As filed with the Securities and Exchange Commission on March 18, 2005
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1933 Act File No. 333-104680
1940 Act File No. 811-21336
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 theCommission 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 VALUE LINE(R) 100 FUND
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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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ENERGY INCOME AND GROWTH FUND
FIRST TRUST VALUE LINE(R) 100 FUND
FIRST TRUST/FIDUCIARY ASSET MANAGEMENT COVERED CALL FUND
FIRST TRUST/ABERDEEN GLOBAL OPPORTUNITY INCOME FUND
1001 Warrenville Road
Suite 300
Lisle, Illinois 60532
March 18, 2005
Dear Shareholder:
The accompanying materials relate to the Joint Annual Meetings of
Shareholders (each a "Meeting" and collectively, the "Meetings") of Energy
Income and Growth Fund, First Trust Value Line(R) 100 Fund, First
Trust/Fiduciary Asset Management Covered Call Fund and First Trust/Aberdeen
Global Opportunity 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 April 18, 2005 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 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.
We appreciate your participation in this important Meeting. Thank you.
Sincerely,
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 the 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
ENERGY INCOME AND GROWTH FUND
FIRST TRUST VALUE LINE(R) 100 FUND
FIRST TRUST/FIDUCIARY ASSET MANAGEMENT COVERED CALL FUND
FIRST TRUST/ABERDEEN GLOBAL OPPORTUNITY INCOME FUND
1001 Warrenville Road
Suite 300
Lisle, Illinois 60532
NOTICE OF JOINT ANNUAL MEETINGS OF SHAREHOLDERS
To be held on April 18, 2005
March 18, 2005
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 Energy Income and
Growth Fund, First Trust Value Line(R) 100 Fund, First Trust/Fiduciary Asset
Management Covered Call Fund and First Trust/Aberdeen Global Opportunity
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
April 18, 2005, at 4:00 p.m. Central time, for the following purposes:
1. The election of Trustees of each Fund.
2. To transact such other business as may properly come before the
Meetings or any adjournment thereof.
The Board of Trustees has fixed the close of business on February 14,
2005 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,
W. Scott Jardine
Secretary
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SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING ARE REQUESTED TO
PROMPTLY COMPLETE, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED
ENVELOPE WHICH DOES 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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ENERGY INCOME AND GROWTH FUND
FIRST TRUST VALUE LINE(R) 100 FUND
FIRST TRUST/FIDUCIARY ASSET MANAGEMENT COVERED CALL FUND
FIRST TRUST/ABERDEEN GLOBAL OPPORTUNITY INCOME FUND
JOINT ANNUAL MEETINGS OF SHAREHOLDERS
APRIL 18, 2005
1001 Warrenville Road
Suite 300
Lisle, Illinois 60532
JOINT PROXY STATEMENT
MARCH 18, 2005
This Joint Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Trustees of Energy Income and Growth
Fund, First Trust Value Line(R) 100 Fund, First Trust/Fiduciary Asset
Management Covered Call Fund and First Trust/Aberdeen Global Opportunity
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 April 18, 2005, 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 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 Board
of Trustees of the Funds has 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 matters being considered and voted on by shareholders.
Proxy solicitations will be made, beginning on or about March 18, 2005,
primarily by mail, but such solicitations may also be made by telephone or
personal interviews conducted by officers or employees of each Fund; First
Trust Advisors L.P. ("First Trust Advisors" or the "Adviser"), the investment
adviser of the Funds; and PFPC Inc. ("PFPC"), the administrator, accounting
agent and transfer agent of the Funds and a subsidiary of The PNC Financial
Services Group Inc., or any of their affiliates. 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 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 or by calling (800) 988-5891. This
Joint Proxy Statement and the enclosed proxy card will first be mailed to
shareholders on or about March 18, 2005.
If the enclosed proxy card is properly executed and returned in time to
be voted at the Meeting, the shares represented thereby will be voted in
accordance with the instructions marked thereon. If no instructions are
marked on the enclosed proxy card, shares represented thereby will be voted
Page 1
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 any other matters 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 Fund at the above address prior to the date of 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 shares of the Fund. In the
absence of a quorum, any lesser number of outstanding shares entitled to vote
present in person or by proxy may adjourn the meeting from time to time until
a quorum shall be present. 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.
The close of business on February 14, 2005 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 all adjournments thereof.
Each Fund has one class of shares of beneficial interest, par value
$0.01 per share, known as Common Shares. On the Record Date, each Fund had
the following number of shares (the "Shares") outstanding:
Common Shares
Fund Outstanding
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Energy Income and Growth Fund 6,434,334
First Trust Value Line(R) 100 Fund 17,490,000
First Trust/Fiduciary Asset Management Covered Call Fund 19,780,236
First Trust/Aberdeen Global Opportunity Income Fund 17,365,236
Common Shares of Energy Income and Growth Fund and First Trust Value
Line(R) 100 Fund are listed on the American Stock Exchange under the ticker
symbols FEN and FVL, respectively. Common Shares of First Trust/Fiduciary
Asset Management Covered Call Fund and First Trust/Aberdeen Global
Opportunity Income Fund are listed on the New York Stock Exchange under the
ticker symbols FFA and FAM, respectively.
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. To the knowledge of the Board of
Trustees, as of February 15, 2005, 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 any Fund's outstanding
Shares. Information as to beneficial ownership is based on reports filed with
the Securities and Exchange Commission ("SEC") by such holders.
Page 2
In order that your Shares may 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 5:00 p.m., on
April 15, 2005).
Page 3
PROPOSAL 1: ELECTION OF TRUSTEES
Proposal 1 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, Niel B. Nielson and David M. Oster. 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 that the Trustees for First Trust Value Line(R) 100
Fund also were elected by shareholders at the Fund's first annual meeting
held on April 19, 2004.
The Trustees, including those who are not "interested persons" of the
Funds ("Independent Trustees") as that term is defined in the Investment
Company Act of 1940, as amended (the "1940 Act"), 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
Proposal 1.
Page 4
ADDITIONAL INFORMATION
MANAGEMENT OF THE FUNDS
The management of each Fund, including 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 the term "interested person" is defined in the 1940 Act) and four
of whom are Independent Trustees. No Independent Trustee has ever been a
trustee, director or employee of, or consultant to, the Adviser, any
sub-adviser described below under "INVESTMENT 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 oversees and the other directorships they hold,
if applicable.
Board Nominees
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Interested Trustee
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NUMBER OF
PORTFOLIOS
TERM OF PRINCIPAL IN FUND
POSITION(S) OFFICE AND OCCUPATION(S) COMPLEX OTHER
NAME, ADDRESS, AND HELD WITH LENGTH OF DURING PAST FIVE OVERSEEN DIRECTORSHIPS
DATE OF BIRTH FUNDS TIME SERVED(2) YEARS BY TRUSTEE HELD BY TRUSTEE
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James A. Bowen(1) President, 1 Year President, First Trust 20 NONE
1001 Warrenville Road Chairman of Portfolios L.P. and
Suite 300 the Board, First Trust Advisors;
Lisle, IL 60532 Chief Since 2003 Chairman of the
DOB: 9/55 Executive Board of Directors,
Officer and BondWave LLC and
Trustee Stonebridge Advisors LLC
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Independent Trustees
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Richard E. Erickson Trustee 1 Year Physician, 20 NONE
c/o First Trust Advisors L.P. Sportsmed/Wheaton
1001 Warrenville Road Orthopedics
Suite 300 Since 2003
Lisle, IL 60532
DOB: 4/51
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Niel B. Nielson Trustee
c/o First Trust Advisors L.P. 1 Year President (2002 to 20 Director of Good
1001 Warrenville Road Present), Covenant News Publishers-
Suite 300 College; Pastor (1997 Crossway Books;
Lisle, IL 60532 Since 2003 to 2002), College Covenant
DOB: 3/54 Church in Wheaton Transport Inc.
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Page 5
NUMBER OF
PORTFOLIOS
TERM OF PRINCIPAL IN FUND
POSITION(S) OFFICE AND OCCUPATION(S) COMPLEX OTHER
NAME, ADDRESS, AND HELD WITH LENGTH OF DURING PAST FIVE OVERSEEN DIRECTORSHIPS
DATE OF BIRTH FUNDS TIME SERVED(2) YEARS BY TRUSTEE HELD BY TRUSTEE
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Thomas R. Kadlec Trustee 1 Year Vice-President, Chief 20 NONE
c/o First Trust Advisors L.P. Financial Officer
1001 Warrenville Road (1990 to Present),
Suite 300 Since 2003 ADM Investor
Lisle, IL 60532 Services, Inc.
DOB: 11/57 (Futures Commission
Merchant); Registered
Representative (2000
to Present),
Segerdahl & Company,
Inc., an NASD
member (Broker-Dealer)
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David M. Oster Trustee 1 Year Trader 9 NONE
c/o First Trust Advisors L.P. (Self-Employed) (1987
1001 Warrenville Road Since 2003 to Present) (Options
Suite 300 Trading and Market
Lisle, IL 60532 Making)
DOB: 3/64
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Officers
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NUMBER OF
PORTFOLIOS IN
TERM OF OFFICE(2) PRINCIPAL FUND
NAME, ADDRESS, AND POSITION(S) HELD AND LENGTH OF OCCUPATION(S) COMPLEX SERVED
DATE OF BIRTH WITH THE FUNDS TIME SERVED(3) DURING PAST FIVE YEARS BY OFFICER
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Mark R. Bradley Treasurer, Indefinite Chief Financial Officer, Managing 20
1001 Warrenville Road Controller, Director,
Suite 300 Chief Financial First Trust Portfolios L.P. and
Lisle, IL 60532 Officer Since 2003 First Trust Advisors; Chief Financial
DOB: 11/57 and Chief Officer, BondWave LLC and Stonebridge
Accounting Officer Advisors LLC
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Susan M. Brix Assistant Vice Indefinite Representative, First 20
1001 Warrenville Road President Trust Portfolios L.P.;
Suite 300 Assistant Portfolio
Lisle, IL 60532 Since 2003 Manager, First Trust
DOB: 1/60 Advisors
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Robert F. Carey Vice President Indefinite Senior Vice President, 20
1001 Warrenville Road First Trust Portfolios
Suite 300 L.P. and First Trust
Lisle, IL 60532 Since 2003 Advisors
DOB: 7/63
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W. Scott Jardine Secretary and Indefinite General Counsel, 20
1001 Warrenville Road Chief Compliance First Trust Portfolios
Suite 300 Officer L.P. and First Trust
Lisle, IL 60532 Since 2003 Advisors; Secretary, BondWave LLC and
DOB: 5/60 Stonebridge Advisors LLC
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Kristi A. Maher Assistant Secretary Indefinite Assistant General Counsel 20
1001 Warrenville Road (March 2004 to Present),
Suite 300 First Trust Portfolios L.P. and First
Lisle, IL 60532 Since 2004 Trust Advisors; Associate (1995 to
DOB: 12/66 March 2004), Chapman and Cutler LLP
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Roger Testin Vice President Indefinite Vice President 20
1001 Warrenville Road (August 2001 to Present), First Trust
Suite 300 Advisors;
Lisle, IL 60532 Since 2003 Analyst (1998 to 2001), Dolan Capital
DOB: 6/66 Management
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1 Mr. Bowen is deemed an "interested person" of the Funds due to his position as President of First
Trust Advisors L.P.
2 Trustees are elected each year by shareholders and serve a one-year term until their successors are
elected. Officers of the Funds have an indefinite term.
3 Officers were elected in 2003 for First Trust Value Line(R) 100 Fund and in 2004 for the other Funds.
Page 6
In addition to the Funds, the First Trust Fund Complex includes First
Defined Portfolio Fund, LLC, an open-end management investment company
advised by First Trust Advisors with 11 portfolios, First Trust Value Line(R)
Dividend Fund, First Trust/Four Corners Senior Floating Rate Income Fund,
Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income Fund,
First Trust Value Line(R) & Ibbotson Equity Allocation Fund, and First
Trust/Four Corners Senior Floating Rate Income Fund II.
Messrs. Bowen, Erickson, Kadlec and Nielson are trustees of First
Defined Portfolio Fund, LLC. Mr. Kadlec was appointed to the Board of
Trustees of First Defined Portfolio Fund, LLC on March 8, 2004. Messrs.
Bowen, Erickson, Kadlec, Nielson and Oster are Trustees of First Trust Value
Line(R) Dividend Fund, First Trust/Four Corners Senior Floating Rate Income
Fund, Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income
Fund, First Trust Value Line(R) & Ibbotson Equity Allocation Fund, and First
Trust/Four Corners Senior Floating Rate Income Fund II. None of the
Independent Trustees, nor 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., any sub-adviser or any of their
affiliates. In addition, Mr. Bowen, chief executive officer of each Fund, and
the other officers of the Funds, hold the same positions with First Defined
Portfolio Fund, LLC, First Trust Value Line(R) Dividend Fund, First Trust/Four
Corners Senior Floating Rate Income Fund, Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund, First Trust Value Line(R) &
Ibbotson Equity Allocation Fund, and First Trust/Four Corners Senior Floating
Rate Income Fund II, as they hold with the Funds.
BENEFICIAL OWNERSHIP OF SHARES HELD IN THE FUNDS BY EACH NOMINEE FOR ELECTION
AS TRUSTEE
The following table sets forth the dollar range and number of equity
securities beneficially owned by the Trustees in each Fund and in other funds in
the First Trust Fund Complex as of December 31, 2004:
Dollar Range of Equity Securities in the Fund/(Number of Shares Held)
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First Trust/ Aggregate Dollar Range of
Fiduciary First Equity Securities in All
Asset Trust/Aberdeen Registered Investment
Energy Income First Trust Management Global Companies Overseen by
and Growth Value Line(R) Covered Call Opportunity Trustee in Fund Complex/
Name of Trustee Fund 100 Fund Fund Income Fund (Number of Shares Held)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
James A. Bowen 0 $10,001-$50,000 0 0 Over $100,000
(2500 Shares) (6750 Shares)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
Richard E. Erickson $1-$10,000 $1-$10,000 $1-$10,000 $1-$10,000 $10,001-$50,000
(100 Shares) (301 Shares) (100 Shares) (200 Shares) (1201 Shares)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
Thomas R. Kadlec 0 $10,001-$50,000 0 0 $50,001-$100,000
(1667 Shares) (4954 Shares)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
Niel B. Nielson 0 $1-$10,000 $1-$10,000 $1-$10,000 $10,001-$50,000
(203 Shares) (202 Shares) (200 Shares) (1005 Shares)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
David M. Oster $1-$10,000 $10,001-$50,000 $1-$10,000 $1-$10,000 Over $100,000
(200 Shares) (1017 Shares) (200 Shares) (200 Shares) (5961 Shares)
--------------------- --------------- --------------- ---------------- --------------- ------------------------------
Page 7
As of December 31, 2004, 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 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 purchased four limited partnership units of Grace
Partners of DuPage L.P., the limited partner of First Trust Advisors L.P.,
from Kimberly Boyer on or about May 17, 2004 for a purchase price of $500,000
per unit. The units were purchased pursuant to exercise of an option
previously granted.
As of December 31, 2004, each Fund knows of no person who owns
beneficially or of record 5% or more of any Fund's Shares. As of December 31,
2004, the Trustees and executive 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
----- -------------------
Energy Income and Growth Fund 300
First Trust Value Line(R) 100 Fund 5688
First Trust/Fiduciary Asset Management Covered Call Fund 502
First Trust/Aberdeen Global Opportunity Income Fund 600
As of December 31, 2004, the Trustees and executive officers as a group
beneficially owned 19,871 shares of funds in the First Trust Fund Complex
(less than 1% of the shares outstanding).
COMPENSATION
Effective June 7, 2004, the Trustees approved a revised compensation
plan. Under the revised plan, each Fund pays each Trustee who is not an
officer or employee of First Trust Advisors, any sub-adviser or any of their
affiliates an annual retainer of $10,000 which includes compensation for all
regular quarterly board meetings and regular committee meetings. No
additional meeting fees are paid in connection with regular quarterly board
meetings or regular committee meetings. Additional fees of $1,000 and $500
are paid to non-interested Trustees for special board meetings and
non-regular committee meetings, respectively. These additional fees are
shared by the funds in the First Trust Fund Complex that participate in the
particular meeting and are not per fund fees. Trustees are also reimbursed
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 June 7, 2004, each
fund paid each Trustee not affiliated with First Trust Advisors, any
sub-adviser or any of their affiliates an annual fee of $10,000 plus $1,000
as compensation for each board meeting (in-person or by electronic means) and
$500 per committee meeting (in-person or by electronic means) attended. The
Board of Trustees of the Energy Income and Growth Fund held eight meetings
Page 8
during the fiscal year ended November 30, 2004. The Board of Trustees of
First Trust Value Line(R) 100 Fund held six meetings, the Board of Trustees of
First Trust/Fiduciary Asset Management Covered Call Fund held six meetings
and the Board of Trustees of First Trust/Aberdeen Global Opportunity Income
Fund held four meetings during the fiscal year ended December 31, 2004. Each
of the Trustees attended all of the meetings of the Board of Trustees of the
Funds.
The following table sets forth certain information regarding the
compensation of each Fund's Trustees for their respective fiscal years. The
Funds have no retirement or pension plans.
Estimated
Aggregate Estimated
Estimated Compensation(3) Aggregate
Aggregate Aggregate From First Compensation (3)
Compensation (3) Compensation Trust/Fiduciary From First Trust/ Total
From Energy From First Trust Asset Management Aberdeen Global Compensation
Income and Growth Value Line(sm) 100 Covered Call Opportunity From the Fund
Name of Trustee Fund(1) Fund(2) Fund(2) Income Fund(2) Complex(2)
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
James A. Bowen $0 $0 $0 $0 $0
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
Richard E. Erickson $10,000 $13,767 $10,000 $10,000 $94,750
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
Thomas R. Kadlec $10,000 $13,767 $10,000 $10,000 $88,625
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
Niel B. Nielson $10,000 $13,767 $10,000 $10,000 $94,750
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
David M. Oster $10,000 $13,772 $10,000 $10,000 $78,000
------------------------ ------------------- ------------------ ------------------- ------------------- ------------------
1 For fiscal year ended November 30, 2004.
2 For fiscal year ended December 31, 2004.
3 The compensation from the Fund has been annualized to reflect revised
compensation payable for a full fiscal year.
The total compensation paid to Messrs. Erickson and Nielson,
Independent Trustees of each fund in the First Trust Fund Complex, includes
compensation for their services as Trustees to First Defined Portfolio Fund,
LLC, First Trust Value Line(R) Dividend Fund, First Trust/Four Corners Senior
Floating Rate Income Fund, Macquarie/First Trust Global
Infrastructure/Utilities Dividend & Income Fund, First Trust Value Line(R) &
Ibbotson Equity Allocation Fund, and First Trust/Four Corners Senior Floating
Rate Income Fund II and the Funds. For the fiscal year ended December 31,
2004, Mr. Oster was not a Trustee of First Defined Portfolio Fund, LLC and
accordingly, his total compensation was based on compensation paid by First
Trust Value Line(R) Dividend Fund, First Trust/Four Corners Senior Floating
Rate Income Fund, Macquarie/First Trust Global Infrastructure/Utilities
Dividend & Income Fund, First Trust Value Line(R) & Ibbotson Equity Allocation
Fund, and First Trust/Four Corners Senior Floating Rate Income Fund II and
the Funds. On March 8, 2004, Mr. Kadlec was appointed as a Trustee of First
Defined Portfolio Fund, LLC and accordingly, his total compensation was based
on compensation paid by First Defined Portfolio Fund, LLC, First Trust Value
Line(R) Dividend Fund, First Trust/Four Corners Senior Floating Rate Income
Fund, Macquarie/First Trust Global Infrastructure/Utilities Dividend & Income
Fund, First Trust Value Line(R) & Ibbotson Equity Allocation Fund, and First
Trust/Four Corners Senior Floating Rate Income Fund II and the Funds.
The officers and the interested Trustee of each Fund receive no
compensation from the Funds for serving in such capacity.
Page 9
COMMITTEES
AUDIT COMMITTEE
The Board of Trustees has an Audit Committee, which consists of
Messrs. Erickson, Kadlec, Nielson and Oster, all of whom are "independent" as
defined in the listing standards of the American Stock Exchange and the New York
Stock Exchange. 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 independent auditors (subject also
to Board approval). The Audit Committee met four times during the fiscal year
ended November 30, 2004 for the Energy Income and Growth Fund. For the fiscal
year ended December 31, 2004, the Audit Committee met six times for the First
Trust Value Line(R) 100 Fund, four times for the First Trust/Fiduciary Asset
Management Covered Call Fund and two times for the First Trust/Aberdeen Global
Opportunity Income Fund. Each of the Trustees attended all of the meetings of
the Audit Committee of the Board of Trustees of each Fund.
In carrying out its responsibilities, the Audit Committee pre-approves
all audit services for each Fund and permitted non-audit services (including
the fees and terms thereof) to be performed for each Fund and the Adviser by
Deloitte & Touche LLP ("Deloitte & Touche"), the Funds' independent
registered public accounting firm ("independent auditors"). The Chairman of
the Audit Committee is authorized to give such pre-approvals on behalf of
the Audit Committee. Any decisions by the Chairman to grant pre-approvals
are reported to the full Audit Committee.
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 Charter that was most recently
reviewed and approved by the Board of Trustees on December 13, 2004, a copy
of which is attached as Exhibit A hereto. 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 January 19, 2005
for Energy Income and Growth Fund and at a meeting held on February 22, 2005 for
First Trust Value Line(R) 100 Fund, First Trust/Fiduciary Asset Management
Covered Call Fund and First Trust/Aberdeen Global Opportunity Income Fund, the
Audit Committee reviewed and discussed with management and Deloitte & Touche,
the audited financial statements of each Fund 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 of
Auditing Standards No. 61, Communications with Audit Committees, as currently
modified or supplemented. The Audit Committee also received from the independent
Page 10
auditors the written disclosures and letter required by Independence 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.
Members of each Fund's Audit Committee are not professionally engaged
in the practice of auditing or accounting and are not employed by the Funds
for purposes of accounting, financial management or internal control
functions. Moreover, the Audit Committee relies on, and makes no independent
verification of, the facts presented and the representations made to it by
Fund management and Deloitte & Touche. Accordingly, the Audit Committee's
oversight does not provide an independent basis to determine that management
has maintained appropriate accounting and/or financial reporting principles
and policies, or internal controls and procedures, designed to assure
compliance with accounting standards and applicable laws and regulations.
Furthermore, the Audit Committee's considerations and discussions referred
to above do not provide assurance that the audit of the Funds' financial
statements has been carried out in accordance with generally accepted
auditing standards or that the financial statements are presented in
accordance with generally accepted accounting principles.
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 the inclusion of each Fund's audited financial
statements in its Annual Report.
Submitted by the Audit Committee of the Funds:
Richard E.Erickson
Thomas R. Kadlec
Niel B. Nielson
David M. Oster
INDEPENDENT AUDITORS' FEES
Deloitte & Touche has been selected to serve as the independent
auditors for Energy Income and Growth Fund for the fiscal year ending
November 30, 2005 and for the First Trust Value Line(R) 100 Fund, the First
Trust/Fiduciary Asset Management Covered Call Fund and the First
Trust/Aberdeen Global Opportunity Income Fund for the fiscal year ending
December 31, 2005. Deloitte & Touche acted as independent auditors for
Energy Income and Growth Fund for the fiscal year ended November 30, 2004
and for the First Trust Value Line(R) 100 Fund, the First Trust/Fiduciary
Asset Management Covered Call Fund and the First Trust/Aberdeen Global
Opportunity Income Fund for the fiscal year ended December 31, 2004.
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 auditors. Deloitte & Touche
did note that the trust account of a Deloitte & Touche partner invested in
First Trust/Four Corners Senior Floating Rate Income Fund II on May 28,
2004. When notified of the violation, the position was immediately divested.
Deloitte & Touche informed the Audit Committee that this situation did not
Page 11
materially impact Deloitte & Touche's independence due to the remediation of
the transaction and the fact that the partner has no involvement with
Deloitte & Touche's engagement with the Funds or First Trust Advisors. It is
expected that representatives of Deloitte & Touche will be present at the
Meeting to answer any questions that may arise. 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 in the table below are fees billed by Deloitte & Touche to
each Fund and the Adviser through the fiscal periods noted:
Audit Related
Audit Fees Fees Tax Fees All Other Fees
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust Value Line(R) 100 Fund $27,677 $0 $0 $0
(from inception on 6/12/03 to 12/31/03)
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust Value Line(R) 100 Fund
(Fiscal Year Ended 12/31/04) $9,000 $0 $0 $0
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
Energy Income and Growth Fund
(from inception on 6/17/04 to 11/30/04) $52,000 $0 $0 $0
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust/Fiduciary Asset Management Covered
Call Fund
(from inception on 8/17/04 to 12/31/04) $15,000 $0 $0 $0
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust/Aberdeen Global Opportunity Income Fund
(from inception on 11/16/04 to 12/31/04) $13,500 $0 $0 $0
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust Advisors N/A $20,4001 $6,0002 $0
(Fiscal Year Ended 12/31/03)
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
First Trust Advisors
(Fiscal Year Ended 12/31/04) N/A $0 $6,0002 $0
---------------------------------------------------- ----------------- ---------------- ---------------- ----------------
1 These fees were for AIMR-PPS verification services.
2 These fees were for tax return preparation.
All of the services in the table above were pre-approved by the Audit
Committee.
OTHER COMMITTEES
The Board of Trustees of the Funds has three other standing committees:
the Executive Committee (and 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 approval of the final terms of the
underwriting agreement, including approval of the members of the underwriting
syndicate. Messrs. Bowen and Kadlec are members of the Executive Committee.
Page 12
The Executive Committee serving as the Dividend and Pricing Committee for the
Energy Income and Growth Fund met a total of three times during the fiscal
year ended November 30, 2004. For the fiscal year ended December 31, 2004,
the Dividend and Pricing Committee met two times for the First Trust Value
Line(R) 100 Fund; two times for the First Trust/Fiduciary Asset Management
Covered Call Fund; and two times for the First Trust/Aberdeen Global
Opportunity Income Fund. Each Fund's Executive Committee met to authorize the
Funds' initial public offering of Shares as well as for each dividend
declaration.
Each Fund's Nominating and Governance Committee (the "Committee") is
composed entirely of Trustees who are not "interested persons" (as that term
is defined in the 1940 Act) of each Fund and who are "independent directors"
within the meaning of the listing standards of the American and New York
Stock Exchanges. Messrs. Erickson, Kadlec, Nielson and Oster 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 one time during the fiscal years
ended November 30, 2004 and December 31, 2004.
If there is no vacancy on the Board, the Board will not actively seek
recommendations from other parties, including shareholders. 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.
Shareholders of a Fund who wish to recommend a person for nomination as a
candidate for a position on the Fund's Board should mail such recommendation
to the Fund, attention W. Scott Jardine, 1001 Warrenville Road, Suite 300,
Lisle, Illinois 60532. Recommendations must include (a) evidence of Fund
ownership of the person or entity recommending the candidate (if a Fund
shareholder); (b) a full description of the proposed candidate's background,
including their education, experience, current employment and date of birth;
(c) names and addresses of at least three professional references for the
candidate; (d) information as to whether the candidate is an "interested
person" (as such term is defined in the 1940 Act) and such other information
that may be considered to impair the candidate's independence; and (e) any
other information that may be helpful to the Committee in evaluating the
candidate. 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
Page 13
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 the pricing
procedures of the Funds. Messrs. Erickson, Kadlec and Oster are members of
the Valuation Committee. The Valuation Committee did not meet during the
fiscal years ended November 30, 2004 and December 31, 2004.
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.
INVESTMENT ADVISER AND ADMINISTRATOR
First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
Illinois 60532, serves as the Funds' investment adviser. Fiduciary Asset
Management, LLC, 8112 Maryland Avenue, Suite 400, St. Louis, Missouri 63105,
serves as the investment sub-adviser to the Energy Income and Growth Fund and
the First Trust/Fiduciary Asset Management Covered Call Fund. Aberdeen Asset
Management, Inc., 300 SE 2nd Street, Suite 820, Fort Lauderdale, Florida
33301, serves as the investment sub-adviser to the First Trust/Aberdeen
Global Opportunity Income Fund.
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.
Page 14
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, the American Stock Exchange and the New York Stock Exchange 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 all such filing
requirements applicable to such persons were met, except as described below.
First Trust Advisors made late Form 3 filings for all of the Funds on
behalf of itself as investment adviser. Upon discovery of this oversight in
November, 2004, Form 3s were filed on behalf of First Trust Advisors for each
of the Funds on December 9, 2004. In addition, First Trust Portfolios L.P.
also failed to make the requisite Form 3 filing on behalf of the Energy
Income and Growth Fund, the First Trust/Fiduciary Asset Management Covered
Call Fund and the First Trust/Aberdeen Global Opportunity Income Fund. Upon
discovery of this oversight in November, 2004, Form 3s were filed on behalf
of First Trust Portfolios L.P. on December 9, 2004 for these Funds. In
addition, a Form 3 was not filed on time on behalf of Fiduciary Asset
Management, LLC, the sub-adviser for the Energy Income and Growth Fund and
First Trust/Fiduciary Asset Management Covered Call Fund. On February 17,
2005, Form 3s were filed for the Energy Income and Growth Fund and First
Trust/Fiduciary Asset Management Covered Call Fund on behalf of Fiduciary
Asset Management, LLC. All of these late Form 3 filings were due to
administrative oversight.
Two Form 4s were filed late on February 17, 2005 on behalf of Niel B.
Nielson, a Trustee of the Funds, for purchases he made on December 21, 2004,
of shares in both First Trust/Fiduciary Asset Management Covered Call Fund
and First Trust/Aberdeen Global Opportunity Income Fund. In addition, Form
4's were filed late for all purchases of shares of Energy Income and Growth
Fund and First Trust/Fiduciary Asset Management Covered Call Fund made during
2004 by Charles D. Walbrandt, Chief Executive Officer of Fiduciary Asset
Management, LLC. All of these late Form 4 filings were due to administrative
oversight.
SHAREHOLDER PROPOSALS
To be considered for presentation at the annual meetings of
shareholders of the Funds to be held in 2006, a shareholder proposal
submitted pursuant to Rule 14a-8 of the 1934 Act must be received at the
offices of the Funds at 1001 Warrenville Road, Suite 300, Lisle, Illinois
60532, not later than November 18, 2005. A shareholder wishing to provide
notice in the manner prescribed by Rule 14a-4(c)(1) of a proposal submitted
outside of the process of Rule 14a-8 must submit such written notice to the
applicable Fund not later than February 1, 2006. Timely submission of a
proposal does not mean that such proposal will be included in a proxy
statement.
Page 15
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.
FISCAL YEAR
The fiscal year end for the Energy Income and Growth Fund was November
30, 2004. The fiscal year end for the First Trust Value Line(R) 100 Fund, the
First Trust/Fiduciary Asset Management Covered Call Fund and the First
Trust/Aberdeen Global Opportunity Income Fund was December 31, 2004.
ANNUAL REPORT DELIVERY
Annual reports will be sent to shareholders of record of each Fund
following the 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 (800)
988-5891.
Please note that in certain circumstances, only one 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 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 multiple copies of such documents are
received, shareholders should contact the Fund at the address and phone
number set forth above.
GENERAL
A list of shareholders entitled to be present and to vote at the
Meeting 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 Meeting.
Failure of a quorum to be present at the Meeting will necessitate
adjournment and will subject the Funds to additional expense. The persons
named in the enclosed proxy may also move for an adjournment of the Meeting
to permit further solicitation of proxies with respect to the proposal if
they determine that adjournment and further solicitation is reasonable and in
Page 16
the best interests of the shareholders. Under each Fund's By-Laws, an
adjournment of a meeting requires the affirmative vote of a majority of the
Shares present in person or represented by proxy at the Meeting.
OTHER MATTERS TO COME BEFORE THE MEETING
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 arise, including any question as to an adjournment or
postponement of a Meeting, the persons named on the enclosed proxy card will
vote thereon according to their best judgment in the interests of the Funds.
March 18, 2005
-----------------------------------------------------------------------------
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 17
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 Requirements
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, each member must meet
the independence and experience requirements of the New York Stock Exchange
or the American Stock Exchange (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.
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, but need not be, the same person as the Funds' "audit committee
financial expert." With respect to Funds that are closed-end funds whose
shares are listed on the American Stock Exchange, 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. 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 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 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 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
A-2
between the audit team and 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.
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 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 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 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 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.
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 considering 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.
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 review and discuss with Fund Management and
the External Auditors the annual audited financial statements and periodic
financial statements of the Funds, major issues regarding accounting and
auditing principles and practices, and the Funds' disclosures in their
periodic reports 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 Auditor's review of the Funds'
financial statements.
5. The Committee shall review and discuss with management and the
A-4
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.
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. 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:
A-5
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.
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 above.
2. The Committee shall review, with fund 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.
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.
A-6
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, fund 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.
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.
VI. MANAGEMENT AND EXTERNAL 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
A-7
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.
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DETACH HERE ZFTV52
PROXY
FIRST TRUST VALUE LINE(R) 100 FUND
PRROXY SOLICITED BY THE BOARD OF TRUSTEES
ANNUAL MEETING ON APRIL 18, 2005
The undersigned holder of shares of the First Trust Value Line(R) 100 Fund (the
"Fund"), a Massachusetts business trust, hereby appoints W. Scott Jardine, Mark
R. Bradley and Eric F. Fess 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 10:00 a.m. Central time on the
date indicated above, and any adjournment or adjournments thereof. The
undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement dated March 18, 2005, 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.
----------- -----------
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
----------- -----------
FIRST TRUST VALUE LINE(R) 100 FUND
C/O PFPC INC.
P.O. BOX 8586
EDISON, NJ 08818-8586
DETACH HERE ZFTV51
[X] Please mark | 3496
votes as in |
this example. --------
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.
1. Election of Trustees.
(01) James A. Bowen (04) Thomas R. Kadlec
(02) Richard E. Erickson (05) David M. Oster
(03) Neil B. Nielson
FOR WITHHELD
ALL [ ] [ ] FROM ALL
NOMINEES NOMINEES
[ ] _______________________________________
For all nominees except as noted above
Mark box at right if an address change or comment
has been noted on the reverse side of this card. [ ]
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE.
NOTE: Please sign exactly as your name appears on this
Proxy. If joint owners, EITHER may sign this Proxy. When
signing as attorney, executor, administrator, trustee,
guardian or corporate officer, please give full title.
Signature:_______________ Date:_______ Signature:_______________ Date:_______