33-18647 and
811-5398) filed with the Securities and Exchange Commission on
May 3, 1999.
(b) Amended and Restated Rule 18f-3 Plan - Incorporated by reference
to Exhibit (n) to Post-Effective Amendment No. 36 of the
Registrant's Registration Statement on Form N-1A (File Nos.
33-18647 and 811-5398) filed with the Securities and Exchange
Commission on February 11, 2004.
(11) Form of Opinion and Consent of Seward & Kissel LLP regarding the
legality of securities being registered - Filed herewith.
(12) Form of Opinion and Consent of Seward & Kissel LLP as to Tax
matters - To be filed by amendment.
(13) (a) Transfer Agency Agreement between the Registrant and
AllianceBernstein Investor Services, Inc. - Incorporated by
reference to Exhibit (9) to Post-Effective Amendment No. 22 of
Registrant's Registration Statement on Form N-1A (File Nos.
33-18647 and 811-5398) filed with the Securities and Exchange
Commission on April 29, 1998.
(b) Expense Limitation Undertaking by AllianceBernstein L.P. -
Incorporated by reference to Exhibit (h)(2) to Post-Effective
Amendment No. 40 of Registrant's Registration Statement on Form
N-1A (File Nos. 33-18647 and 811-5398) filed with the Securities
and Exchange Commission on April 27, 2005.
(c) Form of Expense Limitation Undertaking by AllianceBernstein L.P.
- Incorporated by reference to Post-Effective Amendment No. 41 of
Registrant's Registration Statement on Form N-1A (File Nos.
33-18647 and 811-5398) filed with the Securities and Exchange
Commission on March 1, 2006.
(d) Code of Ethics for the Fund - Incorporated by reference to
Exhibit (p)(1) to Post-Effective Amendment No. 31 of Registrant's
Registration Statement on Form N-1A (File Nos. 33-18647 and
811-5398) filed with the Securities and Exchange Commission on
April 26, 2001.
(e) Code of Ethics for the AllianceBernstein L.P. and
AllianceBernstein Investments, Inc. - Incorporated by reference
to Exhibit (p)(2) to Post-Effective Amendment No. 4 of the
Registration Statement on Form N-1A of The AllianceBernstein
Pooling Portfolios (File Nos. 333-120487 and 811-21673) filed
with the Securities and Exchange Commission on December 29, 2006.
(14) Consent of Independent Registered Public Accounting Firm - Filed
herewith.
(15) Not applicable.
(16) Powers of Attorney for: David H. Dievler, John H. Dobkin, Michael
J. Downey, William H. Foulk, Jr., Marc O. Mayer and Earl D.
Weiner - Filed herewith.
(17) Not applicable.
ITEM 17. Undertakings
(1) The undersigned registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is
a part of this registration statement by any person or party who is
deemed to be an underwriter within the meaning of Rule 145(c) of the
Securities Act 17 CFR 230.145(c), the reoffering prospectus will
contain the information called for by the applicable registration form
for reofferings by persons who may be deemed underwriters, in addition
to the information called for by the other items of the applicable
form.
(2) The undersigned registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as a part of an amendment to
the registration statement and will not be used until the amendment is
effective, and that, in determining any liability under the 1933 Act,
each post-effective amendment shall be deemed to be a new registration
statement for the securities offered therein, and the offering of the
securities at that time shall be deemed to be the initial bona fide
offering of them.
(3) The undersigned registrant undertakes to file a post-effective
amendment to this registration statement upon the closing of the
Acquisition described in this registration statement that contains an
opinion of counsel supporting the tax matters discussed in this
registration statement.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as the
Registrant has duly caused this Registration Statement on Form N-14 to be signed
on its behalf by the undersigned, duly authorized, in the City of New York and
State of New York, on the 28th day of September, 2007.
ALLIANCEBERNSTEIN VARIABLE
PRODUCTS SERIES FUND, INC.
By: Marc O. Mayer*
--------------
Marc O. Mayer
President
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the date indicated:
SIGNATURE TITLE DATE
--------- ----- ----
1. Principal Executive Officer
Marc O. Mayer* President and Chief
Executive Officer September 28, 2007
2. Principal Financial and
Accounting Officer
/s/ Joseph J. Mantineo Treasurer and
------------------------- Chief Financial
Joseph J. Mantineo Officer September 28, 2007
3. Majority of Directors:
David H. Dievler*
John H. Dobkin*
William H. Foulk, Jr.*
Michael Downey*
Marc O. Mayer*
Earl D. Weiner*
*By: /s/ Andrew L. Gangolf September 28, 2007
-----------------------
Andrew L. Gangolf
(Attorney-in-fact)
INDEX TO EXHIBITS
-----------------
Exhibit No. Description of Exhibits
- ----------- -----------------------
(11) Form of Opinion and Consent of Seward & Kissel LLP
(14) Consent of Independent Registered Public Accounting Firm
(16) Powers of Attorney
SK 00250 0157 813639 v2