TRANSFER AGENCY SERVICES AGREEMENT
THIS AGREEMENT is made as of August 27, 2003 by and between PFPC INC.,
a Massachusetts corporation ("PFPC"), and FIRST TRUST VALUE LINE(R) DIVIDEND
FUND, a Massachusetts business trust (the "Fund").
W I T N E S S E T H:
WHEREAS, the Fund is registered as a closed-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund wishes to retain PFPC to serve as transfer agent,
registrar, dividend disbursing agent and shareholder servicing agent and PFPC
wishes to furnish such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Definitions. As Used in this Agreement:
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(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as
amended.
(c) "Authorized Person" means any officer of the Fund and any
other person duly authorized by the Fund to give Oral
Instructions and Written Instructions on behalf of the Fund.
An Authorized Person's scope of authority may be limited by
setting forth such limitation in a written document signed by
both parties hereto.
(d) "Oral Instructions" mean oral instructions received by PFPC
from an Authorized Person or from a person reasonably believed
by PFPC to be an Authorized Person. PFPC may, in its sole
discretion in each separate instance, consider and rely upon
instructions it receives from an Authorized Person via
electronic mail as Oral Instructions.
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(e) "SEC" means the Securities and Exchange Commission.
(f) "Securities Laws" mean the 1933 Act, the 1934 Act and the 0000
Xxx.
(g) "Shares" mean the shares of beneficial interest of any series
or class of the Fund.
(h) "Written Instructions" mean (i) written instructions signed by
an Authorized Person and received by PFPC or (ii) trade
instructions transmitted (and received by PFPC) by means of an
electronic transaction reporting system access to which
requires use of a password or other authorized identifier. The
instructions may be delivered by hand, mail, tested telegram,
cable, telex or facsimile sending device.
2. Appointment. The Fund hereby appoints PFPC to serve as transfer agent,
registrar, dividend disbursing agent and shareholder servicing agent to
the Fund in accordance with the terms set forth in this Agreement. PFPC
accepts such appointment and agrees to furnish such services.
3. Delivery of Documents. The Fund has provided or, where applicable, will
provide PFPC with the following: (a) At PFPC's request, certified or
authenticated copies of the resolutions of the Fund's board of
directors, approving the appointment of PFPC or its affiliates
to provide services to the Fund and approving this Agreement;
(b) A copy of the Fund's most recent effective registration
statement;
(c) A copy of the advisory agreement with respect to the Fund;
(d) A copy of the distribution/underwriting agreement with respect
to the Fund;
(e) A copy of the Fund's administration agreement if PFPC is not
providing the Fund with such services;
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(f) Copies of any distribution and/or shareholder servicing plans
and agreements made in respect of the Fund;
(g) A copy of the Fund's organizational documents, as filed with
the state in which the Fund is organized; and
(h) Copies (certified or authenticated where applicable) of any
and all amendments or supplements to the foregoing.
4. Compliance with Rules and Regulations. PFPC undertakes to comply with
all applicable requirements of the Securities Laws and any laws, rules
and regulations of governmental authorities having jurisdiction with
respect to the duties to be performed by PFPC hereunder. Except as
specifically set forth herein, PFPC assumes no responsibility for such
compliance by the Fund or any other entity.
5. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC shall act
only upon Oral Instructions or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or
Written Instruction it receives from an Authorized Person (or
from a person reasonably believed by PFPC to be an Authorized
Person) pursuant to this Agreement. PFPC may assume that any
Oral Instruction or Written Instruction received hereunder is
not in any way inconsistent with the provisions of
organizational documents or this Agreement or of any vote,
resolution or proceeding of the Fund's board of directors or
of the Fund's shareholders, unless and until PFPC receives
Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions
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confirming Oral Instructions so that PFPC receives the Written
Instructions by the close of business on the same day that
such Oral Instructions are received. The fact that such
confirming Written Instructions are not received by PFPC or
differ from the Oral Instructions shall in no way invalidate
the transactions or enforceability of the transactions
authorized by the Oral Instructions or PFPC's ability to rely
upon such Oral Instructions.
6. Right to Receive Advice.
(a) Advice of the Fund. If PFPC is in doubt as to any action it
should or should not take, PFPC may request directions or
advice, including Oral Instructions or Written Instructions,
from the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any
question of law pertaining to any action it should or should
not take, PFPC may request advice from counsel of its own
choosing (who may be counsel for the Fund, the Fund's
investment adviser or PFPC, at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict between
directions or advice or Oral Instructions or Written
Instructions PFPC receives from the Fund, and the advice it
receives from counsel, PFPC may rely upon and follow the
advice of counsel.
(d) Protection of PFPC. PFPC shall be indemnified by the Fund and
without liability for any action PFPC takes or does not take
in reliance upon directions or advice or Oral Instructions or
Written Instructions PFPC receives from or on behalf of the
Fund or from counsel and which PFPC believes, in good faith,
to be consistent with those directions or advice or Oral
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Instructions or Written Instructions. Nothing in this section
shall be construed so as to impose an obligation upon PFPC (i)
to seek such directions or advice or Oral Instructions or
Written Instructions, or (ii) to act in accordance with such
directions or advice or Oral Instructions or Written
Instructions.
7. Records; Visits.
(a) The books and records pertaining to the Fund, which are in the
possession or under the control of PFPC, shall be the property
of the Fund. Such books and records shall be prepared and
maintained as required by the 1940 Act and other applicable
securities laws, rules and regulations. The Fund and
Authorized Persons shall have access to such books and records
at all times during PFPC's normal business hours. Upon the
reasonable request of the Fund, copies of any such books and
records shall be provided by PFPC to the Fund or to an
Authorized Person, at the Fund's expense.
(b) PFPC shall keep the following records:
(i) all books and records as are customarily maintained by
the transfer agent for a registered investment company.
8. Confidentiality. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information that
is competitively sensitive material, and not generally known to the
public, including, but not limited to, information about product plans,
marketing strategies, finances, operations, customer relationships,
customer profiles, customer lists, sales estimates, business plans, and
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internal performance results relating to the past, present or future
business activities of the Fund or PFPC, their respective subsidiaries
and affiliated companies and the customers, clients and suppliers of
any of them; (b) any scientific or technical information, design,
process, procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality affords the
Fund or PFPC a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow
charts, databases, inventions, know-how, and trade secrets, whether or
not patentable or copyrightable; and (d) anything designated as
confidential. Notwithstanding the foregoing, information shall not be
subject to such confidentiality obligations if: (a) release of such
information is necessary or desirable in connection with PFPC's
provision of services under this Agreement; (b) it is already known to
the receiving party at the time it is obtained; (c) it is or becomes
publicly known or available through no wrongful act of the receiving
party; (d) it is rightfully received from a third party who, to the
best of the receiving party's knowledge, is not under a duty of
confidentiality; (e) it is released by the protected party to a third
party without restriction; (f) it is required to be disclosed by the
receiving party pursuant to a requirement of a court order, subpoena,
governmental or regulatory agency or law (provided the receiving party
will provide the other party written notice of such requirement, to the
extent such notice is permitted); (g) it is relevant to the defense of
any claim or cause of action asserted against the receiving party; or
(h) it has been or is independently developed or obtained by the
receiving party.
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9. Cooperation with Accountants. PFPC shall cooperate with the Fund's
independent public accountants and shall take all reasonable actions in
the performance of its obligations under this Agreement to ensure that
the necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. PFPC System. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC to
the Fund.
11. Disaster Recovery. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment to
the extent appropriate equipment is available. In the event of
equipment failures, PFPC shall, at no additional expense to the Fund,
take reasonable steps to minimize service interruptions. PFPC shall
have no liability with respect to the loss of data or service
interruptions caused by equipment failure, provided such loss or
interruption is not caused by PFPC's own willful misfeasance, bad
faith, negligence or reckless disregard of its duties or obligations
under this Agreement.
12. Compensation. As compensation for services rendered by PFPC during the
term of this Agreement, the Fund will pay to PFPC a fee or fees as may
be agreed to from time to time in writing by the Fund and PFPC. The
Fund acknowledges that PFPC may receive float benefits and/or
investment earnings in connection with maintaining certain accounts
required to provide services under this Agreement.
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13. Indemnification.
(a) The Fund agrees to indemnify, defend and hold harmless PFPC
and its affiliates, including their respective officers,
directors, agents and employees, from all taxes, charges,
expenses, assessments, claims and liabilities (including,
without limitation, reasonable attorneys' fees and
disbursements and liabilities arising under the Securities
Laws and any state and foreign securities and blue sky laws)
("Claims") arising directly or indirectly from any action or
omission to act which PFPC takes in connection with the
provision of services to the Fund. Neither PFPC, nor any of
its affiliates, shall be indemnified against any liability (or
any expenses incident to such liability) caused by PFPC's or
its affiliates' own willful misfeasance, bad faith, negligence
or reckless disregard in the performance of PFPC's activities
under this Agreement, provided that in the absence of a
finding to the contrary the acceptance, processing and/or
negotiation of a fraudulent payment for the purchase of Shares
shall be presumed not to have been the result of PFPC's or its
affiliates own willful misfeasance, bad faith, negligence or
reckless disregard of such duties and obligations. The
provisions of this Section 13 shall survive termination of
this Agreement.
(b) Indemnification of the Fund. PFPC agrees to defend, indemnify
and hold the Fund and its officers, directors and employees
harmless from any and all Claims arising directly or
indirectly from the negligence, bad faith or willful
misfeasance of PFPC in the performance of its duties
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hereunder. Notwithstanding the foregoing, the Fund shall not
be indemnified against any Claim caused by the Fund's or the
Fund's other service providers' willful misfeasance, bad faith
or negligence.
(c) Indemnification Procedure.
(i) Notice of the Action. A party that seeks
indemnification under this Agreement must promptly give
the other party notice of any legal action; provided,
however, that a delay in notice does not relieve an
indemnifying party of any liability to an indemnified
party, except to the extent the indemnifying party
shows that the delay prejudiced the defense of the
action.
(ii) Participating in or Assuming the Defense. The
indemnifying party may participate in the defense at
any time or it may assume the defense by giving notice
to the other party. After assuming the defense, the
indemnifying party:
(1) must select an attorney that is satisfactory to
the other party;
(2) is not liable to the other party for any later
attorney's fees or for any other later expenses
that the other party incurs, except for reasonable
investigation costs;
(3) must not compromise or settle the action without
the other party's consent (but the other party
must not unreasonably withhold its consent); and
(4) is not liable for any compromise or settlement
made without its consent.
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(iii) Failing to Assume the Defense. If the indemnifying
party fails to participate in or assume the defense
within 15 days after receiving notice of the action,
the indemnifying party is bound by any determination
made in the action or by any compromise or settlement
made by the other party.
14. Responsibility of PFPC.
(a) PFPC shall be under no duty to take any action hereunder on
behalf of the Fund except as specifically set forth herein or
as may be specifically agreed to by PFPC and the Fund in a
written amendment hereto. PFPC shall be obligated to exercise
care and diligence in the performance of its duties hereunder
and to act in good faith in performing services provided for
under this Agreement. PFPC shall be liable only for any
damages arising out of PFPC's failure to perform its duties
under this Agreement to the extent such damages arise out of
PFPC's willful misfeasance, bad faith, negligence or reckless
disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary,
(i) PFPC shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control, including without limitation acts of God; action or
inaction of civil or military authority; public enemy; war;
terrorism; riot; fire; flood; sabotage; epidemics; labor
disputes; civil commotion; interruption, loss or malfunction
of utilities, transportation, computer or communications
capabilities; insurrection; elements of nature; or
non-performance by a third party; and (ii) PFPC shall not be
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under any duty or obligation to inquire into and shall not be
liable for the validity or invalidity, authority or lack
thereof, or truthfulness or accuracy or lack thereof, of any
instruction, direction, notice, instrument or other
information which PFPC reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary,
neither PFPC nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, whether
or not the likelihood of such losses or damages was known by
PFPC or its affiliates.
(d) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
(e) The provisions of this Section 14 shall survive termination of
this Agreement.
15. Description of Services.
(a) Services Provided on an Ongoing Basis, If Applicable.
(i) Maintain shareholder registrations;
(ii) Provide toll-free lines for shareholders relating to
shareholder accounts;
(iii) Provide periodic shareholder lists and statistics;
(iv) Mailing of year-end tax information; and
(v) Periodic mailing of shareholder dividend reinvestment
plan account information and Fund financial reports.
(b) Dividends and Distributions. PFPC must receive a resolution of
the Fund's board of directors authorizing the declaration and
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payment of dividends and distributions. Upon receipt of the
resolution, PFPC shall issue the dividends and distributions
in cash, or, if the resolution so provides, pay such dividends
and distributions in Shares. Such issuance or payment shall be
made after deduction and payment of the required amount of
funds to be withheld in accordance with any applicable tax
laws or other laws, rules or regulations. PFPC shall timely
send to the Fund's shareholders tax forms and other
information, or permissible substitute notice, relating to
dividends and distributions, paid by the Fund as are required
to be filed and mailed by applicable law, rule or regulation.
PFPC shall maintain and file with the United States Internal
Revenue Service and other appropriate taxing authorities
reports relating to all dividends above a stipulated amount
(currently $10.00 accumulated yearly dividends) paid by the
Fund to its shareholders as required by tax or other law, rule
or regulation.
In accordance with the Prospectus and such procedures and
controls as are mutually agreed upon from time to time by and
among the Fund, PFPC and the Fund's Custodian, PFPC shall
process applications from Shareholders relating to the Fund's
Dividend Reinvestment Plan ("Dividend Reinvestment Plan")
and will effect purchases of Shares in connection with
the Dividend Reinvestment Plan. As the dividend disbursing
agent, PFPC shall, on or before the payment date of any such
dividend or distribution, notify the fund accounting agent of
the estimated amount required to pay any portion of said
dividend or distribution which is payable in cash, and on or
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before the payment date of such distribution, the Fund shall
instruct the custodian to make available to the dividend
disbursing agent sufficient funds for the cash amount to be
paid out. If a shareholder is entitled to receive additional
Shares, by virtue of any distribution or dividend, appropriate
credits will be made to his or her account and/or certificates
delivered where requested, all in accordance with the Dividend
Reinvestment Plan.
(c) Communications to Shareholders. Upon timely written
instructions, PFPC shall mail all communications by the Fund
to its shareholders, including:
(i) Reports to shareholders;
(ii) Monthly or quarterly dividend reinvestment plan
statements;
(iii) Dividend and distribution notices;
(iv) Proxy material; and
(v) Tax form information.
PFPC will receive and tabulate the proxy cards for the
meetings of the Fund's shareholders.
(d) Records. PFPC shall maintain records of the accounts for each
shareholder showing the following information:
(i) Name, address and United States Tax Identification or
Social Security number;
(ii) Number and class of shares held and number and class of
shares for which certificates, if any, have been
issued, including certificate numbers and
denominations;
(iii) Historical information regarding the account of each
shareholder, including dividends and distributions paid
and the date and price for all transactions on a
shareholder's account;
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(iv) Any stop or restraining order placed against a
shareholder's account;
(v) Any correspondence relating to the current maintenance
of a shareholder's account;
(vi) Information with respect to withholdings; and
(vii) Any information required in order for the transfer
agent to perform any calculations contemplated or
required by this Agreement.
(e) Shareholder Inspection of Stock Records. Upon requests from
Fund shareholders to inspect stock records, PFPC will notify
the Fund and require instructions granting or denying each
such request. Unless PFPC has acted contrary to the Fund's
instructions, the Fund agrees to release PFPC from any
liability for refusal of permission for a particular
shareholder to inspect the Fund's shareholder records.
16. Duration and Termination.
(a) This Agreement shall be effective on the date first written
above and shall continue for a period of five (5) years (the
"Initial Term").
(b) Upon the expiration of the Initial Term, this Agreement shall
automatically renew for successive terms of one (1) year
("Renewal Terms") each, unless the Fund or PFPC provides
written notice to the other of its intent not to renew. Such
notice must be received not less than ninety (90) days prior
to the expiration of the Initial Term or the then current
Renewal Term.
(c) In the event a termination notice is given by the Fund, all
expenses associated with movement of records and materials and
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conversion thereof to a successor transfer agent(s) (and any
other service provider(s)), and all trailing expenses incurred
by PFPC, will be borne by the Fund.
(d) If a party hereto is guilty of a material failure to perform
its duties and obligations hereunder (a "Defaulting Party")
the other party (the "Non-Defaulting Party") may give written
notice thereof to the Defaulting Party, and if such material
breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party. In
all cases, termination by the Non-Defaulting Party shall not
constitute a waiver by the Non-Defaulting Party of any other
rights it might have under this Agreement or otherwise against
the Defaulting Party.
17. Notices. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx ------- 19809, Attention: President; (b)
if to the Fund, at 0000 Xxxxxxxxxxx Xxxx, Xxxxx, XX 00000, Attention:
W. Xxxxx Xxxxxxx or (c) if to neither of the foregoing, at such other
address as shall have been given by like notice to the sender of any
such notice or other communication by the other party. If notice is
sent by confirming telegram, cable, telex or facsimile sending device,
it shall be deemed to have been given immediately. If notice is sent by
first-class mail, it shall be deemed to have been given three days
after it has been mailed. If notice is sent by messenger, it shall be
deemed to have been given on the day it is delivered.
18. Amendments. This Agreement, or any term thereof, may be changed or
waived only by a written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
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19. Delegation; Assignment. PFPC may assign its rights and delegate its
duties hereunder to any majority-owned direct or indirect subsidiary of
PFPC or of The PNC Financial Services Group, Inc., provided that PFPC
gives the Fund 30 days prior written notice of such assignment or
delegation. In addition, PFPC may, in its sole discretion, engage
subcontractors to perform any of the obligations contained in this
Agreement to be performed by PFPC, provided, however, PFPC shall remain
responsible for the acts or omissions of any such sub-contractors.
20. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
21. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
22. Miscellaneous.
(a) Entire Agreement. This Agreement embodies the entire agreement
and understanding between the parties and supersedes all prior
agreements and understandings relating to the subject matter
hereof, provided that the parties may embody in one or more
separate documents their agreement, if any, with respect to
delegated duties.
(b) No Changes that Materially Affect Obligations. Notwithstanding
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anything in this Agreement to the contrary, the Fund agrees
not to make any modifications to its registration statement or
adopt any policies which would affect materially the
obligations or responsibilities of PFPC hereunder without the
prior written approval of PFPC, which approval shall not be
unreasonably withheld or delayed.
(c) Captions. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit
any of the provisions hereof or otherwise affect their
construction or effect.
(d) Governing Law. This Agreement shall be deemed to be a contract
made in Delaware and governed by Delaware law, without regard
to principles of conflicts of law.
(e) Partial Invalidity. If any provision of this Agreement shall
be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be
affected thereby.
(f) Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
(g) No Representations or Warranties. Except as expressly provided
in this Agreement, PFPC hereby disclaims all representations
and warranties, express or implied, made to the Fund or any
other person, including, without limitation, any warranties
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regarding quality, suitability, merchantability, fitness for a
particular purpose or otherwise (irrespective of any course of
dealing, custom or usage of trade), of any services or any
goods provided incidental to services provided under this
Agreement. PFPC disclaims any warranty of title or
non-infringement except as otherwise set forth in this
Agreement.
(h) Facsimile Signatures. The facsimile signature of any party to
this Agreement shall constitute the valid and binding
execution hereof by such party.
(i) The Fund and PFPC agree that the obligations of the Fund under
the Agreement shall not be binding upon any of the directors,
shareholders, nominees, officers, employees or agents, whether
past, present or future, of the Fund individually, but are
binding only upon the assets and property of the Fund (or
applicable series thereof), as provided in the Declaration of
Trust. The execution and delivery of this Agreement have been
authorized by the directors of the Fund, and signed by an
authorized officer of the Fund, acting as such, and neither
such authorization by such directors nor such execution and
delivery by such officer shall be deemed to have been made by
any of them or any shareholder of the Fund individually or to
impose any liability on any of them or any shareholder of the
Fund personally, but shall bind only the assets and property
of the Fund (or applicable series thereof), as provided in the
Articles of Incorporation or Declaration of Trust.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By:
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Title:
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FIRST TRUST VALUE LINE(R) DIVIDEND FUND
By:
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Title:
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