First Trust High Income Long/Short Fund: Omission of Shareholder Proposal Submitted by Dolphin Limited Partnership I, L.P.
March 1, 2019
February 27, 2019
Mr. Jonathan A. Koff, Esq.
Chapman & Cutler LLP
111 West Monroe Street
Chicago, IL 60603-4080
Dear Mr. Koff:
In letters dated December 14, 2018 and January 3, 2019, on behalf of First Trust High Income Long/Short Fund (the “Fund”), you requested confirmation from the staff of the Division of Investment Management (“IM”) that it would not recommend enforcement action to the Securities and Exchange Commission (the “Commission”) if a shareholder proposal and supporting statement (the “Proposal”) submitted by Dolphin Limited Partnership I, L.P. (the “Proponent”) on November 15, 2018, as amended on December 7, 2018, is excluded from the proxy materials for the Fund’s 2019 Annual Meeting (the “Proxy Materials”). We also have received correspondence from the Proponent dated December 21, 2018 and January 31, 2019. The Proposal provides:
RESOLVED: that our Board and First Trust Advisors L.P., FSD’s investment adviser, sub-advised by Mackay Shields LLC (the “Advisor”) take all required steps with respect to First Trust High Income Long/Short Fund (NYSE Ticker Symbol: FSD) to establish a required liquidation date (“Target Term” of between 3-5 years and a Target Term liquidation net asset value (“Target Term NAV”). The Target Term and Target Term NAV shall both be set by the Advisor and seek to maximize the trading price while maintaining closure of the trading price/NAV discount to the Target Term.
The Fund maintains that the Proposal may be excluded from the Proxy Materials: (1)pursuant to Rule 14a-8(e) because the Fund received the Proposal after the deadline for submitting proposals; (2) pursuant to Rule 14a-8(c) and Rule 14a-8(f)(1) because the Proposal includes two proposals; (3) pursuant to Rule 14a-8(i)(13) because the Proposal relates to specific amounts of dividends; and (4) pursuant to Rule 14a-8(i)(6) because the Fund lacks the power or authority to implement the proposal.
There appears to be some basis for your view that the Fund may exclude the Proposal under Rule 14a-8(i)(6). Based on the information that you have provided, it appears the Fund lacks the power or authority to implement the proposal. Accordingly, we will not recommend action to the Commission if the Fund excludes the Proposal from its proxy materials in reliance on Rule 14a-8(i)(6). In reaching this position, we have not found it necessary to address the alternative bases for omission of the Proposal upon which the Fund relies.
Attached is a description of the informal procedures the Division follows in responding to shareholder proposals. You may contact email@example.com if you have any questions.
/s/ Raymond A. Be
Raymond A. Be
cc: Martin D. Sklar
Kleinberg, Kaplan, Wolff & Cohen, P.C.