EX-99 4 exhibit5.txt BLANKET BOND INSURANCE AGREEMENT 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/ James A. Bowen ----------------------------- James A. Bowen, 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 Jones Internet Index(SM) Fund......................................................(FDN) First Trust Dow Jones 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 BICK Index Fund.......................................................................(BICK) First Trust Dow Jones 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 Jones 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 Jones 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 Jones 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 Jones 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 BICK 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 Jones 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 Jones 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 Jones 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 BICK 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 Frist 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 ========