As filed with the Securities and Exchange Commission on October 26, 2007.
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1933 Act File No. 333-114131
1940 Act File No. 811-21549
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the Commission only (as permitted by
Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Section 240.14a-12
ENERGY INCOME AND GROWTH 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:
ENERGY INCOME AND GROWTH FUND
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
October 29, 2007
Dear Shareholder:
The accompanying materials relate to the Special Meeting of
Shareholders (referred to as the "Meeting") of Energy Income and Growth
Fund (the "Fund"). The Meeting will be held at the offices of First Trust
Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532,
on Tuesday, January 8, 2008, at 4:00 p.m. Central Time.
At the Meeting, you will be asked to vote on a proposal to
approve a new investment sub-advisory agreement with a new sub-adviser
for the Fund, to vote on a proposal to authorize the Fund to sell common
shares at a net price less than its then-current net asset value per
common share, subject to certain conditions, and to transact such other
business as may properly come before the Meeting and any adjournments
thereof. The proposals are described in the accompanying Notice of
Special Meeting of Shareholders and Proxy Statement.
YOUR PARTICIPATION AT THE MEETING IS VERY IMPORTANT. If you
cannot attend the Meeting, you may participate by proxy.
With respect to the proposal to approve a new investment
sub-advisory agreement, as a Shareholder, you cast one vote for each
share of the Fund that you own and a proportionate fractional vote for
any fraction of a share that you own.
With respect to the proposal to authorize the sale of common
shares at a net price less than the then-current net asset value per
common share, approval will be determined based on two separate voting
criteria, as described in the Proxy Statement.
Please take a few moments to read the enclosed materials and
then cast your votes on the enclosed proxy card. VOTING TAKES
ONLY A FEW MINUTES. EACH SHAREHOLDER'S VOTES ARE IMPORTANT. YOUR
PROMPT RESPONSE WILL BE MUCH APPRECIATED.
After you have voted on the proposals, 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,
/s/ James A. Bowen
James A. Bowen
Chairman of the Board
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IF YOU NEED ANY ASSISTANCE, OR HAVE ANY QUESTIONS REGARDING THE PROPOSALS
OR HOW TO VOTE YOUR SHARES, CALL YOUR FUND'S PROXY SOLICITOR, THE ALTMAN
GROUP, AT (800) 761-6707 WEEKDAYS FROM 9:00 A.M. TO 10:00 P.M. EASTERN TIME.
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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 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
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 8, 2008
October 29, 2007
To the Shareholders of the above Fund:
Notice is hereby given that the Special Meeting of Shareholders
(referred to as the "Meeting") of Energy Income and Growth Fund (the
"Fund"), 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 Tuesday, January 8, 2008, at 4:00 p.m. Central Time,
for the following purposes:
1. To approve a new investment sub-advisory agreement
among the Fund, First Trust Advisors L.P., as investment
adviser, and Energy Income Partners, LLC, as investment
sub-adviser;
2. To authorize the Fund to issue and sell its common
shares at a net price below then-current net asset value,
subject to certain conditions; and
3. To transact such other business as may properly
come before the Meeting and any adjournments thereof.
The Board of Trustees has fixed the close of business on October 15,
2007 as the record date for the determination of Shareholders entitled to
notice of and to vote at the Meeting and any adjournments or postponements
thereof.
By order of the Board of Trustees,
/s/ W. Scott Jardine
W. Scott Jardine
Secretary
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SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE 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. IF YOU NEED ANY ASSISTANCE, OR HAVE ANY
QUESTIONS REGARDING THE PROPOSALS OR HOW TO VOTE YOUR SHARES, CALL YOUR
FUND'S PROXY SOLICITOR, THE ALTMAN GROUP, AT (800) 761-6707 WEEKDAYS FROM
9:00 A.M. TO 10:00 P.M. EASTERN TIME.
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This page intentionally left blank.
ENERGY INCOME AND GROWTH FUND
SPECIAL MEETING OF SHAREHOLDERS
JANUARY 8, 2008
1001 WARRENVILLE ROAD
SUITE 300
LISLE, ILLINOIS 60532
PROXY STATEMENT
October 29, 2007
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Trustees (the "Board") of Energy
Income and Growth Fund (the "Fund"), a Massachusetts business trust, for
use at the Special Meeting of Shareholders of the Fund to be held on
Tuesday, January 8, 2008, at 4:00 p.m. Central Time, at the offices of
First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
Illinois 60532, and at any adjournments or postponements thereof
(referred to collectively as the "Meeting"). A Notice of Special Meeting
of Shareholders and a proxy card accompany this Proxy Statement.
Proxy solicitations will be made, beginning on or about October
29, 2007, primarily by mail. However proxy solicitations may also be made
by telephone or personal interviews conducted by (i) officers of the
Fund; (ii) The Altman Group ("Altman"), a proxy solicitor that will
provide proxy solicitation services in connection with the proposals;
(iii) First Trust Advisors L.P. ("First Trust Advisors" or the
"Adviser"), the investment adviser of the Fund; (iv) PFPC Inc. ("PFPC"),
the administrator, accounting agent and transfer agent of the Fund and a
subsidiary of The PNC Financial Services Group Inc.; or (v) any
affiliates of those entities.
THE FUND'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS ARE
AVAILABLE UPON REQUEST, WITHOUT CHARGE, BY WRITING TO THE ADVISER AT 1001
WARRENVILLE ROAD, SUITE 300, LISLE, ILLINOIS 60532, BY CALLING (800)
988-5891 OR BY VISITING THE FUND'S WEBSITE AT HTTP://WWW.FTPORTFOLIOS.COM.
THIS PROXY STATEMENT AND THE ENCLOSED PROXY CARD WILL FIRST BE MAILED TO
SHAREHOLDERS ON OR ABOUT OCTOBER 29, 2007.
The costs of preparing, printing and mailing this Proxy
Statement and its enclosures and all other costs in connection with the
solicitation of proxies (including amounts charged by Altman for its
proxy solicitation services, which amounts are expected to be
approximately $51,000), will be paid by Energy Income Partners, LLC and
the Adviser. They will also reimburse brokerage firms and others for
their expenses in forwarding solicitation materials to the beneficial
owners of Fund shares.
If the enclosed proxy card is properly executed and returned in
time to be voted at the Meeting, the Fund shares represented thereby will
be voted in accordance with the instructions marked thereon. If no
instructions are marked on the enclosed proxy card, Fund shares
represented thereby will be voted in the discretion of the persons named
on the proxy card. Accordingly, unless instructions to the contrary are
marked thereon, a proxy will be voted FOR the proposal to approve the new
investment sub-advisory agreement, FOR the proposal to authorize the
issuance and sale of common shares at a net price below then-current net
asset value and at the discretion of the named proxies on any other
matters that may properly come before the Meeting and any adjournments
thereof as deemed appropriate. Any shareholder who has given a proxy has
the right to revoke it at any time prior to its exercise either by
attending the Meeting and voting his or her shares in person, or by
timely submitting a letter of revocation or a later-dated proxy to the
Fund at the above address. A list of shareholders entitled to notice of
and to be present and to vote at the Meeting will be available at the
offices of the Fund, 1001 Warrenville Road, Suite 300, Lisle, Illinois
60532, for inspection by any shareholder during regular business hours
beginning 10 days prior to the date of the Meeting. Shareholders will
need to show valid identification and proof of share ownership to be
admitted to the Meeting or to inspect the list of shareholders.
Under the By-Laws of the 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
entitled to vote on a matter. For the purposes of establishing whether a
quorum is present, all shares present and entitled to vote, including
abstentions and broker non-votes (i.e., shares held by brokers or
nominees as to which (i) instructions have not been received from the
beneficial owners or the persons entitled to vote and (ii) the broker or
nominee does not have discretionary voting power on a particular matter),
shall be counted. Any meeting of shareholders may be postponed prior to
the meeting with notice to the shareholders entitled to vote at that
meeting. Any meeting of shareholders may, by action of the chairman of
the meeting, be adjourned to permit further solicitation of proxies
without further notice with respect to one or more matters to be
considered at such meeting to a designated time and place, whether or not
a quorum is present with respect to such matter. In addition, upon motion
of the chairman of the meeting, the question of adjournment may be
submitted to a vote of the shareholders, and in that case, any
adjournment with respect to one or more matters must be approved by the
vote of holders of a majority of the shares present and entitled to vote
with respect to the matter or matters adjourned, and without further
notice. Unless a proxy is otherwise limited in this regard, any shares
present and entitled to vote at a meeting, including broker non-votes,
may, at the discretion of the proxies named therein, be voted in favor of
such an adjournment or adjournments.
The close of business on October 15, 2007 has been fixed as the
record date (the "Record Date") for the determination of shareholders
entitled to notice of and to vote at the Meeting and any adjournments or
postponements thereof.
The Fund has one class of shares of beneficial interest, par
value $0.01 per share, known as common shares ("Shares"). On the Record
Date, the Fund had 6,446,996 Shares outstanding. Shares of the Fund are
listed on the American Stock Exchange under the ticker symbol "FEN."
To approve the new investment sub-advisory agreement for the
Fund (Proposal 1), the vote of a majority of the outstanding voting
securities of the Fund will be required. The "vote of a majority of the
outstanding voting securities" is defined in the Investment Company Act
of 1940, as amended (together with the rules and regulations thereunder,
the "1940 Act"), as the vote of the lesser of (i) 67% or more of the
shares of the Fund present at the Meeting if the holders of more than 50%
of the outstanding shares of the Fund are present in person or
represented by proxy; or (ii) more than 50% of the outstanding shares of
the Fund. Abstentions and broker non-votes will have the effect of a vote
against the proposal. 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 authorize the issuance and sale by the Fund of its common
shares at a net price below its then-current net asset value (Proposal
2), the proposal must be approved by both (i) the affirmative vote of a
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majority (in number) of all common shareholders of record of the Fund, as
of the Record Date; and (ii) the affirmative vote of a majority of the
votes cast (based on Shares voted), in person or by proxy. If both
approvals are not obtained, Proposal 2 will not pass. Solely for purposes
of determining whether a majority of the number of common shareholders of
record of the Fund approved Proposal 2, the number of Shares held by any
single shareholder will not be relevant, and abstentions and broker
non-votes will have the effect of a vote against the proposal. Solely for
purposes of determining whether a majority of the votes cast by the
common shareholders of record of the Fund approved Proposal 2, (a) each
shareholder of record on the Record Date is entitled to one vote for each
Share the shareholder owns and a proportionate fractional vote for any
fraction of a Share the shareholder owns and (b) abstentions and broker
non-votes will not be counted as votes cast and will have no effect on
the result of the vote for the proposal.
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 card to be received BY
5:00 P.M. EASTERN TIME, on MONDAY, JANUARY 7, 2008.
(However, proxies received after this date may still be
voted in the event the Meeting is adjourned or postponed to
a later date.)
-3-
PROPOSAL 1: APPROVAL OF A NEW INVESTMENT SUB-ADVISORY AGREEMENT FOR THE FUND
AS DESCRIBED BELOW, THE FUND'S PREVIOUS INVESTMENT SUB-ADVISORY
AGREEMENT AMONG THE FUND, THE ADVISER AND FIDUCIARY ASSET MANAGEMENT, LLC
AUTOMATICALLY TERMINATED ON SEPTEMBER 14, 2007. ON SEPTEMBER 21, 2007,
THE BOARD DETERMINED THAT IT WOULD BE IN THE BEST INTERESTS OF THE FUND
TO SELECT ENERGY INCOME PARTNERS, LLC AS THE NEW INVESTMENT SUB-ADVISER
FOR THE FUND AND APPROVED, SUBJECT TO SHAREHOLDER APPROVAL, A NEW
INVESTMENT SUB-ADVISORY AGREEMENT AMONG THE FUND, THE ADVISER AND ENERGY
INCOME PARTNERS, LLC (THE "NEW SUB-ADVISORY AGREEMENT"). IN ADDITION, AS
PERMITTED BY THE 1940 ACT, ON SEPTEMBER 14, 2007, THE BOARD OF TRUSTEES
OF THE FUND, INCLUDING A MAJORITY OF THE TRUSTEES WHO ARE NOT "INTERESTED
PERSONS" OF THE FUND AS THAT TERM IS DEFINED IN THE 1940 ACT (SUCH
TRUSTEES, THE "INDEPENDENT TRUSTEES"), APPROVED AN INTERIM INVESTMENT
SUB-ADVISORY AGREEMENT AMONG THE FUND, THE ADVISER AND ENERGY INCOME
PARTNERS, LLC, WHICH IS CURRENTLY IN EFFECT AND WILL CONTINUE TO BE IN
EFFECT FOR 150 DAYS AFTER THE CLOSING OF THE TRANSACTION DESCRIBED BELOW
OR UNTIL SHAREHOLDERS APPROVE THE NEW SUB-ADVISORY AGREEMENT, WHICHEVER
OCCURS FIRST (UNLESS TERMINATED SOONER IN ACCORDANCE WITH ITS TERMS). THE
BOARD RECOMMENDS THAT SHAREHOLDERS APPROVE THE NEW SUB-ADVISORY
AGREEMENT.
BACKGROUND AND REASON FOR VOTE
On June 24, 2004, the Fund entered into an investment
sub-advisory agreement (the "Prior Sub-Advisory Agreement") with the
Adviser and Fiduciary Asset Management, LLC ("FAMCO" or the "Prior
Sub-Adviser"). In April 2007, FAMCO and Piper Jaffray Companies ("Piper
Jaffray") entered into a definitive agreement (the "Transaction
Agreement") pursuant to which Piper Jaffray agreed to acquire FAMCO (the
"Transaction"). The Transaction was consummated on September 14, 2007 and
resulted in a change in control of the Prior Sub-Adviser, which
constituted an "assignment" of the Prior Sub-Advisory Agreement, as that
term is used in the 1940 Act. Pursuant to the terms of the Prior
Sub-Advisory Agreement and the requirements of the 1940 Act, the Prior
Sub-Advisory Agreement automatically terminated upon its assignment.
At a meeting of the Board held on September 14, 2007, the Board,
after careful consideration of a variety of factors and possible
alternatives to the Fund's investment sub-advisory arrangement (see "BOARD
CONSIDERATIONS" below), determined that the appointment of Energy Income
Partners, LLC ("EIP"), an investment adviser registered with the
Securities and Exchange Commission (the "SEC") pursuant to the Investment
Advisers Act of 1940, was in the best interests of the Fund. Accordingly,
as permitted under the 1940 Act, the Board unanimously approved an
interim investment sub-advisory agreement (the "Interim Sub-Advisory
Agreement") among the Adviser, the Fund and EIP to ensure the
continuation of investment sub-advisory services to the Fund upon the
termination of the Prior Sub-Advisory Agreement. The Interim Sub-Advisory
Agreement has been in effect since September 14, 2007. In addition, at
its meeting on September 21, 2007, the Board approved, subject to
shareholder approval, the New Sub-Advisory Agreement among the Fund, the
Adviser and EIP.
Pursuant to Rule 15a-4 under the 1940 Act, the Interim
Sub-Advisory Agreement will be in effect no longer than through February
11, 2008 (i.e., 150 days after the termination of the Prior Sub-Advisory
Agreement described above). If shareholders of the Fund do not approve
the New Sub-Advisory Agreement by that date, the Interim Sub-Advisory
Agreement will remain in effect through that date, and the Board will
take such action as it deems to be in the best interests of the Fund,
which might include seeking approval of a new investment sub-advisory
agreement or taking any other steps deemed appropriate by the Board. The
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Interim Sub-Advisory Agreement will automatically terminate upon the
approval by shareholders of the New Sub-Advisory Agreement. In addition,
the Interim Sub-Advisory Agreement may be terminated by action of the
Board or by a vote of the majority of the outstanding voting securities
of the Fund upon 60 days' written notice.
EIP
General Information/Investment Philosophy
EIP, located at 49 Riverside Avenue, Westport, Connecticut
06880, is a Delaware limited liability company and an SEC-registered
investment adviser, founded in October 2003 by James J. Murchie to
provide professional asset management services in the area of
energy-related master limited partnerships ("MLPs") and other high-payout
securities. EIP serves as the investment manager to three unregistered
investment companies and one registered investment company for high net
worth individuals and institutions. EIP mainly focuses on infrastructure
assets such as pipelines, storage and terminals that receive fee-based or
regulated income from its customers. At August 31, 2007, EIP managed or
supervised approximately $425 million in assets.
In describing its investment philosophy, EIP believes that,
because the energy industry is capital intensive, mature and has low
rates of overall growth, financial success for companies operating in
this industry requires strict capital spending discipline. According to
EIP, capital spending discipline results from prudent management or a
policy to pay out most available free cash flow to investors. EIP notes
that issuers in the energy industry that pay out all or most of their
available free cash flow in the form of monthly or quarterly
distributions or dividends, such as MLPs, income trusts and corporations
with similar payout dividend policies, have a built-in capital spending
discipline. In EIP's view, energy companies with built-in capital
spending discipline provide an attractive investment universe from which
to construct a portfolio.
As sub-adviser of the Fund (assuming approval by shareholders),
EIP will seek to invest in companies that fit EIP's investment philosophy
and the Fund's investment objective. EIP notes that there have been a
number of MLP initial public offerings recently that are increasingly
based on cyclical businesses such as oil and gas production and shipping.
EIP expects to limit the commodity exposure of the portfolio and to seek
investments in stable energy infrastructure which derives most of its
income from fee-based assets. Moreover, to the extent consistent with its
investment philosophy, EIP expects that the Fund will continue to invest
in private and restricted securities. The Fund's investment objective
will not change.
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Organizational Information
The names and principal occupations of the persons who are
principal executive officers and/or principals of EIP and the percentage
of membership interests in EIP held by each principal are set forth
below:
------------------ ------------------------------------------------------------- --------------------
NAME POSITION WITH EIP AND PRINCIPAL OCCUPATION PERCENTAGE OF
MEMBERSHIP INTERESTS
IN EIP HELD
------------------ ------------------------------------------------------------- --------------------
James J. Murchie Principal, Chief Executive Officer and Co-Portfolio Manager 57%*
------------------ ------------------------------------------------------------- --------------------
Eva Pao Principal and Co-Portfolio Manager 24%
------------------ ------------------------------------------------------------- --------------------
Linda Longville Principal and Research Director 14%
------------------ ------------------------------------------------------------- --------------------
Saul Ballesteros Principal and Head of Trading 5%
------------------ ------------------------------------------------------------- --------------------
*Mr. Murchie's membership interest is held through Duntrune Capital
Partners, LLC.
The address of each of the individuals listed above is 49
Riverside Avenue, Westport, Connecticut 06880.
EIP is a member of the Ospraie Wingspan platform which is
comprised of a group of independent fund managers in the basic industries
and commodities space. Ospraie Management, LLC is the investment manager
of Ospraie Wingspan and other Ospraie investment funds with approximately
$7 billion in assets under management.
There are currently no officers or trustees of the Fund who are
also officers, employees or directors of, or owners of an interest in,
EIP or its parents or subsidiaries. No officers or trustees of the Fund
have had any material interest, direct or indirect, in any material
transactions since the beginning of the most recently completed fiscal
year of the Fund, or in any material proposed transactions, to which EIP
or any of its parents or subsidiaries were or are to be a party. Since
the beginning of the most recently completed fiscal year of the Fund, no
officer or trustee of the Fund has purchased or sold any interest in EIP
or in any of its parents or subsidiaries.
Portfolio Manager Information
It is currently anticipated that the portfolio managers
identified below (who are acting as such under the Interim Sub-Advisory
Agreement) will continue to be responsible for the day-to-day management
of the Fund's portfolio:
JAMES J. MURCHIE. James J. Murchie is the Founder, the Chief
Executive Officer and a Principal of EIP. Mr. Murchie founded EIP in
2003. In December 2004, he and the EIP investment team joined Pequot
Capital Management. In August 2006, Mr. Murchie and the EIP investment
team left Pequot Capital Management and re-established EIP. Prior to
founding EIP, Mr. Murchie was a Portfolio Manager at Lawhill Capital
Partners, LLC ("Lawhill Capital"), a long/short equity hedge fund
investing in commodities and equities in the energy and basic industry
sectors. Before Lawhill Capital, Mr. Murchie was a Managing Director at
Tiger Management, LLC, where his primary responsibility was investments
-6-
in commodities and related equities. Mr. Murchie was also a Principal at
Sanford C. Bernstein. He began his career at British Petroleum.
EVA PAO. Ms. Pao is a Principal of EIP. She joined EIP in 2003
after graduating from Harvard Business School, serving as Managing
Director of EIP until the EIP investment team joined Pequot Capital
Management. Ms. Pao served as Vice President of Pequot Capital Management
from December 2004 through July 2006. Prior to Harvard Business School,
Ms. Pao was a Manager at Enron Corp. where she managed a portfolio in
Canadian oil and gas equities for Enron's internal hedge fund that
specialized in energy-related equities and managed a natural gas trading
book.
Other Registered Investment Company Currently Advised by EIP with a
Similar Investment Objective
EIP acts as investment adviser with respect to one registered
investment company with a similar investment objective as the Fund. The
name of this fund, together with its size and the annual rate of
compensation paid to EIP for its services, are set forth below:
-------------------------- -------------------------- ------------------------
FUND NAME ASSETS UNDER MANAGEMENT ANNUAL RATE OF
AS OF SEPTEMBER 30, 2007 COMPENSATION
-------------------------- -------------------------- ------------------------
EIP Growth and Income Fund Approximately $205 million 1% of average net assets
-------------------------- -------------------------- ------------------------
EIP has not waived, reduced or otherwise agreed to reduce its
compensation under any contract to provide advisory services to the fund
listed above.
THE PRIOR SUB-ADVISORY AGREEMENT
The Prior Sub-Advisory Agreement, dated June 24, 2004, was
approved by the Board of Trustees, including a majority of the
Independent Trustees, on April 18, 2004, and by the initial shareholder
of the Fund on June 17, 2004. Since the beginning of the Fund's last
fiscal year, the continuation of the Prior Sub-Advisory Agreement was
approved by the Board twice, most recently on March 12, 2007 prior to the
announcement of the Transaction. The Prior Sub-Advisory Agreement
provided for its automatic termination in the event of an "assignment," as
defined in the 1940 Act. As described above, a change in ownership and
control of the Prior Sub-Adviser therefore terminated the Prior
Sub-Advisory Agreement on September 14, 2007.
COMPARISON OF THE NEW SUB-ADVISORY AGREEMENT AND PRIOR SUB-ADVISORY AGREEMENT
The terms of the New Sub-Advisory Agreement are substantially
similar to those of the Prior Sub-Advisory Agreement, except for the
effective date and the differences noted below. Except for the effective
date and termination provisions, the terms of the Interim Sub-Advisory
Agreement, which is currently in effect, are substantially similar to
those of the New Sub-Advisory Agreement. The rate of compensation paid to
EIP under both the Interim Sub-Advisory Agreement and the New
Sub-Advisory Agreement is the same as that paid to the Prior Sub-Adviser
under the Prior Sub-Advisory Agreement.
Below is a brief comparison of certain terms of the Prior
Sub-Advisory Agreement to the corresponding terms of the New Sub-Advisory
Agreement. For a more complete understanding of the New Sub-Advisory
Agreement, please refer to the form of the New Sub-Advisory Agreement
provided in Appendix A hereto.
-7-
Advisory Services. The advisory services to be provided by EIP
to the Fund under the New Sub-Advisory Agreement will be substantially
similar to those advisory services previously provided by the Prior
Sub-Adviser under the Prior Sub-Advisory Agreement. Both the Prior
Sub-Advisory Agreement and the New Sub-Advisory Agreement provide that
the sub-adviser will furnish an investment program in respect of, make
investment decisions for, and place all orders for the purchase and sale
of securities for the Fund's investment portfolio, all on behalf of the
Fund and subject to the supervision of the Fund's Board and the Adviser.
As was the case under the Prior Sub-Advisory Agreement, under the New
Sub-Advisory Agreement, the sub-adviser is required to monitor the Fund's
investments and to comply with the provisions of the Fund's Declaration
of Trust and By-Laws and the stated investment objectives, policies and
restrictions of the Fund. In addition, under the Prior Sub-Advisory
Agreement, the Prior Sub-Adviser agreed to vote all proxies solicited by
or with respect to the issuers of securities of the Fund corresponding to
assets of the Fund's investment portfolio allocated by the Adviser to the
sub-adviser. Although this obligation is not explicitly set forth in the
New Sub-Advisory Agreement, EIP has undertaken to vote such proxies.
Brokerage. As was the case under the Prior Sub-Advisory
Agreement, the New Sub-Advisory Agreement authorizes the sub-adviser to
select the brokers or dealers that will execute the purchases and sales
of portfolio investments for the Fund, and directs the sub-adviser to use
its commercially reasonable efforts to obtain best execution, which
includes most favorable net results and execution of the Fund's orders,
taking into account all appropriate factors, including price, dealer
spread or commission, size and difficulty of the transaction and research
or other services provided.
Fees. As was the case under the Prior Sub-Advisory Agreement,
under the New Sub-Advisory Agreement, the Adviser pays the sub-adviser a
portfolio management fee on a monthly basis. Both the Prior Sub-Advisory
Agreement and the New Sub-Advisory Agreement provide that for services
provided and expenses assumed, the Adviser will pay the sub-adviser a fee
equal to the annual rate of 0.50% of the Fund's "Managed Assets." The
term "Managed Assets" means the average daily gross asset value of the
Fund (including assets attributable to the Fund's preferred shares, if
any, and the principal amount of borrowings), minus the sum of the Fund's
accrued and unpaid dividends on any outstanding preferred shares and
accrued liabilities (other than the principal amount of any borrowings
incurred, commercial paper or notes or other forms of indebtedness issued
by the Fund and the liquidation preference of any outstanding preferred
shares).
In addition, under the Prior Sub-Advisory Agreement, the Prior
Sub-Adviser agreed to reduce its management fee to an annual rate of
0.382% of the Fund's Managed Assets for the period from the effective
date of such Agreement until June 24, 2006 and agreed to pay one half of
certain offering costs and organizational costs. Because these provisions
are no longer relevant, they will not be included in the New Sub-Advisory
Agreement.
During the fiscal year of the Fund ended November 30, 2006, the
aggregate fees paid by the Adviser to the Prior Sub-Adviser under the
Prior Sub-Advisory Agreement were $890,634.55.
Payment of Expenses. Under the Prior Sub-Advisory Agreement, the
Prior Sub-Adviser agreed to pay all expenses it incurred in connection
with its activities under such Agreement other than the cost of securities
and other assets (including brokerage commissions, if any) purchased for
the Fund. Under the New Sub-Advisory Agreement, the sub-adviser agrees to
pay all expenses it incurs in connection with its activities under such
Agreement other than (i) the cost of securities and other assets
purchased for the Fund and (ii) the costs directly associated with
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purchasing and selling securities and other assets for the Fund, if any,
including, but not limited to, brokerage commissions, stamps, duties,
taxes and custody fees related to transfers.
Limitation on Liability. The New Sub-Advisory Agreement provides
that the sub-adviser will not be liable for, and the Fund and the Adviser
will not take any action against the sub-adviser to hold the sub-adviser
liable for, any error of judgment or mistake of law or for any loss
suffered by the Fund or the Adviser in connection with the performance of
the sub-adviser's duties under the Agreement, except for a loss resulting
from willful misfeasance, bad faith or gross negligence on the part of
the sub-adviser in the performance of its duties under the Agreement, or
by reason of its reckless disregard of its obligations and duties under
the Agreement. The Prior Sub-Advisory Agreement included a provision
generally similar to the foregoing.
Continuance. The Prior Sub-Advisory Agreement was originally in
effect for an initial term of two years and could be continued thereafter
for successive one-year periods if such continuance was specifically
approved at least annually in the manner required by the 1940 Act. If the
shareholders of the Fund approve the New Sub-Advisory Agreement, the New
Sub-Advisory Agreement will expire on June 30, 2009, unless continued.
Thereafter, the New Sub-Advisory Agreement may be continued for
successive one-year periods if such continuance is specifically approved
at least annually in the manner required by the 1940 Act.
Termination. As was the case under the Prior Sub-Advisory
Agreement, the New Sub-Advisory Agreement provides for termination at any
time without the payment of any penalty by the Adviser or the sub-adviser
upon 60 days' written notice to the other parties, and also provides for
termination by the Fund by action of the Board or by a vote of a majority
of the outstanding voting securities of the Fund upon 60 days' written
notice to the sub-adviser without the payment of any penalty.
In addition, the Prior Sub-Advisory Agreement was, and the New
Sub-Advisory Agreement is, terminable at any time without the payment of
any penalty by the Adviser, by the Board or by vote of a majority of the
outstanding voting securities of the Fund in the event that it is
established by a court of competent jurisdiction that the sub-adviser or
any of its officers or directors has taken any action that results in a
breach of the material covenants of the sub-adviser set forth in the
Agreement.
BOARD CONSIDERATIONS
The Board, including a majority of the Independent Trustees,
approved the Interim Sub-Advisory Agreement and the New Sub-Advisory
Agreement (collectively, the "Agreements") at meetings held on September
14, 2007 and September 21, 2007, respectively. The Board determined that
the terms of the Agreements are fair and reasonable and in the best
interests of the Fund.
In April 2007, the Board was informed that FAMCO had entered
into the Transaction Agreement with Piper Jaffray and that if the
Transaction was consummated, the Prior Sub-Advisory Agreement would
terminate pursuant to its terms and the requirements of the 1940 Act. In
light of the potential termination of the Prior Sub-Advisory Agreement,
the Board, over the course of several months, requested and evaluated all
information it deemed reasonably necessary to evaluate the various
alternatives the Fund could pursue if the Transaction were completed. As
part of the review process, the Board met on several occasions with
representatives of First Trust Advisors to discuss the Transaction. The
Independent Trustees also asked that written requests for information be
sent on their behalf to FAMCO and Piper Jaffray. On June 11, 2007, the
Board met with representatives of FAMCO and Piper Jaffray and received a
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presentation on the Transaction. The Board was able to ask questions
about the possible effects of the Transaction on the services provided by
FAMCO to the Fund. At the June 11th meeting, the Board also requested
that the Adviser research and provide information on potential
alternative sub-advisers for its July meeting. At the July 18, 2007
meeting, the Board met with representatives of EIP and received a
presentation regarding EIP's investment style. Throughout the entire
review process, the Independent Trustees were advised by their
independent legal counsel.
As a result of the consummation of the Transaction and the
termination of the Prior Sub-Advisory Agreement, the Board held a special
meeting on September 14, 2007 to consider how to proceed. At this
meeting, the Adviser recommended to the Board that EIP serve as the new
sub-adviser for the Fund. Based on its consideration of all the
information received prior to the closing of the Transaction, the Board
appointed EIP as the interim sub-adviser to the Fund, pursuant to the
Interim Sub-Advisory Agreement. At a special meeting on September 21,
2007, the Board approved the New Sub-Advisory Agreement and determined to
recommend it to shareholders of the Fund for their approval. The Board
noted that, at the request of the Independent Trustees, First Trust
Advisors and/or EIP had agreed to bear the costs associated with
soliciting shareholder approval of the New Sub-Advisory Agreement.
To reach its determination, the Board considered its duties
under the 1940 Act, as well as under the general principles of state law
in reviewing and approving advisory contracts; the requirements of the
1940 Act in such matters; the fiduciary duty of investment advisers with
respect to advisory agreements and compensation; the standards used by
courts in determining whether investment company boards have fulfilled
their duties; and the factors to be considered by the Board in voting on
such agreements. To assist the Board in its evaluation of the Agreements,
the Independent Trustees received a report from EIP responding to a
request for information from the Adviser and counsel to the Independent
Trustees. The report, among other things, outlined the services to be
provided by EIP (including the relevant personnel responsible for these
services and their experience); the sub-advisory fee for the Fund as
compared to fees charged to other clients of EIP; the nature of expenses
to be incurred in providing services to the Fund and the potential for
economies of scale, if any; financial data on EIP; any fall-out benefits
to EIP; and information on EIP's compliance program. The Independent
Trustees also met separately on a number of occasions with their
independent legal counsel to discuss the information provided by EIP and
the Adviser. The Board applied its business judgment to determine whether
the arrangements between the Fund, the Adviser and EIP are reasonable
business arrangements from the Fund's perspective as well as from the
perspective of shareholders.
In reviewing the Agreements, the Board considered the nature,
quality and extent of services to be provided by EIP under the
Agreements. The Board noted EIP's investment style and the backgrounds of
the investment personnel who would be responsible for the day-to-day
management of the Fund. The Board considered, in particular, EIP's
experience as adviser to a registered investment company and to three
unregistered investment companies with portfolio strategies similar to
the strategies of the Fund. The Board considered the investment
performance of the Fund under FAMCO, and also considered performance
information for one of the unregistered investment companies managed by
EIP in a manner similar to the style to be used for the Fund. In light of
the information presented and the considerations made, the Board
concluded that the nature, quality and extent of services to be provided
to the Fund by EIP under the Agreements are expected to be satisfactory.
The Board considered the sub-advisory fees to be paid under the
Agreements, noting that they would be the same as the fees paid under the
Prior Sub-Advisory Agreement. The Board considered the proposed
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sub-advisory fee and how it would relate to the overall management fee
structure of the Fund, noting that the fees to be paid to EIP would be
paid by the Adviser from its advisory fee. The Board also considered
information provided by EIP as to the fees it charges to other clients,
noting that the sub-advisory fee is less than the fees charged by EIP to
the other investment companies it manages. On the basis of all the
information provided on the fees of the Fund, the Board concluded that
the sub-advisory fees to be paid under the Agreements were reasonable and
appropriate in light of the nature, quality and extent of services
expected to be provided by EIP under the Agreements.
The Board considered EIP's representation that its expenses
incurred in providing services to the Fund are primarily fixed in nature.
The Board also considered that EIP expects that additional investments in
personnel and infrastructure will be made over the course of the next
twelve months. The Board concluded that the fees to be paid under the
Agreements as well as under the investment management agreement with the
Adviser reflect an appropriate sharing of any economies of scale. With
respect to EIP's anticipated profitability under the Agreements, the
Board reviewed a pro forma statement of profits and losses provided by
EIP. The Board noted that the sub-advisory fee rate was negotiated at
arm's length between the Adviser and EIP, and that EIP would be paid by
the Adviser. Based on the information provided, the Board concluded that
the profitability of the Agreements to EIP was anticipated to be not
unreasonable. The Board considered the fall-out benefits expected to be
realized by EIP from its relationship with the Fund, including possible
soft dollar arrangements.
Based on all of the information considered and the conclusions
reached, the Board, including a majority of the Independent Trustees,
determined that the terms of the Agreements are fair and reasonable and
that the approval of the Agreements is in the best interests of the Fund.
No single factor was determinative in the Board's analysis.
SHAREHOLDER APPROVAL AND REQUIRED VOTE
To become effective, the New Sub-Advisory Agreement must be
approved by a vote of a majority of the outstanding voting securities of
the Fund. The "vote of a majority of the outstanding voting securities"
is defined in the 1940 Act as the vote of the lesser of (i) 67% or more
of the Shares of the Fund present at the Meeting if the holders of more
than 50% of the outstanding Shares of the Fund are present in person or
represented by proxy; or (ii) more than 50% of the outstanding Shares of
the Fund. For purposes of determining the approval of the New
Sub-Advisory Agreement, abstentions and broker non-votes will have the
effect of a vote against the proposal.
THE BOARD OF TRUSTEES OF THE FUND RECOMMENDS THAT SHAREHOLDERS
VOTE FOR PROPOSAL 1. IF YOU NEED ANY ASSISTANCE, OR HAVE ANY QUESTIONS
REGARDING PROPOSAL 1 OR HOW TO VOTE YOUR SHARES, CALL YOUR FUND'S PROXY
SOLICITOR, THE ALTMAN GROUP, AT (800) 761-6707 WEEKDAYS FROM 9:00 A.M. TO
10:00 P.M. EASTERN TIME.
-11-
PROPOSAL 2: APPROVAL TO AUTHORIZE THE FUND
TO ISSUE AND SELL SHARES AT A NET PRICE BELOW THE THEN-CURRENT NET ASSET VALUE
AS DESCRIBED BELOW, THE FUND IS SEEKING THE AUTHORITY TO ISSUE
AND SELL SHARES AT A NET PRICE LESS THAN ITS THEN-CURRENT NET ASSET VALUE
PER SHARE ("NAV"). THE 1940 ACT PROVIDES THAT A CLOSED-END INVESTMENT
COMPANY, SUCH AS THE FUND, MAY ONLY SELL COMMON SHARES AT A PRICE THAT IS
LESS THAN NAV IF SUCH INVESTMENT COMPANY HAS OBTAINED THE CONSENT OF A
MAJORITY OF ITS COMMON SHAREHOLDERS OR UNDER CERTAIN OTHER CIRCUMSTANCES.
SO THAT THE FUND MAY, IN ONE OR MORE PUBLIC OR PRIVATE OFFERINGS OF ITS
SHARES, SELL SHARES AT A PRICE LESS THAN THE THEN-CURRENT NAV, SUBJECT TO
CERTAIN CONDITIONS DISCUSSED BELOW, YOU ARE BEING ASKED TO APPROVE THE
PROPOSAL DESCRIBED BELOW.
RATIONALE
The Fund believes that having the ability to issue and sell
Shares at a price that is less than the then-current NAV in certain
instances will benefit all holders of its Shares. The Fund is
periodically presented with attractive opportunities to acquire
securities of MLPs and other prospective portfolio securities. Under
normal market conditions, the Fund typically seeks to remain fully
invested and does not intend to maintain cash for the purpose of making
such investments. The ability of the Fund to sell its existing portfolio
securities and reinvest the sale proceeds in such opportunities may be
limited both by its sub-adviser's desire to retain such existing
portfolio securities based on their relative return potential and the
prospective tax impact which may result from a current sale of such
securities. Thus, the Fund may be unable to capitalize on attractive
investment opportunities presented to it unless it has the ability to
raise capital on a timely basis. The market value of the Fund's Shares,
however, periodically falls below NAV, which is not uncommon for a
closed-end fund. If this happens, absent shareholder approval of this
proposal, the Fund would be precluded from selling Shares to raise
capital during periods in which Shares are trading at a price below NAV.
The following table sets forth a comparison, as of the last day
of each fiscal quarter of the Fund beginning November 30, 2004, between
the Fund's NAV per share and the comparable closing price of Shares:
--------------------- --------------- ----------
DATE SHARE PRICE NAV
--------------------- --------------- ----------
November 30, 2004 $22.12 $21.30
--------------------- --------------- ----------
February 28, 2005 $23.65 $22.81
--------------------- --------------- ----------
May 31, 2005 $22.70 $22.48
--------------------- --------------- ----------
August 31, 2005 $23.33 $23.90
--------------------- --------------- ----------
November 30, 2005 $20.92 $22.50
--------------------- --------------- ----------
February 28, 2006 $21.02 $22.84
--------------------- --------------- ----------
May 31, 2006 $20.70 $23.81
--------------------- --------------- ----------
August 31, 2006 $22.31 $24.36
--------------------- --------------- ----------
November 30, 2006 $24.49 $25.85
--------------------- --------------- ----------
February 28, 2007 $27.94 $27.79
--------------------- --------------- ----------
May 31, 2007 $28.10 $30.52
--------------------- --------------- ----------
August 31, 2007 $26.15 $27.83
--------------------- --------------- ----------
This proposal, if approved, will provide the Fund with the
flexibility to raise cash and purchase attractively priced securities,
even if the net sale price to the Fund of its common shares is below NAV.
The Fund does not anticipate selling Shares for a price below NAV unless
its sub-adviser has identified near-term investment opportunities that it
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believes are attractive and which the Fund's Board reasonably expects
will lead to a long-term increase in the Fund's NAV or a long-term
increase in the level of the Fund's distributions to shareholders.
To the extent that the Fund issues Shares in a publicly
registered transaction, regardless of whether such Shares are sold at a
price above or below NAV, the market capitalization and number of
publicly tradable Shares of the Fund will increase, thus affording all
holders of Shares of the Fund the prospects of greater liquidity.
Notwithstanding shareholder approval of this proposal, any
issuance and sale of new Shares by the Fund, whether at, above or below
NAV, must be approved by the Board. In determining whether or not to sell
additional Shares at a price below NAV, the Board will have a duty to act
in the best interests of the Fund.
CONDITIONS
The Fund will only sell Shares at a price below NAV if the
following conditions are met:
1. The per share offering price, before the deduction of
underwriting fees, commissions and offering expenses, will
not be less than the NAV per share of the Fund's Shares, as
determined at any time within two business days prior to the
pricing of the Shares to be sold in the offering.
2. Immediately following each offering of Shares, after
deducting underwriting fees, commissions and offering
expenses, the NAV per share of the Fund's Shares, as
determined at any time within two business days prior to the
pricing of the Shares to be sold, would not have been
diluted by greater than a total of 1% of the NAV per share
of all of the Fund's outstanding Shares. The Fund will not
be subject to a maximum number of Shares that can be sold or
a defined minimum sales price per share in any offering so
long as for each offering the number of Shares offered and
the price at which such Shares are sold together would not
result in dilution of the NAV per share of the Fund's Shares
in excess of the 1% limitation described above.
3. A majority of the Independent Trustees makes a
determination, based on information and a recommendation
from the Adviser, that they reasonably expect that the
investments to be made with the net proceeds of such
issuance will lead to a long-term increase in the Fund's NAV
or a long-term increase in the level of the Fund's
distributions to shareholders.
EFFECTS OF SALES OF SHARES FOR A PRICE BELOW NAV
Holders of Shares of the Fund should consider the effect of the
issuance of Shares at a price below NAV on the NAV per outstanding Share.
Any sale of Shares at a price less than the then-current NAV would result
in a reduction of NAV per outstanding Share of the Fund of as much as 1%.
The 1940 Act establishes a connection between the sales price of a fund's
common shares and NAV because when common shares are sold at a price
below NAV, the resulting increase in the number of shares is not
accompanied by a proportionate increase in the net assets of the fund.
-13-
If current holders of Shares of the Fund either do not purchase
any Shares in an offering conducted by the Fund or do not purchase
sufficient Shares in such offering to maintain their percentage interest,
the voting power of such holders of Shares will be diluted, regardless of
whether the Shares are sold above or below NAV in such offering. Holders
of Shares of the Fund should consider that they have no subscription,
preferential or preemptive rights to purchase additional Shares of the
Fund proposed to be authorized for issuance.
The issuance of additional Shares will also have an effect on
the fees received by the Adviser and the sub-adviser. The Adviser is paid
an investment advisory fee and the sub-adviser is paid a sub-advisory
fee, each of which is based on the Fund's managed assets. Any issuance of
additional Shares by the Fund would increase the Fund's managed assets,
which would cause an increase in the gross amount of advisory and
sub-advisory fees paid, but would not increase or decrease the advisory
fee or sub-advisory fee as a percentage of the Fund's managed assets.
(Note that the sub-adviser's fee is paid by the Adviser.) Because their
fees are based on managed assets of the Fund, the interests of the
Adviser and the sub-adviser in determining whether to recommend that the
Fund issue Shares for a price below NAV may conflict with the interests
of the Fund and its shareholders. However, the Adviser and EIP (assuming
approval by shareholders of Proposal 1) have committed to waive a portion
of their investment advisory fees and sub-advisory fees following any
offering of Shares in the following manner:
(i) the Adviser and EIP will waive all investment
advisory fees and sub-advisory fees with respect to the Fund's
assets attributable to newly-issued Shares (including any assets
attributable to associated financial leverage) for the first
three-month period following any offering of Shares; and
(ii) the Adviser and EIP will waive 50% of investment
advisory fees and sub-advisory fees with respect to the Fund's
assets attributable to newly-issued Shares (including any assets
attributable to associated financial leverage) for the second
three-month period following any offering of Shares.
This waiver is designed to address concerns about dilution
created by the time required to invest the proceeds of the offering of
the Shares and the costs of the offering.
SHAREHOLDER APPROVAL AND REQUIRED VOTE
With respect to Proposal 2, approval by both (i) the affirmative
vote of a majority (in number) of all common shareholders of record of
the Fund, as of the Record Date; and (ii) the affirmative vote of a
majority of the votes cast (based on Shares voted), in person or by
proxy, is required. If both approvals are not obtained, Proposal 2 will
not pass. Solely for purposes of determining whether a majority of the
number of common shareholders of record of the Fund approved Proposal 2,
the number of Shares held by any single shareholder will not be relevant,
and abstentions and broker non-votes will have the effect of a vote
against the proposal. Solely for purposes of determining whether a
majority of the votes cast by the common shareholders of record of the
Fund approved Proposal 2, (a) each shareholder of record on the Record
Date is entitled to one vote for each Share the shareholder owns and a
proportionate fractional vote for any fraction of a Share the shareholder
owns and (b) abstentions and broker non-votes will not be counted as
votes cast and will have no effect on the result of the vote.
-14-
THE BOARD OF TRUSTEES OF THE FUND RECOMMENDS THAT SHAREHOLDERS
VOTE FOR PROPOSAL 2. IF YOU NEED ANY ASSISTANCE, OR HAVE ANY QUESTIONS
REGARDING PROPOSAL 2 OR HOW TO VOTE YOUR SHARES, CALL YOUR FUND'S PROXY
SOLICITOR, THE ALTMAN GROUP, AT (800) 761-6707 WEEKDAYS FROM 9:00 A.M. TO
10:00 P.M. EASTERN TIME.
-15-
ADDITIONAL INFORMATION
INFORMATION ABOUT THE ADVISER
First Trust Advisors L.P., 1001 Warrenville Road, Suite 300, Lisle,
Illinois 60532, serves as the Fund's investment adviser.
INFORMATION ABOUT THE ADMINISTRATOR
PFPC acts as the Fund's 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.
BENEFICIAL OWNERSHIP
As of August 31, 2007, the Trustees of the Fund beneficially
owned the following number of Shares of the Fund:
-------------------------------------- -------------------------------
TRUSTEE SHARES OWNED
-------------------------------------- -------------------------------
INTERESTED TRUSTEE
-------------------------------------- -------------------------------
James A. Bowen 0
-------------------------------------- -------------------------------
INDEPENDENT TRUSTEES
-------------------------------------- -------------------------------
Richard E. Erickson 296
-------------------------------------- -------------------------------
Thomas R. Kadlec 700
-------------------------------------- -------------------------------
Robert F. Keith 0
-------------------------------------- -------------------------------
Niel B. Nielson 311
-------------------------------------- -------------------------------
As of August 31, 2007, each Trustee beneficially owned less than
1% of the Shares outstanding of the Fund.
As of August 31, 2007, the Trustees and officers as a group
beneficially owned 1,307 Shares of the Fund, which is less than 1% of the
Fund's Shares outstanding.
To the knowledge of the Fund, as of August 31, 2007, no single
shareholder or "group" (as that term is used in Section 13(d) of the
Securities Exchange Act of 1934 (the "1934 Act")) beneficially owned more
than 5% of the Fund's outstanding Shares. Information as to beneficial
ownership is based solely on reports filed with the SEC.
SHAREHOLDER PROPOSALS
To be considered for presentation at the Annual Meeting of
Shareholders of the Fund to be held in 2008, a shareholder proposal
submitted pursuant to Rule 14a-8 of the 1934 Act must be received at the
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offices of the Fund at 1001 Warrenville Road, Suite 300, Lisle, Illinois
60532, not later than November 17, 2007.
Any proposals by shareholders may only be brought before an
annual meeting of the Fund if timely written notice (the "Shareholder
Notice") is provided to the Secretary of the Fund. In accordance with the
advance notice provisions included in the Fund's By-Laws, unless a
greater or lesser period is required under applicable law, to be timely,
the Shareholder Notice must be delivered to or mailed and received at the
Fund's address, 1001 Warrenville Road, Suite 300, Lisle, Illinois 60532,
Attn: W. Scott Jardine, not less than forty-five (45) days nor more than
sixty (60) days prior to the first anniversary date of the date of the
proxy statement released to shareholders for the preceding year's annual
meeting. However, if and only if the annual meeting is not scheduled to
be held within a period that commences thirty (30) days before the first
anniversary date of the annual meeting for the preceding year and ends
thirty (30) days after such anniversary date (an annual meeting date
outside such period being referred to herein as an "Other Annual Meeting
Date"), such Shareholder Notice must be given as described above by the
later of the close of business on (i) the date forty-five (45) days prior
to such Other Annual Meeting Date or (ii) the tenth (10th) business day
following the date such Other Annual Meeting Date is first publicly
announced or disclosed.
Timely submission of a proposal does not mean that such proposal
will be included in a proxy statement.
SHAREHOLDER COMMUNICATIONS
Shareholders of the 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 of
the Board 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 Fund is November 30.
ANNUAL REPORT DELIVERY
Annual reports will be sent to shareholders of record of the
Fund following the Fund's fiscal year end. The 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 only one annual or semi-annual report or proxy
statement may be delivered to two or more shareholders of the Fund who
share an address, unless the Fund has received instructions to the
contrary. To request a separate copy of an annual or semi-annual report
or proxy statement, or for instructions as to how to request a separate
copy of such documents or as to how to request a single copy if multiple
copies of such documents are received, shareholders should contact the
Fund at the address and phone number set forth above. Pursuant to a
request, a separate copy will be delivered promptly.
-17-
OTHER MATTERS TO COME BEFORE THE MEETING
No business other than the matters described above is expected
to come before the Meeting, but should any other matter requiring a vote
of shareholders arise, including any question as to an adjournment or
postponement of the Meeting, the persons named on the enclosed proxy card
will vote thereon according to their best judgment in the interests of
the Fund.
October 29, 2007
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO
NOT EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN,
DATE AND RETURN THE PROXY CARD AS SOON AS POSSIBLE IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
-------------------------------------------------------------------------------
IF YOU NEED ANY ASSISTANCE, OR HAVE ANY QUESTIONS REGARDING THE PROPOSALS
FOR THE FUND OR HOW TO VOTE YOUR SHARES, CALL YOUR FUND'S PROXY
SOLICITOR, THE ALTMAN GROUP, AT (800) 761-6707 WEEKDAYS FROM 9:00 A.M. TO
10:00 P.M. EASTERN TIME.
-------------------------------------------------------------------------------
-18-
APPENDIX A
FORM OF NEW INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made as of this [____] day of [____], 2008 by and
among Energy Income and Growth Fund, a Massachusetts business trust (the
"Fund"), First Trust Advisors L.P., an Illinois limited partnership and a
registered investment adviser with the Securities and Exchange Commission
("SEC") (the "Manager"), and Energy Income Partners, LLC, a Delaware
limited liability company and a registered investment adviser with the
SEC (the "Sub-Adviser").
WHEREAS, the Fund is a closed-end management investment company
registered under the Investment Company Act of 1940, as amended (the
"1940 Act");
WHEREAS, the Fund has retained the Manager to serve as the
investment manager for the Fund pursuant to an Investment Management
Agreement between the Manager and the Fund (as such agreement may be
modified from time to time, the "Management Agreement");
WHEREAS, the Management Agreement provides that the Manager may,
subject to the initial and periodic approvals required under Section 15
of the 1940 Act, appoint a sub-adviser at its own cost and expense for
the purpose of furnishing certain services required under the Management
Agreement;
WHEREAS, the Fund and the Manager desire to retain the
Sub-Adviser to furnish investment advisory services for the Fund's
investment portfolio, upon the terms and conditions hereafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
1. Appointment. The Fund and the Manager hereby appoint the
Sub-Adviser to provide certain sub-investment advisory services to the
Fund for the period and on the terms set forth in this Agreement. The
Sub-Adviser accepts such appointment and agrees to furnish the services
herein set forth for the compensation herein provided. The Sub-Adviser
shall, for all purposes herein provided, be deemed an independent
contractor and, unless otherwise expressly provided or authorized, shall
have no authority to act for nor represent the Fund or Manager in any
way, nor otherwise be deemed an agent of the Fund or the Manager.
2. Services to Be Performed. Subject always to the supervision
of the Fund's Board of Trustees and the Manager, the Sub-Adviser will act
as sub-adviser for, and manage on a discretionary basis the investment
and reinvestment of the assets of the Fund, furnish an investment program
in respect of, make investment decisions for, and place all orders for
the purchase and sale of securities for the Fund's investment portfolio,
all on behalf of the Fund and as described in the Fund's most recent
effective registration statement on Form N-2 as declared effective by the
SEC, and as the same may thereafter be amended from time to time. In the
performance of its duties, the Sub-Adviser will in all material respects
(a) satisfy any applicable fiduciary duties it may have to the Fund, (b)
monitor the Fund's investments, and (c) comply with the provisions of the
Fund's Declaration of Trust and By-laws, as amended from time to time and
communicated by the Fund or the Manager to the Sub-Adviser in writing,
and the stated investment objectives, policies and restrictions of the
Fund as such objectives, policies and restrictions may subsequently be
changed by the Fund's Board of Trustees and communicated by the Fund or
the Manager to the Sub-Adviser in writing. The Fund or the Manager has
provided the Sub-Adviser with current copies of the Fund's Declaration of
Trust, By-laws, prospectus, statement of additional information and any
amendments thereto, and any objectives, policies or limitations not
appearing therein as they may be relevant to the Sub-Adviser's
performance under this Agreement.
The Sub-Adviser is authorized to select the brokers or dealers
that will execute the purchases and sales of portfolio investments for
the Fund, and is directed to use its commercially reasonable efforts to
obtain best execution, which includes most favorable net results and
execution of the Fund's orders, taking into account all appropriate
factors, including price, dealer spread or commission, size and
difficulty of the transaction and research or other services provided.
Subject to approval by the Fund's Board of Trustees and compliance with
the policies and procedures adopted by the Board of Trustees for the Fund
and to the extent permitted by and in conformance with applicable law
(including Rule 17e-1 of the 1940 Act), the Sub-Adviser may select
brokers or dealers affiliated with the Sub-Adviser. It is understood that
the Sub-Adviser will not be deemed to have acted unlawfully, or to have
breached a fiduciary duty to the Fund, or be in breach of any obligation
owing to the Fund under this Agreement, or otherwise, solely by reason of
its having caused the Fund to pay a member of a securities exchange, a
broker or a dealer a commission for effecting a securities transaction
for the Fund in excess of the amount of commission another member of an
exchange, broker or dealer would have charged if the Sub-Adviser
determined in good faith that the commission paid was reasonable in
relation to the brokerage or research services provided by such member,
broker or dealer, viewed in terms of that particular transaction or the
Sub-Adviser's overall responsibilities with respect to its accounts,
including the Fund, as to which it exercises investment discretion.
In addition, the Sub-Adviser may, to the extent permitted by
applicable law, aggregate purchase and sale orders of securities placed
with respect to the assets of the Fund with similar orders being made
simultaneously for other accounts managed by the Sub-Adviser or its
affiliates, if in the Sub-Adviser's reasonable judgment such aggregation
shall result in an overall economic benefit to the Fund, taking into
consideration the selling or purchase price, brokerage commissions and
other expenses. In the event that a purchase or sale of an asset of the
Fund occurs as part of any aggregate sale or purchase orders, the
objective of the Sub-Adviser and any of its affiliates involved in such
transaction shall be to allocate the securities so purchased or sold, as
well as expenses incurred in the transaction, among the Fund and other
accounts in a fair and equitable manner. Nevertheless, the Fund and the
Manager acknowledge that under some circumstances, such allocation may
adversely affect the Fund with respect to the price or size of the
securities positions obtainable or salable. Whenever the Fund and one or
more other investment advisory clients of the Sub-Adviser have available
funds for investment, investments suitable and appropriate for each will
be allocated in a manner believed by the Sub-Adviser to be equitable to
each, although such allocation may result in a delay in one or more
client accounts being fully invested that would not occur if such an
allocation were not made. Moreover, it is possible that due to differing
investment objectives or for other reasons, the Sub-Adviser and its
affiliates may purchase securities or loans of an issuer for one client
and at approximately the same time recommend selling or sell the same or
similar types of securities or loans for another client.
The Sub-Adviser will not arrange purchases or sales of
securities between the Fund and other accounts advised by the Sub-Adviser
or its affiliates unless (a) such purchases or sales are in accordance
with applicable law (including Rule 17a-7 of the 1940 Act) and the Fund's
policies and procedures, (b) the Sub-Adviser determines the purchase or
sale is in the best interests of the Fund, and (c) the Fund's Board of
Trustees has approved these types of transactions.
A-2
The Fund may adopt policies and procedures that modify or
restrict the Sub-Adviser's authority regarding the execution of the
Fund's portfolio transactions provided herein. Such policies and
procedures and any amendments thereto will be communicated by the Manager
to the Sub-Adviser.
The Sub-Adviser will communicate to the officers and Trustees of
the Fund such information relating to transactions for the Fund as they
may reasonably request. In no instance will the Fund's portfolio
securities be purchased from or sold to the Manager, the Sub-Adviser or
any affiliated person of either the Fund, the Manager, or the
Sub-Adviser, except as may be permitted under the 1940 Act.
The Sub-Adviser further agrees that it:
(a) will use the same degree of skill and care in
providing such services as it uses in providing services to
other fiduciary accounts for which it has investment
responsibilities;
(b) will (i) conform in all material respects to all
applicable rules and regulations of the SEC, (ii) comply in all
material respects with all policies and procedures adopted by
the Board of Trustees for the Fund and communicated to the
Sub-Adviser in writing and, (iii) conduct its activities under
this Agreement in all material respects in accordance with any
applicable law and regulations of any governmental authority
pertaining to its investment advisory activities;
(c) will report to the Manager and to the Board of
Trustees of the Fund on a quarterly basis and will make
appropriate persons available for the purpose of reviewing with
representatives of the Manager and the Board of Trustees on a
regular basis at such times as the Manager or the Board of
Trustees may reasonably request in writing regarding the
management of the Fund, including, without limitation, review of
the general investment strategies of the Fund, the performance
of the Fund's investment portfolio in relation to relevant
standard industry indices and general conditions affecting the
marketplace and will provide various other reports from time to
time as reasonably requested by the Manager or the Board of
Trustees of the Fund; and
(d) will prepare and maintain such books and records
with respect to the Fund's securities and other transactions for
the Fund's investment portfolio as required for registered
investment advisers under applicable law or as otherwise
requested by the Manager and will prepare and furnish the
Manager and Fund's Board of Trustees such periodic and special
reports as the Board or the Manager may reasonably request. The
Sub-Adviser further agrees that all records that it maintains
for the Fund are the property of the Fund and the Sub-Adviser
will surrender promptly to the Fund any such records upon the
request of the Manager or the Fund (provided, however, that the
Sub-Adviser shall be permitted to retain copies thereof); and
shall be permitted to retain originals (with copies to the Fund)
to the extent required under Rule 204-2 of the Investment
Advisers Act of 1940 or other applicable law.
3. Expenses. During the term of this Agreement, the Sub-Adviser
will pay all expenses incurred by it in connection with its activities
under this Agreement other than (i) the cost of securities and other
assets purchased for the Fund, and (ii) the costs directly associated
with purchasing and selling securities and other assets for the Fund, if
any, including, but not limited to, brokerage commissions, stamps,
duties, taxes and custody fees related to transfers.
A-3
4. Compensation. For the services provided and the expenses
assumed pursuant to this Agreement, the Manager will pay the Sub-Adviser,
and the Sub-Adviser agrees to accept as full compensation therefor, a
portfolio management fee (the "Management Fee") equal to the annual rate
of 0.50% of the Fund's Managed Assets (as defined below). For purposes of
calculating the Management Fee, Managed Assets means the average daily
gross asset value of the Fund (including assets attributable to the
Fund's preferred shares, if any, and the principal amount of borrowings),
minus the sum of the Fund's accrued and unpaid dividends on any
outstanding preferred shares and accrued liabilities (other than the
principal amount of any borrowings incurred, commercial paper or notes or
other forms of indebtedness issued by the Fund and the liquidation
preference of any outstanding preferred shares). The Management Fee shall
be payable in arrears on or about the first day of each month during the
term of this Agreement.
For the month and year in which this Agreement becomes effective
or terminates, there shall be an appropriate proration on the basis of
the number of days that the Agreement is in effect during the month and
year, respectively.
5. Services to Others. The Fund and the Manager acknowledge
that the Sub-Adviser now acts, or may in the future act, as an investment
adviser to other managed accounts and as investment adviser or
sub-investment adviser to one or more other investment companies. In
addition, the Fund and the Manager acknowledge that the persons employed
by the Sub-Adviser to assist in the Sub-Adviser's duties under this
Agreement will not devote their full time to such efforts. It is also
agreed that the Sub-Adviser may use any supplemental research obtained
for the benefit of the Fund in providing investment advice to its other
investment advisory accounts and for managing its own accounts.
6. Limitation of Liability. The Sub-Adviser shall not be liable
for, and the Fund and the Manager will not take any action against the
Sub-Adviser to hold the Sub-Adviser liable for, any error of judgment or
mistake of law or for any loss suffered by the Fund or the Manager
(including, without limitation, by reason of the purchase, sale or
retention of any security) in connection with the performance of the
Sub-Adviser's duties under this Agreement, except for a loss resulting
from willful misfeasance, bad faith or gross negligence on the part of
the Sub-Adviser in the performance of its duties under this Agreement, or
by reason of its reckless disregard of its obligations and duties under
this Agreement.
7. Term; Termination; Amendment. This Agreement shall become
effective with respect to the Fund on [____], 2008 (the "Effective Date")
provided that it has been approved in the manner required by the 1940
Act, and shall remain in full force until June 30, 2009 unless sooner
terminated as hereinafter provided. This Agreement, however, shall
continue in force from year to year thereafter, but only as long as such
continuance is specifically approved for the Fund at least annually in
the manner required by the 1940 Act and the rules and regulations
thereunder; provided, however, that if the continuation of this Agreement
is not approved for the Fund, the Sub-Adviser may continue to serve in
such capacity for the Fund in the manner and to the extent permitted by
the 1940 Act and the rules and regulations thereunder.
This Agreement shall automatically terminate in the event of its
assignment and may be terminated at any time without the payment of any
penalty by the Manager or the Sub-Adviser upon sixty (60) days' written
notice to the other parties. This Agreement may also be terminated by the
Fund by action of the Board of Trustees of the Fund or by a vote of a
majority of the outstanding voting securities of the Fund upon sixty (60)
A-4
days' written notice to the Sub-Adviser by the Fund without payment of
any penalty.
This Agreement may be terminated at any time without the payment
of any penalty by the Manager, the Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Fund in
the event that it shall have been established by a court of competent
jurisdiction that the Sub-Adviser or any officer or director of the
Sub-Adviser has taken any action that results in a breach of the material
covenants of the Sub-Adviser set forth herein.
The terms "assignment" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth in the
1940 Act and the rules and regulations thereunder.
Termination of this Agreement shall not affect the right of the
Sub-Adviser to receive payments on any unpaid balance of the compensation
described in Section 4 earned prior to such termination and for any
additional period during which Sub-Adviser serves as such for the Fund,
subject to applicable law.
8. Compliance Certification. From time to time the Sub-Adviser
shall provide such certifications with respect to Rule 38a-1 under the
1940 Act as are reasonably requested by the Fund or the Manager. In
addition, the Sub-Adviser will, from time to time, provide a written
assessment of its compliance program in conformity with current industry
standards that is reasonably acceptable to the Fund to enable the Fund to
fulfill its obligations under Rule 38a-1 under the 1940 Act.
9. Notice. Any notice under this Agreement shall be sufficient
in all respects if given in writing and delivered by commercial courier
providing proof of delivery and addressed as follows or addressed to such
other person or address as such party may designate for receipt of such
notice.
If to the Manager or the Fund: If to the Sub-Adviser:
Energy Income and Growth Fund
First Trust Advisors L.P. ENERGY INCOME PARTNERS, LLC
1001 Warrenville Road, Suite 300 49 Riverside Avenue
Lisle, Illinois 60532 Westport, Connecticut 06880
Attention: Secretary Attention: James J. Murchie
If by Facsimile: (630) 241-8650 If by Facsimile: (203) 286-1602
10. Limitations on Liability. All parties hereto are expressly
put on notice of the Fund's Declaration of Trust and all amendments
thereto, a copy of which is on file with the Secretary of the
Commonwealth of Massachusetts, and the limitation of shareholder and
trustee liability contained therein and a copy of which has been provided
to the Sub-Adviser prior to the date hereof. This Agreement is executed
on behalf of the Fund by the Fund's officers in their capacity as
officers and not individually and is not binding upon any of the
Trustees, officers or shareholders of the Fund individually but the
obligations imposed upon the Fund by this Agreement are binding only upon
the assets and property of the Fund, and persons dealing with the Fund
must look solely to the assets of the Fund for the enforcement of any
claims.
A-5
11. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or delimit any of
the provisions hereof or otherwise affect their construction or effect.
This Agreement will be binding upon and shall inure to the benefit of the
parties hereto and their respective successors.
12. Applicable Law. This Agreement shall be construed in
accordance with applicable federal law and (except as to Section 10
hereof which shall be construed in accordance with the laws of
Massachusetts) the laws of the State of Illinois.
13. Amendment, Etc. This Agreement may only be amended, or its
provisions modified or waived, in a writing signed by the party against
which such amendment, modification or waiver is sought to be enforced.
14. Authority. Each party represents to the others that it is
duly authorized and fully empowered to execute, deliver and perform this
Agreement. The Fund represents that engagement of the Sub-Adviser has
been duly authorized by the Fund and is in accordance with the Fund's
Declaration of Trust and other governing documents of the Fund.
15. Severability. Each provision of this Agreement is intended
to be severable from the others so that if any provision or term hereof
is illegal or invalid for any reason whatsoever, such illegality or
invalidity shall not affect the validity of the remaining provisions and
terms hereof; provided, however, that the provisions governing payment of
the Management Fee described in Section 4 are not severable.
16. Entire Agreement. This Agreement constitutes the sole and
entire agreement of the parties hereto with respect to the subject matter
expressly set forth herein.
A-6
IN WITNESS WHEREOF, the Fund, the Manager and the Sub-Adviser
have caused this Agreement to be executed as of the day and year first
above written.
FIRST TRUST ADVISORS L.P. ENERGY INCOME PARTNERS, LLC
By: _____________________________ By: ______________________________
Title: ________________________ Title: _________________________
ENERGY INCOME AND GROWTH FUND
By: _____________________________
Title: ________________________
A-7
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[BLANK INSIDE BACK COVER]
[BLANK BACK COVER]
PROXY CARD
PLEASE FOLD ALONG THE PERFORMATION, DETACH AND RETURN THE
BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------
Proxy - ENERGY INCOME AND GROWTH FUND
--------------------------------------------------------------------------
PROXY SOLICITED BY THE BOARD OF TRUSTEES
SPECIAL MEETING ON JANUARY 8, 2008
The undersigned holder of shares of the Energy Income and Growth Fund (the
"Fund"), a Massachusetts business trust, hereby appoints W. Scott Jardine, Mark
R. Bradley and Kristi A. Maher as attorneys and proxies for the undersigned,
with full powers of substitution and revocation, to represent the undersigned
and to vote on behalf of the undersigned all shares of the Fund that the
undersigned is entitled to vote at the Special Meeting of Shareholders of the
Fund (the "Meeting") to be held at the offices of First Trust Advisors L.P.,
1001 Warrenville Road, Suite 300, Lisle, IL 60532, at 4:00 p.m. Central time on
the date indicated above, and any adjournments and postponements thereof. The
undersigned hereby acknowledges receipt of the Notice of Special Meeting of
Shareholders and the Proxy Statement dated October 29, 2007, 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.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE.
ENERGY INCOME AND GROWTH FUND
MR. A SAMPLE
DESIGNATION (IF ANY)
ADD 1
ADD 2
ADD 3
ADD 4
ADD 5
ADD 6
Using a BLACK INK pen, mark your
votes with an X as shown in this
example. Please do not write
outside the designated areas. [X]
--------------------------------------------------------------------------------
Special Meeting Proxy Card
--------------------------------------------------------------------------------
PLEASE FOLD ALONG THE PERFORMATION, DETACH AND RETURN THE
BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
--------------------------------------------------------------------------------
A Proposals -- The Board of Trustees recommends a vote FOR Proposal 1 and
Proposal 2
For Against Abstain
1. Approval of New Investment Sub-Advisory Agreement. [ ] [ ] [ ]
For Against Abstain
2. Approval to Authorize the Fund to Issue and Sell [ ] [ ] [ ]
Common Shares at a Net Price Below Then-Current
Net Asset Value, subject to Certain Conditions.
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
PROPOSAL 1 AND PROPOSAL 2.
B Non-Voting Items
Change of Address -- Please print new address below.
Comments -- Please print your comments below.
C Authorized Signature(s) -- This section must be completed for your vote
to be counted. -- Date and Sign Below
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.
Date (mm/dd/yyyy) -- Please print date below.
____/____/____
Signature 1 -- Please keep signature within the box.
_______________________________________
Signature 2 -- Please keep signature with the box.
________________________________________
STOCK# 00SJJD