As filed with the Securities and Exchange Commission on August 10, 20066, 2007
===============================================================================
1933 Act File No. 333-115414
1940 Act File No. 811-21539
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the Commission only (as permitted by
Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Section 240.14a-12
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II
MACQUARIE/FIRST TRUST GLOBAL INFRASTRUCTURE/
UTILITIES DIVIDEND & INCOME FUND
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
August 11, 20066, 2007
Dear Shareholder:
The accompanying materials relate to the Joint Annual Meetings of
Shareholders (each a "Meeting" and collectively, the "Meetings") of First
Trust/Four Corners Senior Floating Rate Income Fund and First Trust/Four Corners
Senior Floating Rate Income Fund II and Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund (each a "Fund" and collectively, the
"Funds"). The Meetings will be held at the offices of First Trust Advisors L.P.,
1001 Warrenville Road, Suite 300, Lisle, Illinois 60532, on Monday, September
11,
200610, 2007 at 4:00 p.m. Central time.
At the Meeting, you will be asked to vote on a proposal to elect
Trustees of your Fund and to transact such other business as may properly come
before the Meeting and any adjournments or postponements thereof. The proposal is described in
the accompanying Notice of Joint Annual Meetings of Shareholders and Joint Proxy
Statement.
YOUR PARTICIPATION AT THE MEETING IS VERY IMPORTANT. If you cannot
attend the Meeting, you may participate by proxy. As a shareholder, you cast one
vote for each share of a Fund that you own and a proportionate fractional vote
for any fraction of a share that you own. Please take a few moments to read the
enclosed materials and then cast your vote on the enclosed proxy card.
VOTING TAKES ONLY A FEW MINUTES. EACH SHAREHOLDER'S VOTE IS IMPORTANT.
YOUR PROMPT RESPONSE WILL BE MUCH APPRECIATED.
After you have voted on the proposal, please be sure to SIGN YOUR PROXY
CARD AND RETURN IT IN THE ENCLOSED POSTAGE-PAID ENVELOPE.sign your proxy
card and return it in the enclosed postage-paid envelope.
We appreciate your participation in this important Meeting. Thank you.
Sincerely,/s/ James A. Bowen
James A. Bowen
Chairman of the Board
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of
assistance to you and avoid the time and expense to yourthe Fund involved in
validating your vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to the name shown in the registration.
3. All Other Accounts: The capacity of the individual signing the
proxy should be indicated unless it is reflected in the form of registration.
For example:
REGISTRATION VALID SIGNATURE
CORPORATE ACCOUNTS
(1) ABC Corp. ABC Corp.
(2) ABC Corp. John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer John Doe
(4) ABC Corp. Profit Sharing Plan John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78 Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr., UGMA John B. Smith
(2) John B. Smith John B. Smith, Jr., Executor
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II
MACQUARIE/FIRST TRUST GLOBAL INFRASTRUCTURE/
UTILITIES DIVIDEND & INCOME FUND
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
NOTICE OF JOINT ANNUAL MEETINGS OF SHAREHOLDERS
To be held on September 11, 2006TO BE HELD ON SEPTEMBER 10, 2007
August 11, 20066, 2007
To the Shareholders of the above Funds:
Notice is hereby given that the Joint Annual Meetings of Shareholders
(each a "Meeting" and collectively, the "Meetings") of First Trust/Four Corners
Senior Floating Rate Income Fund and First Trust/Four Corners Senior Floating
Rate Income Fund II and Macquarie/First Trust Global Infrastructure/Utilities
Dividend & Income Fund (each a "Fund" and collectively, the "Funds"), each a
Massachusetts business trust, will be held at the offices of First Trust
Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532, on
Monday, September 11, 2006,10, 2007, at 4:00 p.m. Central time, for the following
purposes:
1. To elect fiveThe election of Trustees of each Fund as outlined below:
a. For Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund: Five
(5) Trustees are to be elected by holders of Common
Shares of the Fund, voting as a single class.
Trustees Bowen, Erickson, Kadlec, Keith and Nielson
are nominees for election by all shareholders of the
Fund.
b. For First Trust/Four Corners Senior Floating Rate
Income Fund and First Trust/Four Corners Senior
Floating Rate Income Fund II:
i. Three (3) Trustees are to be elected by
holders of Common and Preferred Shares of
each Fund, voting together as a single
class. Trustees Bowen, Erickson and Nielson
are nominees for election by holders of
Common and Preferred Shares of each Fund;
and
ii. Two (2) Trustees are to be elected by
holders of Preferred Shares of each Fund,
voting as a single class. Trustees Kadlec
and Keith are nominees for election by
holders of Preferred Shares of each Fund.
2. To transact such other business as may properly come
before the Meetings or any adjournments or postponementsadjournment thereof.
The Board of Trustees has fixed the close of business on July 10, 2006June 21, 2007
as the record date for the determination of shareholders entitled to notice of
and to vote at the Meetings.
By order of the Board of Trustees,
/s/ W. Scott Jardine
W. Scott Jardine
Secretary
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SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETINGMEETINGS ARE REQUESTED TO PROMPTLY
COMPLETE, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE WHICH
NEEDS NODOES NOT REQUIRE POSTAGE IF MAILED IN THE CONTINENTAL UNITED STATES.
INSTRUCTIONS FOR THE PROPER EXECUTION OF PROXIES ARE SET FORTH ON THE INSIDE
COVER.
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FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II
MACQUARIE/FIRST TRUST GLOBAL INFRASTRUCTURE/
UTILITIES DIVIDEND & INCOME FUND
JOINT ANNUAL MEETINGS OF SHAREHOLDERS
SEPTEMBER 11, 200610, 2007
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
JOINT PROXY STATEMENT
AUGUST 11, 20066, 2007
This Joint Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Trustees of First Trust/Four Corners
Senior Floating Rate Income Fund and First Trust/Four Corners Senior Floating
Rate Income Fund II and Macquarie/First Trust Global Infrastructure/Utilities
Dividend & Income Fund (each a "Fund" and collectively, the "Funds"), each a
Massachusetts business trust, for use at the Annual Meetings of Shareholders of
the Funds to be held on Monday, September 11, 2006,10, 2007, at 4:00 p.m. Central time,
at the offices of First Trust Advisors L.P., 1001 Warrenville Road, Suite 300,
Lisle, Illinois 60532, and at any adjournments or postponements thereof (each a "Meeting" and
collectively, the "Meetings"). A Notice of the Joint Annual Meetings of Shareholders
and a proxy card accompany this Joint Proxy Statement. The BoardBoards of Trustees of
the Funds hashave determined that the use of this Joint Proxy Statement is in the
best interests of each Fund and its shareholders in light of the same mattersmatter
being considered and voted on by shareholders.
BeginningProxy solicitations will be made beginning on or about August 11, 2006,6, 2007,
primarily by mail. However, proxy solicitations will be
made, primarily by mail, but may also be made by telephone or
personal interviews conducted by (i) officers of each Fund; officers or employees of(ii) First Trust
Advisors L.P. ("First Trust Advisors" or the "Adviser"), the investment adviser
of the Funds; and employees of(iii) PFPC Inc. ("PFPC"), the administrator, accounting agent and
transfer agent of the Funds and a subsidiary of The PNC Financial Services Group
Inc.,; or (iv) any affiliates of their affiliates.those entities. The costs of proxy
solicitation and expenses incurred in connection
with the preparation of this Joint Proxy Statement and its enclosures will be
paid by the Funds. The Funds will also reimburse brokerage firms and others for
their expenses in forwarding solicitation material to the beneficial owners of
Fund shares.
The close of business on June 21, 2007 has been fixed as the record
date (the "Record Date") for the determination of shareholders entitled to
notice of and to vote at the Meetings and any adjournments or postponements
thereof.
THE FUNDS' MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS ARE AVAILABLE
UPON REQUEST, WITHOUT CHARGE, BY WRITING TO THE ADVISER AT 1001 WARRENVILLE
ROAD, SUITE 300, LISLE, ILLINOIS 60532, BY CALLING (800) 988-5891 OR BY CALLING 1-800-988-5891.VISITING
EACH FUND'S WEBSITE LOCATED AT HTTP://WWW.FTPORTFOLIOS.COM. THIS JOINT PROXY
STATEMENT AND THE ENCLOSED PROXY CARD WILL FIRST BE MAILED TO SHAREHOLDERS ON OR
ABOUT AUGUST 11, 2006.6, 2007.
VOTING
For each Fund, the affirmative vote of a plurality of the shares
present and entitled to vote at the Meeting will be required to elect the
Trustees of that Fund provided a quorum is present. Abstentions and broker
non-votes will have no effect on the approval of the proposal. If the enclosed
proxy card is properly executed and returned in time to be voted at the Meeting,
(including any adjournments or postponements thereof),
the shares represented thereby will be voted in accordance with the instructions
Page 1
marked thereon. If no instructions are marked on the enclosed proxy card, shares
represented thereby will be voted in the discretion of the persons named on the
proxy card. Accordingly, unless instructions to the contrary are marked thereon,
a proxy will be voted FOR the election of the nominees as Trustees and FOR or
AGAINST any other matters properly before the Meeting as deemed appropriate. Any shareholder who has given a
proxy has the right to revoke it at any time prior to its exercise either by
attending the Meeting and voting his or her shares in person, or by submitting a
letter of revocation or a later-dated proxy to the applicable Fund at the above
address prior to the date of the Meeting. Shareholders who intendA list of shareholders entitled to attendbe
present and to vote at the MeetingMeetings will be available at the offices of the
Funds, 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532, for inspection
by any shareholder during regular business hours beginning ten days prior to the
date of the Meetings. Shareholders will need to show valid identification and
proof of share ownership to be admitted to the Meeting.
Under the By-Laws of each Fund, a quorum is constituted by the presence
in person or by proxy of the holders of thirty-three and one-third percent
(33-1/3%) of the voting power of the outstanding Sharesclass of shares entitled to
vote on a matter. For the purposes of establishing whether a quorum is present,
all shares present and entitled to vote, including abstentions and broker
non-votes (i.e., shares held by brokers or nominees as to which (i) instructions
have not been received from the beneficial owners or the persons entitled to
vote and (ii) the broker or nominee does not have discretionary voting power on
a particular matter), shall be counted. Any meeting of Shareholdersshareholders may be
postponed prior to the meeting with notice to the Shareholdersshareholders entitled to vote
at that meeting. Any meeting of Shareholdersshareholders may, by action of the chairman of
the meeting, be adjourned without further notice with respect to one or more
matters to be considered at such meeting to a designated time and place, whether
or not a quorum is present with respect to such matter. In addition, upon motion
of the chairman of the meeting, the question of adjournment may be submitted to
a vote of the Shareholders,shareholders, and in that case, any adjournment with respect to
one or more matters must be approved by the vote of holders of a majority of the
Sharesshares present and entitled to vote with respect to the matter or matters
adjourned, and without further notice. Unless a proxy is otherwise limited in
this regard, any Sharesshares present and entitled to vote at a Meetingmeeting that are
represented by broker non-votes, may, at the discretion of the proxies named
therein, be voted in favor of such an adjournment or adjournments.
For each Fund, the affirmative voteFailure of a pluralityquorum to be present at a Meeting will necessitate
adjournment and will subject the applicable Fund to additional expense. The
persons named in the enclosed proxy may also move for an adjournment of the
shares
presentMeeting to permit further solicitation of proxies with respect to the proposals
if they determine that adjournment and entitled to vote atfurther solicitation are reasonable and
in the Meeting will be required to electbest interests of the Trustees of that Fund.
The close of business on July 10, 2006 has been fixed as the record
date (the "Record Date") for the determination of shareholders entitled to
notice of and to vote at the Meetings and any adjournments or postponements
thereof.
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income
Fund has one class of shares of beneficial interest, par value $0.01 per share,
known as Common Shares.shareholders.
- 2 -
OUTSTANDING SHARES
First Trust/Four Corners Senior Floating Rate Income Fund has two
classes of shares of beneficial interest, par value $0.01 per share, Common Sharescommon
shares and Money Market Cumulative Preferred Shares ("MMP(R) Shares"). First
Trust/Four Corners Senior Floating Rate Income Fund II has two classes of shares
of beneficial interest, par value $0.01 per share, Common
Sharescommon shares and Auction
Market Preferred Shares ("AMPS"). Throughout this Joint Proxy Page 2
Statement, common
shares of either Fund will be referred to as "Common Shares" and MMP(R) Shares
and AMPS will be collectively referred to as "Preferred Shares."
On the Record Date, each Fund had the following number of shares (theCommon and
Preferred Shares (collectively, the "Shares") outstanding:
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COMMON PREFERRED
SHARES SHARES
FUND OUTSTANDING OUTSTANDING
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First Trust/Four Corners Senior Floating Rate Income Fund 4,924,349 2,280
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First Trust/Four Corners Senior Floating Rate Income Fund II 25,272,76825,291,939 4,000
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Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund 8,980,236 N/A
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Common Shares of First Trust/Four Corners Senior Floating Rate Income
Fund are listed on the American Stock Exchange under the ticker symbol FCM.
Common Shares of Macquarie/First Trust Global Infrastructure/Utilities Dividend
& Income Fund and First Trust/Four Corners Senior Floating Rate Income Fund II
are listed on the New York Stock Exchange under the ticker symbols MFD and FCT,
respectively.symbol FCT. The
Preferred Shares of First Trust/Four Corners Senior Floating
Rate Income Fund and First Trust/Four Corners Senior Floating Rate Income Fund
IIthe Funds are not listed on a national stock exchange.
Shareholders of record on the Record Date are entitled to one vote for
each Share the shareholder owns and a proportionate fractional vote for any
fraction of a Share the shareholder owns. The following table indicates which
Shareholdersshareholders are solicited with respect to election of Trustees of each Fund:
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MATTER COMMON PREFERRED
SHARES SHARES
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Election of three (3) Trustees X X
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Election of two (2) Trustees X
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To the knowledge of the Board of Trustees, as of the Record Date, no
single shareholder or "group" (as that term is used in Section 13(d) of the
Securities Exchange Act of 1934 (the "1934 Act")) beneficially owned more than
5% of the outstanding Shares of First Trust/Four Corners Senior Floating Rate
Income Fund or First Trust/Four Corners Senior Floating Rate Income Fund II,
except as noted in the following table. Information as to beneficial ownership
of Common Shares is based on reports filed with the Securities and Exchange
Commission ("SEC") by such holders. Information as to beneficial ownership of
Preferred Shares is based on the securities position listing reports as of the
Record Date. With respect to the beneficial owners of Preferred Shares, the
Board of Trustees has no knowledge of the underlying holders.
- 3 -
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COMMON---------------------------------------- --------------------------------------- ----------------------------
% OUTSTANDING SHARES
PREFERRED
MATTERNAME AND ADDRESS OF BENEFICIAL OWNER SHARES BENEFICIALLY OWNED BENEFICIALLY OWNED
- ---------------------------------------------------------------------------------- ------------------- ------------------------------------------------------- --------------------------------------- ----------------------------
a. ElectionEaton Vance Corporation 1,337,200 Common Shares of five (5) Trustees for Macquarie/First Trust Global X
Infrastructure/Utilities Dividend &5.3%
255 State Street Trust/Four Corners Senior Floating
Boston, Massachusetts 02109 Rate Income Fund II
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The Bank of New York 194 Preferred Shares of First 8.5%
One Wall Street, 6th Floor Trust/Four Corners Senior Floating
New York, New York 10286 Rate Income Fund
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b.i. Election---------------------------------------- --------------------------------------- ----------------------------
Lehman Brothers, Inc 1,829 Preferred Shares of three (3) Trustees forFirst 80.22%
70 Hudson Trust/Four Corners Senior Floating
Jersey City, New Jersey 07302 Rate Income Fund
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E*Trade Clearing, LLC 155 Class A Preferred Shares of First 7.75%
10951 White Rock Road Trust/Four Corners Senior Floating
Rancho Cordova, California 95670 Rate Income Fund II
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Merrill Lynch 459 Class A Preferred Shares of First 22.95%
101 Hudson Street, 8th Floor Trust/Four Corners Senior Floating
Jersey City, New Jersey 07302 Rate Income Fund II
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Merrill Lynch 124 Class A Preferred Shares of First 6.2%
101 Hudson Street, 9th Floor Trust/Four Corners Senior Floating
Jersey City, New Jersey 07302 Rate Income Fund II
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Oppenheimer & Co. Inc. 383 Class A Preferred Shares of First 19.15%
125 Broad Street, 15th Floor Trust/Four Corners Senior Floating
New York, New York 10004 Rate Income Fund II
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Wells Fargo Investments, LLC 632 Class A Preferred Shares of First 31.6%
625 Marquette Avenue, 13th Floor Trust/Four Corners Senior Floating
Minneapolis, Minnesota 55402 Rate Income Fund II
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Merrill Lynch 1,748 Class B Preferred Shares of 87.4%
101 Hudson Street, 8th Floor First Trust/Four Corners Senior
X X
Floating Rate Income Fund and First Trust/Four Corners SeniorJersey City, New Jersey 07302 Floating Rate Income Fund II
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b.ii. Election of two (2) Trustees for First Trust/Four Corners Senior X
Floating Rate Income Fund and First Trust/Four Corners Senior Floating
Rate Income Fund II
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In order forthat your Shares tomay be represented at the Meeting, you are
requested to:
o indicate your instructions on the proxy card;
o date and sign the proxy card;
o mail the proxy card promptly in the enclosed envelope which
requires no postage if mailed in the continental United States; and
o allow sufficient time for the proxy to be received BY 5:4:00 P.M.,
CENTRAL TIME, on FRIDAY, SEPTEMBER 8, 2006.
Page 3
PROPOSAL 1:7, 2007.
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PROPOSAL: ELECTION OF TRUSTEES
Proposal 1The proposal relates to the election of Trustees of each Fund.
Management proposes the election of five Trustees: James A. Bowen, Richard E.
Erickson, Thomas R. Kadlec, Robert F. Keith and Niel B. Nielson. Each Trustee has
indicated his willingness to continue to serve if elected. If elected, each
nominee will hold office until the next annual meetings of shareholders or until
his successor is elected and qualified, or until he resigns, retires, or is
otherwise removed. Each of the
nominees was elected to each Fund's Board by the Fund's initial shareholder on
the Fund's respective organizational date, except for Trustee Keith, who was
appointed to each Fund's Board on June 12, 2006 by the Trustees. In addition,
each of the nominees except for Trustee Keith, was elected to each Fund's Board to serve a one-year term
by the Shareholdersshareholders at the last Joint Annual Meetings of Shareholders of the
Funds held on September 12, 2005.
a. For Macquarie/First Trust Global Infrastructure/Utilities
Dividend & Income Fund: Five (5) Trustees are11, 2006.
Each Trustee has indicated his willingness to becontinue to serve if
elected. If elected, by
holders of Common Shareseach nominee will hold office for the term specified below
or until his successor is elected and qualified, or until he resigns, retires or
is otherwise removed. Each nominee's term is in accordance with the structure of
the staggered Board of each Fund, voting aspursuant to an amendment to the Funds'
By-Laws, which was approved by the Board of each Fund on December 10, 2006. As a
single
class. Trustees Bowen, Erickson, Kadlec, Keith and Nielson are
nominees for election by all Shareholdersresult of the amendment to the Funds' By-Laws, three classes of Trustees were
established: Class I Trustees serve for a term of one year, Class II Trustees
serve for a term of two years and Class III Trustees serve for a term of three
years. As a result of the establishment by each Fund of a staggered Board, a
change in the majority of a Fund's Board of Trustees may be delayed, which may
limit the ability of certain entities or persons to acquire control of such
Fund.
b. For First Trust/Four Corners Senior Floating Rate Income Fund
and First Trust/Four Corners Senior Floating Rate Income Fund II:
i.each Fund:
1) Three (3) Trustees are to be elected by holders of Common
and Preferred Shares of eachthe Fund, voting together as a single class.
Trustees Bowen,Trustee Erickson and Nielson are
nomineesis a nominee for election as a Class I Trustee by
holders of Common and Preferred Shares of each Fund;the Fund for a one-year term;
Trustee Nielson is a nominee for election as a Class II Trustee by
holders of Common and ii.Preferred Shares of the Fund for a two-year term;
and Trustee Bowen is a nominee for election as a Class III Trustee by
holders of Common and Preferred Shares of the Fund for a three-year
term; and
2) Two (2) Trustees are to be elected by holders of
Preferred Shares of eachthe Fund, voting as a single class. Trustees Kadlec
and Keith are nominees for election as Class I Trustees by holders of
Preferred Shares of each Fund.the Fund for one-year terms.
Required Vote: The Trustees, including those who are not "interested
persons" of the Fund ("Independent Trustees")Funds as that term is defined in the Investment Company Act of
1940, as amended (the "1940 Act") (such Trustees, the "Independent Trustees"),
shall be elected by the affirmative vote of the holders of a plurality of the
Shares of each Fund cast in person or by proxy and entitled to vote thereon,
provided a quorum is present. Abstentions and broker "non-votes" will have no
effect on the approval of the proposal. Proxies cannot be voted for a greater
number of persons than the number of nominees named.
Unless you give contrary instructions on the enclosed proxy card, your
Shares will be voted FOR the election of the nominees listed if your proxy card
has been properly executed and timely received by the Fund. If any of the
nominees should withdraw or otherwise become unavailable for election, your
Shares will be voted FOR such other nominee or nominees as management may
recommend.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR
ELECTION OF THE TRUSTEES.
Page 4
ADDITIONAL INFORMATIONPROPOSAL.
- 5 -
MANAGEMENT OF THE FUNDS
The management of each Fund, including the general supervision of the
duties performed for each Fund under the investment management agreement between
each Fund and the Adviser, is the responsibility of the Board of Trustees. There
are five Trustees of each Fund, one of whom is an "interested person" (as thethat
term "interested person" is defined in the 1940 Act) (such Trustee, the "Interested Trustee") and
four of whom are Independent Trustees. During the past five years, no
Independent Trustee has been a trustee, director or employee of, or consultant
to, the Adviser, anythe sub-adviser described below under "INVESTMENT ADVISER,
SUB-ADVISERSSUB-ADVISER AND ADMINISTRATOR," or any of their affiliates. The Trustees of the
Funds set broad policies for each Fund, choose each Fund's officers, and hire
each Fund's investment adviser and if applicable, sub-adviser. The officers of the Funds manage
the day-to-day operations and are responsible to the Funds' Board of Trustees.
The following is a list of Trustees and officers of the Funds and a statement of
their present positions, principal occupations during the past five years, the
number of portfolios each Trustee oversees and the other directorships theythe
Trustees hold, if applicable.
[The remainder of this page intentionally left blank.]
- 6 -
BOARD NOMINEES
BOARD NOMINEES
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE
- ------------------------------------------------------------------------------------------------------------------------------------
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NUMBER OF
PORTFOLIOS IN
FIRST TRUST
POSITION(S) TERM OF PORTFOLIOS
OFFICE(2) PRINCIPAL IN FUND
POSITION(S) AND LENGTH OCCUPATION(S) COMPLEX OTHER
NAME, ADDRESS, AND HELD WITH AND LENGTH OF TIME DURING PAST FIVEPRINCIPAL OCCUPATION(S) OVERSEEN BY DIRECTORSHIPS
DATE OF BIRTH THE FUNDS TIME SERVED(3) DURING PAST FIVE YEARS BY TRUSTEE HELD BY TRUSTEE
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
James A. Bowen(1) President, 1 YearClass III President, First Trust 3354 Trustee of
1001 Warrenville Road Chairman of PortfoliosAdvisors L.P. and First Wheaton College
Suite 300 the Board, FirstSince Fund Trust AdvisorsPortfolios L.P.;
Lisle, IL 60532 Chief Since Fund L.P.;Inception Chairman of the D.O.B.:Board,
DOB: 9/55 Executive Inception Board, BondWave LLC (Software
Officer and (Software Development
Trustee Company/Broker-Dealer) and
Stonebridge Advisors LLC
(Investment Adviser)
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Richard E. Erickson Trustee 1 Year Physician and 33Class I Physician; President, 54 NONE
c/o First Trust Advisors President,Wheaton Orthopedics; Former
L.P. Since Fund Wheaton Orthopedics;Co-Owner and Co-Director,
1001 Warrenville Road Inception Co-Owner andSports Med Center for
Suite 300 Co-Director, SportsFitness; Limited Partner,
Lisle, IL 60532 Med Center for
D.O.B.: 4/51 Fitness; Limited
Partner, Gundersen Real Estate
PartnershipDOB: 4/51 Partnership; Limited
Partner, Sportsmed LLC
- ------------------------------------------------------------------------------------------------------------------------------------
Niel B. Nielson Trustee 1 Year President, Covenant 33 Director of
c/o First Trust Advisors College (2002 to Good News
L.P. Since Fund Present); Associate Publishers-Crossway
1001 Warrenville Road Inception Pastor, College Books; Covenant
Suite 300 Church in Wheaton Transport Inc.
Lisle, IL 60532 (1997 to 2002)
D.O.B.: 3/54
- ------------------------------------------------------------------------------------------------------------------------------------
Page 5
- ------------------------------------------------------------------------------------------------------------------------------------
NUMBER OF
TERM OF PORTFOLIOS
OFFICE(2) PRINCIPAL IN FUND
POSITION(S) AND LENGTH OCCUPATION(S) COMPLEX OTHER
NAME, ADDRESS, AND HELD WITH OF TIME DURING PAST FIVE OVERSEEN DIRECTORSHIPS
DATE OF BIRTH THE FUNDS SERVED(3) YEARS BY TRUSTEE HELD BY TRUSTEE
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Thomas R. Kadlec Trustee 1 YearClass I Senior Vice President ADM 33(May 54 NONE
c/o First Trust Advisors Derivatives, Inc.2007 to Present), Vice
L.P. Since Fund (May 2005 toPresident and Chief
1001 Warrenville Road Inception Present);Financial Officer (1990 to
Suite 300 Vice-President, ChiefMay 2007), ADM Investor
Lisle, IL 60532 Financial Officer,
D.O.B.: 11/57 ADM Investor
Services, Inc. (Futures
DOB: 11/57 Commission Merchant) (1990; Vice
President (May 2005 to
Present), ADM Derivatives,
Inc.; Registered
Representative (2000 to
present), Segerdahl &
Company, Inc., an NASD
member (Broker-Dealer)
(2000
to Present)
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Robert F. Keith Trustee 1 YearClass I President Hibs 21(2003 to Present), 54 NONE
c/o First Trust Advisors Hibs Enterprises (Financial
L.P. Since June (Financial2006 and Management Consulting);
1001 Warrenville Road 2006 ManagementPresident (2001 to 2003),
Suite 300 Consulting) (2003 toAramark Service Master
Lisle, IL 60532 Present);Management; President D.O.B.:and
DOB: 11/56 Aramark ServiceMaster58 Chief Operating Officer
(1998 to 2003), Service
Master Management Services
(2001- -------------------------------------------------------------------------------------------------------------------------------
Niel B. Nielson Trustee Class II President (June 2002 to 2003); President & COO,
ServiceMaster Management
Services (1998 to 2003)54 Director of
c/o First Trust Advisors Present), Covenant College Covenant
L.P. Since Fund Transport Inc.
1001 Warrenville Road Inception
Suite 300
Lisle, IL 60532
DOB: 3/54
- -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
- 7 -
- ------------------------------------------------------------------------------------------------------------------------------
OFFICERS
- ------------------------------------------------------------------------------------------------------------------------------
POSITION(S) TERM OF OFFICE(2)
NAME, ADDRESS, AND HELD WITH AND LENGTH OF PRINCIPAL OCCUPATION(S)
DATE OF BIRTH FUNDS TIME SERVED(3) DURING PAST FIVE YEARS
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL NUMBER OF
TERM OF OFFICE(2) OCCUPATION(S) PORTFOLIOS IN FUND
NAME, ADDRESS, AND POSITION(S) HELD AND LENGTH OF DURING PAST FIVE COMPLEX SERVED
DATE OF BIRTH WITH THE FUNDS TIME SERVED(3) YEARS BY OFFICER
- ------------------------------------------------------------------------------------------------------------------------------------
Mark R. Bradley Treasurer, Controller, Indefinite Chief Financial 33
1001 Warrenville Road Controller, Chief Officer, Managing
Suite 300 Financial Officer Since Fund Director, First Trust
Lisle, IL 60532 and Chief Inception Portfolios L.P. and
D.O.B.: 11/57 Accounting Officer, First Trust Advisors
1001 Warrenville Road Chief Financial Officer L.P. and First Trust Portfolios L.P.; Chief
Suite 300 and Chief Accounting Since Fund Inception Financial Officer, BondWave LLC (Software
Lisle, IL 60532 Officer Development Company/Broker-Dealer) and
DOB: 11/57 Stonebridge Advisors LLC (Investment Adviser)
- ------------------------------------------------------------------------------------------------------------------------------------
Susan M. Brix------------------------------------------------------------------------------------------------------------------------------
Kelley Christensen Vice President Indefinite Assistant Vice Indefinite Representative,President, First 33Trust
1001 Warrenville Road Trust Portfolios L.P.; and First Trust Advisors L.P.
Suite 300 President Since Fund Assistant PortfolioDecember 2006
Lisle, IL 60532
Inception Manager, First Trust
D.O.B.: 1/60 Advisors L.P.DOB: 9/70
- ------------------------------------------------------------------------------------------------------------------------------------
Robert F. Carey Vice President------------------------------------------------------------------------------------------------------------------------------
James M. Dykas Assistant Treasurer Indefinite Senior Vice President 33(April 2007 to
1001 Warrenville Road Present), Vice President (January 2005 to
Suite 300 Since December 2005 April 2007), First Trust Advisors L.P. and
Lisle, IL 60532 First Trust Portfolios L.P.; Executive
DOB: 1/66 Director (December 2002 to January 2005),
Vice President (December 2000 to December
2002), Van Kampen Asset Management and Morgan
Stanley Investment Management
- ------------------------------------------------------------------------------------------------------------------------------
Christopher Fallow Assistant Vice President Indefinite Assistant Vice President (August 2006 to
1001 Warrenville Road Present), Associate (January 2005 to August
Suite 300 Since FundDecember 2006 2006), First Trust Advisors L.P. and First
Trust
Lisle, IL 60532 Inception AdvisorsTrust Portfolios L.P.
D.O.B.: 7/63; Municipal Bond Trader
DOB: 4/79 (July 2001 to January 2005), BondWave LLC
(Software Development Company/Broker-Dealer)
- ------------------------------------------------------------------------------------------------------------------------------------
Page 6
- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL NUMBER OF
TERM OF OFFICE(2) OCCUPATION(S) PORTFOLIOS IN FUND
NAME, ADDRESS, AND POSITION(S) HELD AND LENGTH OF DURING PAST FIVE COMPLEX SERVED
DATE OF BIRTH WITH THE FUNDS TIME SERVED(3) YEARS BY OFFICER
- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
W. Scott Jardine Secretary and Chief Indefinite General Counsel, 33First Trust Advisors L.P.
1001 Warrenville Road Compliance Officer ("CCO") and First Trust Portfolios L.P.; Secretary,
Suite 300 ("CCO") Secretary since L.P. and First Trust
Lisle, IL 60532 Fund Advisors L.P.;
D.O.B.: 5/60 Inception Secretary, BondWave LLC (Software Development
Lisle, IL 60532 inception; Company/Broker-Dealer) and Stonebridge
DOB: 5/60 CCO since 2004 and Stonebridge Advisors LLC (Investment Adviser)
- ------------------------------------------------------------------------------------------------------------------------------------
Kristi A. Maher Assistant Secretary Indefinite Assistant General 33
1001 Warrenville Road Counsel, First Trust
Suite 300 Since 2004 Portfolios L.P. and
Lisle, IL 60532 First Trust Advisors L.P.
D.O.B.: 12/66 (March 2004 to Present);
Associate, Chapman and
Cutler LLP (1995 to
March 2004)
- ------------------------------------------------------------------------------------------------------------------------------------
Roger F. Testin Vice President Indefinite Senior Vice President, 33
1001 Warrenville Road First Trust Portfolios
Suite 300 Since Fund L.P. and First Trust
Lisle, IL 60532 Inception Advisors L.P.
D.O.B.: 6/66 (November 2003 to
present), Vice
President (August 2001
to November 2003)
- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Daniel J. Lindquist Vice President Indefinite Senior Vice President 33(September 2005 to
1001 Warrenville Road First Trust AdvisorsPresent), Vice President (April 2004 to
Suite 300 Since December 2005 September 2005), First Trust Advisors L.P.
Lisle, IL 60532 and First Trust Lisle, IL 60532 2005 Portfolios L.P. (since
D.O.B.: 2/70 April 2004); Chief
DOB: 2/70 Operating Officer
Mina Capital Management, LLC (January 2004 to April
2004);, Mina Capital Management, LLC; Chief
Operating Officer (April 2000 to January
2004), Samaritan Asset Management Services,
Inc.
(April
2000- ------------------------------------------------------------------------------------------------------------------------------
Kristi A. Maher Assistant Secretary Indefinite Deputy General Counsel (May 2007 to January 2004)
- ------------------------------------------------------------------------------------------------------------------------------------
James M. Dykas Assistant Treasurer Indefinite Vice President, First 33Present),
1001 Warrenville Road Trust Portfolios L.P.Assistant General Counsel (March 2004 to May
Suite 300 Since DecemberJuly 2004 2007), First Trust Advisors L.P. and First Trust
Lisle, IL 60532 2005 AdvisorsTrust Portfolios L.P. (January
D.O.B.: 1/; Associate (1995-2004),
DOB: 12/66 2005 to Present);
Executive Director of
Van Kampen Asset
ManagementChapman and Morgan
Stanley Investment
Management (1999 to
January 2005)Cutler LLP
- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
____________________
(1)1 Mr. Bowen is deemed an "interested person" of the Funds due to his position
as President of First Trust Advisors L.P., investment adviser of the Funds.
(2)2 Trustees are electedcurrently serving a one-year term. On December 10, 2006, each
yearFund's Nominating and Governance Committee and Board approved the
implementation of a staggered Board, which required certain amendments to
each Fund's By-Laws. If the proposal is approved by Shareholdersshareholders, Richard
E. Erickson, Thomas R. Kadlec and Robert F. Keith, as Class I Trustees,
would each serve until the next
meeting of Shareholders helda one-year term for the election of TrusteesFunds, Niel B. Nielson, as a Class
II Trustee, would serve a two-year term for the Funds, and until their
successors are elected and qualified.James A. Bowen,
as a Class III Trustee, would serve a three-year term for the Funds.
Officers of the Funds have an indefinite term.
(3)3 All Trustees and Officers, except for Robert F. Keith, W. Scott Jardine
only with respect to his appointment as Chief Compliance Officer, Kristi A.
Maher, Daniel J. Lindquist, and James M. Dykas, Kelley Christensen and
Christopher Fallow, were elected in 2003 for First Trust/Four Corners
Senior Floating Rate Income Fund and in 2004 for the
other Funds.First Trust/Four Corners
Senior Floating Rate Income Fund II. Robert F. Keith was appointed to each
Fund's Board by the Trustees on June 12, 2006. Kristi A. Maher was elected
Assistant Secretary of all Fundsfunds in the First Trust Fund Complex, including
the Funds, on July 26, 2004. Daniel J. Lindquist and James M. Dykas were
elected Vice President and Assistant Treasurer, respectively, of all funds
in the First Trust Fund Complex, including the Funds, on December 12, 2005.
Kelley Christensen was elected Vice President of all funds in the First
Trust Fund Complex, including the Funds, on December 10, 2006. Christopher
Fallow was elected Assistant Vice President of the Funds on December 10,
2006.
Page 7
In addition to the Funds, the First Trust Fund Complex includes First
Defined Portfolio Fund, LLC, an open-end management investment company with 128
portfolios, advised by First Trust Advisors; Macquarie/First Trust Value Line(R) 100 Fund,
First Trust Value Line(R)Global
Infrastructure/Utilities Dividend Fund, First Trust/Value Line(R) & Ibbotson
Equity AllocationIncome Fund, Energy Income and Growth Fund,
First Trust/Fiduciary
Asset Management Covered Call Fund, First Trust/Aberdeen Global Opportunity
Income Fund, First Trust/FIDAC Mortgage Income Fund, First Trust Strategic High
Income Fund, First Trust Strategic High Income Fund II and First Trust
Tax-Advantaged Preferred Income Fund, closed-end funds also advised by First
Trust Advisors; and First Trust Exchange-Traded Fund, an open-end investment
company and an exchange-traded index fund with eight operating portfolios
advised by First Trust Advisors.
Messrs. Bowen, Erickson, Kadlec and Nielson are Trustees of First
Defined Portfolio Fund, LLC; Messrs. Bowen, Erickson, Kadlec, Keith and Nielson
are Trustees of First Trust Value Line(R) 100 Fund, First Trust Value Line(R)
Dividend Fund, First Trust/Value Line(R) & Ibbotson Equity Allocation Fund,
Energy Income and Growth Fund,- 8 -
First Trust/Fiduciary Asset Management Covered Call Fund, First Trust/Aberdeen
Global Opportunity Income Fund, First Trust/FIDAC Mortgage Income Fund, First
Trust Strategic High Income Fund, First Trust Strategic High Income Fund II,
First Trust Strategic High Income Fund III, First Trust Tax-Advantaged Preferred
Income Fund, First Trust/Aberdeen Emerging Opportunity Fund and First
Trust/Gallatin Specialty Finance and Financial Opportunities Fund, closed-end
funds also advised by First Trust Advisors; and First Trust Exchange-Traded Fund
and First Trust Exchange-Traded Fund.AlphaDEX(TM) Fund, each an open-end investment
company and an exchange-traded index fund with 17 and 16 operating portfolios,
respectively, advised by First Trust Advisors.
Trustees
Messrs. Erickson, Kadlec, Keith and Nielson are Independent Trustees,
and Mr. Bowen is an Interested Trustee, of each fund in the First Trust Fund
Complex. During the past five years, none of the Independent Trustees, ornor any
of their immediate family members, has ever been a director, officer or employee
of, or consultant to, First Trust Advisors, First Trust Portfolios L.P., anythe
sub-adviser or any of their affiliates.
In
addition, Mr. Bowen, chief executive officerOfficers
The Officers of each Fund, and the other
officersincluding Mr. Bowen, Chief Executive Officer
of the Funds,each Fund, hold the same positions with each fund in the First Trust Fund
Complex as they hold with the Funds, except for Christopher Fallow, who is not
an officer of First Defined Portfolio Fund, LLC, First Trust Value Line(R) 100Exchange-Traded
Fund First Trust Value Line(R)
Dividend Fund, First Trust/Value Line(R) & Ibbotson Equity Allocation Fund,
Energy Income and Growth Fund, First Trust/Fiduciary Asset Management Covered
Call Fund, First Trust/Aberdeen Global Opportunity Income Fund, First
Trust/FIDAC Mortgage Income Fund, First Trust Strategic High Income Fund, First
Trust Strategic High Income Fund II, First Trust Tax-Advantaged Preferred Income
Fund andor First Trust Exchange-Traded Fund, as they hold with the Funds.AlphaDEX(TM) Fund.
BENEFICIAL OWNERSHIP OF SHARES HELD IN THE FUNDS BY EACH NOMINEE FOR ELECTION
AS TRUSTEE
The following table sets forthAs of January 1, 2007, the dollar rangeTrustees and number of equity
securitiesFund officers as a group
beneficially owned by25,203 shares of the Trustees in each Fund and in other funds in the First Trust Fund Complex
as of May 31, 2006:
Page 8
- --------------------------------------------------------------------------------------------------------------
DOLLAR RANGE OF EQUITY SECURITIES IN THE FUND/
(NUMBER OF COMMON SHARES HELD)
-----------------------------------------------------------
Macquarie/First AGGREGATE DOLLAR RANGE OF
Trust Global EQUITY SECURITIES IN ALL
First Trust/Four First Trust/Four Infrastructure/ REGISTERED INVESTMENT
Corners Corners Utilities COMPANIES OVERSEEN BY
Senior Floating Senior Floating Dividend & TRUSTEE IN FUND COMPLEX/
Name of Trustee Rate Income Fund Rate Income Fund II Income Fund (NUMBER OF SHARES HELD)
- --------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE
- --------------------------------------------------------------------------------------------------------------
James A. Bowen $1-$10,000/ $10,001-$50,000/ None Over $100,000/
(250 Shares) (1,000 Shares) (11,750 Shares)
- --------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEE
- --------------------------------------------------------------------------------------------------------------
Richard E. Erickson $1-$10,000/ $1-$10,000/ $1-$10,000/ $50,001-$100,000/
(284.221 Shares) (223.616 Shares) (243.792 Shares) (2,856.654 Shares)
- --------------------------------------------------------------------------------------------------------------
Thomas R. Kadlec $10,001-$50,000/ $10,001-$50,000/ None Over $100,000/
(571.031 Shares) (600 Shares) (8,586.078 Shares)
- --------------------------------------------------------------------------------------------------------------
Niel B. Nielson $1-$10,000/ $1-$10,000/ $1-$10,000/ $10,001-$50,000/
(215 Shares) (214 Shares) (216 Shares) (1,567 Shares)
- --------------------------------------------------------------------------------------------------------------
Robert F. Keith(1) None None None None
- ---------------------- --------------------- ------------------ ------------------ ---------------------------
(1) Mr. Keith became a Trustee on June 12, 2006.
For the fiscal year ended May 31, 2006, the Independent Trustees of
each Fund and immediate family members do not own beneficially or of record any
class of securities of an investment adviser, sub-adviser or principal
underwriter(less than 1% of the Funds or any person directly or indirectly controlling,
controlled by, or under common control with an investment adviser, sub-adviser
or principal underwriter of the Funds, nor did any Independent Trustee purchase
or sell securities of First Trust Advisors, any sub-adviser or their parents, or
subsidiaries.
James A. Bowen sold three limited partnership units of Grace Partners
of DuPage L.P., the limited partner of First Trust Advisors, to Grace Partners
of DuPage L.P. on May 31, 2006 for a price of $750,000 per unit.shares outstanding). As of May 31, 2006, Eaton Vance Corporation owned 5.3% of Common Shares
of First Trust/Four Corners Senior Floating Rate Income Fund II and is the only
shareholder who owns beneficially or of record 5% or more of Shares of the Fund.
As of May 31, 2006, Macquarie/First Trust Global Infrastructure/Utilities
Dividend & Income Fund and First Trust/Four Corners Senior Floating Rate Income
Fund know of no person who owns beneficially or of record 5% or more of each
Fund's shares. As of May 31, 2006,January 1, 2007, the Trustees
and executiveFund officers as a group beneficially owned the following number of Shares
of each Fund, which is less than 1% of each Fund's Shares outstanding.outstanding:
- ----------------------------------------------------------------- -------------------------- --------------------------------------------------------------------------------------------------------------------------------------------------------
DOLLAR RANGE OF EQUITY SECURITIES (NUMBER OF SHARES HELD)
- ------------------------------------------------------------------------------------------------------------------------------
INTERESTED INDEPENDENT
TRUSTEE TRUSTEES
-------------------------------------------------------------------------------------------------
FUND James A. Bowen Richard E. Erickson Thomas R. Kadlec Robert F. Keith Niel B. Nielson
- ------------------------------------------------------------------------------------------------------------------------------
First Trust/Four Corners $1-$10,000 $1-$10,000 $10,001-$50,000 $0 $1-$10,000
Senior Floating Rate Income
Fund (250 Shares) (289 Shares) (571 Shares) (0 Shares) (222 Shares)
- ------------------------------------------------------------------------------------------------------------------------------
First Trust/Four Corners $10,001-$50,000 $1-$10,000 $10,001-$50,000 $0 $1-$10,000
Senior Floating Rate Income
Fund II (1,000 Shares) (228 Shares) (600 Shares) (0 Shares) (221 Shares)
- ------------------------------------------------------------------------------------------------------------------------------
Aggregate Dollar Range of Over $100,000 $50,001-$100,000 Over $100,000 Over $100,000 $50,001-$100,000
Equity Securities in all
Registered Investment (11,750 Shares) (4,367 Shares) (9,249 Shares) (5,418 Shares) (2,835 Shares)
Companies in the First Trust
Fund Complex Overseen by
Trustee
- ------------------------------------------------------------------------------------------------------------------------------
- 9 -
As of January 1, 2007, the Independent Trustees and their immediate
family members did not own, beneficially or of record, any class of securities
of First Trust Advisors or the sub-adviser or principal underwriter of the Funds
or any person, other than a registered investment company, directly or
indirectly controlling, controlled by, or under common control with First Trust
Advisors or the sub-adviser or principal underwriter of the Funds.
As of January 1, 2007, the Trustees and Officers as a group
beneficially owned less than 1% of the shares outstanding of the funds in the
First Trust Fund Complex. As of January 1, 2007, the Trustees and Officers as a
group beneficially owned the following number of Shares of each Fund, which is
less than 1% of each Fund's Shares outstanding:
- ------------------------------------------------------------- ---------------------- -----------------------
FUND COMMON SHARES OWNED PREFERRED
SHARES OWNED SHARES OWNED
- ----------------------------------------------------------------- -------------------------- --------------------------------------------------------------------------------------- ---------------------- -----------------------
First Trust/Four Corners Senior Floating Rate Income Fund 1,320.2521,332 0
- ----------------------------------------------------------------- -------------------------- --------------------------------------------------------------------------------------- ---------------------- -----------------------
First Trust/Four Corners Senior Floating Rate Income Fund II 2,037.6162,049 0
- ----------------------------------------------------------------- -------------------------- --------------------------
Macquarie/First Trust Global Infrastructure/Utilities Dividend 459.792 N/A
& Income Fund
- ----------------------------------------------------------------- -------------------------- --------------------------------------------------------------------------------------- ---------------------- -----------------------
Page 9
AsCERTAIN PURCHASES AND SALES
Since the beginning of the fiscal year of the Funds ended May 31, 20062007,
none of the Trustees and chief executive officers as a group
beneficially owned 25,259.732 shareshas purchased or sold securities of funds in the First Trust Fund Complex
(less than 1%Advisors,
the sub-adviser or their parents, or subsidiaries of any of the shares outstanding).
INFORMATION PERTAINING TO CERTAIN SHAREHOLDERS OF FIRST TRUST/FOUR CORNERS
SENIOR FLOATING RATE INCOME FUND II
The following table sets forth the beneficial ownership of shares of
First Trust/Four Corners Senior Floating Rate Income Fund II by each person
known to the Fund to be deemed a beneficial owner of more than five percent (5%)
of the total outstanding shares of Common Shares as of May 31, 2006. Information
as to beneficial ownership is based on reports filed with the Securities and
Exchange Commission by such holders.
- ------------------------------ ------------------- ---------------------------
NAME AND ADDRESS OF COMMON SHARES % OF OUTSTANDING COMMON
BENEFICIAL OWNER BENEFICIALLY OWNED SHARES BENEFICIALLY OWNED
- ------------------------------ ------------------- ---------------------------
Eaton Vance Corporation 1,337,200 5.3%
225 State Street
Boston, MA 02109
- ------------------------------ ------------------- ---------------------------
Based solely upon information presented in Schedule 13G, filed February 14, 2006
by Eaton Vance Corporation. Pursuant to Schedule 13G, the entity has sole voting
power over the shares beneficially owned. The Fund does not have any knowledge
of who the ultimate beneficiaries are of these shares.foregoing.
COMPENSATION
Effective January 1, 2006,2007, the Trustees approved a revised compensation
plan. Under the revised plan, each Fund pays eachIndependent Trustee who is not an officer or employee of First Trust Advisors, any sub-adviser or any of
their affiliatespaid an annual
retainer of $10,000 which includes compensationper investment company for all boardthe first 14 investment companies
of the First Trust Fund Complex and committee meetings.an annual retainer of $7,500 per investment
company for each subsequent investment company added to the First Trust Fund
Complex. The annual retainer is allocated equally among each of the investment
companies. No additional meeting fees are paid in connection with board or
committee meetings.
Additionally, Mr.Thomas R. Kadlec is paid
additional compensation of $10,000 annually to serve as the
Lead Independent Trustee and Niel B. Nielson is paid $5,000 annually to serve as
the chairman of the Audit Committee with such compensation paid by the funds in
the First Trust Fund Complex and divided among those funds. Independent Trustees
are also reimbursed by the funds in the First Trust Fund Complex for travel and
out-of-pocket expenses in connection with all meetings. The Trustees adopted the
revised plan because the increase in the number of funds in the First Trust Fund
Complex had the effect of rapidly increasing their compensation under the
previous arrangements. Prior to January 1, 2006,2007, each Fund paid each Independent
Trustee not affiliated with First Trust Advisors,
any sub-adviser or any of their affiliates an annual feeretainer of $10,000, plus $1,000
aswhich included compensation for each specialall board
meeting (in-person or by electronic
means) and $500 per non-regular committee meeting (in-person or by electronic
means) attended.meetings.
The Board of Trustees held eleven meetings of First Trust/Four Corners Senior Floating Rate
Income Fund and of First Trust/Four Corners Senior Floating Rate Income Fund II
and Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fundeach held 8 meetings during thetheir respective fiscal yearyears ended May 31, 2006.2007.
Each of the Trustees except for Trustee Keith, who was not
appointed to each Fund's Board by the Trustees until June 12, 2006, attended all of the meetings of the Board of Trustees of the Funds for the fiscal year
ended May 31, 2006.such meetings. The aggregate fees and expenses
paid to the Trustees by Page 10
each Fund for theeach Fund's fiscal year ended May 31, 2006 (including
reimbursement for travel and out-of-pocket expenses) amounted to the following:
- ------------------------------------------------------------------------------------- -----------------------------------
FUND AGGREGATE FEES AND EXPENSES PAID
- ------------------------------------------------------------------------------------- -----------------------------------
First Trust/Four Corners Senior Floating Rate Income Fund $30,756
- ------------------------------------------------------------------------------------- -----------------------------------
First Trust/Four Corners Senior Floating Rate Income Fund II $31,819
- ------------------------------------------------------------------------------------- -----------------------------------
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund $31,011
- ------------------------------------------------------------------------------------- -----------------------------------
- 10 -
- ------------------------------------------------------------ -------------------
AGGREGATE FEES AND
FUND EXPENSES PAID
- ------------------------------------------------------------ -------------------
First Trust/Four Corners Senior Floating Rate Income Fund $40,300
- ------------------------------------------------------------ -------------------
First Trust/Four Corners Senior Floating Rate Income Fund II $41,509
- ------------------------------------------------------------ -------------------
The following table sets forth certain information regarding the
compensation of each Fund's Trustees except for Trustee Keith, who was appointed
to each Fund's Board on June 12, 2006, for thetheir respective fiscal year ended May 31, 2006.years. The
Funds have no retirement or pension plans. The Officers and the Interested
Trustee of each Fund receive no compensation from the Funds for serving in such
capacities.
- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
AGGREGATE COMPENSATION FOR EACH FUND'S FISCAL YEAR
- -------------------------------------------------------------------------------------------------------------------------------
INTERESTED INDEPENDENT TRUSTEES
TRUSTEE
--------------------------------------------------------------------------------------------
FUND James A. Bowen Richard E. Erickson Thomas R. Kadlec Niel B. Nielson Robert F. Keith(1)
- -------------------------------------------------------------------------------------------------------------------------------
AGGREGATE
AGGREGATE AGGREGATE COMPENSATION
COMPENSATION COMPENSATION FROM
FROM FIRST FROM FIRST MACQUARIE/FIRST
TRUST/FOUR TRUST/FOUR TRUST GLOBAL TOTAL
CORNERS SENIOR CORNERS SENIOR INFRASTRUCTURE/ COMPENSATION
FLOATING RATE FLOATING RATE UTILITIES DIVIDEND FROM THE
NAME OF TRUSTEE INCOME FUND INCOME FUND
First Trust/Four Corners Senior $0 $10,000 $10,259 $10,041 $10,000
Floating Rate Income Fund
- -------------------------------------------------------------------------------------------------------------------------------
First Trust/Four Corners Senior
Floating Rate Income Fund II & INCOME FUND FUND COMPLEX$0 $10,000 $11,301 $10,208 $10,000
- -----------------------------------------------------------------------------------------
INTERESTED TRUSTEE-------------------------------------------------------------------------------------------------------------------------------
Total Compensation from the First
Trust Fund Complex $0 $147,500 $155,000 $148,750 $137,500
- -----------------------------------------------------------------------------------------
James A. Bowen 0 0 0 0
- -----------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
- -----------------------------------------------------------------------------------------
Richard E. Erickson $10,227 $10,481 $10,287 $116,159
- -----------------------------------------------------------------------------------------
Thomas R. Kadlec $10,202 $10,355 $10,239 $115,558
- -----------------------------------------------------------------------------------------
Niel B. Nielson $10,327 $10,983 $10,485 $118,985
- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
____________________
1. Mr. Keith became a Trustee of the then-existing funds in the First Trust
Fund Complex (other than First Defined Portfolio Fund, LLC) on June 12,
2006. He became a Trustee of First Defined Portfolio Fund, LLC on April 30,
2007.
The total compensation paid to Messrs. Erickson, Kadlec, Keith and
Nielson, Independent Trustees of each Fund and the other funds in the First
Trust Fund Complex, for the fiscal year ended May 31, 2006,2007, includes
compensation for their services as Trustees to First Defined Portfolio Fund,
LLC, First Trust Value Line(R) 100 Fund, First Trust Value Line(R) Dividend
Fund, First Trust/Value Line(R) & Ibbotson Equity Allocation Fund,
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund,
Energy Income and Growth Fund, First Trust/Fiduciary Asset Management Covered
Call Fund, First Trust/Aberdeen Global Opportunity Income Fund, First
Trust/FIDAC Mortgage Income Fund, First Trust Strategic High Income Fund, First
Trust Strategic High Income Fund II, First Trust Strategic High Income Fund III,
First Trust Tax-Advantaged Preferred Income Fund, First Trust/Aberdeen Emerging
Opportunity Fund, First Trust Exchange-Traded Fund, First Trust Exchange-Traded
AlphaDEX(TM) Fund and the Funds.
ATTENDANCE AT ANNUAL SHAREHOLDER MEETINGS
The officerspolicy of the Board is to have as many Trustees as possible in
attendance at annual meetings of shareholders. The policy of the Nominating and
Governance Committee relating to attendance by Trustees at annual shareholder
meetings is contained in the Interested TrusteeFunds' Nominating and Governance Committee Charter,
which is available on each Fund's website located at www.ftportfolios.com. All
of the Trustees attended the previous year's annual shareholder meeting for each
Fund receive no
compensation fromof the Funds for serving in such capacities.
PageFunds.
- 11 -
COMMITTEES
AUDIT COMMITTEE
The Board of Trustees has an Audit Committee, which consists of Messrs.
Erickson, Kadlec, Keith and Nielson, all of whom are "independent" as defined in
the listing standards of the American Stock Exchange and the New York Stock
Exchange. Messrs.Mr. Kadlec and Mr. Keith serve as the Audit Committee Financial Experts.
The Audit Committee is responsible for overseeing each Fund's accounting and
financial reporting process, the system of internal controls, audit process and
evaluating and appointing the independent registered public accounting firm
(subject also to Board approval). The Audit
Committee met six times duringFor the fiscal year ended May 31, 2006,2007, the
Audit Committee met 6 times with all members present except for Trustee Keith, who was appointed to the Audit
Committee on June 12, 2006.present.
In carrying out its responsibilities, the Audit Committee pre-approves
all audit and permitted non-audit services for each Fund and permitted non-audit services (including the fees and
terms thereof) and non-audit services to be performed for each Fund and the Adviser by
Deloitte & Touche LLP ("Deloitte & Touche"), the Funds' independent registered
public accounting firm ("independent auditors")., if the engagement relates
directly to the operations and financial reporting of the Funds. The Chairman of
the Audit Committee is authorized to give such pre-approvals on behalf of the
Audit Committee for engagements of less than $25,000. Any decisions by the
Chairman to grant pre-approvals are reported to the full Audit Committee at the
next regularly scheduled meeting.
AUDIT COMMITTEE REPORT
The role of the Audit Committee is to assist the Board of Trustees in
its oversight of each Fund's accounting and financial reporting process. The
Audit Committee operates pursuant to a Chartercharter (the "Charter") that was most
recently reviewed and approved by the Board of Trustees on December 12, 2005,10, 2006, a
copy of which is attached as Exhibit A hereto.hereto, and is available on each Fund's
website located at http://www.ftportfolios.com. As set forth in the Charter,
management of each Fund is responsible for maintaining appropriate systems for
accounting and internal controls and the audit process. The Funds' independent
auditors are responsible for planning and carrying out proper audits of the
Funds' financial statements and expressing an opinion as to their conformity
with accounting principles generally accepted in the United States of America.
In performing its oversight function, at a meeting held on July 26,
2006, the Audit Committee reviewed and
discussed with management and the independent auditors, Deloitte & Touche, the
audited financial statements of eachthe First Trust/Four Corners Senior Floating
Rate Income Fund and the First Trust/Four Corners Senior Floating Rate Income
Fund II for the fiscal yearsyear ended May 31, 2006,2007 at a meeting held on July 18,
2007, and discussed the audit of such financial statements with the independent
auditors and management.
In addition, the Audit Committee discussed with the independent
auditors the accounting principles applied by each Fund and such other matters
brought to the attention of the Audit Committee by the independent auditors
required by Statement on Auditing Standards No. 61, Communications with Audit
Committees, as currently modified or supplemented. The Audit Committee also
received from the independent auditors the written disclosures and letter
required by Independent Standards Board Standard No. 1, Independence Discussions
with Audit Committees, delineating relationships between the independent
auditors and each Fund and discussed the impact that any such relationships may
have on the objectivity and independence of the independent auditors.
Page- 12 -
The members of each Fund's Audit Committee are not full-time employees
of the Fund and are not performing the functions of auditors or accountants. As
such, it is not the duty or responsibility of the Audit Committee or its members
to conduct "field work" or other types of auditing or accounting reviews or
procedures or to set auditor independence standards. Members of each Fund's
Audit Committee necessarily rely on the information provided to them by Fund
management and the independent auditors. Accordingly, the Audit Committee's
considerations and discussions referred to above do not assure that the audit of
each Fund's financial statements has been carried out in accordance with
generally accepted auditing standards, that the financial statements are
presented in accordance with generally accepted accounting principles or that
the independent auditors are in fact "independent."
Based on its consideration of the Funds' audited financial statements
and the discussions referred to above with Fund management and Deloitte &
Touche, and subject to the limitations on the responsibilities and role of the
Audit Committee as set forth in the Charter and discussed above, the Audit
Committee recommended to the Board the inclusion of each Fund's audited
financial statements for the year ended May 31 2006 in its Annual Report dated May
31, 2006.2007.
Submitted by the Audit Committee of the Funds:
Richard E. Erickson
Thomas R. Kadlec
Robert F. Keith
Niel B. Nielson
- 13 -
INDEPENDENT AUDITORS' FEES
Deloitte & Touche has been selected to serve as the independent
auditors for Macquarie/First Trust Global Infrastructure/Utilities Dividend &
Income Fund, whose fiscal year end was changed to November 30, 2006 at a meeting
of the Board held on December 12, 2005, for the fiscal year ending November 30,
2006. Deloitte & Touche acted as independent auditors for the Funds for the
fiscal year ended May 31, 2006. Deloitte & Touche has been selected to serve as
the independent auditors for First Trust/Four Corners Senior Floating Rate
Income Fund and First Trust/Four Corners Senior Floating Rate Income Fund II for the fiscal year ending May 31, 2007 at a meeting of the Board held on July 26,
2006.2008. Deloitte &
Touche has advised the Funds that, to the best of its knowledge and belief,
Deloitte & Touche professionals did not have any direct or material indirect
ownership interest in the Funds inconsistent with independent professional
standards pertaining to independent registered public accounting firms. It is
expected that representatives of Deloitte & Touche will be present at the
Meeting to answer any questions that may arise and will have the opportunity to
make a statement if they desire to do so. In reliance on Rule 32a-4 under the
1940 Act, each Fund is not seeking shareholder ratification of the selection of
Deloitte & Touche as independent auditors.
Set forth inAudit Fees, Audit-Related Fees, Tax Fees and All Other Fees
During each of the table below are fees billed bylast two fiscal years of the Funds ending May 31,
2006 and May 31, 2007, respectively, Deloitte & Touche tohas billed each Fund and
its Adviser for each Fund's fiscal periods ended May 31, 2005 and
May 31, 2006:
Page 13the following fees:
- ----------------------- ------------------------ ----------------------- ----------------------- ---------------------------------------------------------------------------------------------------------------------------------------------------------
AUDIT FEES AUDIT RELATEDAUDIT-RELATED FEES TAX FEES (1) ALL OTHER FEES (2)
------------------------------------------------------------------------------------------------
2006 2007 2006 2007 2006 2007 2006 2007
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- -----------
2005 2006 2005 2006 2005 2006 2005 2006
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- ---------------------------------------------------------------------------------------------------------------------------------------------
First Trust/Four $27,350 $46,000Corners Senior $43,750 $44,000 $0 $0 $ 4,500(3) $ 4,725(3) $0 $ 2,962(5)
Corners Senior$4,725 $4,850 $2,962 $1,253
Floating Rate Income Fund
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- ---------------------------------------------------------------------------------------------------------------------------------------------
First Trust/Four $55,475 $46,000 $8,000(1) $16,675(1) $ 4,500(3) $4,725(3) $0 $14,767(5) Corners Senior
Floating Rate Income Fund II $51,750 $45,000 $0 $0 $4,725 $4,850 $14,766 $6,336
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- -----------
Macquarie/First Trust $37,000 $40,000 $8,000(1) $16,675(1) $ 4,000(3) $ 4,200(3) $0 $ 5,867(5)
Global
Infrastructure/
Utilities Dividend &
Income Fund
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- ---------------------------------------------------------------------------------------------------------------------------------------------
First Trust Advisors $24,000 $32,000 $20,000(2) $ 6,500(2) $ 6,000(3) $ 6,175(3) $35,450(4) $77,927(5)NA NA $0 $0 $0 $0 $84,427 $40,072
- ----------------------- ------------ ----------- ----------- ----------- ----------- ----------- ----------- ---------------------------------------------------------------------------------------------------------------------------------------------
(1) These fees were for agreed upon procedures relating to coverage requirements.tax consultation and tax preparation.
(2) TheseFor the Funds, these fees were for compliance consulting services, and for
First Trust Advisors, these fees were for AIMR-PPS verification services.
(3) These fees were for tax return preparation.
(4) These fees were for tax services in connection with the development of a new fund.
(5) These fees were for services in connection with compliance program evaluation.Services.
Set forth inNon-Audit Fees
During each of the table below arelast two fiscal years of the aggregate non-audit fees shown in
the table above billed byFunds ending May 31,
2006 and May 31, 2007, respectively, Deloitte & Touche tohas billed each Fund, its
Adviser and toentities controlling, controlled by, or under common control with
the Adviser that provide ongoing services to such Fund ("Adviser Entities") for
each Fund's fiscal periods ended May 31, 2005 and May 31, 2006:the following fees:
- --------------------------------------------------------------------------------------------------------------------------------------------------------------
AGGREGATE NON-AUDIT FEES
- ------------------------------------------------------------------------------
2005--------------------------------------------------------------------------------
2006 2007
- ------------------------------------------------- ------------ -----------------------------------------------------------------------------------------------
First Trust/Four Corners Senior Floating Rate $4,500 $7,687
Income Fund $7,687 $6,103
- ------------------------------------------------- ------------ -----------------------------------------------------------------------------------------------
First Trust/Four Corners Senior Floating Rate $12,500 $36,167
Income Fund II $19,492 $11,186
- ------------------------------------------------- ------------ ---------------
Macquarie/First Trust Global Infrastructure/ $12,000 $26,742
Utilities Dividend & Income Fund
- ------------------------------------------------- ------------ -----------------------------------------------------------------------------------------------
First Trust Advisors $61,450 $90,602 $65,072
- ------------------------------------------------- ------------ ---------------
In addition--------------------------------------------------------------------------------
- 14 -
Pre-Approval
Pursuant to pre-approvingits charter and its Audit and Non-Audit Services
Pre-Approval Policy, amended as of December 10, 2006 and March 12, 2007,
respectively, the Audit Committee of each Fund is responsible for the
pre-approval of all audit services and permitted non-audit services (including
the fees and terms thereof) to be performed for each Fund by theits independent
auditors,auditors. The Chairman of the Audit Committee pre-approvesis authorized to give such
pre-approvals on behalf of the Audit Committee up to $25,000 and report any such
pre-approval to the full Audit Committee.
The Audit Committee is also responsible for the pre-approval of the
independent auditors'auditor's engagements for non-audit services tofor the Funds' Adviser
and any entity
controlling, controlled by or under common control with the Adviser Entities that provides ongoing services to a Fund,the Funds, if the
engagement relates directly to the operations and financial reporting of a Fund.
Allthe
Funds, subject to the de minimis exceptions for non-audit services described in
Rule 2-01 of Regulation S-X. If the independent auditor has provided non-audit
services to the Funds' Adviser (other than any sub-adviser whose role is
primarily portfolio management and is sub-contracted with or overseen by another
investment adviser) and any Adviser Entities that were not pre-approved pursuant
to its policies, the Audit Committee will consider whether the provision of such
non-audit services is compatible with the auditor's independence.
None of the Audit Fees, Audit RelatedAudit-Related Fees, Tax Fees, and All Other
Fees and Aggregate Non-Audit Fees for the Funds and the Adviser disclosed in the
tables previously set forth abovethat were required to be pre-approved by the Audit
Committee pursuant to its pre-approval policies. None of these feespolicies were pre-approved by the Audit
Committee pursuant to the pre-approval exceptions included in Regulation S-X.
Page 14The Audit Committee of each Fund has determined that the provision of
non-audit services that were rendered to the Funds' Adviser (not including any
sub-adviser whose role is primarily portfolio management and is subcontracted
with or overseen by another investment adviser) and Adviser Entities that were
not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X
is compatible with maintaining the principal accountant's independence.
OTHER COMMITTEES
The Board of Trustees of each Fundthe Funds has three other standing committees:
the Executive Committee (and(also serving as the Dividend and Pricing Committee),
the Nominating and Governance Committee and the Valuation Committee. The
Executive Committee, which meets between Board meetings, is authorized to
exercise all powers of and to act in the place of the Board of Trustees to the
extent permitted by each Fund's Declaration of Trust and By-Laws. The members of
the Executive Committee also serve as a special committee of the Board of
Trustees known as the Dividend and Pricing Committee which is authorized to
exercise all of the powers and authority of the Board in respect of the
declaration and setting of dividends and the issuance and sale, through an
underwritten public offering, of the Shares of each Fund and all other such
matters relating to such financing, including determining the price at which
such Shares are to be sold and approvingapproval of the final terms of the underwriting
agreement, including approvingapproval of the members of the underwriting syndicate.
Messrs. Bowen and Kadlec are members of the Executive Committee. For the fiscal
year ended May 31, 2006,2007, the Executive Committee, serving as the Dividend and
Pricing Committee, met a total of 12 times for First Trust/Four Corners Senior Floating Rate Income Fund II, 12
times for First Trust/Four Corners Senior Floating Income Fund, and 5 times for
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Incomeeach Fund. Each Fund's Executive
Committee met to authorize the Funds' dividend declarations.
- 15 -
Each Fund's Nominating and Governance Committee (the "Committee") is
composed entirely of Independent Trustees who are not "interested persons" (as that term is
defined in the 1940 Act) of each Fund and who arealso "independent directors"
within the meaning of the listing standards of the American and New York Stock
Exchanges. Messrs. Erickson, Kadlec, Keith and Nielson are members of the
Committee. The purpose of the Committee is to oversee matters related to the
nomination of trustees and, as necessary, the corporate governance of each Fund.
The Committee is responsible for, among other things, seeking, identifying and
nominating qualified candidates for election or appointment as trustees in the
event of a vacancy, consistent with criteria approved by the Board, for the next
annual meeting of shareholders; evaluating Board performance and processes;
reviewing Board committee assignments; and, to the extent necessary or
desirable, establishing corporate governance guidelines and procedures. The
Committee operates under a written charter adopted and approved by the Board, a
copy of which is available on the Funds' website at www.ftportfolios.com. The
Committee met five times duringDuring
the fiscal year ended May 31, 2006.2007, the Committee met 4 times.
If there is no vacancy on the Board, the Board will not actively seek
recommendations from other parties, including shareholders.shareholders of the Funds. When a
vacancy on the Board occurs, the Committee may seek recommendations for
candidates from those sources it deems appropriate in its discretion, including
shareholders of the Funds. The Committee may retain a search firm to identify
candidates.
If a recommendation is received with satisfactorily completed
information regarding a candidate during a time when a vacancy exists on the
Board or during such other time as the Committee is accepting recommendations,
the recommendation will be forwarded to the Chairman of the Committee and
outside counsel to the Independent Trustees. Recommendations received at any
other time will be kept on file until such time as the Committee is accepting
recommendations at which point they may be considered for nomination.
In recruiting new trustees, the Committee seeks to recruit and retain
qualified independent trustees of high integrity, whose skills and experience
will enhance the Board's ability to effectively represent the interests of the
Funds' shareholders and oversee the wide range of regulatory and business issues
affecting the Funds. A candidate for trustee must meet certain basic
requirements, including relevant skills and experience, time availability and if
qualifying as a non-"interested person" candidate, independence from the Funds
and their investment adviser or other service providers. The qualifications of a
particular candidate, however, may vary depending on the current composition of
the Board and the mix of skills and backgrounds of the incumbent trustees since
the Committee seeks to establish an effective Board with an appropriate range of
skills and experience, in the aggregate. In addition to relevant skills and
experience, all candidates must possess high standards of personal integrity
that are assessed on the basis of personal interviews, recommendations, or
direct knowledge by Committee members. The review process may include, without
limitation, personal interviews, background checks, written submissions by the
candidates and third party references. Under no circumstances shall the
Committee evaluate persons recommended by a shareholder of a Fund on a basis
substantially different than that used for other persons recommended for the
same election or appointment of trustees. Each Fund has a retirement policy in
place that prohibits consideration for election as a Trustee persons age 72 or
older. The Committee reserves the right to make the final selection regarding
the nomination of any trustees.
The Valuation Committee is responsible for the oversight of valuation
procedures of the Funds. Messrs. Erickson, Kadlec, Keith and Nielson are members
of the Valuation Committee. The Valuation Committee met a total of 4 times
during the fiscal year ended May 31, 2007.
- 16 -
ADDITIONAL INFORMATION
SHAREHOLDER PROPOSALS
To be considered for presentation at the Joint Annual Meetings of
Shareholders of the Funds to be held in 2008, a shareholder proposal submitted
pursuant to Rule 14a-8 of the 1934 Act must be received at the offices of the
applicable Fund at 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532, not
later than April 9, 2008.
Any proposal to elect any person nominated by shareholders for election
as trustee and any other proposals by shareholders may only be brought before an
annual meeting of a Fund if timely written notice (the "Shareholder Notice") is
provided to the Secretary of the Fund. In accordance with the advance notice
provisions included in each Fund'sthe Funds' By-Laws, unless a greater or lesser period is
required under applicable law, to be timely, the Shareholder Notice must be
delivered to or mailed and received at the Fund's address, 1001 Warrenville
Road, Suite 300, Lisle, Illinois 60532, Attn: W. Scott Jardine, not less than
forty-five (45) days nor more than sixty (60) days prior to the first
anniversary date of the date of the Fund's proxy
Page 15 statement released to shareholders for the priorpreceding
year's annual meeting;
provided, however,meeting of shareholders. However, if and only if the annual
meeting is not scheduled to be held within a period that commences thirty (30)
days before the first anniversary date of the annual meeting for the preceding
year and ends thirty (30) days after such anniversary date (an annual meeting
date outside such period being referred to herein as an "Other Annual Meeting
Date"), such Shareholder Notice must be given in the manner provided hereinas described above by the later of
the close of business on (i) the date forty-five (45) days prior to such Other
Annual Meeting Date or (ii) the tenth (10th) business day following the date
such Other Annual Meeting Date is first publicly announced or disclosed.
Any shareholder submitting a nomination of any person or persons (as
the case may be) for election as a trustee or trustees of a Fund shallis required to
deliver, as part of such Shareholder Notice: (i) a statement in writing setting
forthforth: (A) the name, age, date of birth, business address, residence address and
nationality of the person or persons to be nominated; (B) the class or series
and number of all sharesShares of the Fund owned of record or beneficially by each
such person or persons, as reported to such shareholder by such nominee(s); (C)
any other information regarding each such person required by paragraphs (a),
(d), (e) and (f) of Item 401 of Regulation S-K or paragraph (b) of Item 22 of
Rule 14a-101 (Schedule 14A) under the Securities Exchange1934 Act of 1934 (or any successor provision
thereto) (the "1934 Act"); (D) any other information regarding the person or persons to be
nominated that would be required to be disclosed in a proxy statement or other
filings required to be made in connection with solicitation of proxies for
election of trustees or directors pursuant to Section 14 of the 1934 Act and the
rules and regulations promulgated thereunder; and (E) whether such shareholder
believes any nominee is or will be an "interested person" of the Fund (as
defined in the 1940 Act) and, if not an "interested person," information
regarding each nominee that will be sufficient for the Fund to make such
determination; and (ii) the written and signed consent of any person nominated
to be named as a nominee and to serve as a trustee if elected. In addition, the
Trustees may require any proposed nominee to furnish such other information as
they may reasonably require or deem necessary to determine the eligibility of
such proposed nominee to serve as a trustee.
Without limiting the foregoing, any shareholder who gives a Shareholder
Notice of any matter proposed to be brought before a shareholder meeting
(whether or not involving nominees for trustees) shallis required to deliver, as part
of such Shareholder Notice: (i) the description of and text of the proposal to
be presented; (ii) a brief written statement of the reasons why such shareholder
favors the proposal; (iii) such shareholder's name and address as they appear on
- 17 -
the Fund's books; (iv) any other information relating to the shareholder that
would be required to be disclosed in a proxy statement or other filings required
to be made in connection with the solicitation of proxies with respect to the
matter(s) proposed pursuant to Section 14 of the 1934 Act;Act and the rules and
regulations promulgated thereunder; (v) the class or series and number of all
sharesShares of the Fund owned beneficially and of record by such shareholder; (vi)
any material interest of such shareholder in the matter proposed (other than as
a shareholder); (vii) a representation that the shareholder intends to appear in
person or by proxy at the shareholder meeting to act on the matter(s) proposed;
(viii) if the proposal involves nominee(s) for trustees, a description of all
arrangements or understandings between the shareholder and each proposed nominee
and any other person or persons (including their names) pursuant to which the
nomination(s) are to be made by the shareholder; and (ix) in the case of a
shareholder (a "Beneficial Owner") that holds sharesShares entitled to vote at the
meeting through a nominee or "street name" holder of record, evidence
establishing such Beneficial Owner's indirect ownership of, and entitlement to
vote, sharesShares at the meeting of shareholders. Shares "beneficially owned" means
all sharesShares which such person is deemed to beneficially own pursuant to Rules
13d-3 and 13d-5 under the 1934 Act.
Page 16
If a recommendation is received with satisfactorily completed
information regarding a candidate during a time when a vacancy exists on the
Board or during such other time as the Committee is accepting recommendations,
the recommendation will be forwarded to the Chairperson of the Committee and
outside counsel to the Independent Trustees. Recommendations received at any
other time will be kept on file until such time as the Committee is accepting
recommendations at which point they may be considered for nomination.
In recruiting new trustees, the Committee seeks to recruit and retain
qualified independent trustees of high integrity, whose skills and experience
will enhance the Board's ability to effectively represent the interests of the
Funds' shareholders and oversee the wide range of regulatory and business issues
affecting the Funds. A candidate for trustee must meet certain basic
requirements, including relevant skills and experience, time availability and if
qualifying as a non- "interested person" candidate, independence from the Funds,
investment adviser or other service providers. The qualifications of a
particular candidate, however, may vary depending on the current composition of
the Board and the mix of skills and backgrounds of the incumbent trustees since
the Committee seeks to establish an effective Board with an appropriate range of
skills and experience, in the aggregate. In addition to relevant skills and
experience, all candidates must possess high standards of personal integrity
that are assessed on the basis of personal interviews, recommendations, or
direct knowledge by Committee members. The review process may include, without
limitation, personal interviews, background checks, written submissions by the
candidates and third party references. Under no circumstances shall the
Committee evaluate persons recommended by a shareholder of the Funds on a basis
substantially different than that used for other persons recommended for the
same election or appointment of trustees. The Committee reserves the right to
make the final selection regarding the nomination of any trustees.
The Valuation Committee is responsible for the oversight of valuation
procedures of the Funds. Messrs. Erickson, Kadlec, Keith and Nielson are members
of the Valuation Committee. The Valuation Committee met four times during the
fiscal year ended May 31, 2006.
ATTENDANCE AT ANNUAL SHAREHOLDER MEETINGS
The policy of the Board relating to attendance by Trustees at annual
meetings of the Funds is contained in the Funds' Nominating and Governance
Committee Charter, which is posted on the Funds' website at
www.ftportfolios.com. All of the Trustees except for Trustee Keith attended the
previous year's annual meeting.
INVESTMENT ADVISER, SUB-ADVISERS AND ADMINISTRATOR
First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
Illinois 60532, serves as the Funds' investment adviser. Four Corners Capital
Management, LLC, 515 South Flower Street, Suite 1600, Los Angeles, California
90071, serves as the investment sub-adviser to the First Trust/Four Corners
Senior Floating Rate Income Fund, Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund, and First Trust/Four Corners
Senior Floating Rate Income Fund II. Macquarie Fund Adviser, LLC, 125 West 55th
Street, New York, New York 10019, serves as the investment sub-adviser to the
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund.
Page 17
PFPC acts as the Funds' administrator and accounting agent and is
located at 4400 Computer Drive, Westborough, Massachusetts 01581. PFPC is a
leading provider of full service mutual fund shareholder and record keeping
services. In addition to its mutual fund transfer agent and record keeping
service, PFPC provides other services through its own subsidiary business units.
SECTION 30(h) AND SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 30(h) of the 1940 Act and Section 16(a) of the 1934 Act require
the Funds' officers and Trustees, certain persons affiliated with First Trust
Advisors and any sub-adviser and persons who beneficially own more than 10% of a
Fund's Shares to file reports of ownership and changes of ownership with the SEC
and the American Stock Exchange or the New York Stock Exchange, as applicable,
and to furnish the Funds with copies of all Section 16(a) forms they file. Based
solely upon a review of copies of such forms received by the Funds and certain
written representations, the Funds believe that during the fiscal year ended May
31, 2006, all such filing requirements applicable to such persons were met,
except as described below.
Four Corners Capital Management LLC made late form 3 filings for all the
Funds on behalf of Edward F. Soccorso, Drew R. Sweeney, Michael Price and David
A. Lakomcik. Upon discovery of this oversight, Form 3s were filed for Edward F.
Soccorso on August 12, 2005, Drew R. Sweeney on August 18, 2005, Michael Price
on September 19, 2005, and David A. Lakomcik on November 18, 2005. In all late
Form 3 filings mentioned above, no person was purchasing or selling Shares of
the Funds.
First Trust Advisors made late Form 4 filings for First Trust/Four
Corners Senior Floating Rate Income Fund and First Trust/Four Corners Senior
Floating Rate Income Fund II on behalf of David M. Oster, a former trustee.
David M. Oster purchased 200 shares of First Trust Four/Four Corners Senior
Floating Rate Income Fund on July 16, 2005 and 400 shares of First Trust/Four
Corners Senior Floating Rate income Fund II on December 2, 2004. Upon discovery
of this oversight, Form 4s were filed on behalf of David M. Oster for both Funds
on August 4, 2005.
SHAREHOLDER PROPOSALS
To be considered for presentation at the annual meetings of
shareholders of First Trust/Four Corners Senior Floating Rate Income Fund and
First Trust/Four Corners Senior Floating Rate Income Fund II to be held in 2007,
a shareholder proposal submitted pursuant to Rule 14a-8 of the 1934 Act must be
received at the offices of the applicable Fund at 1001 Warrenville Road, Suite
300, Lisle, Illinois 60532, not later than April 13, 2007. Due to the change in
fiscal year end from May 31 to November 30 for Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund, which was approved by the Board
on December 12, 2005, this Fund's next annual shareholder meeting will be held
on or about April 17, 2007. Therefore, a shareholder proposal submitted pursuant
to Rule 14a-8 of the 1934 Act must be received by December 18, 2006, at the
offices of the Fund at 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532,
within a reasonable time before the Fund begins to print and mail its proxy
materials.
Page 18
In order to nominate persons to the Funds' Board or to present any
other permitted proposal for action by shareholders at an annual meeting of the
shareholders, the Funds' advance notice provision by-laws require that a
shareholder must provide advance written notice to the Secretary of the Funds,
which notice must be delivered to or mailed and received at the Funds' principal
executive offices not later than the close of business on the 45th day nor
earlier than the close of business on the 60th day prior to the first
anniversary of the preceding year's annual meeting of shareholders; provided
that in the event that the date of the annual meeting to which such
shareholder's notice relates is more than 30 days before or more than 30 days
after such anniversary date; for notice by the shareholder to be timely it must
be so delivered not later than the close of business on the later of the 45th
day prior to such annual meeting or the 10th day following the day on which
public announcement of the date of such annual meeting is first made by the
Funds. The shareholder's notice must contain detailed information specified in
the Funds' by-laws.
Timely submission of a proposal does not mean that such proposal will
be included in a proxy statement.
SHAREHOLDER COMMUNICATIONS
Shareholders of a Fund who want to communicate with the Board of
Trustees or any individual Trustee should write the Fund to the attention of the
Fund Secretary, W. Scott Jardine. The letter should indicate that you are a Fund
shareholder. If the communication is intended for a specific Trustee and so
indicates, it will be sent only to that Trustee. If a communication does not
indicate a specific Trustee, it will be sent to the chair of the Nominating and
Governance Committee and the outside counsel to the Independent Trustees for
further distribution as deemed appropriate by such persons.
INVESTMENT ADVISER, SUB-ADVISER AND ADMINISTRATOR
First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
Illinois 60532, serves as the Funds' investment adviser. Four Corners Capital
Management, LLC, 515 South Flower Street, Suite 1600, Los Angeles, California
90071, serves as the investment sub-adviser to the Funds.
PFPC acts as the Funds' administrator and accounting agent and is
located at 4400 Computer Drive, Westborough, Massachusetts 01581. PFPC is a
leading provider of full service mutual fund shareholder and record keeping
services. In addition to its mutual fund transfer agent and record keeping
service, PFPC provides other services through its own subsidiary business units.
SECTION 30(h) AND SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 30(h) of the 1940 Act and Section 16(a) of the 1934 Act require
the Funds' Officers and Trustees, certain persons affiliated with First Trust
Advisors or the sub-adviser and persons who beneficially own more than 10% of a
Fund's Shares to file reports of ownership and changes of ownership with the
SEC, the American Stock Exchange or the New York Stock Exchange, as applicable,
and to furnish the Funds with copies of all Section 16(a) forms they file. Based
solely upon a review of copies of such forms received by the Funds and certain
- 18 -
written representations, the Funds believe that during the fiscal year ended May
31, 2007, all such filing requirements applicable to such persons were met
except as noted below.
First Trust Advisors made late Form 3 filings for the Funds on behalf
of (1) Joseph McDermott, who became Chief Compliance Officer of First Trust
Advisors on July 10, 2006 and (2) Kristi A. Maher, Assistant Secretary of the
Funds. Upon discovery of the applicable oversight, Form 3s were filed for Mr.
McDermott on November 15, 2006 and for Ms. Maher on January 3, 2007. Four
Corners Capital Management, LLC made late Form 3 filings for the Funds on behalf
of Ketei Marakoolo, an officer of Four Corners Capital Management, LLC, on March
19, 2007. The event requiring the filing of the Form 3 occurred on February 5,
2007. In these late Form 3 filings, no person was purchasing or selling Shares
of the Funds.
FISCAL YEAR
Each Fund's fiscal year end was May 31, 2006. For Macquarie/First Trust
Global Infrastructure/Utilities Dividend & Income Fund, the Board approved a
change in fiscal year end to November 30 at a meeting held on December 12, 2005.2007.
ANNUAL REPORT DELIVERY
Annual reports will be sent to shareholders of record of each Fund
following the Funds'Fund's fiscal year end. Each Fund will furnish, without charge, a
copy of its annual report and/or semi-annual report as available upon request.
Such written or oral requests should be directed to the Fund at 1001 Warrenville
Road, Suite 300, Lisle, Illinois 60532 or by calling 1-800-988-5891.(800) 988-5891.
Please note that only one annual or semi-annual report or proxy
statement may be delivered to two or more shareholders of a Fund who share an
address, unless the Fund has received instructions to the contrary. To request a
separate copy of an annual or semi-annual report or proxy statement, or for
instructions as to how to request a separate copy of such documents or as to how
to request a single copy if
Page 19 multiple copies of such documents are received,
shareholders should contact the Fund at the address and phone number set forth
above. Pursuant to a request, a separate copy will be delivered promptly.
GENERAL
A list of shareholders entitled to be present and to vote at the
Meetings will be available at the offices of the Funds, 1001 Warrenville Road,
Suite 300, Lisle, Illinois 60532, for inspection by any shareholder during
regular business hours beginning two days after the date of the Notice of Joint
Annual Meetings of Shareholders included with this Proxy Statement.
Failure of a quorum to be present at a Meeting will necessitate
adjournment and will subject the applicable Fund to additional expense. The
Chairman of the Meeting may also call for an adjournment of the Meeting to
permit further solicitation of proxies with respect to the proposal if the
Chairman determines that adjournment and further solicitation is reasonable and
in the best interests of the shareholders. Under each Fund's By-Laws, an
adjournment of a Meeting either requires the affirmative vote of a majority of
the shares present in person or represented by proxy at the Meeting, or action
by the Chairman of the Meeting, as described earlier.
OTHER MATTERS TO COME BEFORE THE MEETINGMEETINGS
No business other than the matters described above is expected to come
before the Meetings, but should any other matter requiring a vote of
shareholders properly come before the Meetings,arise, including any question as to an adjournment or postponement
of athe Meeting, the persons named on the enclosed proxy card will vote thereon
according to their best judgment in the interests of the Funds.
August 11, 20066, 2007
- --------------------------------------------------------------------------------
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN, DATE AND
RETURN THE PROXY CARD AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
- --------------------------------------------------------------------------------
Page 20- 19 -
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EXHIBIT A
AUDIT COMMITTEE CHARTER
I. PURPOSE.
The Audit Committee (the "Committee") is appointed by the Boards of
Trustees (the "Boards") of investment companies (the "Funds") advised by First
Trust Advisors L.P. ("Fund Management") for the following purposes:
A. to oversee the accounting and financial reporting processes of each
Fund and its internal controls and, as the Audit Committee deems appropriate, to
inquire into the internal controls of certain third-party service providers;
B. to oversee the quality and integrity of each Fund's financial
statements and the independent audit thereof;
C. to oversee, or, as appropriate, assist Board oversight of, each
Fund's compliance with legal and regulatory requirements that relate to the
Fund's accounting and financial reporting, internal controls and independent
audits; and
D. to approve, prior to the appointment, the engagement of each Fund's
independent auditor and, in connection therewith, to review and evaluate the
qualifications, independence and performance of the Fund's independent auditor.
II. COMMITTEE ORGANIZATION AND COMPOSITION.
A. Size and Membership RequirementsRequirements.
1. The Committee shall be composed of at least three members, all of
whom shall be trustees of the Funds. Each member of the Committee, and a
Committee chairperson, shall be appointed by the Board on the recommendation of
the Nominating and Governance Committee.
2. Each member of the Committee shall be independent of the Fund and
must be free of any relationship that, in the opinion of the Board, would
interfere with the exercise of independent judgment as a Committee member. With
respect to the Funds which are closed-end funds or open-end exchange-traded
funds ("ETFs"), each member must meet the independence and experience
requirements of the New York Stock Exchange or the American Stock Exchange or
the NASDAQ Stock Market (as applicable), and Section 10A of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and Rule 10A-3
thereunder, and other applicable rules and regulations of the Securities and
Exchange Commission ("SEC"). Included in the foregoing is the requirement that
no member of the Committee be an "interested person" of the Funds within the
meaning of Section 2(a)(19) of the Investment Company Act of 1940, as amended
(the "1940 Act"), nor shall any Committee member accept, directly or indirectly,
any consulting, advisory or other compensatory fee from the Funds (except in the
capacity as a Board or committee member).
3. At least one member of the Committee shall have been determined by
the Board, exercising its business judgment, to qualify as an "audit committee
financial expert" as defined by the SEC.
Page A-1
4. With respect to Funds that are closed-end funds whose shares are
listed on the New York Stock Exchange, each member of the Committee shall have
been determined by the Board, exercising its business judgment, to be
"financially literate" as required by the New York Stock Exchange. In addition,
at least one member of the Committee shall have been determined by the Board,
exercising its business judgment, to have "accounting or financial management
expertise," as required by the New York Stock Exchange. Such member may, be, but
need not be, the same person as the Funds' "audit committee financial expert."
With respect to Funds that are closed-end funds or ETFs whose shares are listed
on the American Stock Exchange or the NASDAQ Stock Market, each member of the
Committee shall be able to read and understand fundamental financial statements,
including a Fund's balance sheet, income statement and cash flow statement. In
addition, at least one member of the Committee shall have been determined by the
Board, exercising its business judgment, to be "financially sophisticated," as
required by the American Stock Exchange.Exchange and the NASDAQ Stock Market. A member
whom the Board determines to be the Fund's "audit committee financial expert"
shall be presumed to qualify as financially sophisticated.
5. With respect to Funds that are closed-end funds, Committee members
shall not serve simultaneously on the audit committee of more than two other public
companies, in addition to their service on the Committee.
B. Frequency of Meetings.
The Committee will ordinarily meet once for every regular meeting of
the Board. The Committee may meet more or less frequently as appropriate, but no
less than twice per year.
C. Term of Office.
Committee members shall serve until they resign or are removed or
replaced by the Board.
III. RESPONSIBILITIES.
A. With respect to Independent Auditors:
1. The Committee shall be responsible for the appointment or
replacement (subject if applicable, to Board and/or shareholder ratification),
compensation, retention and oversight of the work of any registered public
accounting firm engaged (including resolution of disagreements between
management and the auditor regarding financial reporting) for the purpose of
preparing or issuing an audit report or performing other audit, review or attest
services for the Funds ("External Auditors"). The External Auditors shall report
directly to the Committee.
2. The Committee shall meet with the External Auditors and Fund
Management to review the scope, fees, audit plans and staffing of the proposed
audits for each fiscal year. At the conclusion of the audit, the Committee shall
review such audit results, including the External Auditors'Auditor's evaluation of the
Fund's financial and internal controls, any comments or recommendations of the
External Auditors, any audit problems or difficulties and Fund Management's
response, including any restrictions on the scope of the External Auditors'Auditor's
activities or on access to requested information, any significant disagreements
with Fund Management, any accounting adjustments noted or proposed by the
auditor but not made by the Fund, any communications between the audit team and
Page A-2
the audit firm's national office regarding auditing or accounting issues
presented by the engagement, any significant changes required from the
originally planned audit programs and any adjustments to the financial
statements recommended by the External Auditors.
A-2
3. The Committee shall meet with the External Auditors in the absence
of Fund Management, as necessary.
4. The Committee shall pre-approve all audit services and permitted
non-audit services (including the fees and terms thereof) to be performed for
the Fund by its External Auditors. The Chairman of the Committee is authorized
to give such pre-approvals on behalf of the Committee, and shall report any such
pre-approval to the full Committee.
5. The Committee shall pre-approve the External Auditors'Auditor's engagements
for non-audit services to Fund Management and any entity controlling, controlled
by or under common control with Fund Management that provides ongoing services
to the Fund, if the engagement relates directly to the operations and financial
reporting of the Fund, subject to the de minimis exceptions for non-audit
services described in Rule 2-01 of Regulation S-X. The Chairman of the Committee
is authorized to give such pre-approvals on behalf of the Committee, and shall
report any such pre-approval to the full Committee.
6. If the External Auditors have provided non-audit services to Fund
Management and any entity controlling, controlled by or under common control
with Fund Management that provides ongoing services to the Fund that were not
pre-approved pursuant to the de minimis exception, the Committee shall consider
whether the provision of such non-audit services is compatible with the External
Auditors'Auditor's independence.
7. The Committee shall obtain and review a report from the External
Auditors at least annually (including a formal written statement delineating all
relationships between the auditors and the Fund consistent with Independence
Standards Board Standard No. 1 as may be amended, restated, modified or
replaced) regarding (a) the External Auditors'Auditor's internal quality-control
procedures; (b) any material issues raised by the most recent internal
quality-control review, or peer review, of the firm, or by an inquiry or
investigation by governmental or professional authorities within the preceding
five years, respecting one or more independent audits carried out by the firm;
(c) any steps taken to deal with any such issues; and (d) the External Auditors'Auditor's
independence, including all relationships between the External Auditors and the
Fund and its affiliates; and evaluating the qualifications, performance and
independence of the External Auditors, including their membership in the SEC
practice section of the AICPA and their compliance with all applicable
requirements for independence and peer review, and a review and evaluation of
the lead partner, taking into account the opinions of management and discussing
such reports with the External Auditors. The Committee shall present its
conclusions with respect to the External Auditors to the Board.
8. The Committee shall review reports and other information provided to
it by the External Auditors regarding any illegal acts that the External
Auditors should discover (whether or not perceived to have a material effect on
the Fund's financial statements), in accordance with and as required by Section
10A(b) of the Exchange Act.
Page A-3
9. The Committee shall ensure the rotation of the lead (or concurring)
audit partner having primary responsibility for the audit and the audit partner
responsible for reviewing the audit as required by law, and further considerconsidering
the rotation of the independent auditor firm itself.
10. The Committee shall establish and recommend to the Board for
ratification a policy of the Funds with respect to the hiring of employees or
former employees of the External Auditors who participated in the audits of the
Funds' financial statements.
A-3
11. The Committee shall take (and, where appropriate, recommend that
the Board take) appropriate action to oversee the independence of the External
Auditors.
12. The Committee shall report regularly to the Board on the results of
the activities of the Committee, including any issues that arise with respect to
the quality or integrity of the Funds' financial statements, the Funds'
compliance with legal or regulatory requirements, the performance and
independence of the Funds' External Auditors, or the performance of the internal
audit function, if any.
B. With respect to Fund Financial Statements:
1. The Committee shall meet to review and discuss with Fund Management
and the External Auditors the annual audited financial statements of the Funds,
major issues regarding accounting and auditing principles and practices, and the
Funds' disclosures under "Management's Discussion and Analysis," and shall meet
to review and discuss with Fund Management the semi-annual financial statements
of the Funds and the Funds' disclosures under "Management's Discussion and
Analysis."
2. The Committee shall review and discuss reports, both written and
oral, from the External Auditors or Fund Management regarding (a) all critical
accounting policies and practices to be used; (b) all alternative treatments of
financial information within generally accepted accounting principles ("GAAP")
for policies and practices that have been discussed with management, including
the ramifications of the use of such alternative treatments and disclosures and
the treatment preferred by the External Auditors; (c) other material written
communications between the External Auditors and management, such as any
management letter or schedule of unadjusted differences; and (d) all non-audit
services provided to any entity in the investment company complex (as defined in
Rule 2-01 of Regulation S-X) that were not pre-approved by the Committee.
3. The Committee shall review disclosures made to the Committee by the
Funds' principal executive officer and principal financial officer during their
certification process for the Funds' periodic reports about any significant
deficiencies in the design or operation of internal controls or material
weaknesses therein and any fraud involving management or other employees who
have a significant role in the Funds' internal controls.
4. The Committee shall discuss with the External Auditors the matters
required to be discussed by Statement of Auditing Standards ("SAS") No. 90,
Audit Committee Communications (which amended SAS No. 61, Communication with
Audit Committees), that arise during the External Auditors'Auditor's review of the Funds'
financial statements.
Page A-4
5. The Committee shall review and discuss with management and the
External Auditors (a) significant financial reporting issues and judgments made
in connection with the preparation and presentation of the Funds' financial
statements, including any significant changes in the Funds' selection or
application of accounting principles and any major issues as to the adequacy of
the Funds' internal controls and any special audit steps adopted in light of
material control deficiencies, and (b) analyses prepared by Fund Management or
the External Auditors setting forth significant financial reporting issues and
judgments made in connection with the preparation of the financial statements,
including analyses of the effects of alternative GAAP methods on the financial
statements.
6. The Committee shall review and discuss with management and the
External Auditors the effect of regulatory and accounting initiatives on the
Funds' financial statements.
A-4
7. The Committee shall discuss with Fund Management the Funds' press
releases regarding financial results and dividends, as well as financial
information and earnings guidance provided to analysts and rating agencies. This
discussion may be done generally, consisting of discussing the types of
information to be disclosed and the types of presentations to be made. The
Chairman of the Committee shall be authorized to have these discussions with
Fund Management on behalf of the Committee, and shall report to the Committee
regarding any such discussions.
8. The Committee shall discuss with Fund Management the Funds' major
financial risk exposures and the steps Fund Management has taken to monitor and
control these exposures, including the Funds' risk assessment and risk
management policies and guidelines. In fulfilling its obligations under this
paragraph, the Committee may, as applicable, review in a general manner the
processes other Board committees have in place with respect to risk assessment
and risk management.
C. With respect to serving as a Qualified Legal Compliance Committee:
1.I. The Committee shall serve as the Funds' "qualified legal compliance
committee" ("QLCC") within the meaning of the rules of the SEC and, in that
regard, the following shall apply.
i. The Committee shall receive and retain, in confidence,
reports of evidence of (a) a material violation of any federal or state
securities laws, (b) a material breach of a fiduciary duty arising
under any federal or state laws or (c) a similar material violation of
any federal or state law by a Fund or any of its officers, trustees,
employees or agents (a "Report of Material Violation"). Reports of
Material Violation may be addressed to the Funds, attention W. Scott
Jardine, at the address of the principal offices of the Funds, which
currently is 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532,
who shall forward the Report of Material Violation to the Committee.
ii. Upon receipt of a Report of Material Violation, the
Committee shall (a) inform the Fund's chief legal officer and chief
executive officer (or the equivalents thereof) of the report (unless
the Committee determines it would be futile to do so), and (b)
determine whether an investigation is necessary.
iii. After considering the Report of a Material Violation, the
Committee shall do the following if it deems an investigation
necessary:
o Notify the full Board;
o Initiate an investigation, which may be conducted
either by the chief legal officer (or the equivalent
thereof) of the Fund or by outside attorneys; and
o Retain such additional expert personnel as the
Committee deems necessary.
iv. At the conclusion of any such investigation, the Committee
shall:
o Recommend, by majority vote, that the Fund implement
an appropriate response to evidence of a material
violation; and
o Inform the chief legal officer and the chief
executive officer (or the equivalents thereof) and
the Board of the results of any such investigation
and the appropriate remedial measures to be adopted.
A-5
2. The Committee shall take all other action that it deems appropriate
in the event that the Fund fails in any material respect to implement an
appropriate response that the Committee, as the QLCC, has recommended the Fund
take.
D. Other Responsibilities:
1. The Committee shall receive, retain and handle complaints received
by the Funds regarding accounting, internal accounting controls, or auditing
matters from any person, whether or not an employee of the Funds or Fund
Management, and shall receive submissions of concerns regarding questionable
accounting or auditing matters by employees of the Funds and Fund Management,
administrator, principal underwriter, or any other provider of
accounting-related services for the Funds. All such complaints and concerns
shall be handled in accordance with the Committee's procedures for operating as
a QLCC, outlined in III. C.III.C above.
2. The Committee shall review, with Fundfund counsel and independent legal
counsel, any legal matters that could have significant impact on the Fund's
financial statements or compliance policies and the findings of any examination
by a regulatory agency as they relate to financial statement matters.
3. The Committee shall review and reassess the adequacy of this charter
on an annual basis, if necessary, and provide a recommendation to the Board for
approval of any proposed changes deemed necessary or advisable by the Committee.
4. The Committee shall evaluate on an annual basis the performance of
the Committee.
Page A-6
5. The Committee shall review with the External Auditors and with Fund
Management the adequacy and effectiveness of the Funds' internal accounting and
financial controls.
6. The Committee shall discuss with Fund Management and the External
Auditors any correspondence with regulators or governmental agencies that raise
material issues regarding the Funds' financial statements or accounting
policies.
7. The Committee shall obtain any reports from Fund Management with
respect to the Funds' policies and procedures regarding compliance with
applicable laws and regulations. The Committee shall perform other special
reviews, investigations or oversight functions as requested by the Board and
shall receive and review periodic or special reports issued on
exposure/controls, irregularities and control failures related to the Funds.
8. The Committee shall prepare any report of the Committee required to
be included in a proxy statement for a Fund.
9. The Committee may request any officer or employee of a Fund or Fund
Management, independent legal counsel, Fundfund counsel and the External Auditors to
attend a meeting of the Committee or to meet with any members of, or consultants
to, the Committee.
10. The Committee shall maintain minutes of its meetings.
11. The Committee shall perform such other functions and have such
powers as may be necessary or appropriate in the efficient and lawful discharge
of its responsibilities.
A-6
IV. AUTHORITY TO ENGAGE ADVISERS.
The Committee may engage independent counsel and other advisers, as it
determines necessary to carry out its duties. The Funds' External Auditors shall
have unrestricted accessibility at any time to Committee members.
V. FUNDING PROVISIONS.
A. The Committee shall determine the:
1. Compensation to any independent registered public accounting firm
engaged for the purpose of preparing or issuing an audit report or performing
other audit, review or attest services for a Fund; and
2. Compensation to any advisers employed by the Committee.
B. The expenses enumerated in this Article V and all necessary and
appropriate administrative expenses of the Committee shall be paid by the
applicable Fund or Fund Management.
Page A-7
VI. MANAGEMENT AND EXTERNAL AUDITORS'AUDITOR'S RESPONSIBILITIES.
A. Fund Management has the primary responsibility for establishing and
maintaining systems for accounting, reporting, disclosure and internal controls.
The External Auditors have the primary responsibility to plan and implement an
audit, with proper consideration given to the accounting, reporting and internal
controls. All External Auditors engaged for the purpose of preparing or issuing
an audit report or performing other audit, review or attest services for the
Funds shall report directly to the Committee. The External Auditors' ultimate
accountability is to the Board and the Committee, as representatives of
shareholders.
B. While the Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Committee to plan or conduct audits or
to determine that the Funds' financial statements are complete and accurate and
are in accordance with GAAP, nor is it the duty of the Committee to assure
compliance with laws and regulations and/or the Funds' Code of Ethics.
C. In discharging its responsibilities, the Committee and its members
are entitled to rely on information, opinions, reports, or statements, including
financial statements and other financial data, if prepared or presented by: (1)
one or more officers of a Fund; (2) legal counsel, public accountants, or other
persons as to matters the Committee member reasonably believes are within the
person's professional or expert competence; or (3) a Board committee of which
the Committee member is not a member.
Amended: June 13, 2005
Page A-8
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[BLANK INSIDE BACK COVER]Amended: December 11, 2006
A-7
[BLANK BACK COVER]
FIRST TRUST/FOUR CORNERS
SENIOR FLOATING RATE INCOME FUND II
[ ] Mark this boxUsing a BLACK INK pen, mark your votes
with an X if you
have made changes to your name
or address details above.as shown in this example.
Please do not write outside the
designated areas. [X]
________________________________________________________________________________
ANNUAL MEETING PROXY CARD
________________________________________________________________________________
This proxy, if properly executed, will be voted in the manner directed by the
undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTEDPLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION
IN THE ENCLOSED ENVELOPE.
- -------------------------------------------------------------------------------
A PROPOSAL -- THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR ALL THE ELECTION OF EACH NOMINEE SET FORTH.
A. ELECTION OF DIRECTORS
1.NOMINEES
LISTED.
Election of Trustees: To elect three Trustees for the terms specified, by
holders of Common and Preferred Shares, voting together as a single class.
For Withhold
01 - James A. Bowen [ ] [ ]
Class III (Expiring 2010)
02 - Richard E. Erickson [ ] [ ]
03-Class I (Expiring 2008)
03 - Neil B. Nielson [ ] [ ]
Class II (Expiring 2009)
Election of Trustees: To elect two Trustees for the terms specified, by
holders of Preferred Shares, voting separately as a single class.
For Withhold
04 - Thomas R. Kadlec [ ] [ ]
Class I (Expiring 2008)
05 - Robert F. Keith [ ] [ ]
Class I (Expiring 2008)
B Non-Voting Items
Change of Address -- Please print new address below.
Comments -- Please print your comments below.
MEETING ATTENDANCE
Mark thisthe box with an Xto the right
if you have made comments belowplan to attend the
Annual Meeting. [ ]
________________________________
________________________________
________________________________
________________________________
B. AUTHORIZED SIGNATURES - SIGN HERE - THIS SECTION MUST BE COMPLETED FOR YOUR
INSTRUCTIONS TO BE EXECUTED.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.C Authorized Signatures -- This section must be completed for your vote
to be counted. -- Date and Sign Below
NOTE: Please sign exactly as your name appears on this Proxy. If joint owners,
EITHER may sign this Proxy.proxy. When signing as attorney, executor, administrator,
trustee, guardian or corporate officer, please give full title.
Date (mm/dd/yyyy) -- Please print date below.
____/____/____
Signature 1- Please keep Signature 2-1 -- Please keep signature within the boxbox.
_______________________________________
Signature 2 -- Please keep signature withinwith the box Date (mm/dd/yyyy)
__________________________ _________________________ _________________
/ /
__________________________ _________________________ __________________
0102952 1UPX COY
001CD40001 00LTHAbox.
________________________________________
C 1234567890 J N T
1 U P X 0 1 4 2 4 4 3
STOCK# 00RG5C
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION
IN THE ENCLOSED ENVELOPE.
- -------------------------------------------------------------------------------
________________________________________________________________________________
PROXY - FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II
________________________________________________________________________________
PROXY SOLICITED BY THE BOARD OF TRUSTEES
ANNUAL MEETING ON SEPTEMBER 11, 200610, 2007
The undersigned holder of Preferred Shares of the First Trust/Four Corners
Senior Floating Rate Income Fund II (the "Fund"), a Massachusetts business
trust, hereby appoints W. Scott Jardine, Mark R. Bradley and Kristi A. Maher as
attorneys and proxies for the undersigned, with full powers of substitution and
revocation, to represent the undersigned and to vote on behalf of the
undersigned all shares of the Fund that the undersigned is entitled to vote at
the Annual Meeting of Shareholders of the Fund (the "Meeting") to be held at the
offices of First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
IL 60532, at 4:00 p.m. Central time on the date indicated above, and any
adjournment or adjournments thereof. The undersigned hereby acknowledges receipt
of the Notice of Joint Annual Meeting of Shareholders and Joint Proxy Statement
dated August 11,6, 2006, and hereby instructs said attorneys and proxies to vote
said shares as indicated hereon. In their discretion, the proxies are authorized
to vote upon such other business as may properly come before the Meeting. A
majority of the proxies present and acting at the Meeting in person or by
substitute (or, if only one shall be so present, then that one) shall have and
may exercise all of the power and authority of said proxies hereunder. The
undersigned hereby revokes any proxy previously given.
THIS PROXY, IF PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF EACH NOMINEE SET FORTH.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.