First Trust/Highland Capital Completes IPO and Closes Revolving Credit Facility

On February 17, 2005, First Trust/Highland Capital Floating Rate Income Fund completed its initial public offering of 18,500,000 units at $10 per unit for gross proceeds of $185 million.

The Fund has invested the proceeds of the offering in a portfolio of senior secured floating rate corporate loans. In order to enhance the yield available to the Fund’s unitholders, the Fund will utilize leverage by borrowing an amount representing not more than 100 per cent of the value of its pre-leverage net assets under a senior secured credit facility provided by one or more asset-backed commercial paper conduit lenders agented by Scotia Capital Inc.

The syndicate of agents was led by CIBC World Markets and included RBC Dominion Securities Inc., BMO Nesbitt Burns Inc., TD Securities Inc., National Bank Financial Inc., Scotia Capital Inc., HSBC Securities (Canada) Inc., Canaccord Capital Corp., Desjardins Securities Inc., Dundee Securities Corp., First Associates Investments Inc., Raymond James Ltd. and Richardson Partners Financial Ltd.

The fund and its advisor and promoters were represented by Fasken Martineau DuMoulin LLP with a team that included Craig Brown (corporate/investment funds), Tracy Hooey and Nancy Eastman (securities/investment funds), Brian Wright and Jon Holmstrom (banking and structured finance), Mitchell Thaw (tax) and Daniel Fabiano (corporate).

The syndicate of agents was represented by Davies Ward Phillips & Vineberg LLP in Toronto and New York with a team that included Shawn McReynolds and Jennifer Grossklaus (corporate and securities) and Ron Wilson, Elie Roth and Scott Semer (tax).

Scotia Capital, in its capacity as agent for the asset-backed commercial paper conduit lenders, was represented by Osler, Hoskin & Harcourt LLP with a team that included Phil Heath and Charles Zienius, with assistance from Peter Milligan and Richard Pratt (banking and structured finance).