CORPORATE FINANCE SERVICES AND CONSULTING AGREEMENT
This CORPORATE FINANCE SERVICES AND CONSULTING AGREEMENT (the
"Agreement"), dated as of June 12, 2003, between X.X. Xxxxxxx & Sons, Inc.
("X.X. Xxxxxxx") and First Trust Advisors, L.P. ("First Trust Advisors").
WHEREAS, First Trust Value Line(R) 100 Fund (the "Fund") is a
diversified, closed-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), and its common
shares of beneficial interest, par value $0.01 per share (the "Common Shares"),
are registered under the Securities Act of 1933, as amended;
WHEREAS, X.X. Xxxxxxx has acted as lead underwriter in the public
offering of the Fund's Common Shares (the "Offering");
WHEREAS, First Trust Advisors is the investment adviser of the Fund;
WHEREAS, First Trust Advisors desires to retain X.X. Xxxxxxx to
provide, directly or (in part) through a Delegation Party (as defined below),
certain corporate finance and consulting services to First Trust Advisors and to
the Fund on an ongoing basis, and X.X. Xxxxxxx is willing to render such
services; and
WHEREAS, First Trust Advisors desires to provide compensation to X.X.
Xxxxxxx and, as applicable, any Delegation Party for providing such services;
NOW, THEREFORE, in consideration of the mutual terms and conditions set
forth below, the parties hereto agree as follows:
1. (a) First Trust Advisors hereby employs X.X. Xxxxxxx, for the
period and on the terms and conditions set forth herein, to
provide the following services: (i) Provide relevant
information, studies or reports regarding general trends in
the closed-end investment company and asset management
industries, if reasonably obtainable, and consult with
representatives of First Trust Advisors in connection
therewith; (ii) At the request of First Trust Advisors,
provide certain economic research and statistical information
and reports, if reasonably obtainable, on behalf of First
Trust Advisors or the Fund and consult with representatives of
First Trust Advisors or the Fund, and/or Trustees of the Fund
in connection therewith, which information and reports shall
include: (a) statistical and financial market information with
respect to the Fund's market performance; and (b) comparative
information regarding the Fund and other closed-end management
investment companies with respect to (x) the net asset value
of their respective shares (as made publicly available by the
Fund and such investment companies), (y) the respective market
performance of the Fund and such other companies, and (z)
other relevant performance indicators; and (iii) Provide First
Trust Advisors with such other services in connection with the
Common Shares relating to the trading price and market price
thereof upon which First Trust Advisors and X.X. Xxxxxxx
shall, from time to time, agree, including after-market
services designed to maintain the visibility of the Fund in
the market.
(b) At the request of First Trust Advisors, X.X. Xxxxxxx and, as
applicable, any Delegation Party, shall limit or cease any
action or service provided hereunder to the extent and for the
time period requested by First Trust Advisors; provided,
however, that pending termination of this Agreement as
provided for in Section 8 hereof, any such limitation or
cessation shall not relieve First Trust Advisors of its
payment obligations pursuant to Section 3 hereof.
(c) X.X. Xxxxxxx and, as applicable, any Delegation Party, will
promptly notify First Trust Advisors in writing if it learns
of any material inaccuracy or misstatement in, or material
omission from, any written information provided by X.X.
Xxxxxxx or any Delegation Party to First Trust Advisors in
connection with the performance of services by X.X. Xxxxxxx or
any Delegation Party under this Agreement. X.X. Xxxxxxx and,
as applicable, each Delegation Party, agrees that in
performing its services under this Agreement, it shall comply
in all material respects with all applicable laws, rules and
regulations.
2. X.X. Xxxxxxx may delegate a portion of its rights and obligations under
this Agreement to other persons (each, a "Delegation Party"), certain
of whom may be Underwriters (as defined in the Underwriting Agreement
dated June , 2003 between X.X. Xxxxxxx, the Fund, First Trust Advisors
and each of the Underwriters named therein) or other participants, or
affiliates of such participants, in the offering and distribution of
the Common Shares; provided that X.X. Xxxxxxx shall have obtained the
prior written consent of First Trust Advisors if such person is not an
Underwriter of the offering and distribution of the Common Shares. X.X.
Xxxxxxx shall give notice to First Trust Advisors of each such
delegation and of each such Delegation Party prior to delegation in the
form attached as Annex A hereto. Such notice shall state the portion of
the fees otherwise payable to X.X. Xxxxxxx hereunder which shall
instead be payable by First Trust Advisors directly to such Delegation
Party and shall be appended to and become a part of this Agreement.
Each Delegation Party shall be a registered broker-dealer under the
Securities Exchange Act of 1934, as amended, and shall not be otherwise
prohibited by law from providing services to First Trust Advisors
hereunder.
3. First Trust Advisors shall pay to X.X. Xxxxxxx (or, as applicable with
respect to a portion of such fee payable instead to a Delegation Party
pursuant to Section 2 above, the appropriate Delegation Party) a fee
payable quarterly in arrears commencing on the date hereon at an
annualized rate of 0.15% of the Fund's average daily net assets for a
term as described in Section 8 hereof; provided that the total amount
of the fee hereunder (when taken together with the sales load of $0.675
per share [and the expense reimbursement equal to the greater of (1)
$50,000 and (2) $0.005 per share received by the underwriters in
connection with the Offering of the Common Shares)] shall not exceed
any sales charge limits (which the parties hereto currently understand
to be 9.0% of the aggregate offering price of the shares of Common
Shares in the Offering) under the rules of the NASD, Inc., as then in
effect; and provided further, that in determining when this maximum fee
amount has been paid, the value of each of the quarterly payments made
hereunder shall be discounted at the annual rate of 10% to the closing
date of the Offering. All quarterly fees payable hereunder shall be
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paid to X.X. Xxxxxxx or, as applicable, the appropriate Delegation
Party within 15 days following the end of each quarter.
4. First Trust Advisors shall be permitted to discharge all or a portion
of its payment obligations hereunder upon prepayment in full or in part
of the remaining balance due of the maximum additional compensation
amount described in paragraph 3 above.
5. First Trust Advisors acknowledges that the services of X.X. Xxxxxxx
(and, as applicable, any Delegation Party) provided for hereunder do
not include any advice as to the value of securities or regarding the
advisability of purchasing or selling any securities, in each case for
the Fund's portfolio. No provision of this Agreement shall be
considered as creating, nor shall any provision create, any obligation
on the part of X.X. Xxxxxxx or any Delegation Party, and neither X.X.
Xxxxxxx nor any Delegation Party is agreeing, to: (i) furnish any
advice or make any recommendations regarding the purchase or sale of
portfolio securities or (ii) render any opinions, valuations of
portfolio securities or recommendations of any kind in connection with
providing the services described in Section 1 hereof, to the extent
that any such services would constitute investment advisory or
investment banking services, it being understood between the parties
hereto that any such investment advisory or investment banking services
if, and to the extent, agreed to be performed by X.X. Xxxxxxx or any
Delegation Party, shall be the subject of a separate agreement with
First Trust Advisors.
6. Nothing herein shall be construed as prohibiting X.X. Xxxxxxx, any
Delegation Party or any of their respective affiliates from providing
similar or other services to any other clients (including other
registered investment companies or other investment advisers), so long
as X.X. Xxxxxxx'x or the applicable Delegation Party's services to
First Trust Advisors are not impaired thereby. Neither this Agreement
nor the performance of the services contemplated hereunder shall be
considered to constitute a partnership, association or joint venture
between X.X. Xxxxxxx or any Delegation Party and First Trust Advisors.
In addition, nothing in this Agreement shall be construed to constitute
X.X. Xxxxxxx or any Delegation Party as the agent or employee of First
Trust Advisors or First Trust Advisors as the agent or employee of X.X.
Xxxxxxx or any Delegation Party, and neither party shall make any
representation to the contrary. It is understood that X.X. Xxxxxxx and,
as applicable, each Delegation Party are being engaged hereunder solely
to provide the services described above to First Trust Advisors and
that neither X.X. Xxxxxxx nor any Delegation Party is acting as an
agent or fiduciary of, and neither X.X. Xxxxxxx nor any Delegation
Party shall have any duties or liability to the current or future
shareholders of the Fund or any other third party in connection with
its engagement hereunder, all of which are hereby expressly waived to
the extent First Trust Advisors has the authority to waive such duties
and liabilities.
7. First Trust Advisors will furnish X.X. Xxxxxxx and, as applicable, any
Delegation Party with such information as such party reasonably
believes appropriate to the performance of its obligations hereunder
(all such information so furnished being the "Information"). First
Trust Advisors recognizes and confirms that X.X. Xxxxxxx and, as
applicable, any Delegation Party (a) will use and rely primarily on the
Information and on information available from generally recognized
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public sources in performing the services contemplated by this
Agreement without having independently verified the same and (b) does
not assume responsibility for the accuracy or completeness of the
Information and such other information. To the best of First Trust
Advisors' knowledge, the Information to be furnished by First Trust
Advisors when delivered, will be true and correct in all material
respects and will not contain any material misstatement of fact or omit
to state any material fact. First Trust Advisors will promptly notify
X.X. Xxxxxxx or any Delegation Party if it learns of any material
inaccuracy or misstatement in, or material omission from, any
Information delivered to such party.
8. The term of this Agreement shall commence upon the date referred to
above and shall be in effect only so long as First Trust Advisors (or
any affiliate or successor in interest) acts as the investment adviser
to the Fund pursuant to the Advisory Agreement (as such term is defined
in the Underwriting Agreement, dated June , 2003, by and among the
Fund, First Trust Advisors and each of the Underwriters named therein),
as such Advisory Agreement (or other subsequent advisory agreement with
First Trust Advisors or any successor thereto) may be renewed from time
to time pursuant to the 1940 Act.
9. First Trust Advisors agrees that neither X.X. Xxxxxxx nor any
Delegation Party shall have any liability to First Trust Advisors or
the Fund for any act or omission to act by X.X. Xxxxxxx or any
Delegation Party in the course of its performance under this Agreement,
in the absence of gross negligence or willful misconduct on the part of
X.X. Xxxxxxx or such Delegation Party. X.X. Xxxxxxx shall have no
liability for any acts or omissions of any Delegation Party. First
Trust Advisors agrees that it shall provide indemnification to X.X.
Xxxxxxx and each Delegation Party as set forth in the Indemnification
Agreement appended hereto.
10. This Agreement and any claim, counterclaim or dispute of any kind or
nature whatsoever arising out of or in any way relating to this
Agreement ("Claim") shall be governed by and construed in accordance
with the laws of the State of New York.
11. No Claim may be commenced, prosecuted or continued in any court other
than the courts of the State of New York located in the City and County
of New York or in the United States District Court for the Southern
District of New York, which courts shall have exclusive jurisdiction
over the adjudication of such matters, and First Trust Advisors, X.X.
Xxxxxxx and, as applicable, each Delegation Party consent to the
jurisdiction of such courts and personal service with respect thereto.
Each of First Trust Advisors, X.X. Xxxxxxx and, as applicable, each
Delegation Party waives all right to trial by jury in any proceeding
(whether based upon contract, tort or otherwise) in any way arising out
of or relating to this Agreement. Each of First Trust Advisors, X.X.
Xxxxxxx and, as applicable, each Delegation Party agrees that a final
judgment in any proceeding or counterclaim brought in any such court
shall be conclusive and binding upon such party and may be enforced in
any other courts to the jurisdiction of which such party is or may be
subject, by suit upon such judgment.
12. Except as provided in Section 2 hereof, this Agreement may not be
assigned by either party without the prior written consent of the other
party.
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13. This Agreement embodies the entire agreement and understanding between
the parties hereto and supersedes all prior agreements and
understandings relating to the subject matter hereof. If any provision
of this Agreement is determined to be invalid or unenforceable in any
respect, such determination will not affect such provision in any other
respect or any other provision of this Agreement, which will remain in
full force and effect. This Agreement may not be amended or otherwise
modified or waived except by an instrument in writing signed by First
Trust Advisors, X.X. Xxxxxxx and, as applicable, each Delegation Party.
14. All notices required or permitted to be sent under this Agreement shall
be sent, if to First Trust Advisors:
First Trust Advisors, L.P.
0000 Xxxxxxxxxxx Xxxx, Xxxxx 000
Xxxxx, XX 00000
Attention: Xxxxx Xxxxxxx--General Counsel
or if to X.X. Xxxxxxx:
X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx
Xx. Xxxxx, XX 00000
Attention: Investment Banking--Corporate Finance
or if to any Delegation Party, to the name and address specified in the
relevant Notice of Delegation or such other name or address as may be
given in writing to the other parties. Any notice shall be deemed to be
given or received on the third day after deposit in the U.S. mail with
certified postage prepaid or when actually received, whether by hand,
express delivery service or facsimile transmission, whichever is
earlier.
15. This Agreement may be executed in separate counterparts, each of which
is deemed to be an original and all of which taken together constitute
one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Corporate Finance Services and Consulting Agreement as of the date first above
written.
FIRST TRUST ADVISORS, L.P. A.G. XXXXXXX & SONS, INC.
By: _____________________________ By: _____________________________
Name: Name:
Title: Title:
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ANNEX A
Notice of Delegation
X.X. Xxxxxxx & Sons, Inc. ("X.X. Xxxxxxx") hereby delegates a portion
of its obligations under that certain Corporate Finance Services and Consulting
Agreement (the "Agreement"), dated June , 2003 between X.X. Xxxxxxx and First
Trust Advisors, L.P. ("First Trust Advisors"), to Xxxxxxx Lynch, Pierce, Xxxxxx
& Xxxxx Incorporated (the "Delegation Party"). The Delegation Party hereby
agrees to provide such services to First Trust Advisors and First Trust Value
Line(R) 100 Fund (the "Fund") as First Trust Advisors and the Delegation Party
shall from time to time agree.
X.X. Xxxxxxx hereby agrees to instruct First Trust Advisors to pay to
the Delegation Party [ ]% of the total fees payable under the Agreement to the
Delegation Party. The Delegation Party agrees that by executing this Notice of
Delegation, it shall become a party to the Agreement and shall abide by the
terms and conditions thereof.
All notices required or permitted to be sent under this Notice of
Delegation or the Agreement shall be sent to the Delegation Party at the
following address:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
4 World Financial Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxx
Agreed to and accepted by:
X.X. Xxxxxxx & Sons, Inc. Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
_______________________________ ____________________________________
By: Xxxxx X. Xxxxxx By: Xxxxxxx X. Xxxx
Title: Vice President Title: First Vice President
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Indemnification Agreement
X.X. Xxxxxxx & Sons, Inc.
on behalf of itself and each
Delegation Party
c/o X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx
Xx. Xxxxx, XX 00000
Ladies and Gentlemen:
In connection with the engagement of X.X. Xxxxxxx and, as
applicable, each Delegation Party (as defined in the Agreement referred to
below) to provide services to the undersigned (together with its affiliates and
subsidiaries, referred to as the "Company") in connection with the matters set
forth in the Corporate Finance Services and Consulting Agreement dated June ,
2003 (the "Agreement"), between the Company, X.X. Xxxxxxx & Sons, Inc. and, as
applicable, each Delegation Party (any Delegation Parties, together with X.X.
Xxxxxxx & Sons, Inc., are referred to herein as the "Service Providers"), in the
event that any Service Provider becomes involved in any capacity in any claim,
suit, action, proceeding, investigation or inquiry (including, without
limitation, any shareholder or derivative action or arbitration proceeding)
(collectively, a "Proceeding") in connection with any matter in any way relating
to or referred to in the Agreement or arising out of the matters contemplated by
the Agreement, including, without limitation, related services and activities
prior to the date of the Agreement, the Company agrees to indemnify, defend and
hold each Service Provider harmless to the fullest extent permitted by law, from
and against any losses, claims, damages, liabilities and expenses in connection
with any matter in any way relating to or referred to in the Agreement or
arising out of the matters contemplated by the Agreement, including, without
limitation, related services and activities prior to the date of the Agreement,
except to the extent that it shall be determined by a court of competent
jurisdiction in a judgment that has become final in that it is no longer subject
to appeal or other review, that such losses, claims, damages, liabilities and
expenses resulted from the gross negligence or willful misconduct of such
Service Provider. In addition, in the event that any Service Provider becomes
involved in any capacity in any Proceeding in connection with any matter in any
way relating to or referred to in the Agreement or arising out of the matters
contemplated by the Agreement, including, without limitation, related services
and activities prior to the date of the Agreement, the Company will reimburse
such Service Provider for its legal and other expenses (including the cost of
any investigation and preparation) as such expenses are reasonably incurred by
such Service Provider in connection therewith. If such indemnification were not
to be available for any reason, the Company agrees to contribute to the losses,
claims, damages, liabilities and expenses involved (i) in the proportion
appropriate to reflect the relative benefits received or sought to be received
by the Company and its shareholders and affiliates and other constituencies, on
the one hand, and the Service Providers, on the other hand, in the matters
contemplated by the Agreement or (ii) if (but only if and to the extent) the
allocation provided for in clause (i) is for any reason held unenforceable, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company and its
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shareholders and affiliates and other constituencies, on the one hand, and the
party entitled to contribution, on the other hand, as well as any other relevant
equitable considerations. The Company agrees that for the purposes of this
paragraph the relative benefits received, or sought to be received, by the
Company and its shareholders and affiliates, on the one hand, and the party
entitled to contribution, on the other hand, of a transaction as contemplated
shall be deemed to be in the same proportion that the total value received or
paid or contemplated to be received or paid by the Company or its shareholders
or affiliates and other constituencies, as the case may be, as a result of or in
connection with the transaction (whether or not consummated) for which the
Service Providers have been retained to perform services bears to the fees paid
to the Service Providers under the Agreement; provided, that in no event shall
the Company contribute less than the amount necessary to assure that no Service
Provider is liable for losses, claims, damages, liabilities and expenses in
excess of the amount of fees actually received by such Service Provider pursuant
to the Agreement. Relative fault shall be determined by reference to, among
other things, whether any alleged untrue statement or omission or any other
alleged conduct relates to information provided by the Company or other conduct
by the Company (or its employees or other agents), on the one hand, or by the
relevant Service Provider, on the other hand. The Company shall not be liable
under this Indemnification Agreement to any Service Provider regarding any
settlement or compromise or consent to the entry of any judgment with respect to
any Proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the Company is an actual or potential party to such
Proceeding) unless such settlement, compromise or judgment is consented to by
the Company. The Company shall not, without the prior written consent of each
Service Provider, settle or compromise or consent to the entry of any judgment
with respect to any Proceeding in respect of which indemnification or
contribution could be sought under this Indemnification Agreement (whether or
not any Service Provider is an actual or potential party thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
Service Provider from all liability arising out of such Proceeding and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any Service Provider. For purposes of this
Indemnification Agreement, each Service Provider shall include any of its
affiliates, each other person, if any, controlling such Service Provider or any
of its affiliates, their respective officers, current and former directors,
employees and agents, and the successors and assigns of all of the foregoing
persons. The foregoing indemnity and contribution agreement shall be in addition
to any rights that any indemnified party may have at common law or otherwise.
The Company agrees that neither any Service Provider nor any of its
affiliates, directors, agents, employees or controlling persons shall have any
liability to the Company or any person asserting claims on behalf of or in right
of the Company in connection with or as a result of either such Service
Provider's engagement under the Agreement or any matter referred to in the
Agreement, including, without limitation, related services and activities prior
to the date of the Agreement, except to the extent that it shall be determined
by a court of competent jurisdiction in a judgment that has become final in that
it is no longer subject to appeal or other review that any losses, claims,
damages, liabilities or expenses incurred by the Company resulted from the gross
negligence or willful misconduct of such Service Provider in performing the
services that are the subject of the Agreement.
Notwithstanding any provision contained herein, in no event shall
any Service Provider be entitled to indemnification by the Company hereunder
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from and against any losses, claims, damages, liabilities or expenses in respect
of which indemnity may be sought under Section 9 of the Underwriting Agreement.
For clarification, the parties to this Indemnification Agreement
agree that the term "affiliate" as used in the definition of "Company" herein
does not include any registered investment company for which First Trust
Advisors, L.P. serves as investment adviser.
THIS INDEMNIFICATION AGREEMENT AND ANY CLAIM, COUNTERCLAIM OR
DISPUTE OF ANY KIND OR NATURE WHATSOEVER ARISING OUT OF OR IN ANY WAY RELATING
TO THIS AGREEMENT ("CLAIM"), DIRECTLY OR INDIRECTLY, SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS SET
FORTH BELOW, NO CLAIM MAY BE COMMENCED, PROSECUTED OR CONTINUED IN ANY COURT
OTHER THAN THE COURTS OF THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF
NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK, WHICH COURTS SHALL HAVE EXCLUSIVE JURISDICTION OVER THE ADJUDICATION OF
SUCH MATTERS, AND THE COMPANY AND EACH SERVICE PROVIDER CONSENT TO THE
JURISDICTION OF SUCH COURTS AND PERSONAL SERVICE WITH RESPECT THERETO. THE
COMPANY HEREBY CONSENTS TO PERSONAL JURISDICTION, SERVICE AND VENUE IN ANY COURT
IN WHICH ANY CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT IS
BROUGHT BY ANY THIRD PARTY AGAINST ANY SERVICE PROVIDER OR ANY INDEMNIFIED
PARTY. EACH SERVICE PROVIDER AND THE COMPANY WAIVES ALL RIGHT TO TRIAL BY JURY
IN ANY PROCEEDING OR CLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT. THE COMPANY AGREES THAT
A FINAL JUDGMENT IN ANY PROCEEDING OR CLAIM ARISING OUT OF OR IN ANY WAY
RELATING TO THIS AGREEMENT BROUGHT IN ANY SUCH COURT SHALL BE CONCLUSIVE AND
BINDING UPON THE COMPANY AND MAY BE ENFORCED IN ANY OTHER COURTS TO THE
JURISDICTION OF WHICH THE COMPANY IS OR MAY BE SUBJECT, BY SUIT UPON SUCH
JUDGMENT.
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The foregoing Indemnification Agreement shall remain in full force and
effect notwithstanding any termination of any Service Provider's engagement.
This Indemnification Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which shall constitute one and
the same agreement.
Very truly yours,
FIRST TRUST ADVISORS, L.P.
By: _______________________
Name:
Title:
Accepted and agreed to as of
the date first above written:
X.X. XXXXXXX & SONS, INC.
By: _______________________
Name: Xxxxx X. Xxxxxx
Title: Vice President
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