BLANKET BOND INSURANCE AGREEMENT
THIS AGREEMENT is made as of the 4th day of April, 2011, by and among the
investment companies listed in Appendix A (collectively referred to herein as
the "Funds"), First Trust Advisors L.P. (the "Advisor") and First Trust
Portfolios L.P. (collectively, with the Advisor and the Funds referred to as the
"Parties").
WITNESSETH:
WHEREAS, the Parties have agreed to acquire a joint insured policy (the
"Policy") issued by ICI Mutual Insurance Company containing broker's blanket
bond coverage ("Blanket Bond Coverage") which shall cover all Parties;
WHEREAS, the total amount of the Blanket Bond Coverage under the Policy
will be $15,000,000 ("Bond Amount") based upon the determination of each Fund's
Board of Trustees that such insured Parties should have an amount of coverage,
in the aggregate, of at least $14,150,000 ("Basic Bond Coverage") as provided in
Appendix B;
WHEREAS, the Parties desire to provide herein for an allocation of the
premiums for the Blanket Bond Coverage and a manner of allocating any loss
proceeds received under the Policy.
The Parties, therefore, agree that:
1. Allocation of Blanket Bond Coverage Premium. Each Party shall pay a
proportionate share of the Blanket Bond Coverage annual premium based on the
allocation as set forth in Appendix C.
2. Losses.
(a) General. The Policy is a "claims made" insurance policy and a Policy
Year is the period from October 9th through the next succeeding October 9th (or
any modification of that period as may be agreed by the Parties and the
insurer). The insured loss (including all related expenses) of a Party which
relates to a claim made by that Party relating to a particular Policy Year under
the Blanket Bond Coverage is hereinafter referred to as a "Blanket Bond Loss."
Party includes the trustees and officers of an insured Party and other insured
agents or employees of such a Party.
(b) Blanket Bond Loss. If only one insured Party incurs a Blanket Bond
Loss relating to a Policy Year, the proceeds of the Blanket Bond Coverage for
that Policy Year will be allocated to that Party. If more than one insured Party
incurs a Blanket Bond Loss relating to a particular Policy Year, the proceeds of
the Blanket Bond Coverage for that Policy Year will first be allocated among
those insured Parties in proportion to their respective premiums paid under
Paragraph 1 hereof for Blanket Bond Coverage. If, for that particular Policy
Year, after initial allocation, there are remaining proceeds of the Blanket Bond
Coverage and there are then insured Parties whose Blanket Bond Losses have not
been paid in full, such proceeds shall be further allocated among such insured
Parties in proportion to their respective premiums paid for such Coverage
(repeating this further allocation procedure as each of such insured Parties is
paid in full, until all proceeds have been allocated). If all Blanket Bond
Losses relating to a particular Policy Year are not paid at the same time, the
insured Parties who claim such Losses for that Policy Year shall make such
provisions as they deem suitable to the particular circumstances (taking into
account the size of any payment received, the size, nature and expected result
of any remaining claims, and all other relevant factors) to permit a later
re-allocation of amounts first paid. In no event shall any insured Party that
incurs a Blanket Bond Loss relating to a Policy Year which equals or exceeds its
Basic Bond Coverage be allocated proceeds of the Blanket Bond Coverage for that
particular Policy Year in an amount less than its Basic Bond Coverage.
3. Notices. Each Party agrees to give promptly to the insurer all notices
required under the Policy.
4. Agent. The Advisor is hereby appointed as the agent for all of the
Parties for the purpose of making, adjusting, receiving and enforcing payment of
all claims under the Policy and otherwise dealing with the insurer with respect
to the Policy. All expenses incurred by the Advisor in its capacity as agent for
claims shall be shared by the Parties (including the Advisor) in the same manner
as above provided for the sharing of Losses.
5. Modification and Termination. This Agreement may be modified or
amended from time to time by mutual written agreement among all of the Parties.
It may be terminated with respect to any one Party by not less than 60 days'
written notice to the other Parties which are still parties to the Agreement. It
shall terminate with respect to any Party as of the date that Party ceases to be
an insured under the Policy; provided that such termination shall not affect
that Party's rights and obligations hereunder with respect to any claims on
behalf of that Party which are paid under the Policy by the insurer after the
date the Party ceases to be an insured under the Policy.
6. Further Assurances. Each Party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
as of the day and year first above written.
Energy Income and Growth Fund
First Defined Portfolio Fund, LLC
First Trust Enhanced Equity Income Fund
First Trust Senior Floating Rate Income Fund II
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund
First Trust/Aberdeen Global Opportunity Income Fund
First Trust Mortgage Income Fund
First Trust Strategic High Income Fund
First Trust Exchange-Traded Fund
First Trust Strategic High Income Fund II
First Trust Strategic High Income Fund III
First Trust/Aberdeen Emerging Opportunity Fund
First Trust Exchange-Traded AlphaDEX(R) Fund
First Trust Specialty Finance and Financial Opportunities Fund
First Trust Active Dividend Income Fund
First Trust Exchange-Traded Fund II
First Trust High Income Long/Short Fund
First Trust Series Fund
First Trust Advisors L.P.
First Trust Portfolios L.P.
By: /s/ Xxxxx X. Xxxxx
-----------------------------
Xxxxx X. Xxxxx, President
APPENDIX A
Closed-End Fund
---------------
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund.......................(MFD)
First Trust Senior Floating Rate Income Fund II....................................................(FCT)
Energy Income and Growth Fund......................................................................(FEN)
First Trust Enhanced Equity Income Fund............................................................(FFA)
First Trust/Aberdeen Global Opportunity Income Fund................................................(FAM)
First Trust Mortgage Income Fund...................................................................(FMY)
First Trust Strategic High Income Fund.............................................................(FHI)
First Trust Strategic High Income Fund II..........................................................(FHY)
First Trust/Aberdeen Emerging Opportunity Fund.....................................................(FEO)
First Trust Strategic High Income Fund III.........................................................(FHO)
First Trust Specialty Finance and Financial Opportunities Fund.....................................(FGB)
First Trust Active Dividend Income Fund............................................................(FAV)
First Trust High Income Long/Short Fund............................................................(FSD)
ETFS
First Trust Exchange-Traded Fund
--------------------------------
First Trust Dow Xxxxx Internet Index(SM) Fund......................................................(FDN)
First Trust Dow Xxxxx Select MicroCap Index(SM) Fund...............................................(FDM)
First Trust ISE Chindia Index Fund.................................................................(FNI)
First Trust ISE Water Index Fund...................................................................(FIW)
First Trust ISE Revere Natural Gas Index Fund......................................................(FCG)
First Trust Morningstar(R) Dividend Leaders(SM) Index Fund.........................................(FDL)
First Trust NASDAQ(R) ABA Community Bank Index Fund...............................................(QABA)
First Trust NASDAQ(R) Clean Edge(R) Green Energy Index Fund.......................................(QCLN)
First Trust NASDAQ-100 Equal Weighted Index(SM) Fund..............................................(QQEW)
First Trust NASDAQ-100 Ex-Technology Sector Index(SM) Fund........................................(QQXT)
First Trust NASDAQ-100-Technology Sector IndexSM Fund.............................................(QTEC)
First Trust NYSE Arca Biotechnology Index Fund.....................................................(FBT)
First Trust S&P REIT Index Fund....................................................................(FRI)
First Trust Strategic Value Index Fund.............................................................(FDV)
First Trust US IPO Index Fund......................................................................(FPX)
First Trust Value Line(R) 100 Exchange-Traded Fund.................................................(FVL)
First Trust Value Line(R) Dividend Index Fund......................................................(FVD)
First Trust Value Line(R) Equity Allocation Index Fund.............................................(FVI)
First Trust Exchange-Traded Fund II
-----------------------------------
First Trust XXXX Index Fund.......................................................................(XXXX)
First Trust Dow Xxxxx Global Select Dividend Index Fund............................................(FGD)
First Trust STOXX(R) European Select Dividend Index Fund...........................................(FDD)
First Trust FTSE EPRA/NAREIT Developed Markets Real Estate Index Fund..............................(FFR)
First Trust ISE Global Copper Index Fund............................................................(CU)
First Trust ISE Global Engineering and Construction Index Fund.....................................(FLM)
First Trust ISE Global Platinum Index Fund........................................................(PLTM)
First Trust ISE Global Wind Energy Index Fund......................................................(FAN)
First Trust NASDAQ CEA Smartphone Index Fund......................................................(FONE)
First Trust NASDAQ(R) Clean Edge(R) Smart Grid Infrastructure Index Fund..........................(GRID)
First Trust Exchange-Traded AlphaDEX(R) Fund
------------------------------------------
First Trust Consumer Discretionary AlphaDEX(R) Fund................................................(FXD)
First Trust Consumer Staples AlphaDEX(R) Fund......................................................(FXG)
First Trust Energy AlphaDEX(R) Fund................................................................(FXN)
First Trust Financials AlphaDEX(R) Fund............................................................(FXO)
First Trust Health Care AlphaDEX(R) Fund...........................................................(FXH)
First Trust Industrials/Producer Durables AlphaDEX(R) Fund.........................................(FXR)
First Trust Large Cap Core AlphaDEX(R) Fund........................................................(FEX)
First Trust Large Cap Growth AlphaDEX(R) Fund......................................................(FTC)
First Trust Large Cap Value AlphaDEX(R) Fund.......................................................(FTA)
First Trust Materials AlphaDEX(R) Fund.............................................................(FXZ)
First Trust Mid Cap Core AlphaDEX(R) Fund..........................................................(FNX)
First Trust Multi Cap Growth AlphaDEX(R) Fund......................................................(FAD)
First Trust Multi Cap Value AlphaDEX(R) Fund.......................................................(FAB)
First Trust Small Cap Core AlphaDEX(R) Fund........................................................(FYX)
First Trust Technology AlphaDEX(R) Fund............................................................(FXL)
First Trust Utilities AlphaDEX(R) Fund.............................................................(FXU)
Open-End Funds
--------------
First Defined Portfolio Fund, LLC
---------------------------------
First Trust Target Focus Four Strategy
Global Dividend Target 15 Portfolio
The Dow(R) DART 10 Portfolio
The Dow(R) Target Dividend Portfolio
Nasdaq(R) Target 15 Portfolio
S&P Target 24 Portfolio
Target Managed VIP Portfolio
Value Line(R) Target 25 Portfolio
First Trust Series Fund
-----------------------
First Trust Preferred Securities and Income Fund.................................................(FPEIX)
First Trust/Confluence Small Cap Value Fund......................................................(FOVIX)
APPENDIX B
RULE 17G-1
REQUIRED
BOND LIMITS
-----------------
FIRST DEFINED PORTFOLIO FUND, LLC
The Target Managed VIP Portfolio N/A
Dow Dart 10 Portfolio N/A
Global Target 15 Portfolio N/A
S&P Target 24 Portfolio N/A
NASDAQ Target 15 Portfolio N/A
First Trust Target Focus Four Portfolio N/A
Value Line Target 25 Portfolio N/A
Dow Target Dividend N/A
SUB-TOTAL $525,000
FIRST TRUST SERIES FUND
First Trust Preferred Securities and Income Fund N/A
First Trust/Confluence Small Cap Value Fund N/A
SUB-TOTAL $100,000
FIRST TRUST CLOSED-END FUNDS
First Trust Senior Floating Rate Income Fund II $900,000
Energy Income and Growth Fund 900,000
First Trust Enhanced Equity Income Fund 750,000
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund 600,000
First Trust /Aberdeen Global Opportunity Income Fund 750,000
First Trust Mortgage Income Fund 450,000
First Trust Strategic High Income Fund 350,000
First Trust Strategic High Income Fund II 400,000
First Trust/Aberdeen Emerging Opportunity Income Fund 525,000
First Trust Strategic High Income Fund III 400,000
First Trust Specialty Finance & Financial Opportunities Fund 525,000
First Trust Active Dividend Income Fund 525,000
First Trust High Income Long/Short Fund 1,000,000
SUB-TOTAL $8,075,000
FIRST TRUST EXCHANGE-TRADED FUND
First Trust Dow Xxxxx Select MicroCap Index(SM) Fund N/A
First Trust Morningstar(R) Dividend Leaders(SM) Index Fund N/A
First Trust US IPO Index Fund N/A
First Trust NASDAQ-100 Equal Weighted Index(SM) Fund N/A
First Trust NASDAQ-100-Technology Sector Index(SM) Fund N/A
First Trust NYSE Arca Biotechnology Index Fund N/A
First Trust Dow Xxxxx Internet Index(SM) Fund N/A
First Trust Strategic Value Index Fund N/A
First Trust Value Line(R) Equity Allocation Index Fund N/A
First Trust Value Line(R) Dividend Index Fund N/A
First Trust NASDAQ-100 Ex-Technology Sector Index(SM) Fund N/A
First Trust NASDAQ(R) Clean Edge(R) Green Energy Index Fund N/A
First Trust S&P REIT Index Fund N/A
First Trust ISE Chindia Index Fund N/A
First Trust ISE-Revere Natural Gas Index Fund N/A
First Trust ISE Water Index Fund N/A
First Trust Value Line(R) 100 Exchange-Traded Fund N/A
First Trust NASDAQ(R) ABA Community Bank Index Fund N/A
SUB-TOTAL $2,300,000
FIRST TRUST EXCHANGE-TRADED ALPHADEX(R) FUND
First Trust Large Cap Core AlphaDEX(R) Fund N/A
First Trust Mid Cap Core AlphaDEX(R) Fund N/A
First Trust Small Cap Core AlphaDEX(R) Fund N/A
First Trust Large Cap Value Opportunities AlphaDEX(R) Fund N/A
First Trust Large Cap Growth Opportunities AlphaDEX(R) Fund N/A
First Trust Multi Cap Value AlphaDEX(R) Fund N/A
First Trust Multi Cap Growth AlphaDEX(R) Fund N/A
First Trust Consumer Discretionary AlphaDEX(R) Fund N/A
First Trust Consumer Staples AlphaDEX(R) Fund N/A
First Trust Energy AlphaDEX(R) Fund N/A
First Trust Financials AlphaDEX(R) Fund N/A
First Trust Health Care AlphaDEX(R) Fund N/A
First Trust Industrials/Producer Durables AlphaDEX(R) Fund N/A
First Trust Materials AlphaDEX(R) Fund N/A
First Trust Technology AlphaDEX(R) Fund N/A
First Trust Utilities AlphaDEX(R) Fund N/A
SUB-TOTAL $1,900,000
FIRST TRUST EXCHANGE-TRADED FUND II
First Trust Dow Xxxxx STOXX(R) European Select Dividend Index Fund N/A
First Trust FTSE EPRA/NAREIT Developed Markets Real Estate Index Fund N/A
First Trust Dow Xxxxx Global Select Dividend Index Fund N/A
First Trust ISE Global Wind Energy Index Fund N/A
First Trust ISE Global Engineering and Construction Index Fund N/A
First Trust NASDAQ(R) Clean Edge(R) Smart Grid Infrastructure Index Fund N/A
First Trust ISE Global Copper Index Fund N/A
First Trust ISE Global Platinum Index Fund N/A
First Trust XXXX Index Fund N/A
First Trust NASDAQ CEA Smartphone Index Fund N/A
SUB-TOTAL $1,250,000
GRAND TOTAL $14,150,000
APPENDIX C
PREMIUM
FIRST DEFINED PORTFOLIO FUND
Target Managed VIP $154
DART 10 $31
Nasdaq Target 15 $29
S&P Target 24 $46
Global Target Dividend 15 $211
Value Line Target 25 $62
Target Focus Four $58
Dow Target Dividend $119
--------
Total $710
OPEN-END FUNDS
First Trust/Confluence Small Cap Value Fund - Class A $0
First Trust/Confluence Small Cap Value Fund - Class C $0
First Trust/Confluence Small Cap Value Fund - Class F $0
First Trust/Confluence Small Cap Value Fund - Class I $0
First Trust/Confluence Small Cap Value Fund - Class R3 $0
First Trust Preferred Securities and Income Fund - Class A $0
First Trust Preferred Securities and Income Fund - Class C $0
First Trust Preferred Securities and Income Fund - Class F $0
First Trust Preferred Securities and Income Fund - Class I $0
First Trust Preferred Securities and Income Fund - Class R3 $0
--------
Total $0
FIRST TRUST EXCHANGE-TRADED FUND
First Trust Dow Xxxxx Select MicroCap Index Fund $348
First Trust Morningstar Dividend Leaders Index Fund $1,894
First Trust US IPO Index Fund $77
First Trust NASDAQ-100 Equal Weighted Index Fund $334
First Trust NASDAQ-100 Technology Sector Index Fund $1,682
First Trust Dow Xxxxx Internet Index Fund $2,077
First Trust NYSE Arca Biotechnology Index Fund $941
First Trust Strategic Value Index Fund $195
First Trust NASDAQ-100 Ex-Technology $99
First Trust NASDAQ Clean Edge $195
First Trust NASDAQ(R) ABA Community Bank Index Fund $51
First Trust ISE Water $246
First Trust ISE-Revere Natural Gas $2,032
First Trust ISE Chindia $872
First Trust S&P REIT $383
First Trust Value Line Equity Allocation $37
First Trust Value Line Dividend Index $1,034
First Trust Value Line 100 Exchange-Traded $349
--------
Total $12,846
FIRST TRUST EXCHANGE-TRADED FUND II
First Trust STOXX European Select Dividend $39
First Trust FTSE EPRA/NAREIT Developed Markets Real Estate $277
First Trust Dow Xxxxx Global Select Dividend $231
First Trust ISE Global Wind Energy $309
First Trust ISE Global Engineering and Construction $187
First Trust NASDAQ(R) Clean Edge(R) Smart Grid Infrastructure $179
First Trust ISE Global Copper Index Fund $242
First Trust ISE Global Platinum Index Fund $53
First Trust XXXX Index Fund $865
First Trust NASDAQ CEA Smartphone Index Fund $2
--------
Total $2,384
FIRST TRUST EXCHANGE-TRADED ALPHADEX FUND
First Trust Large Cap Core AlphaDEX Fund $519
First Trust Mid Cap Core AlphaDEX Fund $473
First Trust Small Cap Core AlphaDEX Fund $271
First Trust Large Cap Value Opportunities AlphaDEX Fund $393
First Trust Large Cap Growth Opportunities AlphaDEX Fudn $292
First Trust Multi Cap Value AlphaDEX Fund $132
First Trust Multi Cap Growth AlphaDEX Fund $49
First Trust Consumer Discretionary AlphaDEX Fund $1,449
First Trust Consumer Staples AlphaDEX Fund $179
First Trust Energy AlphaDEX Fund $303
First Trust Financials AlphaDEX Fund $1,254
Xxxxx Trust Health Care AlphaDex Fund $296
First Trust Industrials AlphaDEX Fund $194
First Trust Materials AlphaDEX Fund $1,589
First Trust Technology AlphaDex Fund $437
First Trust Utilities AlphaDEX Fund $220
--------
Total $8,050
FIRST TRUST CLOSED-END FUNDS
First Trust High Income Long/Short Fund $3,443
Macquarie/First Trust Global Opportunity Dividend & Income Fund $1,041
First Trust Senior Floating Rate Income Fund II $2,717
Energy Income and Growth Fund $1,824
First Trust Enhanced Equity Income Fund $1,394
First Trust/Aberdeen Global Opportunity Income Fund $2,228
First Trust Mortgage Income Fund $512
First Trust Strategic High Income Fund I $231
First Trust Strategic High Income Fund II $336
First Trust/Aberdeen Emerging Opportunity Fund $705
First Trust Strategic High Income Fund III $312
First Trust Specialty Finance and Financial Opp Fd. $695
First Trust Active Dividend Income Fund $441
--------
Total $15,879
--------
$39,869
First Trust Advisors L.P. $23,257
First Trust Portfolios L.P. $3,322
--------
TOTAL $66,448
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