2,400,000 SHARES
FIRST TRUST ENERGY INCOME AND GROWTH FUND
COMMON SHARES OF BENEFICIAL INTEREST
(PAR VALUE $0.01 PER SHARE)
UNDERWRITING AGREEMENT
July 26, 2012
July 26, 2012
Morgan Stanley & Co. LLC
Citigroup Global Markets Inc.
RBC Capital Markets, LLC
as representatives of the several
Underwriters named in Schedule I hereto
c/o Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036
Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
RBC Capital Markets, LLC
Three World Financial Center
200 Vesey Street, 8th Floor
New York, NY 10281
Ladies and Gentlemen:
First Trust Energy Income and Growth Fund, a business trust organized
under the laws of the Commonwealth of Massachusetts (the "FUND"), is a
non-diversified closed-end management investment company registered under the
Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT"). The
Fund proposes to issue and sell to the several Underwriters named in Schedule I
hereto (the "UNDERWRITERS") 2,400,000 shares of its common shares of beneficial
interest (par value $0.01 per share) (the "FIRM SHARES"). The Fund also proposes
to issue and sell to the several Underwriters not more than an additional
360,000 shares of its common shares of beneficial interest (par value $0.01 per
share) (the "ADDITIONAL SHARES") if and to the extent that you, as Managers of
the offering, shall have determined to exercise, on behalf of the Underwriters,
the right to purchase all or any part of such shares granted to the Underwriters
in Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "SHARES." The common shares of beneficial
interest (par value $0.01 per share) of the Fund to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"COMMON SHARES."
First Trust Advisors L.P. (the "ADVISOR") acts as the Fund's investment
advisor pursuant to an Investment Management Agreement between the Advisor and
the Fund (the "INVESTMENT MANAGEMENT AGREEMENT"). Energy Income Partners, LLC
("SUBADVISOR" and, together with Advisor, the "INVESTMENT ADVISORS") acts as the
Fund's subadvisor pursuant to a Sub-Advisory Agreement among the Fund, the
Advisor and the Subadvisor (the "SUB-ADVISORY AGREEMENT").
The Fund has filed with the Securities and Exchange Commission (the
"COMMISSION") a notification on Form N-8A (the "NOTIFICATION") of registration
of the Fund as an investment company and a registration statement on Form N-2,
including a prospectus and a statement of additional information incorporated by
reference in the prospectus, relating to the Shares. Such Registration
Statement, including any amendments thereto filed prior to the Execution Time
(as defined in Section 10), has become effective. The Fund has filed, as part of
an amendment to the Registration Statement or pursuant to Rule 497 under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), one or more
amendments thereto, including a related Preliminary Final Prospectus (including
the statement of additional information incorporated by reference therein), each
of which has previously been furnished to you. The Fund will file with the
Commission a final prospectus supplement (including the statement of additional
information incorporated by reference therein) related to the Shares in
accordance with Rule 497.
As filed, such final prospectus supplement (including the statement of
additional information incorporated by reference therein), together with the
Basic Prospectus, shall contain all information required by the Securities Act
and the Investment Company Act and the Rules and Regulations and, except to the
extent that Morgan Stanley & Co. LLC, Citigroup Global Markets Inc. and RBC
Capital Markets, LLC shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution Time
or, to the extent not completed at the Execution Time, shall contain only such
specific additional information and other changes (beyond that contained in the
Basic Prospectus and the Preliminary Final Prospectus) as the Fund has advised
you, prior to the Execution Time, will be included or made therein. The
Registration Statement, at the Execution Time, meets the requirements set forth
in Rule 415(a)(1).
For purposes of this Agreement, "REGISTRATION STATEMENT" means the
registration statement referred to in the preceding paragraph, including
exhibits and financial statements and any prospectus supplement relating to the
Shares that is filed with the Commission pursuant to Rule 497 and deemed part of
such registration statement pursuant to Rule 430B, as amended at the Execution
Time and, in the event any post-effective amendment thereto or any related Rule
462(b) Registration Statement becomes effective prior to the Closing Date, shall
also mean such registration statement as so amended or such Rule 462(b)
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Registration Statement, as the case may be. "RULE 462(B) REGISTRATION STATEMENT"
shall mean a registration statement and any amendments thereto filed pursuant to
Rule 462(b) relating to the offering covered by the Registration Statement. The
"BASIC PROSPECTUS" shall mean the prospectus (including the statement of
additional information incorporated by reference herein) referred to in the
paragraph above contained in the Registration Statement at the time it became
effective. The "PRELIMINARY FINAL PROSPECTUS" shall mean any preliminary
prospectus supplement (including the statement of additional information
incorporated by reference therein) to the Basic Prospectus filed with the
Commission pursuant to Rule 497, which describes the Shares and the offering
thereof and is used prior to the filing of the Final Prospectus, together with
the Basic Prospectus. The "FINAL PROSPECTUS" shall mean the prospectus
supplement (including the statement of additional information incorporated by
reference therein) relating to the Shares that is first filed pursuant to Rule
497 after the Execution Time, together with the Basic Prospectus.
The Investment Company Act and the Securities Act are hereinafter
referred to collectively as the "ACTS," the Investment Advisers Act of 1940, as
amended, is hereinafter referred to as the "ADVISERS ACT" and the rules and
regulations of the Commission under the Acts, the Advisers Act and under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") are hereinafter
referred to collectively as the "RULES AND REGULATIONS."
For purposes of this Agreement, "OMITTING PROSPECTUS" means any
advertisement used in the public offering of the Shares pursuant to Rule 482 of
the Rules and Regulations ("RULE 482") and "TIME OF SALE PROSPECTUS" means the
Preliminary Final Prospectus dated July 25, 2012, relating to the Shares,
together with the pricing information as set forth in Schedule III. As used
herein, the terms "Registration Statement," "Basic Prospectus," "Preliminary
Final Prospectus," "Time of Sale Prospectus" and "Final Prospectus" shall
include the documents, if any, incorporated by reference therein, including the
statement of additional information.
1. Representations and Warranties of the Fund and the Investment
Advisors. The Fund and the Investment Advisors, jointly and severally, represent
and warrant to and agree with each of the Underwriters as of the Execution Time,
as of the Closing Date referred to in Section 5 hereof, and as of each Option
Closing Date (if any) referred to in Section 3 hereof, that:
(a) The Fund meets the requirements for the use of Form N-2
under the Acts. The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to the
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knowledge of the Fund or the Investment Advisors, threatened by the
Commission. The Fund has filed one or more Preliminary Final
Prospectuses, each of which has previously been furnished to you. The
Fund will file with the Commission a Final Prospectus related to the
Shares in accordance with Rule 497. As filed, such Final Prospectus shall
contain, in all material respects, all information required by the Acts
and the Rules and Regulations and, except to the extent the Underwriters
shall agree in writing to a modification, shall be in all substantive
respects in the form furnished to you prior to the Execution Time or, to
the extent the Final Prospectus is not complete at the Execution Time,
contains only such specific additional information or other changes
(beyond the Preliminary Final Prospectus, as amended or supplemented as
of the Execution time), as the Fund advised you, prior to the Execution
Time, would be included or made therein. At the Execution Time, the
Registration Statement meets the requirements set forth in Rule
415(a)(1).
(b) (i) The Registration Statement, when it became effective,
did not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration Statement and
the Basic Prospectus comply and, as amended or supplemented, if
applicable, will comply in all material respects with the Acts and the
applicable Rules and Regulations thereunder, (iii) the Time of Sale
Prospectus does not, and at the time of each sale of the Shares in
connection with the offering when the Final Prospectus is not yet
available to prospective purchasers, the Time of Sale Prospectus, as then
amended or supplemented, if applicable, will not, contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading and (iv) the Final Prospectus, as
amended or supplemented, if applicable, will not, as of its date and the
Closing Date (as defined in Section 5), contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in
the Registration Statement, the Time of Sale Prospectus or the Final
Prospectus based upon information relating to any Underwriter furnished
to the Fund in writing by such Underwriter through you expressly for use
therein.
(c) The Fund has been duly formed, is validly existing as a
business trust in good standing under the laws of the Commonwealth of
Massachusetts, has the power and authority to own its property and to
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conduct its business as described in the Time of Sale Prospectus and is
duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing could not
reasonably be expected to have (i) a material adverse effect on the
performance of this Agreement or the consummation of any of the
transactions contemplated hereby or (ii) a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business,
properties or operations of the Fund whether or not arising from
transactions in the ordinary course of business (a "FUND MATERIAL ADVERSE
EFFECT"). The Fund has no subsidiaries.
(d) The Fund is registered with the Commission as a
non-diversified, closed-end management investment company under the
Investment Company Act and no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated or, to the
Fund's or Investment Advisor's knowledge, threatened by the Commission.
No person is serving or acting as an officer or trustee of, or investment
advisor to, the Fund except in accordance with the provisions of the
Investment Company Act and the Advisers Act. Except as otherwise
disclosed in the Registration Statement, the Time of Sale Prospectus and
the Final Prospectus, no trustee of the Fund is an "interested person" of
the Fund or an "affiliated person" of any Underwriter (each as defined in
the Investment Company Act).
(e) Each of this Agreement, the Investment Management
Agreement, the Sub-Advisory Agreement, the Administration and Accounting
Services Agreement between BNY Mellon Investment Servicing (U.S.) Inc.
(the "ADMINISTRATOR") and the Fund (the "ADMINISTRATION AGREEMENT"), the
Custodian Agreement between The Bank of New York Mellon, as successor to
BNY Mellon Investment Servicing Trust Company (formerly PFPC Trust
Company) (the "CUSTODIAN") and the Fund (the "CUSTODIAN AGREEMENT"), the
Transfer Agency Services Agreement between BNY Mellon Investment
Servicing (US) Inc., formerly known as PNC Global Investment Servicing
(U.S.) Inc. (the "TRANSFER AGENT") and the Fund (the "TRANSFER AGENCY
AGREEMENT") and the Committed Facility Agreement between BNP Paribas
Prime Brokerage Inc. and the Fund ( the "COMMITTED FACILITY AGREEMENT")
(this Agreement, the Investment Management Agreement, the Sub-Advisory
Agreement, the Administration Agreement, the Custodian Agreement, the
Transfer Agency Agreement and the Committed Facility Agreement being
referred to herein collectively as the "FUNDAMENTAL AGREEMENTS") has been
duly authorized, executed and delivered by the Fund and complies, in all
material respects, with the applicable provisions of the Acts, the
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Advisers Act and the applicable Rules and Regulations. The Fund has
adopted the Dividend Reinvestment Plan (the "PLAN"). Each Fundamental
Agreement, other than this Agreement, and the Plan is a valid and binding
agreement of the Fund, enforceable in accordance with its terms, subject
to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and equitable principles of general
applicability.
(f) None of (1) the execution and delivery by the Fund of, and
the performance by the Fund of its obligations under, each Fundamental
Agreement or the adoption by the Fund of the Plan, or (2) the issue and
sale by the Fund of the Shares as contemplated by this Agreement
contravenes or will contravene any provision of applicable law or the
declaration of trust and by-laws of the Fund, any agreement or other
instrument binding upon the Fund or any other obligation, agreement or
condition contained in any bond, debenture, note or any other evidence of
indebtedness, that is material to the Fund, or any judgment, order or
decree of any governmental body, agency or court having jurisdiction over
the Fund, whether foreign or domestic. No consent, approval,
authorization, order or permit of, or qualification with, any
governmental body or agency, self-regulatory organization or court or
other tribunal, whether foreign or domestic, is required for the
performance by the Fund of its obligations under the Fundamental
Agreements or the Plan, except such as have been obtained and as may be
required by the Acts, the Advisers Act, the Exchange Act, or the
applicable Rules and Regulations, or by the securities or Blue Sky laws
of the various states and foreign jurisdictions in connection with the
offer and sale of the Shares.
(g) As of the Execution Time, the Fund has an authorized and
outstanding capitalization as set forth under the heading "Actual" in the
section of the Preliminary Final Prospectus and the Final Prospectus
entitled "Capitalization" and, as of the Closing Date (without giving
effect to any issuance of Additional Shares), the Fund shall have an
authorized and outstanding capitalization as set forth under the heading
"As Adjusted" in the section of the Final Prospectus entitled
"Capitalization"; and the authorized capital stock of the Fund conforms
in all material respects to the description thereof contained in each of
the Time of Sale Prospectus and the Final Prospectus, and the declaration
of trust and by-laws of the Fund, the Fundamental Agreements and the Plan
conform in all material respects to the descriptions thereof contained in
each of the Time of Sale Prospectus and the Final Prospectus.
(h) The declaration of trust and by-laws of the Fund, the
Fundamental Agreements and the Plan comply, in all material respects,
6
with the applicable provisions of the Acts and the applicable Rules and
Regulations, and all approvals of such documents required under the
Investment Company Act by the Fund's shareholders or board of trustees
have been obtained and are in full force and effect.
(i) The Fundamental Agreements (other than this Agreement) and
the Plan are in full force and effect and neither the Fund nor, to the
Fund's or the Investment Advisors' knowledge, any other party to any such
agreement is in default thereunder, and no event has occurred which with
the passage of time or the giving of notice or both would constitute a
default thereunder. The Fund is not currently in breach of, or in default
under, any other written agreement or instrument to which it or its
property is bound or affected.
(j) The Common Shares and preferred shares, if any,
outstanding prior to the issuance of the Shares have been duly authorized
and are validly issued, fully paid and non-assessable, except that, as
set forth in the Registration Statement, the Time of Sale Prospectus and
the Final Prospectus, shareholders of a Massachusetts business trust may
under certain circumstances be held personally liable for obligations of
the Fund. The Common Shares and preferred shares, if any, outstanding
prior to the issuance of the Shares are not entitled to preemptive or
other rights to subscribe for the shares.
(k) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares
will not be subject to any preemptive or similar rights.
(l) The Shares and any Common Shares outstanding prior to the
issuance of the Shares have been approved for listing on the NYSE Amex
LLC ("NYSE AMEX"), subject to official notice of issuance. The Fund's
Registration Statement on Form 8-A under the Exchange Act is effective.
(m) Each Omitting Prospectus (i) complies with the
requirements of Rule 482, (ii) does not contain an untrue statement of a
material fact, (iii) complied and will comply in all material respects
with the Acts, the Rules and Regulations and the rules and regulations of
the Financial Industry Regulatory Authority ("FINRA") and (iv) if
required, has been duly filed with FINRA and FINRA has issued no
objections with respect thereto. Except for the Omitting Prospectuses
identified on Schedule II hereto, the Fund has not prepared, used or
7
referred to and will not, without your prior written consent, prepare,
use or refer to any prospectus in reliance upon Rule 482.
(n) The Fund has filed all tax returns with respect to each
jurisdiction in which such returns are required to be filed or has duly
requested extensions thereof, and all such returns are complete and
correct in all material respects. The Fund has paid all taxes and any
related assessments, fines or penalties to all jurisdictions in which
such taxes, assessments, fines or penalties are required to be paid,
except for any such tax, assessment, fine or penalty that is being
contested in good faith and by appropriate proceedings and as to which
adequate reserves have been provided in accordance with U.S. GAAP. The
Fund has not received notice of any tax deficiency.
(o) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Fund from that set forth in the Time of Sale
Prospectus, and there have been no transactions entered into by the Fund
which are material to the Fund other than those in the ordinary course of
its business or as described in the Time of Sale Prospectus.
(p) There are no legal or governmental proceedings pending or
threatened to which the Fund is a party or to which any of the properties
of the Fund is subject (i) other than proceedings accurately described in
all material respects in the Time of Sale Prospectus and proceedings that
would not have a Fund Material Adverse Effect, or on the power or ability
of the Fund to perform its obligations under this Agreement or to
consummate the transactions contemplated by the Time of Sale Prospectus
or (ii) that are required to be described in the Registration Statement
or the Final Prospectus and are not so described; and there are no
statutes, regulations, contracts or other documents that are required to
be described in the Registration Statement, the Time of Sale Prospectus
or the Final Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required, except that for
the avoidance of doubt, this Agreement and the opinions and consents of
counsel and Deloitte & Touche LLP, will be filed by a post-effective
amendment to the Registration Statement.
(q) The Fund has all necessary consents, authorizations,
approvals, orders (including exemptive orders), certificates and permits
of and from, and has made all declarations and filings with, all
governmental authorities, self-regulatory organizations and courts and
other tribunals, whether foreign or domestic, to own and use its assets
and to conduct its business in the manner described in the Time of Sale
8
Prospectus and the Final Prospectus, except to the extent that the
failure to obtain or file the foregoing would not have a Fund Material
Adverse Effect.
(r) Each Preliminary Final Prospectus relating to the Shares
(including the statement of additional information incorporated therein
by reference) filed as part of the Registration Statement as originally
filed or as part of any amendment thereto, and the Final Prospectus filed
pursuant to Rule 497 under the Securities Act, complied when so filed in
all material respects with the Acts and the applicable Rules and
Regulations.
(s) The financial statements, together with related schedules
and notes, included in the Registration Statement, the Time of Sale
Prospectus and the Final Prospectus present fairly, in all material
respects, the financial position of the Fund as of the date indicated and
said statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein); and the other
financial and statistical information and data included in the
Registration Statement, the Time of Sale Prospectus and the Final
Prospectus are accurately derived from such financial statements and the
books and records of the Fund. Deloitte & Touche LLP, whose report
appears in the Time of Sale Prospectus and the Final Prospectus and who
has certified the financial statements and supporting schedules, if any,
included in the Registration Statement, the Time of Sale Prospectus and
the Final Prospectus is an independent registered public accounting firm
as required by the Acts and the applicable Rules and Regulations.
(t) There are no material restrictions, limitations or
regulations with respect to the ability of the Fund to invest its assets
as described in the Time of Sale Prospectus and the Final Prospectus,
other than as described therein.
(u) All advertisements authorized by the Fund for use in the
offering of the Shares complied and will comply in all material respects
with the requirements of the Acts, the applicable Rules and Regulations
and the rules and regulations of FINRA and there are no such
advertisements other than the Omitting Prospectuses identified in
Schedule II hereto.
(v) There are no contracts, agreements or understandings
between the Fund and any person granting such person the right to require
the Fund to file a registration statement under the Securities Act with
respect to any securities of the Fund or to require the Fund to include
9
such securities with the Shares registered pursuant to the Registration
Statement.
(w) The expense summary information set forth in the Time of
Sale Prospectus and the Final Prospectus in the Fee Table has been
prepared, in all material respects, in accordance with the requirements
of Form N-2 and any fee projections or estimates, if applicable, are
reasonably based.
(x) Subsequent to the respective dates as of which information
is given in each of the Registration Statement, the Time of Sale
Prospectus and the Final Prospectus, (i) the Fund has not incurred any
material liability or obligation, direct or contingent, nor entered into
any material transaction; (ii) the Fund has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock since the most
recent dividend payment on April 30, 2012 (other than, in the event this
representation and warranty is made after the Closing Date, ordinary and
customary dividends declared and payable after the Closing Date); and
(iii) there has not been any material change in the capital stock,
short-term debt or long-term debt of the Fund except in each case as
described in each of the Registration Statement, the Time of Sale
Prospectus and the Final Prospectus, respectively.
(y) The Fund owns or possesses, or can acquire on reasonable
terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names currently employed
by them in connection with the business now operated by it, and the Fund
has not received any notice of infringement of or conflict with asserted
rights of others with respect to any of the foregoing which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Fund Material Adverse Effect.
(z) The Fund maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions
are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access
to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
10
appropriate action is taken with respect to any differences. Except as
described in the Time of Sale Prospectus and the Final Prospectus, since
the date of the Fund's most recent audited financial statements included
or incorporated by reference in the Time of Sale Prospectus and the Final
Prospectus, there has been (i) no material weakness in the Fund's
internal control over financial reporting (whether or not remediated) and
(ii) no change in the Fund's internal control over financial reporting
that has materially affected, or is reasonably likely to materially
affect, the Fund's internal control over financial reporting.
(aa) Neither the Fund nor any employee nor agent of the Fund
has made any payment of funds of the Fund or received or retained any
funds, which payment, receipt or retention is of a character to be
disclosed in the Time of Sale Prospectus, the Final Prospectus or the
Registration Statement.
(bb) The Transfer Agent is duly enrolled as a participant in
the Fast Automated Transfer Program (FAST) of The Depository Trust
Company ("DTC").
(cc) At the Execution Time, the Purchase Price (defined below)
exceeds the net asset value per Common Share (exclusive of any
distributing commission or discount) in accordance with Section 23(b) of
the Investment Company Act.
(dd) The questionnaires relating to the FINRA Corporate
Financing Rule provided to the Underwriters or to the counsel for the
Underwriters, if any, in connection with letters, filings or other
supplemental information provided to FINRA pursuant to FINRA's conduct
rules is true, complete and correct in all material respects.
(ee) The Fund maintains "disclosure controls and procedures"
(as such term is defined in Rule 30a-3 under the Investment Company Act);
such disclosure controls and procedures are effective as required by the
Investment Company Act and the Investment Company Act rules and
regulations.
(ff) The Fund has adopted and implemented written policies and
procedures reasonably designed to prevent violation of the Federal
Securities Laws (as that term is defined in Rule 38a-1 under the
Investment Company Act) by the Fund, including policies and procedures
that provide oversight of compliance by each Investment Advisor,
administrator and transfer agent of the Fund.
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(gg) Neither the Fund nor any of its trustees, officers, or
employees, nor, to the Fund's knowledge, any agent or representative of
the Fund, has taken or will take any action in furtherance of an offer,
payment, promise to pay, or authorization or approval of the payment or
giving of money, property, gifts or anything else of value, directly or
indirectly, to any "government official" (including any officer or
employee of a government or government-owned or controlled entity or of a
public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political party
or party official or candidate for political office) to influence
official action or secure an improper advantage; and the Fund has
conducted its businesses in compliance with applicable anti-corruption
laws, including the Foreign Corrupt Practices Act of 1977, as amended,
and the rules and regulations thereunder ("FCPA"), and has instituted and
maintains and will continue to maintain policies and procedures designed
to promote and achieve compliance with such laws and with the
representation and warranty contained herein.
(hh) There is and has been no failure on the part of the Fund
or any of the Fund's trustees or officers, in their capacities as such,
to comply in all material respects with any provision of the
Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in
connection therewith applicable to them.
(ii) The operations of the Fund are and have been conducted at
all times in compliance in all material respects with the applicable
financial recordkeeping and reporting requirements, including those of
the Bank Secrecy Act, as amended by Title III of the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the
applicable anti-money laundering statutes of jurisdictions where the Fund
conducts business, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered or
enforced by any governmental agency (collectively, the "ANTI-MONEY
LAUNDERING LAWS"), and no action, suit or proceeding by or before any
court or governmental agency, authority or body or any arbitrator
involving the Fund with respect to the Anti-Money Laundering Laws is
pending or, to the best knowledge of the Fund, threatened.
(jj) (i) Neither the Fund nor any trustee, officer, or
employee thereof, nor, to the Fund's knowledge, any agent, affiliate or
representative of the Fund, is an individual or entity ("PERSON") that
is, or is owned or controlled by a Person that is:
12
(A) the subject of any sanctions administered or
enforced by the U.S. Department of Treasury's Office of
Foreign Assets Control ("OFAC"), the United Nations
Security Council ("UNSC"), the European Union ("EU"),
Her Majesty's Treasury ("HMT"), or other relevant
sanctions authority (collectively, "SANCTIONS"), or
(B) located, organized or resident in a country or
territory that is the subject of Sanctions (including,
without limitation, Burma/Myanmar, Cuba, Iran, Libya,
North Korea, Sudan and Syria).
(ii) The Fund will not, directly or indirectly, use the
proceeds of the offering, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture
partner or other Person:
(A) to fund or facilitate any activities or
business of or with any Person or in any country or
territory that, at the time of such funding or
facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a
violation of Sanctions by any Person (including any
Person participating in the offering, whether as
underwriter, advisor, investor or otherwise).
(iii) For the past 5 years, the Fund has not knowingly
engaged in, is not now knowingly engaged in, and will not
knowingly engage in, any dealings or transactions with any
Person, or in any country or territory, that at the time of
the dealing or transaction is or was the subject of Sanctions.
2. Representations and Warranties of the Investment Advisors. Each
Investment Advisor, severally and not jointly, represents and warrants to and
agrees with each of the Underwriters as of the Execution Time, as of the Closing
Date referred to in Section 5 hereof, and as of each Option Closing Date (if
any) referred to in Section 3 hereof, that:
(a) Such Investment Advisor has been duly organized, is
validly existing as a limited partnership or a limited liability company,
as the case may be, in good standing under the laws of the jurisdiction
of its organization, has the power and authority to own its property and
to conduct its business as described in the Time of Sale Prospectus and
13
the Final Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing could not reasonably be expected to have (i) a material adverse
effect on the performance of this Agreement or the consummation of any of
the transactions contemplated hereby or (ii) a material adverse effect on
the condition (financial or otherwise), prospects, earnings, business,
properties or operations of such Investment Advisor whether or not
arising from transactions in the ordinary course of business (an
"INVESTMENT ADVISOR MATERIAL ADVERSE EFFECT"). Such Investment Advisor
has no subsidiaries.
(b) Such Investment Advisor is duly registered as an
investment advisor under the Advisers Act, and is not prohibited by the
Advisers Act or the Investment Company Act from acting under the
Investment Management Agreement or Sub-Advisory Agreement as an
investment advisor to the Fund as contemplated by the Time of Sale
Prospectus and the Final Prospectus, in the case of the Advisor, or from
acting as the subadvisor under the Sub-Advisory Agreement, in the case of
the Subadvisor, and no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated or, to the
knowledge of such Investment Advisor, threatened by the Commission.
(c) Each of this Agreement, the Investment Management
Agreement, the Sub-Advisory Agreement and the Administration Agreement
(collectively, the "ADVISOR AGREEMENTS") has been duly authorized,
executed and delivered by such Investment Advisor and complies in all
material respects with the applicable provisions of the Acts, the
Advisers Act and the applicable Rules and Regulations. Each of the
Advisor Agreements is a valid and binding agreement of such Investment
Advisor, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights
generally and by equitable principles of general applicability.
(d) The execution and delivery by such Investment Advisor of,
and the performance by such Investment Advisor of its obligations under
the Advisor Agreements will not contravene any provision of applicable
law or the certificate of formation, the certificate of limited
partnership, the limited liability company agreement or the limited
partnership agreement, as the case may be, of such Investment Advisor or
any agreement or other instrument binding upon the Investment Advisor
that is material to such Investment Advisor, or any judgment, order or
decree of any governmental body, agency or court having jurisdiction over
14
such Investment Advisor, whether foreign or domestic. No consent,
approval, authorization, order or permit of, or qualification with, any
governmental body or agency, self-regulatory organization or court or
other tribunal, whether foreign or domestic, is required for the
performance by such Investment Advisor of its obligations under the
Advisor Agreements, except such as have been obtained and as may be
required by the Acts, the Advisers Act, the Exchange Act or the
applicable Rules and Regulations, or by the securities or Blue Sky laws
of the various states and foreign jurisdictions in connection with the
offer and sale of the Shares.
(e) There are no legal or governmental proceedings pending or,
to the knowledge of such Investment Advisor, threatened to which such
Investment Advisor is a party or to which any of the properties of such
Investment Advisor is subject (i) other than proceedings accurately
described in all material respects in the Time of Sale Prospectus and
proceedings that would not have an Investment Advisor Material Adverse
Effect, or on the power or ability of such Investment Advisor to perform
its obligations under this Agreement or to consummate the transactions
contemplated by the Time of Sale Prospectus or (ii) that are required to
be described in the Registration Statement, the Time of Sale Prospectus
or the Final Prospectus and are not so described; and there are no
statutes, regulations, contracts or other documents that are required to
be described in the Registration Statement, the Time of Sale Prospectus
or the Final Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required.
(f) Such Investment Advisor has all necessary consents,
authorizations, approvals, orders (including exemptive orders),
certificates and permits of and from, and has made all declarations and
filings with, all governmental authorities, self-regulatory organizations
and courts and other tribunals, whether foreign or domestic, to own and
use its assets and to conduct its business in the manner described in the
Time of Sale Prospectus and the Final Prospectus, except to the extent
that the failure to obtain or file the foregoing would not have an
Investment Advisor Material Adverse Effect or a Fund Material Adverse
Effect.
(g) Such Investment Advisor has the financial resources
available to it necessary for the performance of its services and
obligations as contemplated in the Time of Sale Prospectus and the Final
Prospectus and by the Advisor Agreements.
(h) The Investment Management Agreement and the Sub-Advisory
Agreement are in full force and effect and neither the Fund nor any
Investment Advisor is in default thereunder, and, no event has occurred
15
which with the passage of time or the giving of notice or both would
constitute a default under such document. Each Investment Advisor is not
in violation of its organizational documents or in default under any
agreement, indenture or instrument, where such violation or default would
reasonably be expected to have an Investment Advisor Material Adverse
Effect.
(i) All information furnished by such Investment Advisor for
use in the Registration Statement, the Time of Sale Prospectus and the
Final Prospectus, including, without limitation, the description of such
Investment Advisor, does not, and on the Closing Date will not, contain
any untrue statement of a material fact or omit to state any material
fact necessary to make such information not misleading.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of such Investment Advisor from that set forth in the Time of
Sale Prospectus, and there have been no transactions entered into by such
Investment Advisor which are material to such Investment Advisor other
than those in the ordinary course of its business or as described in the
Time of Sale Prospectus.
(k) Neither such Investment Advisor nor any of its directors,
partners, managers, officers, or employees, nor, to such Investment
Advisor's knowledge, any agent or representative of such Investment
Advisor, has taken or will take any action in furtherance of an offer,
payment, promise to pay, or authorization or approval of the payment or
giving of money, property, gifts or anything else of value, directly or
indirectly, to any "government official" (including any officer or
employee of a government or government-owned or controlled entity or of a
public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political party
or party official or candidate for political office) to influence
official action or secure an improper advantage; and such Investment
Advisor has conducted its businesses in compliance with applicable
anti-corruption laws, including the FCPA, and has instituted and
maintains and will continue to maintain policies and procedures designed
to promote and achieve compliance with such laws and with the
representation and warranty contained herein.
(l) The operations of such Investment Advisor are and have
been conducted at all times in compliance with all applicable financial
recordkeeping and reporting requirements, including those of the Bank
16
Secrecy Act, as amended by Title III of the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA PATRIOT Act), and the Anti-Money Laundering
Laws, and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving such
Investment Advisor with respect to the Anti-Money Laundering Laws is
pending or, to the best knowledge of such Investment Advisor, threatened.
(m) (i) Neither such Investment Advisor of its directors,
partners, managers, officers, or employees thereof, nor, to such
Investment Advisor's knowledge, any agent, affiliate or representative of
such Investment Advisor, is a Person that is, or is owned or controlled
by a Person that is:
(A) the subject of any Sanctions, or
(B) located, organized or resident in a country or
territory that is the subject of Sanctions (including,
without limitation, Burma/Myanmar, Cuba, Iran, Libya,
North Korea, Sudan and Syria).
(ii) Such Investment Advisor will not, directly or
indirectly, use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any
subsidiary, joint venture partner or other Person:
(A) to fund or facilitate any activities or
business of or with any Person or in any country or
territory that, at the time of such funding or
facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a
violation of Sanctions by any Person (including any
Person participating in the offering, whether as
underwriter, advisor, investor or otherwise).
(iii) For the past 5 years, such Investment Advisor has
not knowingly engaged in, is not now knowingly engaged in, and
will not knowingly engage in, any dealings or transactions
with any Person, or in any country or territory, that at the
time of the dealing or transaction is or was the subject of
Sanctions.
17
3. Agreements to Sell and Purchase. The Fund hereby agrees to sell to
the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the Fund
the respective numbers of Firm Shares set forth in Schedule I hereto opposite
its name at $29.28 a share (the "PURCHASE PRICE").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Fund agrees to sell to
the Underwriters the Additional Shares, and the Underwriters shall have the
right to purchase, severally and not jointly, up to 360,000 Additional Shares at
the Purchase Price less an amount per share equal to any dividends or
distributions declared by the Fund and paid or payable on the Firm Shares, but
not payable on the Additional Shares. Morgan Stanley & Co. LLC may exercise this
right on behalf of the Underwriters in whole or from time to time in part by
giving written notice not later than 45 days after the date of this Agreement.
Any exercise notice shall specify the number of Additional Shares to be
purchased by the Underwriters and the date on which such shares are to be
purchased. Each purchase date must be at least one business day after the
written notice is given and may not be earlier than the closing date for the
Firm Shares nor later than ten business days after the date of such notice.
Additional Shares may be purchased as provided in Section 5 hereof solely for
the purpose of covering over-allotments made in connection with the offering of
the Firm Shares. On each day, if any, that Additional Shares are to be purchased
(an "OPTION CLOSING DATE"), each Underwriter agrees, severally and not jointly,
to purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the total number of Additional Shares to be purchased on such Option Closing
Date as the number of Firm Shares set forth in Schedule I hereto opposite the
name of such Underwriter bears to the total number of Firm Shares.
The Fund hereby agrees that, without the prior written consent of each of
Morgan Stanley & Co. LLC, Citigroup Global Markets Inc. and RBC Capital Markets,
LLC, on behalf of the Underwriters, it will not, during the period ending 90
days after the date of the Final Prospectus, (1) offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any Common Shares or
any other securities convertible into or exercisable or exchangeable for Common
Shares or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Shares, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Shares or such other securities, in
cash or otherwise. The agreements contained in this paragraph shall not apply to
the Shares to be sold hereunder or any Common Shares issued pursuant to the
18
Plan. If: (1) during the last 17 days of the restricted period the Fund issues
an earnings release or material news or a material event relating to the Fund
occurs; or (2) prior to the expiration of the restricted period, the Fund
announces that it will release earnings results during the 16-day period
beginning on the last day of the restricted period, the foregoing restrictions
shall continue to apply until the expiration of the 18-day period beginning on
the issuance of the earnings release or the occurrence of the material news or
material event.
4. Terms of Public Offering. The Fund and the Investment Advisors are
advised by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement and
this Agreement have become effective as in your judgment is advisable. The Fund
and the Investment Advisors are further advised by you that the Shares are to be
offered to the public initially at $30.50 a share (the "PUBLIC OFFERING PRICE"),
and to certain dealers selected by you at a price that represents a concession
not in excess of $0.732 a share under the Public Offering Price.
5. Payment and Delivery. Payment for the Firm Shares shall be made to
the Fund in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 A.M. (New York City time), on July 31, 2012, or at such
other time on the same or such other date, not later than August 14, 2012, as
shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Shares shall be made to the Fund in Federal or
other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several Underwriters at
10:00 A.M. (New York City time), on the date specified in the corresponding
notice described in Section 3 or at such other time on the same or on such other
date, in any event not later than September 21, 2012, as shall be designated in
writing by you.
The Firm Shares and Additional Shares shall be registered in such names
and in such denominations as you shall request in writing not later than one
full business day prior to the Closing Date or the applicable Option Closing
Date, as the case may be. The Firm Shares and Additional Shares shall be
delivered to you through the facilities of DTC on the Closing Date or an Option
Closing Date, as the case may be, for the respective accounts of the several
Underwriters, with any transfer taxes payable in connection with the transfer of
the Shares to the Underwriters duly paid, against payment of the Purchase Price
therefor.
19
6. Conditions to the Underwriters' Obligations. The respective
obligations of the Fund and the Investment Advisors and the several obligations
of the Underwriters hereunder are subject to the condition that the Registration
Statement became effective prior to the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have occurred any change,
or any development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Fund or the Investment Advisors, from that set forth in the Time of Sale
Prospectus that, in your judgment, is material and adverse and that makes
it, in your judgment, impracticable to market the Shares on the terms and
in the manner contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
each of the Fund and the Investment Advisors, to the effect that (i) the
Final Prospectus has been filed and the Final Prospectus and any
supplements thereto have been filed in the manner and within the time
period required by Rule 497, (ii) no stop order suspending the
effectiveness of the Registration Statement is in effect or any notice
objecting to its use or order pursuant to Section 8(e) of the Investment
Company Act shall have been issued and no proceedings for such purpose
are, as of the Closing Date, pending before or threatened by the
Commission and any request of the Commission for additional information
(to be included in the Registration Statement or Final Prospectus or
otherwise) shall have been complied with in all material respects, (iii)
the representations and warranties of the Fund and the Investment
Advisors contained in this Agreement are true and correct as of the
Closing Date, (iv) that each of the Fund and the Investment Advisors has
complied with all of the agreements and satisfied all of the conditions
on its part to be performed or satisfied hereunder on or before the
Closing Date and (v) the Purchase Price exceeds the net asset value per
Common Share (exclusive of any distributing commission or discount) in
accordance with Section 23(b) of the Investment Company Act.
Each officer signing and delivering such a certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
20
(c) Each of the Investment Advisors and the Fund shall have
performed all of their respective obligations to be performed hereunder
on or prior to the Closing Date.
(d) The Underwriters shall have received on the Closing Date
an opinion of Chapman and Cutler LLP, special counsel for the Fund, dated
the Closing Date, substantially in the form attached hereto as Exhibit A
and Exhibit B.
(e) The Underwriters shall have received on the Closing Date
(x) an opinion of Chapman and Cutler LLP, counsel for the Advisor,
substantially in the form attached hereto as Exhibit C and (x), an
opinion of Dechert LLP, counsel for the Subadvisor, substantially in the
form attached hereto as Exhibit D, each dated the Closing Date.
(f) The Underwriters shall have received on the Closing Date
the favorable opinion of Simpson Thacher & Bartlett LLP, counsel for the
Underwriters, dated the Closing Date, and covering such matters as the
Underwriters shall reasonably request.
(g) The "lock up" agreements, each substantially in the form
attached hereto as Exhibit E, between the Underwriters and each of the
Fund, its trustees and the Investment Advisors delivered to the
Underwriters on or before the date hereof, shall be in full force and
effect on the Closing Date.
In rendering its opinion described in Section 6(d) above, as to matters
of Massachusetts law, Chapman and Cutler LLP may rely on the opinion of Bingham
McCutchen LLP, so long as a copy of such opinion of Bingham McCutchen LLP is
delivered to you and is in form and substance satisfactory to you and your
counsel, and such opinion of Bingham McCutchen LLP expressly permits reliance
thereon by Chapman and Cutler LLP and Simpson Thacher & Bartlett LLP for
purposes of rendering their respective opinions.
The opinions of Chapman and Cutler LLP and Dechert LLP described in
Sections 6(d) and 6(e) above, respectively, shall be rendered to the
Underwriters at the request of the Fund and shall so state therein.
(h) The Underwriters shall have received on the Closing Date a
certificate from a duly authorized officer of the Custodian, certifying
that the Custodian Agreement is in full force and effect and is a valid
and binding agreement of the Custodian.
21
(i) The Underwriters shall have received on the Closing Date a
certificate from a duly authorized officer of the Administrator
certifying that the Administration Agreement is in full force and effect
and is a valid and binding agreement of the Administrator.
(j) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriters, from Deloitte & Touche LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect
to the financial statements and certain financial information contained
in the Registration Statement, the Time of Sale Prospectus and the Final
Prospectus, provided that the letter delivered on the Closing Date shall
use a "cut-off date" not earlier than the date hereof.
(k) All filings, applications and proceedings taken by the
Fund and the Investment Advisors in connection with the organization and
registration of the Fund and the Shares under the Acts and the applicable
Rules and Regulations shall be satisfactory in form and substance to you
and counsel for the Underwriters.
(l) No action, suit, proceeding, inquiry or investigation
shall have been instituted or threatened by the Commission which would
adversely affect the Fund's standing as a registered investment company
under the Investment Company Act or the standing of the Advisor or the
Subadvisor as a registered investment advisor under the Advisers Act.
(m) The Shares shall have been duly authorized for listing on
the NYSE Amex, subject only to official notice of issuance thereof.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the applicable Option Closing
Date of such documents as you may reasonably request with respect to the good
standing of the Fund and the Investment Advisors, the due authorization and
issuance of the Additional Shares to be sold on such Option Closing Date and
other matters related to the issuance of such Additional Shares, and officers'
certificates and opinions of Chapman and Cutler LLP, Dechert LLP, Bingham
McCutchen LLP and Simpson Thacher & Bartlett LLP to the effect set forth above,
except that such certificates and opinions shall be dated as of the applicable
Option Closing Date and statements and opinions above contemplated to be given
as of the Closing Date shall instead be made and given as of such Option Closing
Date.
22
7. Covenants of the Fund and the Investment Advisors. In further
consideration of the agreements of the Underwriters herein contained, the Fund
and the Investment Advisors, jointly and severally, covenant and agree with each
Underwriter as follows:
(a) To notify you immediately, and confirm such notice in
writing, (i) of the institution of any proceedings pursuant to Section
8(e) of the Investment Company Act and (ii) of the happening of any event
during the period mentioned in Section 7(h) below which in the judgment
of the Fund makes any statement in the Notification, the Registration
Statement, the Time of Sale Prospectus, any Omitting Prospectus or the
Final Prospectus untrue in any material respect or which requires the
making of any change in or addition to the Notification, the Registration
Statement, the Time of Sale Prospectus, any Omitting Prospectus or the
Final Prospectus in order to make the statements therein not misleading
in any material respect. If at any time the Commission shall issue any
order suspending the effectiveness of the Registration Statement or an
order pursuant to Section 8(e) of the Investment Company Act, the Fund
will make every reasonable effort to obtain the withdrawal of such order
at the earliest possible moment.
(b) To furnish to you, without charge, three conformed copies
of each of the Notification and the Registration Statement (including
exhibits thereto) and for delivery to each other Underwriter a conformed
copy of each of the Notification and the Registration Statement (without
exhibits thereto) and to furnish to you in New York City, without charge,
prior to 10:00 A.M. (New York City time) on the business day next
succeeding the date of this Agreement and during the period mentioned in
Section 7(d) below, as many copies of the Time of Sale Prospectus, the
Final Prospectus and any supplements and amendments thereto or to the
Registration Statement as you may reasonably request.
(c) During the period during which the Final Prospectus is
required to be delivered in connection with the sale of the Shares,
before amending or supplementing the Registration Statement, the Basic
Prospectus, the Time of Sale Prospectus or the Final Prospectus, to
furnish to you a copy of each such proposed amendment or supplement and
not to file any such proposed amendment or supplement to which you
reasonably object, and to file with the Commission within the applicable
period specified in Rule 497 under the Securities Act any prospectus
required to be filed pursuant to such Rule.
(d) To furnish to you a copy of each proposed Omitting
Prospectus to be prepared by or on behalf of, used by, or referred to by
23
the Fund and not to use or refer to any proposed Omitting Prospectus to
which you reasonably object.
(e) If the Time of Sale Prospectus is being used to solicit
offers to buy the Shares at a time when the Final Prospectus is not yet
available to prospective purchasers and any event shall occur or
condition exist as a result of which it is necessary to amend or
supplement the Time of Sale Prospectus in order to make the statements
therein, in the light of the circumstances, not misleading, or if any
event shall occur or condition exist as a result of which the Time of
Sale Prospectus conflicts with the information contained in the
Registration Statement then on file, or if, in the opinion of counsel for
the Underwriters, it is necessary to amend or supplement the Time of Sale
Prospectus to comply with applicable law, forthwith to prepare, file with
the Commission and furnish, at its own expense, to the Underwriters and
to any dealer upon request, either amendments or supplements to the Time
of Sale Prospectus so that the statements in the Time of Sale Prospectus
as so amended or supplemented will not, in the light of the circumstances
when delivered to a prospective purchaser, be misleading or so that the
Time of Sale Prospectus, as amended or supplemented, will no longer
conflict with the Registration Statement, or so that the Time of Sale
Prospectus, as amended or supplemented, will comply in all material
respects with applicable law.
(f) The Fund will use the net proceeds received by it from the
sale of the Shares in the manner specified in the Registration Statement,
the Time of Sale Prospectus and the Final Prospectus and direct the
investment of net proceeds in such a manner as to comply with the
investment objectives, policies and restrictions of the Fund as described
in the Time of Sale Prospectus and the Final Prospectus.
(g) The Fund and the Investment Advisors will not take any
action designed to cause or result in the manipulation of the price of
any security of the Fund to facilitate the sale of Shares in violation of
the Acts or the Securities Act and the applicable Rules and Regulations,
or the securities or Blue Sky laws of the various states and foreign
jurisdictions in connection with the offer and sale of Shares.
(h) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Final Prospectus is required by law to be delivered in connection
with sales by an Underwriter or dealer, any event shall occur or
condition exist as a result of which it is necessary to amend or
supplement the Final Prospectus in order to make the statements therein,
in the light of the circumstances when the Final Prospectus is delivered
to a purchaser, not misleading, or if, in the opinion of counsel for the
24
Underwriters, it is necessary to amend or supplement the Final Prospectus
to comply with applicable law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to
the dealers (whose names and addresses you will furnish to the Fund) to
which Shares may have been sold by you on behalf of the Underwriters and
to any other dealers upon request, either amendments or supplements to
the Final Prospectus so that the statements in the Final Prospectus as so
amended or supplemented will not, in the light of the circumstances when
the Final Prospectus is delivered to a purchaser, be misleading or so
that the Final Prospectus, as amended or supplemented, will comply in all
material respects with applicable law.
(i) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request.
(j) To make generally available to the Fund's security holders
and, upon request, to you as soon as practicable an earnings statement
covering a period of at least twelve months beginning with the first
fiscal quarter of the Fund occurring after the date of this Agreement
which shall satisfy the provisions of Section 11(a) of the Securities Act
and the rules and regulations, including Rule 158, of the Commission
thereunder.
(k) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all expenses incident to the performance of the
obligations of the Fund and the Investment Advisors under this Agreement,
including: (i) the fees, disbursements and expenses of the Fund's counsel
and the Fund's accountants in connection with the registration and
delivery of the Shares under the Securities Act and all other fees or
expenses in connection with the preparation and filing of the
Registration Statement, any Preliminary Final Prospectus, the Basic
Prospectus, the Time of Sale Prospectus, the Final Prospectus, and any
Omitting Prospectus prepared by or on behalf of, used by, or referred to
by the Fund and amendments and supplements to any of the foregoing,
including all printing costs associated therewith, and the mailing and
delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to
the transfer and delivery of the Shares to the Underwriters, including
any transfer or other taxes payable thereon, (iii) the cost of printing
or producing any Blue Sky memorandum in connection with the offer and
sale of the Shares under state securities laws and all expenses in
connection with the qualification of the Shares for offer and sale under
25
state securities laws as provided in Section 7(i) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with
the Blue Sky memorandum, (iv) all filing fees and the reasonable fees and
disbursements of counsel to the Underwriters incurred in connection with
the review and qualification of the offering of the Shares by FINRA, (v)
all costs and expenses incident to listing the Shares on the NYSE Amex,
(vi) the cost, if any, of printing certificates representing the Shares,
(vii) the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses, if any, of the Fund relating
to investor presentations on any "road show" undertaken in connection
with the marketing of the offering of the Shares, including, without
limitation, expenses associated with the preparation or dissemination of
any electronic road show, expenses associated with production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of
the Fund, travel and lodging expenses of the representatives and officers
of the Fund and any such consultants, and the cost of any aircraft
chartered in connection with the road show, (ix) the document production
charges and expenses associated with printing this Agreement and (x) all
other costs and expenses incident to the performance of the obligations
of the Fund hereunder for which provision is not otherwise made in this
Section. It is understood, however, that except as provided in this
Section, Section 8 entitled "Indemnity and Contribution" and the last
paragraph of Section 10 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel,
stock transfer taxes payable on resale of any of the Shares by them and
any advertising expenses connected with any offers they may make.
(l) The Fund shall provide satisfactory evidence to the
Underwriters that the Fund has filed a listing application for the
Additional Shares with the NYSE Amex and the NYSE Amex has approved the
listing of the Additional Shares.
8. Indemnity and Contribution. (a) Each of the Fund and the Investment
Advisors, jointly and severally, agrees to indemnify and hold harmless each
Underwriter, each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act, each agent of any Underwriter and each director, officer or affiliate of
any Underwriter within the meaning of Rule 405 under the Securities Act from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim), caused by any untrue
statement or alleged untrue statement of a material fact contained in the
26
Registration Statement or any amendment thereof, any Omitting Prospectus except
for the Omitting Prospectuses identified on Schedule II hereto, any Preliminary
Final Prospectus (including any statement of additional information incorporated
therein by reference), the Time of Sale Prospectus, or the Final Prospectus or
any amendment or supplement thereto, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Fund in writing by such Underwriter
through you expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless each of the Fund and the Investment Advisors,
their respective directors or trustees (as the case may be), and each
officer of the Fund who signed the Registration Statement and each
person, if any, who controls the Fund or any Investment Advisor within
the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent as the foregoing indemnity from the
Fund and the Investment Advisors to such Underwriter, but only with
reference to information relating to such Underwriter furnished to the
Fund in writing by such Underwriter through you expressly for use in the
Registration Statement, any Preliminary Final Prospectus (including any
statement of additional information incorporated therein by reference),
the Time of Sale Prospectus, any Omitting Prospectus or the Final
Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 8(a) or 8(b), such
person (the "INDEMNIFIED PARTY") shall promptly notify the person against
whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii)
the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be
27
inappropriate due to actual or potential differing interests between
them. It is understood that the indemnifying party shall not, in respect
of the legal expenses of any indemnified party in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for
(i) the fees and expenses of more than one separate firm (in addition to
any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, all persons who are
agents of any Underwriters or all persons who are directors, officers or
affiliates of any Underwriters within the meaning of Section 405 under
the Securities Act, (ii) the fees and expenses of more than one separate
firm (in addition to any local counsel) for the Fund, its trustees, its
officers who signed the Registration Statement and each person, if any,
who controls the Fund within the meaning of either such Section, and
(iii) the fees and expenses of more than one separate firm (in addition
to any local counsel) for the Investment Advisors, its directors,
trustees or control persons, as the case may be, and each person, if any,
who controls any of the Investment Advisors within the meaning of either
such Section, and that all such fees and expenses shall be reimbursed as
they are incurred. In the case of any such separate firm for the
Underwriters and such control persons, agents, directors, officers and
affiliates of any Underwriters, such firm shall be designated in writing
by Morgan Stanley & Co. LLC, Citigroup Global Markets Inc and RBC Capital
Markets, LLC. In the case of any such separate firm for the Fund, and
such trustees, officers and control persons of the Fund, such firm shall
be designated in writing by the Fund. In the case of any such separate
firm for the Investment Advisors, and such directors and control persons
of the Investment Advisors, such firm shall be designated in writing by
the Advisor. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party from and against any loss or liability by reason of such settlement
or judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel as contemplated by
the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered
into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to
the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of
any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
28
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding and does not
include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
(d) To the extent the indemnification provided for in Section
8(a) or 8(b) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to
therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Fund and the
Investment Advisors on the one hand and the Underwriters on the other
hand from the offering of the Shares or (ii) if the allocation provided
by clause 8(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits
referred to in clause 8(d)(i) above but also the relative fault of the
Fund and the Investment Advisors on the one hand and of the Underwriters
on the other hand in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received
by the Fund and the Investment Advisors on the one hand and the
Underwriters on the other hand in connection with the offering of the
Shares shall be deemed to be in the same respective proportions as the
net proceeds from the offering of the Shares (before deducting expenses)
received by the Fund and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on
the cover of the Final Prospectus, bear to the aggregate Public Offering
Price of the Shares. The relative fault of the Fund and the Investment
Advisors on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Fund or any of the Investment Advisors or by the Underwriters and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Underwriters' respective obligations to contribute pursuant to this
Section 8 are several in proportion to the respective number of Shares
they have purchased hereunder, and not joint. Each of the Investment
Advisors agrees to pay any amounts that are payable by the Fund pursuant
29
to this paragraph to the extent that the Fund fails to make all
contributions required to be made by the Fund pursuant to this Section 8.
(e) The Fund, the Investment Advisors and the Underwriters
agree that it would not be just or equitable if contribution pursuant to
this Section 8 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable
considerations referred to in Section 8(d). The amount paid or payable by
an indemnified party as a result of the losses, claims, damages and
liabilities referred to in Section 8(d) shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 8 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in
this Section 8 and the representations, warranties and other statements
of the Fund and each of the Investment Advisors contained in this
Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by
or on behalf of any Underwriter, any person controlling any Underwriter
or any agent of any Underwriter or any director, officer or affiliate of
any Underwriter or by or on behalf of any of the Investment Advisors,
their officers or directors or any person controlling the Investment
Advisors or by or on behalf of the Fund, its officers or trustees or any
person controlling the Fund and (iii) acceptance of and payment for any
of the Shares.
9. Termination. The Underwriters may terminate this Agreement by
notice given by you to the Fund, if after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on, or by, as the case may be, any of the New
York Stock Exchange, the NYSE Amex, the NASDAQ Global Market, the Chicago Board
30
of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (ii) trading of any securities of the Fund shall have been suspended on
any exchange or in any over-the-counter market, (iii) a material disruption in
securities settlement, payment or clearance services in the United States shall
have occurred, (iv) any moratorium on commercial banking activities shall have
been declared by Federal or New York State authorities or (v) there shall have
occurred any outbreak or escalation of hostilities, or any change in financial
markets, currency exchange rates or controls or any calamity or crisis that, in
your judgment, is material and adverse and which, singly or together with any
other event specified in this clause (v), makes it, in your judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the
Shares on the terms and in the manner contemplated in the Time of Sale
Prospectus or the Final Prospectus.
10. Effectiveness; Defaulting Underwriters. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
(the "EXECUTION TIME").
If, on the Closing Date or an Option Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase Shares that
it has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the number of
Shares that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 10 by an amount in excess of one-ninth of
such number of Shares without the written consent of such Underwriter. If, on
the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased on such date, and arrangements satisfactory to you and
the Fund for the purchase of such Firm Shares are not made within 36 hours after
such default, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter, the Fund or the Investment Advisors. In any such
case either you or the Fund shall have the right to postpone the Closing Date,
but in no event for longer than seven days, in order that the required changes,
if any, in the Registration Statement, in the Time of Sale Prospectus, in the
Final Prospectus or in any other documents or arrangements may be effected. If,
31
on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse
to purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased on such Option Closing Date, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase the Additional Shares to be sold on such Option
Closing Date or (ii) purchase not less than the number of Additional Shares that
such non-defaulting Underwriters would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Fund or any of the
Investment Advisors to comply with the terms or to fulfill any of the conditions
of this Agreement, or if for any reason the Fund or any of the Investment
Advisors shall be unable to perform its obligations under this Agreement, the
Fund and the Investment Advisors, jointly and severally, will reimburse the
Underwriters or such Underwriters as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including the
fees and disbursements of their counsel) reasonably incurred by such
Underwriters in connection with this Agreement or the offering contemplated
hereunder.
11. Entire Agreement. (a) This Agreement, together with any
contemporaneous written agreements and any prior written agreements (to the
extent not superseded by this Agreement) that relate to the offering of the
Shares, represents the entire agreement between the Fund, the Investment
Advisors and the Underwriters with respect to the preparation of any Preliminary
Final Prospectus, the Registration Statement, the Basic Prospectus, the
Preliminary Final Prospectus, the Time of Sale Prospectus, the Final Prospectus,
the conduct of the offering, and the purchase and sale of the Shares.
(b) The Fund and the Investment Advisors acknowledge that in
connection with the offering of the Shares: (i) the Underwriters have
acted at arm's length, are not agents of, and owe no fiduciary duties to,
the Fund, the Investment Advisors or any other person, (ii) the
Underwriters owe the Fund and the Investment Advisors only those duties
and obligations set forth in this Agreement and prior written agreements
(to the extent not superseded by this Agreement), if any, and (iii) the
Underwriters may have interests that differ from those of the Fund and
the Investment Advisors. The Fund and the Investment Advisors waive to
the full extent permitted by applicable law any claims any of them may
have against the Underwriters arising from an alleged breach of fiduciary
duty in connection with the offering of the Shares.
32
12. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.
14. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
15. Notices. All communications hereunder shall be in writing and
effective only upon receipt and if to the Underwriters shall be delivered,
mailed or sent to you in care of Morgan Stanley & Co. LLC, 1585 Broadway, New
York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal
Department; if to the Fund, shall be delivered, mailed or sent to First Trust
Energy Income and Growth Fund, First Trust Portfolios L.P., 120 East Liberty
Drive, Suite 400, Wheaton, Illinois 60187, Attn: W. Scott Jardine, Esq.; if to
the Advisor, shall be delivered, mailed or sent to First Trust Portfolios L.P.,
120 East Liberty Drive, Suite 400, Wheaton, Illinois 60187, Attn: W. Scott
Jardine, Esq.; and if to the Subadvisor, shall be delivered, mailed or sent to
Energy Income Partners, LLC, 49 Riverside Avenue, Westport, Connecticut 06880,
Attn: Jim Murchie.
16. Disclaimer of Liability of Trustees and Beneficiaries. A copy of
the Declaration of Trust of the Fund is on file with the Secretary of State of
The Commonwealth of Massachusetts, and notice hereby is given that this
Agreement is executed on behalf of the Fund by an officer or Trustee of the Fund
in his or her capacity as an officer or Trustee of the Fund and not individually
and that the obligations under or arising out of this Agreement are not binding
upon any of the Trustees, officers or shareholders individually but are binding
only upon the assets and properties of the Fund.
[Signature Pages Follow]
33
Very truly yours,
FIRST TRUST ENERGY INCOME AND GROWTH FUND
By: /s/ Mark R. Bradley
-----------------------------------
Name: Mark R. Bradley
Title: President and Chief
Executive Officer
FIRST TRUST ADVISORS L.P.
By: /s/ Mark R. Bradley
-----------------------------------
Name: Mark R. Bradley
Title: Chief Financial Officer and
Chief Operating Officer
ENERGY INCOME PARTNERS, LLC
By: /s/ Eva Pao
-----------------------------------
Name: Eva Pao
Title: Member, Vice President and
Secretary
[Signature page to Underwriting Agreement]
Accepted as of the date hereof
Morgan Stanley & Co. LLC
Citigroup Global Markets Inc.
RBC Capital Markets, LLC
Acting severally on behalf of themselves and
the several Underwriters named in
Schedule I hereto
By: Morgan Stanley & Co. LLC
By: /s/ Jon Zimmerman
--------------------------------------------
Name: Jon Zimmerman
Title: Vice President
[By: Citigroup Global Markets Inc.
By: /s/ Kevin Deignan
--------------------------------------------
Name: Kevin Deignan
Title: Managing Director
By: RBC Capital Markets, LLC
By: /s/ Jennifer Caruso
--------------------------------------------
Name: Jennifer Caruso
Title: Director
[Signature page to Underwriting Agreement]
SCHEDULE I
NUMBER OF FIRM
SHARES TO BE
UNDERWRITER PURCHASED
Morgan Stanley & Co. LLC................................... 780,000
Citigroup Global Markets Inc............................... 780,000
RBC Capital Markets, LLC................................... 360,000
Oppenheimer & Co. Inc...................................... 240,000
Robert W. Baird & Co. Incorporated ........................ 240,000
---------------
Total:............................................ 2,400,000
===============
I-1
SCHEDULE II
OMITTING PROSPECTUSES
1. Launch press release dated July 25, 2012.
2. Pricing press release dated July 26, 2012.
I-2
SCHEDULE III
1. Price per Share to the public: $30.50
2. Number of Shares sold: 2,400,000
3. Number of Additional Shares: 360,000
4. Underwriting discount: 4.00%
I-3