EXECUTION COPY
CONSENT NO. 1 AND AMENDMENT NO. 1 TO CREDIT AGREEMENT
AND AMENDMENT NO. 1 TO SECURITY AGREEMENT
CONSENT NO. 1 AND AMENDMENT NO. 1, dated as of July 11, 2008 to the Credit
Agreement (as the same may be amended, supplemented or otherwise modified from
time to time, the "Credit Agreement"), dated as of May 13, 2008 between First
Trust/Four Corners Senior Floating Rate Income Fund (the "Borrower") and The
Bank of Nova Scotia (the "Bank"), and AMENDMENT NO. 1 to the Security Agreement
(as the same may be amended, supplemented or otherwise modified from time to
time, the "Security Agreement"), dated as of May 13, 2008, between the Borrower
and the Bank (this "Consent and Amendment").
RECITALS
I. Capitalized terms used herein and not herein defined shall have the
meanings set forth in the Credit Agreement.
II. The Borrower desires to amend the Credit Agreement and the Security
Agreement upon the terms and conditions herein contained, and the Bank has
agreed thereto upon the terms and conditions herein contained.
Accordingly, in consideration of the Recitals and the covenants, conditions
and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
1. Notwithstanding the provisions of Section 7.6(a) of the Credit
Agreement, the Bank hereby consents to the termination of the Custodian Services
Agreement (the "PFPC Custodian Agreement"), dated as of September 18, 2003, by
and between the Borrower and PFPC Trust Company ("PFPC"), provided that (i) all
assets held by PFPC as custodian in all accounts of the Borrower established
under the PFPC Custodian Agreement are simultaneously transferred to an account
or accounts of the Borrower established with JPMorgan Chase Bank, N.A. (the
"Successor Custodian") under the Domestic Custody Agreement, dated as of June 1,
2008, by and between the Borrower and the Successor Custodian in its capacity as
custodian thereunder, (the "JPMC Custody Account"), (ii) such transfer shall not
occur until after the effectiveness of the Control Agreement (as defined in
paragraph 2 below), and (iii) immediately after the effectiveness of this
Consent and Amendment the Bank shall have a perfected security interest in all
assets transferred.
2. The defined terms "Control Agreement", "Custodian", and "Custody
Agreement", contained in Section 1.1 of the Credit Agreement are hereby amended
and restated in their entirety to read as follows:
"Control Agreement" means the Control Agreement, dated as of July 11,
2008, among the Borrower, JPMorgan Chase Bank, N.A. and the Bank.
"Custodian" means JPMorgan Chase Bank, N.A., in its capacity as
custodian under the Custody Agreement.
"Custody Agreement" means the Domestic Custody Agreement, dated as of
June 1, 2008, by and between the Borrower and JPMorgan Chase Bank, N.A., in
its capacity as custodian thereunder.
3. Section 5.1(g) of the Credit Agreement is hereby amended by deleting the
parenthetical phrase "(the "Control Agreement")" contained therein.
4. Section 8.1(k) of the Credit Agreement is hereby amended and restated in
its entirety to read as follows:
(k) (1) the Investment Adviser shall fail to be First Trust Advisors
L.P., or an Affiliate thereof, (2) the custodian for all of the assets of
the Borrower shall fail to be JPMorgan Chase Bank, N.A. or an Affiliate
thereof, or any successor thereto agreed to in writing by the Bank in its
sole and absolute discretion, (3) the sole administrator for the Borrower
shall fail to be JPMorgan Chase Bank, N.A., or an Affiliate thereof, or any
successor thereto agreed to in writing by the Bank in its sole and absolute
discretion, or (4) the independent auditors for the Borrower shall fail to
be reasonably acceptable to the Bank;
5. The defined term "Loan Collateral" contained in Section 1.1(b) of the
Security Agreement is hereby amended and restated in its entirety to read as
follows:
"Loan Collateral" means any asset that is a direct or
participation or subparticipation interest in or assignment or
novation of a loan or other extension of credit (other than (i) any
direct interest in a corporate bond obligation, (ii) a debt obligation
issued by or on behalf of any state, territorial, county, municipal or
other local government or any governmental agency, corporation,
department, instrumentality or other political unit or subdivision or
other entity of any of the foregoing (a "Municipal Authority") and is
either (a) a general obligation bond issued directly by such Municipal
Authority and secured by its faith, credit and taxing power for the
payment of principal and interest or (b) a revenue bond issued by a
special purpose entity on behalf of such Municipal Authority and
payable from revenue derived from a specified facility or class of
facilities or the proceeds of a special excise or other specified
revenue source, or (iii) a debt obligation or pass-through security
issued by a special purpose trust or other entity structured to be
bankruptcy remote and representing a direct or indirect participation
in, or that is secured by, a diversified pool of assets, including,
without limitation, commercial or residential real property,
commercial loans, bonds, credit card receivables, leases or other
financial assets); and all Proceeds (as defined in the UCC) of such
assets, including, without limitation, all interest, dividends and
other money or property of any kind distributed in respect of such
assets; and each loan agreement, promissory note, participation
certificate, collateral security agreement, guarantee, supporting
obligation and any other agreement or document evidencing, securing,
governing or executed in connection with such asset, including without
limitation, the agreements and instruments in respect of which the
Borrower acquired such asset, evidencing, governing or representing
the Borrower's ownership in or the Borrower's interest in such asset,
which are delivered to the Custodian by the Borrower or by a third
party at the direction of the
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Consent and Amendment No. 1
Borrower, including without limitation all loan notes, certificates
and other "instruments" within the meaning of the UCC
6. Paragraphs 1 through 5 of this Consent and Amendment shall not be
effective unless and until the following conditions precedent shall have been
satisfied (the "Amendment Effective Date"):
(a) The Bank shall have received from the Borrower either (i) a
counterpart of this Consent and Amendment executed on behalf of the
Borrower or (ii) written evidence satisfactory to the Bank (which may
include telecopy transmission of a signed signature page of this Consent
and Amendment) that the Borrower has executed a counterpart of this Consent
and Amendment.
(b) The Borrower and the Successor Custodian shall have entered into
the Custody Agreement (as defined in paragraph 2 hereof), and the Borrower,
the Bank and the Successor Custodian, as Custodian, shall have entered into
the Control Agreement (as defined in paragraph 2 hereof).
(c) The Bank shall have received favorable written opinions from (i)
Xxxxxxx & Xxxxxx LLP, special counsel to the Borrower, and (ii) Xxxxxxx
XxXxxxxxx LLP, special Massachusetts counsel to the Borrower, covering,
without limitation, (1) the due authorization, execution and delivery of
this Consent and Amendment, the Control Agreement (as defined in paragraph
2 hereof) and the Custody Agreement (collectively the "Amendment
Documents"), (2) the enforceability of the Amendment Documents and the
Credit Agreement and the Security Agreement as amended by this Amendment
and Consent, and (3) the continuing perfection of the Bank's security
interest in the Collateral (as defined in the Security Agreement), which
shall be in all respects satisfactory to the Bank.
(d) The Bank shall have received a certificate from the Secretary of
the Borrower (or such other officer as shall be acceptable to the Bank), in
all respects satisfactory to the Bank, (i) certifying as to the incumbency
of authorized persons of the Borrower executing the Amendment Documents,
(ii) attaching true, complete and correct copies of the resolutions of the
Board of the Borrower approving the Amendment Documents, and the
transactions contemplated thereby, all of which are in full force and
effect on the date hereof, and (iii) certifying that none of the Borrower's
Organization Documents, Prospectus, Statement of Additional Information and
Registration Statement have been amended, supplemented or otherwise
modified since May 13, 2008 or, if so, attaching true, complete and correct
copies of any such amendment, supplement or modification.
(e) All assets held by PFPC as custodian in all accounts of the
Borrower established under the PFPC Custodian Agreement shall
simultaneously have been transferred to an account or accounts of the
Borrower established with the Successor Custodian under the Domestic
Custody Agreement.
(f) The Bank shall have received all fees and other amounts due and
payable by the Borrower on or prior to the Amendment Effective Date,
including, to the extent invoiced, reimbursement or payment of all
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Consent and Amendment No. 1
reasonable out-of-pocket costs and expenses required to be reimbursed or
paid by the Borrower under the Credit Agreement.
7. The Borrower (a) reaffirms and admits the validity and enforceability of
each Loan Document and all of its obligations thereunder, (b) agrees and admits
that it has no defense to or offset against any such obligation, and (c)
represents and warrants that, as of the date of the execution and delivery
hereof by the Borrower, no Default has occurred and is continuing.
8. This Amendment may be executed in any number of counterparts, each of
which shall be original and all of which shall constitute one agreement. It
shall not be necessary in making proof of this Consent and Amendment to produce
or account for more than one counterpart signed by the party to be charged.
9. This Amendment shall be governed by, and construed in accordance with,
the laws of the State of New York, without regard to conflict of laws principles
that would require the application of the laws of another jurisdiction.
10. The Borrower's Declaration of Trust is on file with the Secretary of
the Commonwealth of Massachusetts. This Consent and Amendment is executed on
behalf of the Borrower by the Borrower's officers as officers and not
individually and the obligations imposed upon the Borrower by this Agreement are
not binding upon any of the Borrower's trustees, officers or shareholders
individually but are binding only upon the Borrower and it assets and property.
11. Except as modified hereby, the Credit Agreement shall in all other
respects remain in full force and effect.
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First Trust/Four Corners Senior Floating Rate Income Fund
Consent and Amendment No. 1
IN WITNESS WHEREOF, the parties hereto have caused this Consent and
Amendment to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
FIRST TRUST/FOUR CORNERS SENIOR
FLOATING RATE INCOME FUND
By: /s/ Xxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx
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Title: CFO & Treasurer
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First Trust/Four Corners Senior Floating Rate Income Fund
Consent and Amendment Xx. 0
XXX XXXX XX XXXX XXXXXX
By: /s/ Xxxxx Xxxxxxxxx
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Name: Xxxxx Xxxxxxxxx
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Title: Managing Director
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First Trust/Four Corners Senior Floating Rate Income Fund
Consent and Amendment No. 1
