STRUCTURING FEE AGREEMENT
STRUCTURING FEE AGREEMENT (the "Agreement"), dated as of [ ],
2010, between Xxxxxxx Xxxxx & Associates, Inc. ("Qualifying Underwriter"), First
Trust Advisors L.P. ("First Trust Advisors") and MacKay Xxxxxxx LLC ("XxxXxx",
together with First Trust Advisors, the "Advisors").
WHEREAS, First Trust High Income Long/Short Fund (including any successor
by merger or otherwise, 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 ("common
shares") are registered under the Securities Act of 1933, as amended;
WHEREAS, the Fund and the Advisors have entered into an underwriting
agreement (the "Underwriting Agreement"), dated [ ], 2010 with each
of the underwriters named therein (the "Underwriters");
WHEREAS, First Trust Advisors is the adviser of the Fund;
WHEREAS, MacKay is the sub-adviser of the Fund.
WHEREAS, Qualifying Underwriter is acting as a co-manager in an offering
of the Fund's common shares; and
WHEREAS, the Advisors desire to provide a structuring fee (the "Fee") to
Qualifying Underwriter for services assisting the Advisors with respect to the
structure and design of the Fund and the organization of the Fund as well as
services related to the sale and distribution of the Fund's common shares,
including without limitation, views from an investor market and distribution
perspective on (i) investment policies to consider in light of today's market,
(ii) the amount and nature of economic and/or financial leverage that could be
accepted by the potential investor community, (iii) marketing issues with
respect to investments in non-investment grade securities, (iv) marketing issues
with respect to utilization of a long/short strategy and (v) the overall
marketing and positioning for the Fund's initial public offering;
NOW, THEREFORE, in consideration of the mutual terms and conditions set
forth below, the parties hereto agree as follows:
1. In consideration of the services noted above, the Advisors shall pay to the
Qualifying Underwriter a Fee of [ ]% of the aggregate purchase
price of the common shares sold in the offering by Qualifying Underwriter;
provided that the total amount of the Fee shall not exceed [(black
circle)]% of the total price to the public of the Fund's common shares
offered by the prospectus dated [ ], 2010 (the "Prospectus")
(including all Initial Securities and Option Securities as such terms are
described in the Underwriting Agreement). The Fee shall be paid at the same
time as the delivery of the common shares to the underwriters in the
offering and shall be made by wire transfer to the order of Qualifying
Underwriter.
2. This Agreement shall terminate upon the payment of the entire amount of the
Fee, as specified in Section 1 hereof or upon the termination of the
Underwriting Agreement without common shares having been delivered and paid
for.
3. 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.
4. 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 Advisors and Qualifying Underwriter
consent to the jurisdiction of such courts and personal service with
respect thereto. Each of Qualifying Underwriter and the Advisors 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 the Advisors and Qualifying Underwriter agrees that a final judgment in
any proceeding or counterclaim brought in any such court shall be
conclusive and binding upon the Advisors and Qualifying Underwriter, as the
case may be, and may be enforced in any other courts to the jurisdiction of
which the Advisors and Qualifying Underwriter, as the case may be, is or
may be subject, by suit upon such judgment.
5. This Agreement may not be assigned by either party without the prior
written consent of the other parties.
6. 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 both Qualifying Underwriter
and the Advisors.
7. All notices required or permitted to be sent under this Agreement shall be
sent, if to First Trust Advisors:
First Trust Advisors L.P.
[ ]
or if to MacKay:
MacKay Xxxxxxx LLC
[ ]
or if to Qualifying Underwriter:
Xxxxxxx Xxxxx & Associates, Inc.
000 Xxxxxxxx Xxxxxxx
Tower 3, 0xx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
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.
8. 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.
IN WITNESS WHEREOF, the parties hereto have duly executed this Structuring
Fee Agreement as of the date first above written.
XXXXXXX XXXXX & ASSOCIATES, INC.
By: ______________________________
Name: Xxxxx Xxxxx
FIRST TRUST ADVISORS L.P.
By: ______________________________
Name:
Title:
MACKAY XXXXXXX LLC
By: ______________________________
Name:
Title:
INDEMNIFICATION AGREEMENT
[ ], 2010
Xxxxxxx Xxxxx & Associates, Inc.
000 Xxxxxxxx Xxxxxxx
Tower 3, 0xx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Ladies and Gentlemen:
In connection with the engagement of Xxxxxxx Xxxxx & Associates, Inc.
("Qualifying Underwriter") to advise and assist the undersigned (together with
their affiliates and subsidiaries, referred to as the "Companies") with the
matters set forth in the Structuring Fee Agreement dated [ ], 2010
between the Companies and Qualifying Underwriter (the "Agreement"), in the event
that Qualifying Underwriter 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
(other than those services provided under the Underwriting Agreement), the
Companies agree to indemnify, defend and hold Qualifying Underwriter 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 (other than those services
provided under the Underwriting Agreement), except to the extent that it shall
be determined by a court of competent jurisdiction that such losses, claims,
damages, liabilities and expenses resulted primarily from the gross negligence
or willful misconduct of Qualifying Underwriter. In addition, in the event that
Qualifying Underwriter 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 (other
than those services provided under the Underwriting Agreement), the Companies
will reimburse Qualifying Underwriter for its reasonable legal and other
expenses incurred 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 from the gross negligence or willful misconduct of
Qualifying Underwriter or Qualifying Underwriter is not otherwise entitled to
indemnification hereunder. If such indemnification were not to be available for
any reason, the Companies agree 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 Companies and
their stockholders and affiliates, on the one hand, and Qualifying Underwriter,
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 Companies and their stockholders and affiliates, on the one hand, and the
party entitled to contribution, on the other hand, as well as any other relevant
equitable considerations. The Companies agree that for the purposes of this
paragraph the relative benefits received, or sought to be received, by the
Companies and their stockholders 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 Companies or their
stockholders or affiliates, as the case may be, as a result of or in connection
with the Agreement bears to the fees paid to Qualifying Underwriter under the
Agreement; provided, that in no event shall the Companies contribute less than
the amount necessary to assure that Qualifying Underwriter is not liable for
losses, claims, damages, liabilities and expenses in excess of the amount of
fees actually received by Qualifying Underwriter 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 Companies or other conduct by the Companies (or
their employees or other agents), on the one hand, or by Qualifying Underwriter,
on the other hand. The Companies will not settle any Proceeding in respect of
which indemnity may be sought hereunder, whether or not Qualifying Underwriter
is an actual or potential party to such Proceeding, without Qualifying
Underwriter's prior written consent. The Companies shall not be liable for any
settlement of any Proceeding effected by Qualifying Underwriter without its
prior written consent. For purposes of this Indemnification Agreement,
Qualifying Underwriter shall include Qualifying Underwriter, any of its
affiliates, each other person, if any, controlling Qualifying Underwriter 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 Companies agree that neither Qualifying Underwriter nor any of its
affiliates, 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 Qualifying
Underwriter'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 (other than those services provided under the
Underwriting Agreement), except to the extent that it shall be determined by a
court of competent jurisdiction that any losses, claims, damages, liabilities or
expenses incurred by the Companies resulted primarily from the gross negligence
or willful misconduct of Qualifying Underwriter in performing the services that
are the subject of the Agreement. Nothing in this Indemnification Agreement
shall be read or construed to limit any liability or obligations of any party
arising under or in connection with the Underwriting Agreement.
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 QUALIFYING UNDERWRITER 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 QUALIFYING UNDERWRITER OR ANY INDEMNIFIED PARTY. EACH OF
QUALIFYING UNDERWRITER AND THE COMPANIES 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. EACH OF QUALIFYING UNDERWRITER
AND THE COMPANIES 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 QUALIFYING UNDERWRITER AND THE
COMPANIES, AS THE CASE MAY BE, AND MAY BE ENFORCED IN ANY OTHER COURTS TO THE
JURISDICTION OF WHICH QUALIFYING UNDERWRITER AND THE COMPANIES, AS THE CASE MAY
BE, 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 the Agreement. 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:
MACKAY XXXXXXX LLC
By: ______________________________
Name:
Title:
Accepted and agreed to as of
the date first above written:
XXXXXXX XXXXX & ASSOCIATES, INC.
By: ______________________________
Name: Xxxxx Xxxxx
Title: Managing Director
