STRUCTURING FEE AGREEMENT
STRUCTURING FEE AGREEMENT (the "Agreement"), dated as of May [ ], 2013, by
and among Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"),
First Trust Advisors L.P. ("Investment Adviser") and Stonebridge Advisors LLC
(the "Sub-Adviser," and together with the Investment Adviser, the "Advisers").
WHEREAS, First Trust Intermediate Duration Preferred & Income Fund (the
"Fund") is a newly organized, non-diversified, closed-end management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), and its common shares are registered under the Securities Act of
1933, as amended;
WHEREAS, the Fund and the Advisers have entered into an underwriting
agreement (the "Underwriting Agreement"), dated May [ ], 2013 with Xxxxxxx Xxxxx
and the other underwriters named therein (the "Underwriters");
WHEREAS, First Trust Advisors L.P. is the investment adviser of the Fund;
WHEREAS, Stonebridge Advisors LLC is the investment sub-adviser of the
Fund;
WHEREAS, Xxxxxxx Xxxxx is acting as an underwriter in an offering of the
Fund's common shares (the "Offering"), made under the terms of the Fund's
prospectus dated May [ ], 2013 (the "Prospectus"); and
WHEREAS, the Advisers desire to provide a structuring fee to Xxxxxxx Xxxxx
for providing the advice and services described below;
NOW, THEREFORE, in consideration of the mutual terms and conditions set
forth below, the parties hereto agree as follows:
1. In consideration of Xxxxxxx Xxxxx'x providing advice relating to the
structure and design and the organization of the Fund as well as services
related to the sale and distribution of the Fund's common shares, par
value $0.01 per share, which may but need not necessarily include views
from an investor market and distribution perspective on (i)
diversification, proportion and concentration approaches for the Fund's
investments in light of current market conditions, (ii) marketing issues
with respect to the Fund's investment policies and proposed investments,
(iii) the proportion of the Fund's assets to invest in the Fund's
strategies and (iv) the overall marketing and positioning thesis for the
Offering, the Advisers shall pay Xxxxxxx Xxxxx an aggregate fee equal to
1.25% of the total price to the public of the Fund's common shares issued
by the Fund sold by Xxxxxxx Xxxxx pursuant to the Prospectus (including
all Firm Shares and Additional Shares as such terms are described in the
Underwriting Agreement) (the "Fee"), $[ ] of which will be paid by the
Adviser, and $[ ] of which will be paid by the Sub-Adviser. The Fee shall
be paid on the Closing Date (as defined in the Underwriting Agreement) in
an aggregate amount equal to 1.25% of the total price to the public of the
common shares issued by the Fund sold by Xxxxxxx Xxxxx on such Closing
Date, or as otherwise agreed to by the parties. The sum total of all
compensation to or reimbursement of underwriters in connection with the
offering, including sales load and all forms of additional compensation,
shall not exceed [ ]% of the total price of the Fund's common shares sold
in the offering. In the event the Offering does not proceed, Xxxxxxx Xxxxx
will not receive any fees under this Agreement; however, for the avoidance
of doubt, accountable expenses actually incurred may be payable to Xxxxxxx
Xxxxx pursuant to the terms of the Underwriting Agreement.
2. Nothing herein shall be construed as prohibiting Xxxxxxx Xxxxx or its
affiliates from providing similar or other services to any other clients
(including other registered investment companies or other investment
advisers).
3. The Advisers acknowledge that Xxxxxxx Xxxxx did not provide and is not
providing any advice hereunder as to the value of securities or regarding
the advisability of purchasing or selling any securities 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 Xxxxxxx
Xxxxx, and Xxxxxxx Xxxxx is not hereby agreeing, to: (i) furnish any
advice or make any recommendations regarding the purchase or sale of
portfolio securities or (ii) render any opinions, valuations or
recommendations of any kind or to perform any such similar services in
connection with acting as an underwriter in the Offering of the Fund's
common shares.
4. This Agreement shall terminate upon the payment of the entire amount of
the Fee, as specified in Paragraph 1 hereof.
5. The Advisers will xxxxxxx Xxxxxxx Xxxxx with such information as Xxxxxxx
Xxxxx believes appropriate to its assignment hereunder (all such
information so furnished being the "Information"). The Advisers recognize
and confirm that Xxxxxxx Xxxxx (a) has used and relied primarily on the
Information and on information available from generally recognized 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 the Adviser's and Sub-Adviser's
knowledge, respectively, the Information furnished by such party, when
delivered, was true and correct in all material respects and did not
contain any material misstatement of fact or omit to state any material
fact necessary to make the statements contained therein not misleading.
Such party will promptly notify Xxxxxxx Xxxxx if they learn of any
material inaccuracy or misstatement in, or material omission from, any
Information delivered to Xxxxxxx Xxxxx.
6. The Advisers agree that Xxxxxxx Xxxxx shall have no liability to the
Advisers or the Fund for any act or omission to act by Xxxxxxx Xxxxx in
the course of its performance under this Agreement, in the absence of
gross negligence or willful misconduct on the part of Xxxxxxx Xxxxx. The
Advisers agree to the terms set forth in the Indemnification Agreement
attached hereto, the provisions of which are incorporated herein by
reference and shall survive the termination, expiration or supersession of
this Agreement.
7. 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.
2
8. 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 Intermediate Duration
Preferred & Income Fund, First Trust Advisors L.P., Stonebridge Advisors
LLC and Xxxxxxx Xxxxx consent to the jurisdiction of such courts and
personal service with respect thereto. Each of Xxxxxxx Xxxxx and the
Advisers 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 Adviser agrees that a final judgment in
any proceeding or counterclaim brought in any such court shall be
conclusive and binding upon that Adviser and may be enforced in any other
courts to the jurisdiction of which the Adviser or Sub-Adviser, as
applicable, is or may be subject, by suit upon such judgment.
9. This Agreement may not be assigned by any parties without the prior
written consent of the other parties.
10. This Agreement (including the attached Indemnification 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 Xxxxxxx Xxxxx and the Advisers.
11. All notices required or permitted to be sent under this Agreement shall be
sent, if to First Trust Advisors L.P.:
First Trust Advisors L.P.
000 X. Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: General Counsel
or if to Stonebridge Advisors LLC:
Stonebridge Advisors LLC
000 Xxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: [ ]
or if to Xxxxxxx Xxxxx:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxx Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
3
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
electronic transmission, whichever is earlier.
12. 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.
[signatures on following page]
4
IN WITNESS WHEREOF, the parties hereto have duly executed this Structuring
Fee Agreement as of the date first above written.
FIRST TRUST ADVISORS X.X. XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
By: By:
-------------------------------- ------------------------------------
Name: Name:
Title: Title:
STONEBRIDGE ADVISORS LLC
By:
--------------------------------
Name:
Title:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Indemnification Agreement
May [ ], 2013
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxx Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with the engagement of Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx") to advise and assist the undersigned (together
with their affiliates and subsidiaries, each referred to as a "Company" and,
together, the "Companies") with the matters set forth in the Structuring Fee
Agreement dated May [ ], 2013 among each of the Companies and Xxxxxxx Xxxxx (the
"Agreement"), in the event that Xxxxxxx Xxxxx 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, the Companies agree to jointly and severally
indemnify, defend and hold Xxxxxxx Xxxxx 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,
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 solely from the gross negligence or willful misconduct of
Xxxxxxx Xxxxx. In addition, in the event that Xxxxxxx Xxxxx 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, the Companies shall jointly and severally reimburse Xxxxxxx Xxxxx
for its legal and other expenses, including the cost of any investigation and
preparation, as such expenses are reasonably incurred by Xxxxxxx Xxxxx in
connection therewith, 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 legal and other
expenses resulted solely from the gross negligence or willful misconduct of
Xxxxxxx Xxxxx; provided that in any Proceeding, the indemnified person shall
have the right to retain its own counsel (and local counsel), but the fees and
expenses of such counsel (and local counsel) shall be at the expense of the
indemnified person unless (i) the indemnifying party and the indemnified person
shall have mutually agreed to the retention of such counsel or (ii) the named
parties to any such Proceeding (including any impleaded parties) include both
the indemnifying party and the indemnified person and representations of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. Promptly as reasonably practicable after
receipt by Xxxxxxx Xxxxx of notice of the commencement of any Proceeding,
Xxxxxxx Xxxxx will, if a claim in respect thereof is to be made under this
paragraph, notify the Companies in writing of the commencement thereof; but the
failure to so notify the Companies (i) will not relieve the Companies from
liability under this paragraph to the extent they are not materially prejudiced
as a result thereof and (ii) in any event shall not relieve the Companies from
any liability which they may have otherwise than on account of this
Indemnification Agreement. Counsel to Xxxxxxx Xxxxx shall be selected by Xxxxxxx
Xxxxx. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of Xxxxxxx Xxxxx) also be counsel to Xxxxxxx
Xxxxx. No indemnifying party shall, without the prior written consent of the
Xxxxxxx Xxxxx, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought hereunder
(whether or not Xxxxxxx Xxxxx is an actual or potential party thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
Xxxxxxx Xxxxx from all liability arising out of such litigation, investigation
or 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 Xxxxxxx Xxxxx.
If such indemnification were not to be available for any reason, each
Company agrees to, jointly and severally with the other Company, 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 that Company and its stockholders and affiliates and other
constituencies, on the one hand, and Xxxxxxx Xxxxx, 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 that Company and its
stockholders and affiliates, on the one hand, and Xxxxxxx Xxxxx, on the other
hand, as well as any other relevant equitable considerations. Each Company
agrees that for the purposes of this paragraph the relative benefits received,
or sought to be received, by that Company and its stockholders and affiliates,
on the one hand, and Xxxxxxx Xxxxx, on the other hand, of a transaction as
contemplated shall be deemed to be in the same proportion that the total value
received by or paid to or contemplated to be received by or paid to the Company
or its stockholders or affiliates, as the case may be, as a result of or in
connection with the transaction (whether or not consummated) for which Xxxxxxx
Xxxxx has been retained to perform services bears to the fees paid to Xxxxxxx
Xxxxx under the Agreement; provided, that in no event shall the Company
contribute less than the amount necessary to assure that Xxxxxxx Xxxxx is not
liable for losses, claims, damages, liabilities and expenses in excess of the
amount of fees actually received by Xxxxxxx Xxxxx 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 a Company or other conduct by that Company (or its
employees or other agents), on the one hand, or by Xxxxxxx Xxxxx, on the other
hand.
Neither Company shall settle any Proceeding in respect of which indemnity
may be sought hereunder, whether or not Xxxxxxx Xxxxx is an actual or potential
party to such Proceeding, without Xxxxxxx Xxxxx'x prior written consent. For
purposes of this Indemnification Agreement, Xxxxxxx Xxxxx shall include Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, any of its affiliates, each other
person, if any, controlling Xxxxxxx Xxxxx Xxxxxx, Xxxxxx & Xxxxx Incorporated or
any of its affiliates, their respective officers, current and former officers,
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 Companies agree that neither Xxxxxxx Xxxxx nor any of its affiliates,
officers, directors, agents, employees or controlling persons shall have any
liability to the Companies or any person asserting claims on behalf of or in
right of the Companies in connection with or as a result of either Xxxxxxx
Xxxxx'x 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 Companies resulted solely from
the gross negligence or willful misconduct of Xxxxxxx Xxxxx in performing the
services that are the subject of the 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, except for the Fund, for which such Company
or any of its affiliates 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 COMPANIES AND XXXXXXX XXXXX CONSENT TO THE JURISDICTION OF SUCH COURTS
AND PERSONAL SERVICE WITH RESPECT THERETO. THE COMPANIES HEREBY CONSENT 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 XXXXXXX XXXXX OR ANY INDEMNIFIED PARTY. EACH OF XXXXXXX XXXXX AND THE
COMPANIES WAIVE 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. EACH 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 THAT COMPANY AND MAY BE ENFORCED
IN ANY OTHER COURTS TO THE JURISDICTION OF WHICH THAT COMPANY IS OR MAY BE
SUBJECT, BY SUIT UPON SUCH JUDGMENT.
The foregoing Indemnification Agreement shall remain in full force and
effect notwithstanding any termination of Xxxxxxx Xxxxx'x 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:
STONEBRIDGE ADVISORS LLC
By:
-------------------------------------
Name:
Title:
Accepted and agreed to as of
the date first above written:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
-------------------------------------
Name:
Title:
