0001213900-23-023252.txt : 20230327 0001213900-23-023252.hdr.sgml : 20230327 20230327171306 ACCESSION NUMBER: 0001213900-23-023252 CONFORMED SUBMISSION TYPE: N-14 8C PUBLIC DOCUMENT COUNT: 17 FILED AS OF DATE: 20230327 DATE AS OF CHANGE: 20230327 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Kayne Anderson Energy Infrastructure Fund, Inc. CENTRAL INDEX KEY: 0001293613 IRS NUMBER: 000000000 STATE OF INCORPORATION: MD FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: N-14 8C SEC ACT: 1933 Act SEC FILE NUMBER: 333-270879 FILM NUMBER: 23765358 BUSINESS ADDRESS: STREET 1: 811 MAIN STREET STREET 2: 14TH FLOOR CITY: HOUSTON STATE: TX ZIP: 77002 BUSINESS PHONE: 713-425-0242 MAIL ADDRESS: STREET 1: 811 MAIN STREET STREET 2: 14TH FLOOR CITY: HOUSTON STATE: TX ZIP: 77002 FORMER COMPANY: FORMER CONFORMED NAME: Kayne Anderson MLP/Midstream Investment Co DATE OF NAME CHANGE: 20180820 FORMER COMPANY: FORMER CONFORMED NAME: Kayne Anderson MLP Investment CO DATE OF NAME CHANGE: 20040813 FORMER COMPANY: FORMER CONFORMED NAME: Kayne Anderson Midstream Investment CO DATE OF NAME CHANGE: 20040614 N N-14 8C 1 ea151744_n148c.htm N-14 8C

As filed with the Securities and Exchange Commission on March 27, 2023

Securities Act File No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-14
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

☐ Pre-Effective Amendment No.

☐ Post-Effective Amendment No.

(Check appropriate box or boxes)

Kayne Anderson Energy Infrastructure Fund, Inc. 
(Exact name of registrant as specified in charter)

811 Main Street, 14th Floor
Houston, TX 77002
(Address of Principal Executive Offices)
Registrant’s Telephone Number, Including Area Code: (713) 493-2020

Michael J. O’Neil
KA Fund Advisors, LLC
1800 Avenue of the Stars, Third Floor
Los Angeles, California 90067
(Name and Address of Agent for Service)

Copies of Communications to:

R. William Burns
Paul Hastings LLP
600 Travis Street, 58th Floor
Houston, Texas 77002
(713) 860-7300

David A. Hearth
Paul Hastings LLP
101 California Street, 48th Floor
San Francisco, California 94111
(415) 856-7000

Approximate Date of Proposed Offering: As soon as practicable after this Registration Statement is declared effective.

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

EXPLANATORY NOTE

This Joint Proxy Statement/Prospectus is organized as follows:

Letter to Stockholders of Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”) and Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”), each a Maryland corporation and registered closed-end management investment company

Notice of Special Meeting of KYN and Special Meeting of KMF

Joint Proxy Statement/Prospectus for KYN and KMF

Statement of Additional Information regarding the proposed merger of KMF into a wholly owned subsidiary of KYN

Part C Information

Exhibits

LOGO

Kayne Anderson Energy Infrastructure Fund, Inc. (NYSE: KYN)
Kayne Anderson NextGen Energy & Infrastructure, Inc. (NYSE: KMF)

, 2023

Dear Fellow Stockholder:

You are cordially invited to attend the combined Special Meeting of Stockholders (the “KYN Special Meeting”) of Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”) and Special Meeting of Stockholders (the “KMF Special Meeting,” and, together with the KYN Special Meeting, the “Meeting”) of Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”) to be held on:

June 20, 2023
8:00 a.m. Central Time

Kayne Anderson
811 Main Street, 14^th Floor
Houston, TX 77002

At the Meeting, (i) KMF stockholders will be asked to consider and approve the combination of KMF and KYN, which will be accomplished as a tax-free merger of KMF into a wholly owned subsidiary of KYN (the “Merger”), and any adjournment of the KMF Special Meeting, and (ii) KYN stockholders will be asked to consider and approve the issuance of additional shares of KYN common stock in connection with the Merger, and any adjournment of the KYN Special Meeting.

The Board of Directors of KYN and KMF each voted unanimously to approve the Merger, believes that it is in the best interest of stockholders, recommends KMF stockholders vote “FOR” the approval of the Merger and each other proposal for which you are entitled to vote and recommends KYN stockholders vote “FOR” the approval of the issuance of additional shares of KYN common stock in connection with the Merger and each other proposal for which you are entitled to vote.

Enclosed with this letter are (i) the formal notice of the Meeting, (ii) the joint proxy statement/prospectus, which gives detailed information about the Merger and the other proposals and why the Boards of Directors recommends that you vote to approve them, and (iii) a written proxy for you to sign and return. If you have any questions about the enclosed proxy or need any assistance in voting your shares, please call [●].

Your vote is important. Please vote your shares via the internet or by telephone or complete, sign, and date the enclosed proxy card and return it in the enclosed envelope. You may also vote in person if you are able to attend the Meeting. However, even if you plan to attend the Meeting, we urge you to cast your vote early. That will ensure your vote is counted should your plans change.

Sincerely,

James C. Baker, Jr.

Chairman of the Boards of Directors

President and Chief Executive Officer

LOGO

Kayne Anderson Energy Infrastructure Fund, Inc.
Kayne Anderson NextGen Energy & Infrastructure, Inc.

NOTICE OF KYN SPECIAL MEETING OF STOCKHOLDERS
NOTICE OF KMF SPECIAL MEETING OF STOCKHOLDERS

To the Stockholders of:

Kayne Anderson Energy Infrastructure Fund, Inc.
Kayne Anderson NextGen Energy & Infrastructure, Inc.

NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders (the “KYN Special Meeting”) of Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”), a Maryland corporation, and a Special Meeting of Stockholders (the “KMF Special Meeting,” and, together with the KYN Special Meeting, the “Meeting”) of Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”), a Maryland corporation, will be held on June 20, 2023 at 8:00 a.m. Central Time at the offices of Kayne Anderson, at 811 Main Street, 14^th Floor, Houston, TX 77002. The Meeting is being held for the following purposes:

For KMF:

To approve the combination of KMF and KYN by means of a tax-free merger, pursuant to which KMF will be merged with and into a wholly owned subsidiary (“Merger Sub”) of KYN (the “Merger”), pursuant to that certain Agreement and Plan of Merger, dated March 24, 2023, by and among KYN and KMF and any adjournment of the Meeting;

For KYN:

To approve the issuance of additional KYN common stock in connection with the Merger, and any adjournment of the Meeting.

The foregoing items of business are more fully described in the joint proxy statement/prospectus accompanying this notice.

Stockholders of record of KYN or KMF as of the close of business on March 27, 2023 are entitled to notice of and to vote (on KYN’s or KMF’s matters, as applicable) at the Meeting (or any adjournment or postponement of the Meeting thereof).

The Boards of Directors unanimously recommend stockholders vote “FOR” each proposal.

It is important that your shares be represented at the Meeting in person or by proxy. We urge you to complete, sign, date, and return the enclosed proxy card in the postage-paid envelope provided or vote via telephone or the Internet pursuant to the instructions on the enclosed proxy card so you will be represented at the Meeting. If you attend the Meeting and wish to vote, you will be able to do so and your vote at the Meeting will revoke any proxy you may have submitted. Merely attending the Meeting, however, will not revoke any previously submitted proxy.

By Order of the Boards of Directors,

Michael J. O’Neil
Secretary
, 2023

Houston, Texas

The information contained in this joint proxy statement/prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This joint proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated March [●], 2023

JOINT PROXY STATEMENT/PROSPECTUS

LOGO

Kayne Anderson Energy Infrastructure Fund, Inc.
Kayne Anderson NextGen Energy & Infrastructure, Inc.

811 Main Street, 14th Floor
Houston, TX 77002
(713) 493-2020

SPECIAL MEETING OF STOCKHOLDERS OF KYN
SPECIAL MEETING OF STOCKHOLDERS OF KMF
June 20, 2023

This joint proxy statement/prospectus is being sent to you by the Boards of Directors of Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”) and the Board of Directors of Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”), each a Maryland corporation. The Boards of Directors are asking you to complete and return the enclosed proxy card, permitting your votes to be cast at the Special Meeting of Stockholders of KYN (the “KYN Special Meeting”) and the Special Meeting of Stockholders of KMF (the “KMF Special Meeting,” and, together with the KYN Special Meeting, the “Meeting”) to be held on:

June 20, 2023
8:00 a.m. Central Time

Kayne Anderson
811 Main Street, 14^th Floor
Houston, TX 77002

Stockholders of record of KYN or KMF at the close of business on March 27, 2023 (the “Record Date”) are entitled to vote (on KYN’s or KMF’s matters, as applicable) at the Meeting. As a stockholder, for each applicable proposal, you are entitled to one vote for each share of common stock and one vote for each share of preferred stock you hold. This joint proxy statement/prospectus and the enclosed proxy are first being mailed to stockholders on or about , 2023.

Each Company is managed by KA Fund Advisors, LLC (“KAFA”), an affiliate of Kayne Anderson Capital Advisors, L.P. (“KACALP” and, together with its affiliates, “Kayne Anderson”). KAFA is registered as an investment adviser under the Investment Advisers Act of 1940, as amended. Kayne Anderson is a leading alternative investment adviser focused on real estate, credit, infrastructure/energy, renewables, and growth equity. Kayne Anderson’s investment philosophy is to pursue niches, with an emphasis on cash flow, where our knowledge and sourcing advantages enable us to seek to deliver above average, risk-adjusted investment returns. As responsible stewards of capital, Kayne Anderson’s philosophy extends to promoting responsible investment practices and sustainable business practices to create long-term value for our investors. Kayne Anderson manages over $32 billion in assets (as of December 31, 2022) for institutional investors, family offices, high net worth, and retail clients and employs over 325 professionals in five core offices across the United States. Kayne Anderson may be contacted at the address listed above.

This joint proxy statement/prospectus sets forth the information that you should know in order to evaluate each of the following proposals. The following table presents a summary of the proposals and the classes of stockholders being solicited with respect to each proposal. This joint proxy statement/prospectus relates to the proposed combination of KMF and KYN, which will be accomplished as a tax-free merger of KMF into a wholly owned subsidiary of KYN (the “Merger”). Please refer to the discussion of each proposal in this joint proxy statement/prospectus for information regarding votes required for the approval of each proposal, as well as information regarding the change in fees and expenses borne by KMF stockholders as a result of the Merger as described under “Questions and Answers— What are some of the factors that the Boards considered in determining that the Merger is in the best interests of the Companies?”.

	Proposals	Who votes on the proposals?

	KMF

1.	To approve the Merger (including any adjournment of the Meeting).	The holders of common stock and preferred stock, voting together as a single class.

	KYN

2.	To approve the issuance of additional KYN common stock in connection with the Merger (including any adjournment of the Meeting).	The holders of common stock and preferred stock, voting together as a single class.

The Agreement and Plan of Merger between KYN and KMF is sometimes referred to herein as the “Merger Agreement.” KMF and KYN are sometimes referred to herein as a “Company” and collectively as the “Companies.” KYN following the Merger is sometimes referred to herein as the “Combined Company.”

Additional Information

This joint proxy statement/prospectus sets forth the information stockholders should know before voting on the proposals. The Merger constitutes an offering of common stock of KYN, and this joint proxy statement/prospectus serves as a prospectus of KYN in connection with the issuance of its common stock in the Merger. Please read it carefully and retain it for future reference. A Statement of Additional Information, dated , 2023, relating to this joint proxy statement/prospectus (the “Statement of Additional Information”) has been filed with the Securities and Exchange Commission (the “SEC”) and is incorporated herein by reference.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SPECIAL MEETINGS OF STOCKHOLDERS TO BE HELD ON JUNE 20, 2023:

You should have received a copy of the Annual Reports for the fiscal year ended November 30, 2022 for KYN and/or KMF. If you would like another copy of either Annual Report or the Statement of Additional Information, please write us at Kayne Anderson’s address or call us at (713) 493-2020. The Annual Report(s) and Statement of Additional Information will be sent to you without charge. This joint proxy statement/prospectus, the Annual Report and the Statement of Additional Information can be accessed on our website at www.kaynefunds.com or on the website of the SEC at www.sec.gov.

The Companies are subject to certain informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith file reports, proxy statements, proxy materials and other information with the SEC. Materials filed with the SEC can be reviewed and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549 or downloaded from the SEC’s web site at www.sec.gov. Information on the operation of the SEC’s Public Reference Room may be obtained by calling the SEC at (202) 551-8090. You may also request copies of these materials, upon payment at the prescribed rates of a duplicating fee, by electronic request to the SEC’s e-mail address (publicinfo@sec.gov) or by writing the Public Reference Branch, Office of Consumer Affairs and Information Services, SEC, Washington, DC, 20549-0102.

The currently outstanding shares of common stock of KYN are listed on the New York Stock Exchange (the “NYSE”) under the ticker symbol “KYN” and will continue to be so listed after completion of the Merger. The common stock of KYN to be issued in connection with the Merger will be listed on the NYSE. The currently outstanding shares of common stock of KMF are also listed on the NYSE under the ticker symbol “KMF.” Reports, proxy statements and other information concerning KYN and KMF may be inspected at the offices of the NYSE, 20 Broad Street, New York, NY 10005.

No person has been authorized to give any information or make any representation not contained in this joint proxy statement/prospectus and, if so given or made, such information or representation must not be relied upon as having been authorized. This joint proxy statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction in which, or to any person to whom, it is unlawful to make such offer or solicitation.

THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS JOINT PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this joint proxy statement/prospectus is , 2023.

TABLE OF CONTENTS

QUESTIONS AND ANSWERS	1
GLOSSARY	7
SUMMARY	8
RISK FACTORS	15
PROPOSAL ONE: MERGER	36
Reasons for the Merger and Board Considerations	36
Investment Objectives and Policies of KYN	40
Comparison of the Companies	45
Management	46
Capitalization	51
Automatic Dividend Reinvestment Plan	52
Governing Law	53
Description of Securities	53
Market and Net Asset Value Information	64
Financial Highlights	68
Information about the Merger	76
Terms of the Agreement and Plan of Merger	77
Material U.S. Federal Income Tax Consequences of the Merger	78
Certain Federal Income Tax Matters	81
Required Vote	84
Board Recommendation	84
PROPOSAL TWO: ISSUANCE OF ADDITIONAL KYN COMMON STOCK IN CONNECTION WITH THE MERGER	85
MORE INFORMATION ABOUT THE MEETING	86
Outstanding Stock	86
How Proxies Will Be Voted	86
How to Vote	86
Dissenters’ or Appraisal Rights	87
Revoking a Proxy	87
Broker Non-Votes	87
Quorum and Adjournment	87
Investment Adviser	87
Administrator	87
Householding of Proxy Materials	87
Stockholder Proposals	88
APPENDIX A FORM OF AGREEMENT AND PLAN OF MERGER	A-1

QUESTIONS AND ANSWERS

Although it is recommended that you read the complete joint proxy statement/prospectus of which this “Questions and Answers” section is a part, a brief overview of the issues to be voted on has been provided below for your convenience.

The anticipated positive impacts of the Merger are set forth below. No assurance can be given that the anticipated positive impacts of the Merger will be achieved. For information regarding the risks associated with an investment in KYN, see “Risk Factors.”

Questions Regarding the Merger

Q: Why is the Merger being recommended by the Boards of Directors?

A: The Board of Directors of each Company has approved the Merger because they have determined that it is in the best interests of each Company and that the interests of the existing stockholders of each Company will not be diluted as a result of the Merger. In making this determination, the Board of Directors of each Company considered (i) the expected benefits of the transaction for each Company (as outlined in more detail below) and (ii) the fact that both Companies have very similar investment policies, investment strategies and portfolio holdings. The Combined Company will pursue KYN’s investment objective which is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders. The Combined Company intends to achieve this objective by investing at least 80% of total assets in the securities of Energy Infrastructure Companies. Please refer to the Glossary for the meaning of capitalized terms not otherwise defined herein.

Q: What are some of the factors that the Boards considered in determining that the Merger is in the best interests of the Companies?

A: After careful consideration, the Board of Directors of each Company believes that the Merger will benefit the stockholders of the Companies for the reasons noted below:

●

Merger expected to increase KMF’s distribution level

Currently, KYN pays a quarterly cash distribution at an annualized rate of $0.84 per share. Based on this distribution level, the Merger is expected to result in an increase to the distribution received by KMF’s common stockholders of approximately $0.10 on an annualized basis, or approximately 16% greater than its current annualized distribution rate. Upon closing of the Merger, KYN’s management plans to recommend a $0.01 per share increase in KYN’s quarterly distribution (to a quarterly rate of $0.22 per share), which if approved by KYN’s Board of Directors, would increase KYN’s distribution to an annualized rate of $0.88 per share. This would result in an approximate 22% increase in the current annualized distribution received by KMF’s common stockholders.

These estimates are based on the relative net asset value (“NAV”) per share of the Companies as of February 28, 2023, which would have resulted in an exchange ratio of approximately 0.886 shares of KYN for each share of KMF. The exchange ratio will be determined based on the relative NAV per share of each Company on the business day prior to closing of the Merger. Historically, a portion of the distributions paid to common stockholders of KYN and KMF has been classified as a return of capital. The final tax characterization of distributions paid in future periods will depend on the earnings and profits of the Combined Company in any given year. A “return of capital” represents a return of a stockholder’s original investment and should not be confused with a dividend from earnings and profits. See “Risk Factors—Risks Related to Our Business and Structure—Tax Risks”.

●

KMF’s stockholders should benefit from enhanced market liquidity and may benefit from improved trading relative to NAV per share

KMF stockholders will be part of a much larger company with significantly higher trading volume. KMF’s Board of Directors also considered the fact that KYN has historically traded at a smaller discount to NAV compared to KMF’s historical discount to NAV. For example, for the three years ended February 28, 2023, KYN has traded at an average discount to NAV of 14.3%, and KMF has traded at an average discount to NAV of 19.8%. Further, in the period from KMF’s initial public offering (November 2010) through February 28, 2023, KYN’s average discount to NAV was 4.3% and KMF’s average discount to NAV was 12.2%.

	KYN		KMF		Pro Forma Combined Company⁽¹⁾
Equity capitalization ($ in millions)	$	1,213	$	349	$	1,532
Average daily trading volume⁽²⁾		454		127		NA

As of February 28, 2023.

(1)	Pro forma for the Merger and including the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed).
(2)	90-day average trading volume in thousands of shares.

●

KMF’s stockholders may benefit from a tender offer of common stock to be completed upon the approval and before the closing of the Merger

Upon obtaining the necessary stockholder approvals to complete the Merger, KMF will conduct a tender offer (prior to the closing of the Merger) for up to 15% of the outstanding common stock of KMF at a price of 95% of the NAV per share on the expiration date of the tender offer. KMF common stockholders that wish to participate in the tender offer may benefit by monetizing their shares of common stock at a substantially narrower discount to NAV compared to KMF’s average stock price discount to NAV over the prior three years. For illustrative purposes, using KMF’s NAV and stock price as of February 28, 2023, the tender offer would represent a 14% premium to KMF’s market price on such date. For further information regarding the tender offer, see “How do I participate in the KMF tender offer?”

●

The Combined Company will have more flexibility than KMF regarding its portfolio of Energy Infrastructure Companies

KMF currently qualifies as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). As long as KMF meets certain portfolio diversification and other requirements that govern its sources of income and timely distribution of earnings to stockholders, KMF will not be subject to federal income tax. For KMF to qualify as a RIC, at the end of each quarter, KMF must have (i) at least 50% of the value of its total assets comprised of investments that are not greater in value than 5% of total assets and (ii) no more than 25% of the value of its total assets invested in the securities of one or more qualified publicly traded partnership (“PTPs”). Currently, these requirements are limiting the types of investments that KMF could make – in particular, the fund’s MLP holdings (which are considered PTPs for the purpose of KMF’s RIC diversification requirement), cannot exceed 25% of its total assets. In contrast, KYN (as a taxable corporation) does not have these same portfolio constraints. See “Proposal One: Merger – Investment Objectives and Policies of KYN”. Upon completion of the Merger, the Combined Company will operate as a taxable corporation and pursue KYN’s investment objective. We believe the benefits of additional portfolio flexibility, which enables KYN to invest across a full spectrum of Energy Infrastructure Companies, outweigh the benefits of qualifying as a RIC. See “Proposal One: Merger—Comparison of the Companies”.

●

Potential for reduced management fee in the future as assets appreciate, due to revised KYN management fee waiver

As of February 28, 2023, KYN was subject to a management fee of 1.375% on its $1.9 billion of management fee total assets and KMF was subject to a management fee of 1.25% on its $0.5 billion of management fee total assets. Pro forma for the combination and the proposed tender offer, the Combined Company would have pro forma management fee total assets of $2.4 billion, based on the Companies’ assets as of February 28, 2023. Upon completion of the Merger, KAFA has agreed to revise its management fee waiver agreement with KYN to reduce the asset tiers for fee waivers. The initial asset tier for fee waiver will be reset to the pro forma Combined Company management fee total assets as of the closing of the Merger. The revised fee waiver will lower the effective management fee that KYN pays as its assets appreciate. The table below outlines the current and revised management fee waivers assuming the Merger was completed on February 28, 2023:

KYN Asset Tiers for Fee Waiver		Management Fee			Applicable
Current	Revised	Waiver			Management Fee⁽¹⁾
$0 to $4.0 billion	$0 to $2.4 billion⁽²⁾		0.000	%		1.375	%
$4.0 billion to $6.0 billion	$2.4 billion⁽²⁾ to $4.0 billion		0.125	%		1.250	%
$6.0 billion to $8.0 billion	$4.0 billion to $6.0 billion		0.250	%		1.125	%
Greater than $8.0 billion	Greater than $6.0 billion		0.375	%		1.000	%

	(1)	Represents the management fee, after giving effect to the fee waiver, applicable to the incremental total assets at each tier.
	(2)	Initial asset tier for fee waiver of $2.4 billion based on the approximate management fee total asset values at each Company as of February 28, 2023. The actual amount of the first asset tier will be reset to the pro forma Combined Company management fee total asset value as of closing.

In addition to reducing the asset tiers for fee waivers, KAFA has also agreed to waive an amount of management fees (based on KYN and KMF assets at closing of the Merger) such that the pro forma, run-rate fees payable to KAFA are equal to the aggregate, run-rate management fees payable if KYN and KMF had remained standalone companies. The waiver will last for three years and is estimated to be approximately $0.7 million per year based on KYN and KMF assets as of February 28, 2023. The revised asset tiers for fee waivers and the new fee waiver would be effective as of the closing of the Merger and would not be subject to recoupment, either with respect to KYN, KMF or the Combined Company. Based on KMF’s current management fee, the Combined Company’s management fee as a percentage of net assets is expected to be higher than KMF’s standalone fee.

●

KMF’s stockholders should benefit from the larger asset base of the Combined Company

The larger asset base of the Combined Company relative to KMF may provide greater financial flexibility. In particular, as a larger entity, KMF’s stockholders should benefit from the Combined Company’s access to attractive leverage terms and a wider range of alternatives for raising capital to grow the Combined Company.

●

Elimination of duplicative expenses and greater economies of scale

The Merger is expected to result in an increase in expenses as a percentage of net assets for KMF stockholders, though it is expected that the Combined Company will have a lower expense level than KYN, driven by estimated cost savings, a portion of which is expected to be attributable to reduced operating costs. Each Company incurs operating expenses that are fixed (e.g., board fees, printing fees, legal, tax returns and auditing services) and operating expenses that are variable (e.g., administrative and custodial services that are based on assets under management). Many of these fixed expenses are duplicative between the Companies and can be reduced/eliminated as a result of the Merger. There will also be an opportunity to reduce variable expenses by taking advantage of greater economies of scale. Because the Merger is expected to be completed during the second half of fiscal 2023, and because there are expenses associated with the Merger, the full impact of the elimination of duplicative expenses will not be entirely recognized this year. We expect the Combined Company to realize the full benefit of these reductions during fiscal 2024.

The increase in expenses as a percentage of net assets for KMF’s stockholders is also a result of (i) the net deferred tax liability (as a percentage of total assets) at KYN and the Combined Company as compared to standalone KMF, which causes net assets for the Combined Company to be smaller as a percentage of total assets as compared to standalone KMF and (ii) the entity level income taxes that are expected to be borne by KYN and the Combined Company. KYN is a taxable corporation with entity level income taxes whereas KMF is a regulated investment company (or RIC) that does not have entity level income taxes.

Q: What impact will the Merger have on leverage levels?

A: The amount of leverage as a percentage of total assets following the Merger is not expected to significantly change from that of each Company’s standalone leverage levels. The table below illustrates the leverage of each Company on both a standalone and pro forma basis.

($ in millions)	KYN			KMF			Pro Forma Combined KYN⁽¹⁾
Total Debt	$	310		$	85		$	395
Mandatory Redeemable Preferred Stock	$	112		$	42		$	154
Leverage	$	422		$	127		$	549
Leverage as % of total assets		22	%		23	%		23	%

As of February 28, 2023

(1)

Pro forma for the Merger and including the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed).

Q. How has KYN performed relative to KMF?

A: The performance table below illustrates the past performance of an investment in each Company. These total returns are based on net asset values, which reflect the total expenses incurred at each Company for the periods presented and, for KYN, this includes the impact of income taxes. Although total operating expenses including the management fee and income taxes may be higher for the Combined Company, KYN’s performance, inclusive of such expenses, has exceeded that of KMF for the prior 1-, 5-, and 10-year periods, as well as since November 30, 2010 (shortly after KMF’s commencement of operations).

	Total Returns Based on Net Asset Value⁽¹⁾
	1-Year			3-Year			5-Year			10-Year			Since 11/30/10⁽²⁾
KYN/Acquirer		30.5	%		2.6	%		10.0	%		(1.7	)%		21.1	%
KMF/Target		20.9	%		8.7	%		3.7	%		(19.6	)%		10.1	%

(1)

Total returns are based on net asset values, rather than stock prices, and are shown as of November 30, 2022. These returns reflect each Company’s total expense ratio, which includes net operating expenses, interest expense and current and deferred tax expense (or benefit), as applicable, as well as the reinvestment of distributions pursuant to each Companies' dividend reinvestment plan.

(2)

KYN commenced operations in September 2004 while KMF commenced operations in November 2010. Returns for the period since November 30, 2010 represent the applicable total return of the Companies since the first month-end following KMF's commencement of operations.

Past performance is no guarantee of future returns, and current performance may be lower or higher than the figures shown. The investment return and principal value of an investment will fluctuate with changes market conditions and other factors so that an investor’s shares, when sold, may be worth more or less than their original cost.

Q: Will the Merger cause a change in value of KYN’s deferred tax liability?

A: The Merger should not result in any incremental net deferred income tax liability for KYN. KMF, as a RIC, is not generally subject to federal income tax and as such does not have a deferred tax liability associated with unrealized gains on investments (nor any deferred tax asset associated with capital loss carryforwards). As of November 30, 2022, KMF had $402 million of capital loss carryforwards and an unrealized gain on investment for tax purposes of $100 million. As a RIC, KMF capital loss carryforwards would be eligible to be carried forward indefinitely and generally would not be limited. Following the Merger, all pre-Merger KMF capital losses would be subject to a five year carryforward period as applicable to taxable corporations. KYN, as a corporation, is obligated to pay federal and state income tax on its taxable income and accrues deferred income tax in accordance with the Income Tax Topic of the FASB Accounting Standards Codification (ASC 740). In the Merger, KYN as the tax acquiror will succeed to any capital loss carryforward that KMF has as of the time of the Merger. Any such capital loss carryforward acquired will be subject to certain limitations under the Code. It is KYN’s expectation that KMF capital losses available post-Merger will equal, if not exceed, the amount of the KMF net unrealized gain (if any) as of the Merger date such that KYN should not be required to increase its net deferred tax liability in connection with the Merger. Any KMF capital losses in excess of the limitations imposed by the Code will expire unused. See “Material U.S. Federal Income Tax Consequences of the Merger”.

Q: How will the Merger affect me?

A: KYN stockholders will remain stockholders of KYN. KMF stockholders will become stockholders of KYN. KMF will then cease its separate existence under Maryland law.

Q: How are distributions to KYN stockholders treated for tax purposes and how does that compare to distributions to KMF stockholders?

A: As a corporation, the tax character of KYN distributions paid is generally either taxable dividends (eligible to be treated as “qualified dividend income”) or return of capital. See “Certain Federal Income Tax Matters—U.S. Federal Income Taxation of Holders of Our Common Stock”. As a RIC, the tax character of KMF distributions paid may be ordinary income, qualified dividend income, capital gains or return of capital. The tax character of each Company’s common distributions for fiscal 2022 and since their inception is included below.

	Fiscal Year 2022						Since Inception⁽¹⁾
Tax Character of Distributions	KYN			KMF			KYN			KMF
Return of Capital⁽²⁾		0	%		79	%		43	%		23	%
Qualified Dividend Income		100	%		21	%		57	%		25	%
Ordinary Income		N/A	⁽³⁾		-			N/A	⁽³⁾		32	%
Long-Term Capital Gains		N/A			-			N/A			20	%

(1)	Based on the cumulative tax character of distributions for each Company since its inception and through the fiscal year ended November 30, 2022.
(2)	For both KYN and KMF, if the distributions paid exceed the Company’s current or accumulated earnings and profits, the distribution will be treated as a return of capital to the extent of the stockholder’s basis. Any distribution received in excess of a stockholder’s basis would be taxable as capital gain.

(3)

If stockholders meet the requisite holding period requirement (and certain other requirements), KYN's taxable dividends should be eligible to be treated as tax-advantaged qualified dividend income.

We cannot assure you what percentage of the distributions paid on the pro forma Combined Company’s common stock, if any, will be treated as tax-advantaged qualified dividend income or tax-deferred return of capital in the future. Historically, more of KYN’s distributions to its stockholder has been classified as tax-advantaged qualified dividend income and tax-deferred return of capital as compared to distributions paid to KMF stockholders. As a stockholder of KYN, provided that you meet the requisite holding period requirement (and certain other requirements), taxable dividends should be eligible to be treated as tax-advantaged qualified dividend income and not ordinary income. Qualified dividend income is taxed at lower capital gain rates. The final tax characterization of distributions paid in future periods will depend on the earnings and profits of the Combined Company in any given year. Historically, a portion of the cash distributions received from KYN's and KMF's portfolio investments was characterized as a return of capital which contributed to the amount of return of capital that KYN and KMF have paid to their respective stockholders. A reduction in the return of capital portion of the distributions received from KYN and KMF portfolio investments (or an increase in each Company's earnings and profits) may reduce the portion of the distribution paid by KYN and KMF that is treated as a tax-deferred return of capital. A “return of capital” represents a return of a stockholder’s original investment and should not be confused with a dividend from earnings and profits. See “Risk Factors—Risks Related to Our Business and Structure—Tax Risks”.

Q: What will happen to the shares of KYN and KMF that I currently own as a result of the Merger?

A: For KYN stockholders, your currently issued and outstanding shares of common and preferred stock of KYN will remain unchanged.

KMF common stockholders will be issued shares of KYN common stock in exchange for their outstanding shares of KMF common stock (see below for a description of how the exchange ratio is calculated). No fractional shares of KYN common stock will be issued in the Merger; instead KMF stockholders will receive cash in an amount equal to the value of the fractional shares of KYN common stock that they would otherwise have received.

KMF preferred stockholders will receive, on a one-for-one basis, newly issued KYN preferred shares having substantially identical terms as the KMF preferred shares you held immediately prior to the closing of the Merger.

Q: How is the exchange ratio determined?

A: The exchange ratio will be determined based on the relative NAVs per share of each Company on the business day prior to the closing of the Merger. As of February 28, 2023, KYN’s NAV per share was $10.06 and KMF’s was $8.91. For illustrative purposes, if these were the NAVs on the day prior to closing of the Merger, then KMF common stockholders would be issued approximately 0.886 shares of KYN for each share of KMF.

Q: How will the net asset values utilized in calculating the exchange rate be determined?

A: The net asset value of a share of common stock of each Company will be calculated in a manner consistent with past practice and will include the impact of each Company’s share of the costs of the Merger. See “Proposal One: Merger—Information About the Merger.”

Q: Is the Merger expected to be a taxable event for stockholders?

A: No. The Merger is intended to qualify as a tax-free merger for federal income tax purposes. This means it is expected that stockholders will recognize no gain or loss for federal income tax purposes as a result of the Merger, except that gain or loss generally will be recognized by KMF stockholders with respect to cash received in lieu of fractional shares of KYN common stock.

Q: Will I have to pay any sales load, commission or other similar fees in connection with the Merger?

A: No, you will not pay any sales loads or commissions in connection with the Merger. The Companies will bear the costs associated with the proposed Merger. Costs will be allocated 50% to KYN and 50% to KMF. Costs related to the Merger are currently estimated to be approximately $1.5 million or 0.1% of pro forma Combined Company net assets, which equates to $0.75 million or $0.01 per share for KYN and $0.75 million or $0.02 per share for KMF as of February 28, 2023.

Q: Who do we expect to vote on the Merger?

A: KMF’s common and preferred stockholders are being asked to vote, together as a single class, on the Merger. KYN’s common and preferred stockholders are being asked to vote, together as a single class, to approve the issuance of KYN shares required to complete the Merger.

Q: What happens if KMF stockholders do not approve the Merger or KYN stockholders do not approve the issuance of additional shares of KYN common stock in connection therewith?

A: The Merger must be approved by KMF’s common and preferred stockholders, voting together as a single class. In addition, the issuance of additional shares of KYN common stock in connection with the Merger must be approved by KYN’s common and preferred stockholders, voting together as a single class. If KMF stockholders do not approve the Merger, or if KYN stockholders do not approve the issuance of additional KYN common stock in connection therewith, then the Merger will not take place and KYN and KMF will continue to operate as separate entities. Further, if the Merger is not approved, KMF will not conduct a tender offer and KYN’s current asset tiers for fee waivers will remain in effect.

Q: What is the timetable for the Merger?

A: The Merger is expected to take effect prior to the end of fiscal 2023, following the receipt of stockholder approvals, completion of KMF’s tender offer and once other customary conditions to closing are satisfied.

Q: How do I participate in the KMF tender offer?

A: Upon obtaining all stockholder approvals necessary to complete the Merger, KMF will conduct a tender offer prior to closing the Merger. The tender offer will be made for up to 15% of the outstanding common stock of KMF at a price of 95% of the net asset value per share on the expiration date of the tender offer.

The tender offer will be conducted in accordance with the requirements of rules adopted under the Securities Exchange Act of 1934, as amended, and KMF will file a Schedule TO containing more detailed information about the tender offer. No action needs to be taken by KMF stockholders at this time in order to participate in the tender offer when it occurs. KMF stockholders should read the Schedule TO and other disclosures once they become available. The discussion of the proposed tender offer is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of KMF stock.

General Questions

Q: How do the Boards of Directors suggest that I vote?

A: After careful consideration, the Boards of Directors recommend that you vote “FOR” all proposals on the enclosed proxy card for which you are entitled to vote.

Q: How do I vote my shares?

A: Voting is quick and easy. You may vote your shares via the internet or by telephone by following the instructions on the proxy card, or by simply completing and signing the enclosed proxy card, and mailing it in the postage-paid envelope included in this package. You may also vote in person if you are able to attend the Meeting. However, even if you plan to attend the Meeting, we urge you to cast your vote early. That will ensure your vote is counted should your plans change.

Q: Whom do I contact for further information?

A: You may contact your financial advisor for further information. You may also call AST Fund Solutions, the Companies’ proxy solicitor, at [●]. Representatives are available to assist you Monday through Friday 9 a.m. to 10 p.m. Eastern time.

Q: Will anyone contact me?

A: You may receive a call from AST Fund Solutions, the Companies’ proxy solicitor, to verify that you received your proxy materials, to answer any questions you may have about the proposals and to encourage you to authorize your proxy. We recognize the inconvenience of the proxy solicitation process and would not impose it on you if we did not believe that the matters being proposed were important. Once your vote has been registered with the proxy solicitor, your name will be removed from the solicitor’s follow-up contact list.

Your vote is very important. We encourage you as a stockholder to participate in the Companies’ governance by authorizing a proxy to vote your shares as soon as possible. If enough stockholders fail to cast their votes, the Companies may not be able to hold the Meeting or to call for a vote on each issue, and will be required to incur additional solicitation costs in order to obtain sufficient stockholder participation.

GLOSSARY

This glossary contains definitions of certain key terms, as they are used in KYN investment policies and as described in this joint proxy statement/prospectus. These definitions may not correspond to standard sector definitions.

“Energy Assets” means Energy Infrastructure Assets and other assets that are used in the energy sector, including assets used in exploring, developing, producing, generating, transporting, transmitting, storing, gathering, processing, fractionating, refining, distributing, mining or marketing of natural gas, natural gas liquids, crude oil, refined products, coal, electricity or water.

“Energy Companies” means companies that own and/or operate Energy Assets or provide energy- related services. For purposes of this definition, this includes companies that (i) derive at least 50% of their revenues or operating income from operating Energy Assets or providing services for the operation of such assets or (ii) have Energy Assets that represent the majority of their assets.

“Energy Infrastructure Assets” means (a) Midstream Assets, (b) Renewable Infrastructure Assets and (c) Utility Assets.

“Energy Infrastructure Companies” consists of (a) Midstream Energy Companies, (b) Renewable Infrastructure Companies and (c) Utility Companies.

“Master Limited Partnerships” or “MLPs” means limited partnerships and limited liability companies that are publicly traded and are treated as partnerships for federal income tax purposes.

“Midstream Assets” means assets used in energy logistics, including, but not limited to, assets used in (a) transporting, storing, gathering, processing, fractionating, distributing, or marketing of natural gas, natural gas liquids, crude oil, refined products or water produced in conjunction with such activities or (b) the capture, transportation or sequestration of carbon dioxide.

“Midstream Energy Companies” means companies that primarily own and operate Midstream Assets. Such companies may be structured as Master Limited Partnerships or taxed as corporations. For purposes of this definition, this includes companies that (i) derive at least 50% of their revenue or operating income from operating Midstream Assets or providing services for the operation of such assets or (ii) have Midstream Assets that represent the majority of their assets.

“Renewable Infrastructure Assets” means assets used in the generation, production, distribution, transportation, transmission, storage and marketing of energy including, but not limited to, electricity, steam, natural gas or transportation fuels, from renewable sources such as solar, wind, flowing water (hydroelectric power), geothermal, biomass and organic waste.

“Renewable Infrastructure Companies” means companies that own and/or operate Renewable Infrastructure Assets. For purposes of this definition, this includes companies that (i) derive at least 50% of their revenues or operating income from operating Renewable Infrastructure Assets or providing services for the operation of such assets or (ii) have Renewable Infrastructure Assets that represent the majority of their assets.

“Utility Assets” means assets, other than Renewable Infrastructure Assets, that are used in the generation, production, distribution, transportation, transmission, storage and marketing of energy, including, but not limited to, electricity, natural gas and steam.

“Utility Companies” means companies that own and/or operate Utility Assets. For purposes of this definition, this includes companies that (i) derive at least 50% of their revenues or operating income from operating Utility Assets or providing services for the operation of such assets or (ii) have Utility Assets that represent the majority of their assets.

SUMMARY

The following is a summary of certain information contained elsewhere in this joint proxy statement/prospectus and is qualified in its entirety by reference to the more complete information contained in this joint proxy statement/prospectus and in the Statement of Additional Information. Stockholders should read this entire joint proxy statement/prospectus carefully.

Proposal One: Merger

The Board of Directors of KMF, including the Directors who are not “interested persons” of KMF (as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended (the “1940 Act”)) (the “Independent Directors”), has unanimously approved the Merger Agreement, declared the Merger advisable and directed that the Merger proposal be submitted to the KMF stockholders for consideration. Upon the closing of the Merger, KMF will be merged with and into a wholly owned subsidiary (“Merger Sub”) of KYN, with KMF’s shares of common stock converted into shares of KYN common stock (although cash will be distributed in lieu of fractional shares). KMF will then cease its separate existence under Maryland law and terminate its registration under the 1940 Act. Immediately following the Merger, it is expected that Merger Sub will be merged with and into KYN. The aggregate NAV of KYN common stock received by KMF common stockholders in the Merger will equal the aggregate NAV of KMF shares held on the business day prior to closing of the Merger (excluding cash distributed by KYN for fractional shares). KYN will be the accounting survivor following the closing of the Merger and will continue to operate after the Merger as a registered, non-diversified, closed-end management investment company with the investment objectives and policies described in this joint proxy statement/prospectus.

In connection with the Merger, each holder of KMF MRP Shares will receive in a private placement an equivalent number of newly issued KYN MRP Shares, each having substantially identical terms as the respective KMF MRP Shares. The aggregate liquidation preference of the KYN MRP Shares received by the holders of KMF MRP Shares in the Merger will equal the aggregate liquidation preference of the KMF MRP Shares held immediately prior to the closing of the Merger. The KYN MRP Shares to be issued in the Merger will have equal priority with KYN’s existing outstanding preferred shares as to the payment of dividends and the distribution of assets in the event of a liquidation of KYN. In addition, the preferred shares of KYN, including the KYN MRP Shares to be issued in connection with the Merger, will be senior in priority to KYN common shares as to payment of dividends and the distribution of assets in the event of a liquidation of KYN.

If the Merger is not approved by stockholders of KMF, or if the issuance of additional KYN common stock in connection with the Merger is not approved by the stockholders of KYN, KYN and KMF will each continue to operate as a standalone Maryland corporation advised by KAFA and will each continue its investment activities in the normal course. Further, if the Merger is not approved, KMF will not conduct a tender offer and KYN’s current asset tiers for fee waivers will remain in effect.

Reasons for the Merger and Board Considerations

The Board of Directors of each Company has approved the Merger because they have determined that it is in the best interests of each Company and that the interests of the existing stockholders of each Company will not be diluted as a result of the Merger. In making this determination, the Board of Directors of each Company considered (i) the expected benefits of the transaction for each Company (as outlined in more detail below) and (ii) the fact that both Companies have very similar investment policies, investment strategies and portfolio holdings. The Combined Company will pursue KYN’s investment objective which is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders. The Combined Company intends to achieve this objective by investing at least 80% of total assets in the securities of Energy Infrastructure Companies. Please refer to the Glossary for the meaning of capitalized terms not otherwise defined herein.

After careful consideration, the Board of Directors of each Company believes that the Merger will benefit the stockholders of the Companies for the reasons noted below:

●

Merger expected to increase KMF’s distribution level

●

KMF’s stockholders should benefit from enhanced market liquidity and may benefit from improved trading relative to NAV per share

The larger market capitalization of the Combined Company relative to KMF should provide an opportunity for enhanced market liquidity over the long-term. Greater market liquidity may lead to a narrowing of bid-ask spreads and reduce price movements on a trade-to-trade basis. The table below illustrates the equity market capitalization and average daily trading volume for each Company on a standalone basis as well as for the Combined Company. KMF stockholders will be part of a much larger company with significantly higher trading volume. KMF’s Board of Directors also considered the fact that KYN has historically traded at a smaller discount to NAV compared to KMF’s historical discount to NAV. For example, for the three years ended February 28, 2023, KYN has traded at an average discount to NAV of 14.3%, and KMF has traded at an average discount to NAV of 19.8%. Further, in the period from KMF’s initial public offering (November 2010) through February 28, 2023, KYN’s average discount to NAV was 4.3% and KMF’s average discount to NAV was 12.2%.

	KYN		KMF		Pro Forma Combined Company⁽¹⁾
Equity capitalization ($ in millions)	$	1,213	$	349	$	1,532
Average daily trading volume⁽²⁾		454		127		NA

As of February 28, 2023.

(1)	Pro forma for the Merger and including the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed).
(2)	90-day average trading volume in thousands of shares.

●

KMF’s stockholders may benefit from a tender offer of common stock to be completed upon the approval and before the closing of the Merger

The tender offer will be conducted in accordance with the requirements of rules adopted under the Securities Exchange Act of 1934, as amended, and KMF will file a Schedule TO containing more detailed information about the tender offer. No action needs be taken by KMF stockholders at this time in order to participate in the tender offer when it occurs. KMF stockholders should read the Schedule TO and other disclosures once they become available. The discussion of the proposed tender offer is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of KMF stock.

●

The Combined Company will have more flexibility than KMF regarding its portfolio of Energy Infrastructure Companies

KMF currently qualifies as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). As long as KMF meets certain portfolio diversification and other requirements that govern its sources of income and timely distribution of earnings to stockholders, KMF will not be subject to federal income tax. For KMF to qualify as a RIC, at the end of each quarter, KMF must have (i) at least 50% of the value of its total assets comprised of investments that are not greater in value than 5% of total assets and (ii) no more than 25% of the value of its total assets invested in the securities of one or more qualified publicly traded partnership (“PTPs”). Currently, these requirements are limiting the types of investments that KMF could make – in particular, the fund’s MLP holdings (which are considered PTPs for the purpose of KMF’s RIC diversification requirement), cannot exceed 25% of its total assets. In contrast, KYN (as a taxable corporation) does not have these same portfolio constraints See “Proposal One: Merger – Investment Objectives and Policies of KYN”. Upon completion of the Merger, the Combined Company will operate as a taxable corporation and pursue KYN’s investment objective. We believe the benefits of additional portfolio flexibility, which enables KYN to invest across a full spectrum of Energy Infrastructure Companies, outweigh the benefits of qualifying as a RIC. See “Proposal One: Merger—Comparison of the Companies”.

●

Potential for reduced management fee in the future as assets appreciate, due to revised KYN management fee waiver

KYN Asset Tiers for Fee Waiver		Management Fee			Applicable
Current	Revised	Waiver			Management Fee⁽¹⁾
$0 to $4.0 billion	$0 to $2.4 billion⁽²⁾		0.000	%		1.375	%
$4.0 billion to $6.0 billion	$2.4 billion⁽²⁾to $4.0 billion		0.125	%		1.250	%
$6.0 billion to $8.0 billion	$4.0 billion to $6.0 billion		0.250	%		1.125	%
Greater than $8.0 billion	Greater than $6.0 billion		0.375	%		1.000	%

(1)

Represents the management fee, after giving effect to the fee waiver, applicable to the incremental total assets at each tier.

(2)

Initial asset tier for fee waiver of $2.4 billion based on the approximate management fee total asset values at each Company as of February 28, 2023. The actual amount of the first asset tier will be reset to the pro forma Combined Company management fee total asset value as of closing.

● KMF’s stockholders should benefit from the larger asset base of the Combined Company

●

Elimination of duplicative expenses and greater economies of scale

Fees and Expenses for Common Stockholders of the Companies as of November 30, 2022

The following table and example contain information about the change in operating expenses expected as a result of the Merger. The tables set forth (i) the fees and expenses, including leverage costs, as a percentage of net assets as of November 30, 2022, for each Company, (ii) pro forma fees and expenses, including leverage costs, for KMF assuming that the tender offer had been completed as contemplated and (iii) the pro forma fees and expenses, including leverage costs, for the Combined Company, assuming the Merger had taken place on November 30, 2022 and the tender offer was completed as contemplated prior to the merger. The fees and expenses are presented as a percentage of net assets and not as a percentage of gross assets or managed assets. The annual operating expenses for each Company reflect fixed expenses for the fiscal year ended November 30, 2022, and variable expenses assuming each Company’s capital structure and asset levels as of November 30, 2022. The pro forma presentation includes the change in operating expenses expected as a result of the Merger, assuming the Combined Company’s capital structure and asset levels as of November 30, 2022.

Stockholder Transaction Expenses	KYN/Acquirer			KMF/Target			Pro Forma KMF/Target⁽¹⁾			Pro Forma Combined Company⁽²⁾
Maximum Sales Load (as a percentage of the offering price) imposed on purchases of common stock⁽³⁾		None			None			None			None
Dividend Reinvestment Plan Fees		None			None			None			None
Annual Expenses (as a percentage of net assets attributable to common stock as of November 30, 2022)
Management Fees⁽⁴⁾		1.88	%		1.58	%		1.63	%		1.83	%
Interest Payments (including issuance costs) on Borrowed Funds⁽⁵⁾		1.05	%		0.89	%		1.04	%		1.02	%
Dividend Payments (including issuance costs) on Preferred Stock⁽⁵⁾		0.31	%		0.47	%		0.55	%		0.36	%
Other Operating Expenses (exclusive of current and deferred income tax expense)⁽⁶⁾		0.19	%		0.30	%		0.34	%		0.20	%
Annual Expenses (exclusive of current and deferred income tax expense)		3.43	%		3.24	%		3.56	%		3.41	%
Income Tax Expense⁽⁷⁾		5.65	%		—			—			4.43	%
Total Annual Expenses⁽⁸⁾		9.08	%		3.24	%		3.56	%		7.84	%

(1)

KMF pro forma net assets and expense ratios assume that the proposed 15% tender offer has been completed as contemplated (assuming the tender offer is fully subscribed).

(2)

The pro forma annual operating expenses are projections for a 12-month period and do not include expenses to be borne by each Company in connection with the Merger. In accordance with the Merger Agreement, KYN and KMF will bear the costs associated with the proposed Merger. KYN and KMF expect to incur approximately $1.5 million in Merger related costs (allocated 50%/50% between the Companies). Pro forma combined net assets and expense ratios also reflect the impact of the proposed 15% tender offer that is contemplated to occur prior to the closing of the Merger (assuming the tender offer is fully subscribed).

(3)

No sales load will be charged in connection with the issuance of KYN’s shares of common stock as part of the Merger. Shares of common stock are not available for purchase from KYN but shares of KYN may be purchased on the NYSE through a broker-dealer subject to individually negotiated commission rates.

(4)

Upon completion of the Merger, KAFA has agreed to revise its management fee waiver agreement with KYN. The revised fee waiver provides for a management fee of 1.375% on average total assets of the Combined Company as of the closing of the Merger, a fee of 1.250% on average total assets above this amount and up to $4 billion, a fee of 1.125% on average total assets between $4 billion and $6 billion, and a fee of 1.000% on average total assets in excess of $6 billion. In addition, KAFA has agreed to waive an amount of management fees (based on KYN and KMF assets at the closing of the Merger) such that the pro forma, run-rate fees payable to KAFA are equal to the aggregate, run-rate management fees payable had KYN and KMF remained standalone companies. The waiver will last for three years and is estimated to be approximately $0.7 million per year as of November 30, 2022.

(5)

Interest and dividend payments (including issuance costs) reflect projections for a 12-month period assuming each Company’s and the Combined Company’s capital structure as of November 30, 2022.

(6)

Other Operating Expenses for each Company reflect actual expenses for the fiscal year ended November 30, 2022. Other Operating Expenses for the pro forma Combined Company are projections for a 12-month period, assuming each Company’s capital structure and asset levels as of November 30, 2022.

(7)

KYN, as a corporation, is obligated to pay federal and state income tax on its taxable income. Income Tax Expense for KYN reflects current and deferred income taxes for the fiscal year ended November 30, 2022. KMF, which qualified and was treated as a regulated investment company (“RIC”) for the fiscal year ended November 30, 2022, was not subject to U.S. federal income tax. The pro forma Combined Company is expected to operate as a corporation and, as such, is expected to incur income tax expense. The projection of Income Tax Expense for the pro forma Combined Company is based on KYN’s actual income tax expense for the fiscal year ended November 30, 2022. Actual Income Tax Expense will reflect current and deferred income taxes based on the Combined Company’s investment performance and may differ materially from the projection.

(8)

The table presents certain annual expenses stated as a percentage of net assets attributable to common shares. This results in a higher percentage than the percentage attributable to annual expenses stated as a percentage of total assets.

Example:

The following example is intended to help you compare the costs of investment in KMF prior to the Merger with the costs of the Combined Company. An investor would pay the following expenses on a $1,000 investment, assuming

(1) the total annual expenses before tax for each Company (as a percentage of net assets attributable to shares of common stock) set forth in the table above, (2) all common stock distributions are reinvested at net asset value, (3) an annual rate of return of 5% on portfolio securities and (4) a 22.0% effective income tax rate for KYN and the pro form Combined Company (expenses in the table below include income tax expense associated with the 5% assumed rate of return on such portfolio securities).

	1 Year		3 Years		5 Years		10 Years
KYN/Acquirer	$	43	$	133	$	228	$	486
KMF/Target	$	32	$	100	$	172	$	370
Pro Forma KMF/Target⁽¹⁾	$	36	$	110	$	189	$	405
Pro Forma Combined KYN⁽²⁾	$	43	$	133	$	227	$	483

(1)

Based on KMF net assets and expense ratios pro forma for the effects of the contemplated 15% tender offer (assuming the tender offer is fully subscribed).

(2)

These figures assume that the Merger had taken place on November 30, 2022 and include the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed).

Deferred Tax Liabilities

As of November 30, 2022, the net deferred tax liability and net deferred tax liability as a percentage of net assets for KYN are as stated below.

	KYN
Net Deferred Tax Liability ($ in millions)	$	124
Net Deferred Tax Liability As a Percentage of Net Assets		8.5	%

As a tax-paying entity, KYN records a deferred tax asset (an amount that can be used to offset future taxable income) or a deferred tax liability (a tax due in the future). As of November 30, 2022, KYN had a net deferred tax liability. These net deferred tax liabilities are primarily attributable to unrealized gains on investments. Any net deferred tax liability is included in KYN’s NAV under GAAP and will be reflected in the exchange rate for the Merger. Additionally, the effective tax rate for the Combined Company will be dependent upon the operating results of its underlying portfolio and as such it is expected that over time it may differ from that of standalone KYN.

Comparison of the Companies

Each of KYN and KMF is a Maryland corporation. Both Companies are registered as non-diversified, closed-end management investment companies under the 1940 Act.

Investment Objectives and Principal Investment Strategies

The Companies have substantially similar investment objectives, with KMF’s investment objective of providing a high level of total return with an emphasis on making cash distributions to stockholders, and KYN’s investment objective of providing high after-tax total return with an emphasis on making cash distributions to stockholders. KYN has a limit on investments in debt securities, including debt securities rated below investment grade, of 20%, while KMF’s limit is 30%.

Investment Advisory Fee Structure

KYN’s investment management agreement (which will govern following the completion of the Merger) provides for a fee of 1.375% of average total assets up to $4 billion; 1.25% on average total assets between $4 billion and $6 billion; 1.125% on average total assets between $6 billion and $8 billion; and 1.0% on average total assets over $8 billion, while KMF’s investment management agreement provides for a fee of 1.25% of average monthly total assets. Upon completion of the Merger, KAFA has agreed to revise its management fee waiver agreement with KYN. The revised fee waiver provides for a management fee of 1.375% on average total assets of the Combined Company as of the Merger closing, a fee of 1.250% on average total assets above this amount and up to $4 billion, a fee of 1.125% on average total assets between $4 billion and $6 billion, and a fee of 1.000% on average total assets in excess of $6 billion. In addition, KAFA has agreed to waive an amount of management fees (based on KYN and KMF assets at the closing of the Merger) such that the pro forma, run-rate fees payable to KAFA are equal to than the aggregate, run-rate management fees payable had KYN and KMF remained standalone companies. The waiver will last for three years and is estimated to be approximately $0.7 million per year as of November 30, 2022. Please see “Proposal: Merger—Comparison of the Companies” for more detail regarding the advisory fee structure of each of KYN and KMF.

Distributions

KYN and KMF each pay quarterly distributions.

The Board of Directors of each Company considers several items in determining the distributions to common stockholders including net distributable income (“NDI”), realized and unrealized gains from its portfolio investments, and expected returns for portfolio investments. NDI is the amount of income received by each Company from its portfolio investments less operating expenses, subject to certain adjustments. Payment of future distributions is subject to Board of Directors approval, as well as meeting the covenants on its debt agreements and terms of its preferred stock.

Principal Investment Risks

Because of the similar investment objectives of KMF and KYN, the Companies are subject to similar principal investment risks associated with an investment in the relevant Company. See “Risk Factors” for detailed descriptions of KYN’s principal risks.

Tax Status

KYN is taxed as a corporation, while KMF qualifies as a regulated investment company (a “RIC”), which is generally not subject to U.S. federal income taxes.

See “Proposal One: Merger—Comparison of the Companies” for a more detailed comparison of the Companies. After the Merger, the investment strategies and significant operating policies will be those of KYN.

Further Information Regarding the Merger

The parties believe that the Merger will be characterized for federal income tax purposes as a tax-free merger under Section 368(a) of the Internal Revenue Code of 1986 (the “Code”). If the Merger so qualifies, in general, stockholders of KMF will recognize no gain or loss upon the receipt of KYN’s stock in connection with the Merger (except with respect to cash received by stockholders in lieu of fractional shares). Additionally, if the Merger so qualifies, KMF will recognize no gain or loss as a result of the Merger with KYN and neither KYN nor its stockholders will recognize any gain or loss in connection with the Merger. If the Merger so qualifies, the aggregate tax basis of KYN common stock received by stockholders of KMF should be the same as the aggregate tax basis of the common shares of KMF surrendered in exchange therefor (reduced by any amount of tax basis allocable to a fractional share of common stock for which cash is received).

Subject to the requisite approval of the stockholders of KMF with regard to the Merger, and the stockholders of KYN with respect to the issuance of additional shares of KYN common stock in connection with the Merger, it is expected that the closing date of the Merger will occur during the second half of fiscal 2023, but it may be at a different time as described herein.

The Board of Directors of KMF unanimously recommends KMF stockholders vote “FOR” the Merger.

Proposal Two: Issuance of Additional KYN Common Stock

The Board of Directors of KYN, including the Independent Directors, has unanimously approved the Merger Agreement, including the issuance of additional shares of KYN common stock in connection therewith, declared the Merger advisable and directed that the issuance of additional KYN common stock be submitted to the KYN stockholders.

The rules of the NYSE require the stockholders of KYN to approve the issuance of additional shares of KYN common stock in connection with the Merger. In connection with the proposed Merger described under “Proposal One: Merger,” KYN will issue additional KYN common stock and list such shares of common stock on the NYSE. The Merger will result in no reduction of the NAV of the KYN common stock, immediately following the Merger, other than to reflect the costs of the Merger. No gain or loss is expected to be recognized by KYN or its stockholders in connection with the Merger. The Board of Directors of KYN, based upon its evaluation of all relevant information, anticipates that the Merger will benefit stockholders of KYN. The Companies have very similar investment strategies and objectives and the Merger will permit the Combined Company to continue to pursue them in a larger fund. Additionally, the Merger is expected to result in several benefits for stockholders in the Combined Company, including (i) cost savings through the elimination of duplicative expenses and greater economies of scale, (ii) potential for reduced management fees in the future due to the revised KYN management fee waiver, and (iii) greater financial flexibility through a larger asset base.

Stockholder approval of the issuance of additional shares of KYN common stock in connection with the Merger requires the affirmative vote of the holders of a majority of votes cast by the holders of the issued and outstanding KYN common and preferred stock (voting as a class). For purposes of this proposal, each share of common stock and each share of preferred stock is entitled to one vote.

Subject to the requisite approval of the stockholders of KYN of the issuance of additional shares of KYN common stock in connection with the Merger, and the requisite approval by the stockholders of KMF with regard to the Merger, it is expected that the closing date will occur during the second half of fiscal 2023, but it may be at a different time as described herein. For additional information about the Merger, including a comparison of KYN and KMF, the reasons for the Merger and the U.S. Federal income tax consequences of the Merger, see “Proposal One: Merger.”

RISK FACTORS

If the Merger is approved and consummated, holders of KMF’s common stock will receive shares of KYN’s common stock in exchange. That would represent an investment in KYN’s common stock. KMF’s stockholders should understand that, like an investment in KMF’s common stock, investing in KYN’s common stock involves risk, including the risk that you may receive little or no return on your investment or that you may lose part or all of your investment. The following discussion summarizes some of the risks that a holder of KMF’s common stock should carefully consider before deciding whether to approve the Merger. You should carefully consider the following risks before voting on the Merger.

This section relates to KYN and the risk factors for KYN’s common stockholders (other parts of this document relate to both KYN and KMF). Accordingly, references to “we” “us” “our” or “the Company” in this section are references to KYN.

Risks Related to Our Investments and Investment Techniques

Investment and Market Risk

An investment in our common stock is subject to investment risk, including the possible loss of the entire amount that you invest. Your investment in our common stock represents an indirect investment in Energy Infrastructure Companies and other securities owned by us, which will generally be traded on a national securities exchange or in the over-the-counter markets. An investment in our common stock is not intended to constitute a complete investment program and should not be viewed as such. The value of these publicly traded securities, like other market investments, may move up or down, sometimes rapidly and unpredictably. The value of the securities in which we invest may affect the value of our common stock. Your common stock at any point in time may be worth less than your original investment, even after taking into account the reinvestment of our distributions. We are primarily a long-term investment vehicle and should not be used for short-term trading.

Energy Infrastructure Company Risk

Our concentration in the energy infrastructure sector may present more risk than if we were broadly diversified over multiple sectors of the economy. Energy Infrastructure Companies, including Midstream Energy Companies, Renewable Infrastructure Companies and Utility Companies, are subject to risks specific to the energy and energy-related industries. See “Glossary” for descriptions of these capitalized terms.

Energy Sector Risk

The revenues of Energy Infrastructure Companies, including many Midstream Energy Companies and Utilities, are often dependent upon the volumes of oil, natural gas, refined products, natural gas liquids or water produced by Energy Companies and/or consumed by customers of these commodities, and could be adversely affected by reductions in the supply of, or demand for, such energy commodities. The adverse impact of these events could lead to a material reduction in the earnings of Energy Infrastructure Companies and a substantial reduction (or elimination) of distributions paid to equity holders, and could result in a decline in (i) the equity values of the affected Energy Infrastructure Companies and/or (ii) our net distributable income. The volume of energy commodities produced and the volume of energy commodities available for transportation, storage, processing or distribution could be negatively affected by a variety of factors, including, among others, depletion of resources, depressed commodity prices, access to capital for companies engaged in the energy industry, catastrophic or extreme weather events, labor relations, increased environmental or other governmental regulation (including policies designed to reduce carbon emissions and/or address climate change), limitations on leasing of additional federal lands or the issuance of permits for oil and gas drilling, equipment malfunctions and maintenance difficulties, volumes of imports or exports, international politics, policies of the Organization of the Petroleum Exporting Countries (“OPEC”), and increased competition from alternative energy sources. A decline in demand for energy commodities could result from factors such as adverse economic conditions, increased taxation, increased environmental or other governmental regulation (including policies designed to reduce carbon emissions and/or address climate change), catastrophic events, extreme weather events, pandemics, increased fuel economy, increased energy conservation or use of alternative energy sources, legislation intended to promote the use of alternative energy sources, or increased commodity prices.

Power Sector Risk

The revenues of Energy Infrastructure Companies, including many Utility Companies and Renewable Infrastructure Companies, are often dependent upon the availability of electric power and/or the consumption of electric power and could be adversely affected by reductions in the supply of, or demand for, such power. The adverse impact of these events could lead to a material reduction in the earnings of Energy Infrastructure Companies and a substantial reduction (or elimination) of dividends paid to equity holders, and could result in a decline in (i) the equity values of the affected Energy Infrastructure Companies and/or (ii) our net distributable income. The production or availability of electric power could be negatively affected by a variety of factors, including depressed power prices, high prices for commodities used in the generation of power, lower than expected wind, solar or hydro power resources, catastrophic or extreme weather events, labor relations, increased environmental or other governmental regulation (including policies designed to reduce carbon emissions and/or address climate change), equipment malfunctions, transmission grid disruptions and maintenance difficulties. A decline in demand for power could result from factors such as increased power prices, adverse economic conditions, increased taxation, increased governmental regulation, catastrophic events, extreme weather events, equipment malfunctions, transmission grid disruptions and maintenance difficulties.

Commodity Pricing Risk

The operations and financial performance of Energy Infrastructure Companies may be directly affected by energy commodity or power prices, especially those companies that (i) produce energy commodities or power, (ii) consume energy commodities or power in their operations, or (iii) receive payments for services that are based on energy commodity or power prices. Such impact may be a result of changes in the price for such commodity or a result of changes in the price of one commodity relative to the price of another commodity (for example, the price of natural gas relative to the price of natural gas liquids). Commodity prices can fluctuate for many different reasons, including changes in market and economic conditions, the impact of weather on demand, levels of domestic and international production, policies implemented by producer groups such as OPEC, energy conservation, domestic and foreign governmental regulation and taxation, acts of terrorism or war and the availability of local, intrastate and interstate transportation systems. Volatility of commodity prices may also make it more difficult for Energy Infrastructure Companies to raise capital to the extent the market perceives that their performance may be directly or indirectly tied to commodity prices, and such difficulty raising capital could adversely impact the financial condition of these companies and their ability to maintain or grow cash distributions or dividends to their equity holders. In addition to the volatility of commodity prices, extremely high commodity prices may drive further energy conservation efforts or incentivize substitution in favor of other energy sources, which may adversely affect the performance of Energy Infrastructure Companies.

Regulatory Risk

Energy Infrastructure Companies are subject to significant national, state and local government regulation in virtually every aspect of their operations, including (i) how facilities are constructed, maintained and operated, (ii) how services are provided, (iii) environmental and safety controls, and, in some cases, the prices they may charge for the products and services they provide. Such regulation can change rapidly or over time in both scope and intensity and may vary significantly across countries, states, and local jurisdictions. Various governmental authorities have the power to enforce compliance with these regulations and the permits issued under them. Working with national, state, and local governments to plan, site, and install energy infrastructure in compliance with such regulations can be complex, time-consuming, and costly. Violations of such regulations may subject companies to administrative, civil and criminal penalties, including civil fines, injunctions or both. Stricter laws, regulations or enforcement policies could be enacted in the future which would likely increase compliance costs and may adversely affect the financial performance of Energy Infrastructure Companies. Additionally, government authorities, such as the Federal Energy Regulatory Commission (“FERC”) and state authorities regulate the rates charged for services of many Energy Infrastructure Companies. Those authorities can change the regulations and, as a result, materially reduce the rates charged for these services, which may adversely affect the financial performance of Energy Infrastructure Companies.

Emissions of greenhouse gases, including gases associated with the production and use of hydrocarbons such as carbon dioxide, methane and nitrous oxide among others contribute to a warming of the earth’s atmosphere and other adverse environmental effects, commonly referred to as “climate change.” To protect against climate change, most of the worlds’ governments, including the federal government of the United States and many states, are committed to taking action to substantially reduce emissions of greenhouse gases. The adoption and implementation of federal, state or local limits on greenhouse gas emissions from Energy Infrastructure Companies could result in significant costs to reduce emissions of greenhouse gases associated with their operations or could adversely affect the supply of, or demand for, power, crude oil, natural gas, natural gas liquids or other hydrocarbon products, which in turn could reduce production of those commodities. As a result, greenhouse gas emissions legislation or regulation could have a material adverse impact on the financial performance of Energy Infrastructure Companies.

There is an inherent risk that Energy Infrastructure Companies may incur material environmental costs and liabilities due to the nature of their businesses and the substances they handle. For example, an accidental release from a pipeline could subject the owner of such pipeline to substantial liabilities for environmental cleanup and restoration costs, claims made by neighboring landowners and other third parties for personal injury and property damage, and fines or penalties for related violations of environmental laws or regulations. Energy Infrastructure Companies can be liable for hazardous substance releases under certain environmental statutes, including the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation, and Liability Act, the federal Oil Pollution Act and analogous state laws and regulations. These laws impose strict, joint and several liability for costs required to clean up and restore sites where Energy Infrastructure Companies have released hazardous substances. Moreover, the possibility exists that stricter laws, regulations or enforcement policies could significantly increase the compliance costs of Energy Infrastructure Companies. Similarly, the implementation of more stringent environmental requirements could significantly increase the cost for any remediation that may become necessary. Energy Infrastructure Companies may not be able to recover these costs from insurance or recover these costs in the rates they charge customers.

Catastrophic Event Risk

Energy Infrastructure Companies are subject to many dangers inherent in the production, exploration, management, transportation, processing and distribution of natural gas, natural gas liquids, crude oil, refined products, water or power. These dangers include leaks, fires, explosions, train wrecks, damage to facilities and equipment resulting from natural disasters — including floods, freezes and hurricanes — inadvertent damage to facilities and equipment and terrorist acts, including cyber- attacks. The U.S. government has issued warnings that energy assets, specifically domestic energy infrastructure such as pipelines or power transmission grids may be targeted in future terrorist attacks.

These dangers give rise to risks of substantial losses as a result of loss or destruction of reserves; damage to or destruction of property, facilities and equipment; pollution and environmental damage; and personal injury or loss of life. Any occurrence of such catastrophic events could bring about a limitation, suspension or discontinuation of the operations of certain assets owned by such Energy Infrastructure Company.

Midstream Energy Companies Risk

Midstream Energy Companies are a subset of Energy Infrastructure Companies and, as such, are subject to the risks described above under Energy Infrastructure Company Risks.

Regulatory Risk

In the last several years, several pipeline projects have experienced significant delays related to difficulties in obtaining the necessary permits to proceed with construction (or some phase of construction). These delays have raised concerns about the ability of Midstream Energy Companies to place such projects in service and their ability to get the necessary financing to complete such projects. Furthermore, it has become much more common for opponents of energy infrastructure development to utilize the courts, media campaigns and political activism to attempt to stop, or delay as much as possible, these projects. Significant delays could result in a material increase in the cost of developing these projects and could result in Midstream Energy Companies developing such projects failing to generate the expected return on investment or, if the project does not go forward, realizing a financial loss, either of which would adversely affect the results of operations and financial performance of the affected Energy Infrastructure Companies.

Natural gas transmission pipeline systems, crude oil transportation pipeline systems, refined products transportation pipeline systems, and certain classes of storage facilities and related assets owned by Energy Infrastructure Companies are subject to regulation by the FERC. The regulators have authority to regulate natural gas pipeline transmission, crude oil pipeline transportation services, and refined products pipeline transportation services including the rates charged for the services, terms and conditions of service, certification and construction of new facilities, the extension or abandonment of services and facilities, the maintenance of accounts and records, the acquisition and disposition of facilities, the initiation and discontinuation of services, and various other matters. Action by the FERC could adversely affect the ability of Energy Infrastructure Companies to establish or charge rates that would cover future increases in their costs, such as additional costs related to environmental matters including any climate change regulation, or even to continue to collect rates that cover current costs, including a reasonable rate of return. It could also become more common for regulatory agencies (such as FERC) to include the impact of carbon emissions from energy infrastructure assets as a consideration in granting permits for the construction or operation of such assets. This could result in costly delays in obtaining permits, requirements to spend additional capital to limit carbon emissions or denial of required permits to operate existing or proposed energy infrastructure assets. Any such change could have an adverse impact on the financial condition, results of operations, or cash flows of Energy Infrastructure Companies.

Over the past several years, governmental agencies have imposed more stringent protections governing hydraulic fracturing and the disposal of wastewater associated with hydraulic fracturing processes that are critical to the recovery of economic amounts of oil, natural gas and natural gas liquids by Energy Companies. Wastewater is a byproduct of hydraulic fracturing and production and, to the extent it is not recycled, must be disposed. Scientific research links the disposal of wastewater to increased earthquake activity in certain oil and natural gas producing regions, and legislation and regulations have been proposed in states like Oklahoma and Colorado to limit or prohibit further underground wastewater disposal in seismically sensitive regions. While we are not able to predict the likelihood that similar regulations will be adopted in other regions, additional restrictions on hydraulic fracturing, wastewater disposal or any other activity necessary for the production of oil, natural gas or natural gas liquids could result in a reduction in production of those commodities. Midstream Energy Companies have spent (and continue to spend) significant amounts of capital building pipelines, processing, treating and storage assets to facilitate the development of oil and gas reserves and such reductions in production could have an adverse impact on the financial performance of Midstream Energy Companies.

Upstream Exploration and Production Risk

Energy reserves naturally deplete as they are produced over time, and to maintain or grow their revenues, companies engaged in the production of natural gas, natural gas liquids, crude oil and other energy commodities need to maintain or expand their reserves through exploration of new sources of supply, through the development of existing sources or through acquisitions. Energy Companies may be unsuccessful adding reserves and/or maintaining production levels for several reasons, including the lack of sufficient cash flow to fund re-investment due to a material decline in commodity prices, an inability to raise capital on favorable terms or an unwillingness to reinvest cash flow in the development (or acquisition) of new reserves. The failure to cost-effectively acquire additional reserves sufficient to replace the natural decline in production may cause the production of natural gas, natural gas liquids, crude oil and other energy commodities to decline. During recent industry downturns, including the 2020 downturn resulting from COVID-19’s severe negative impact on global demand, many Energy Companies significantly reduced capital expenditures, leading to declines in U.S. production of natural gas and crude oil. Many Energy Companies were forced to monetize reserves or acreage to manage their balance sheets and maintain adequate liquidity levels. Some Energy Companies were forced to file for bankruptcy in an effort to restructure their balance sheets. These actions have had a negative impact on the operating results and financial performance for some Midstream Energy Companies engaged in the transportation, storage, distribution and processing of production from such Energy Companies.

Energy Companies engaged in the production of natural gas, natural gas liquids and crude oil estimate the quantities of their reserves. If reserve estimates prove to be inaccurate, these companies’ reserves may be overstated, and no commercially productive amounts of such energy commodities may be discovered. Furthermore, drilling or other exploration activities, may be curtailed, delayed, or cancelled as a result of low commodity prices, unexpected conditions or miscalculations, title problems, pressure or irregularities in formations, equipment failures or accidents, adverse weather conditions, compliance with environmental and other governmental requirements and cost of, or shortages or delays in the availability of, drilling rigs and other exploration equipment. In addition, there are many operational risks and hazards associated with the development of the underlying properties, including natural disasters, blowouts, explosions, fires, leakage of such energy commodities, mechanical failures, cratering, and pollution. Midstream Energy Companies invest significant capital in assets to provide transportation, processing, treating, storage, and other services to facilitate production of these energy commodities and would be adversely impacted in the event reserves were significantly underestimated or were unable to be economically produced.

Affiliated Party Risk

Certain Midstream Energy Companies are dependent on their affiliates for a majority of their revenues. In some cases, those same affiliates are the majority owners and/or have effective control of the Midstream Energy Companies. Any failure by a Midstream Energy Company’s affiliates to satisfy their payments or obligations would impact the Midstream Energy Company’s revenues and cash flows and ability to make interest payments and distributions or dividends to their equity holders. Controlling affiliates of Midstream Energy Companies may also enter into M&A transactions or attempt to effect changes in commercial contracts that could be adverse to the Midstream Energy Company.

Contract Renegotiation/Rejection Risk

Midstream Energy Companies that operate midstream assets are also subject to the credit risk of their customers. For example, many Energy Companies that explore for and produce oil, natural gas and natural gas liquids filed for bankruptcy during the last downturn. During the bankruptcy process, the debtor Energy Company may be able to reject a contract that it has with a Midstream Energy Company that provides services for the debtor, which could include gathering, processing, treating, transportation or storage services. If a contract is successfully rejected during bankruptcy, the affected Midstream Energy Company will have an unsecured claim for damages but will likely only recover a portion of its claim for damages and may not recover anything at all. A debtor Energy Company may also threaten to reject a contract in an effort to force a renegotiation of the agreement on terms less favorable to its counterparty, the Midstream Energy Company. For these reasons, a Midstream Energy Company that provides services to an Energy Company that is in financial distress could experience a material adverse impact to its financial performance and results of operations.

Risks of Investing in MLP Units

In addition to the risks summarized herein, an investment in MLP units involves certain risks, which differ from an investment in the securities of a corporation. Limited partners of MLPs, unlike investors in the securities of a corporation, have limited voting rights on matters affecting the partnership and generally have no rights to elect the directors of the general partner. In addition, conflicts of interest exist between limited partners and the general partner and the general partner does not generally have any duty to the limited partners beyond a “good faith” standard.

Tax Risks of Investing in Equity Securities of MLPs

Our ability to meet our investment objective will depend, in part, on the level of taxable income and distributions and dividends we receive from the MLP securities in which we invest, a factor over which we have no control. The benefit we derive from our investment in MLPs is largely dependent on the MLPs being treated as partnerships and not as corporations for federal income tax purposes. As a partnership, an MLP has no tax liability at the entity level. If, as a result of a change in the tax code or a change in an MLP’s business, an MLP were treated as a corporation for federal income tax purposes, such MLP would be obligated to pay federal income tax on its income at the corporate tax rate. Upon the sale of an equity security in an MLP, we generally will be liable for any previously deferred taxes. In addition, the sale of an equity security in an MLP involves certain tax depreciation recapture relating to the MLP’s underlying assets. Such depreciation recapture is treated as ordinary income for tax purposes, and such ordinary income may result even if the sale of the MLP equity security is at a loss or exceeds the gain if sold at a gain. MLPs generally provide the relevant tax information for these calculations on a delayed basis, usually during the calendar year following the sale, so final determination of any resulting recapture income may be similarly delayed. If the recapture exceeds operating losses, we could recognize taxable income and have an income tax liability. No assurance can be given that such taxes will not exceed the Company’s deferred tax assumptions for purposes of computing the Company’s net asset value per share, which would result in an immediate reduction of the Company’s net asset value per share. If an MLP were classified as a corporation for federal income tax purposes, the amount of cash available for distribution by the MLP would likely be reduced and distributions received by us that are treated as dividend income or capital gain would be taxed under federal income tax laws applicable to corporate distributions, which would reduce our net distributable income. In addition, as U.S presidential and legislative priorities change and develop, energy-related tax provisions may be enacted, some of which may not be favorable to MLPs or corporations investing in them and may increase the amount of taxes we ultimately bear. There can be no assurance how any such provisions could affect our net distributable income or our business generally.

Utility Companies Risk

Utility Companies are a subset of Energy Infrastructure Companies and, as such, are subject to the risks described above under Energy Infrastructure Company Risk.

Other risks inherent in the utilities sector include a variety of factors that may adversely affect the business or operations of Utility Companies, including: high interest costs associated with capital construction and improvement programs; difficulty in raising adequate capital on reasonable terms in periods of high inflation and unsettled capital markets; governmental regulation of rates that the company can charge to customers; costs associated with compliance with, and adjusting to changes to, environmental and other regulations; the difficulty in obtaining an adequate return on invested capital or in financing large construction projects; effects of economic slowdowns and surplus capacity; increased competition from other providers of utilities services; costs associated with the reduced availability of certain types of fuel, occasionally reduced availability and high costs of natural gas for resale, and the effects of energy conservation policies.

Some Utility Companies also face risks associated with the effects of a national energy policy and lengthy delays, and greatly increased costs and other problems, associated with the design, construction, licensing, regulation and operation of nuclear facilities for power generation, including, among other considerations: the problems associated with the use of radioactive materials and the disposal of radioactive wastes; technological innovations that may render existing plants, equipment or products obsolete; difficulty in obtaining regulatory approval of new technologies; lack of compatibility of telecommunications equipment; potential impacts of terrorist activities on the utilities industry and its customers; and the impact of natural or man-made disasters. Utility Companies may also be subject to regulation by various governmental authorities and may be affected by the imposition of special tariffs and changes in tax laws, regulatory policies and accounting standards.

Deregulation is subjecting Utility Companies to greater competition and may adversely affect profitability. As deregulation allows utilities to diversify outside of their original geographic regions and their traditional lines of business, Utility Companies may engage in riskier ventures. There is no assurance that regulatory authorities will, in the future, grant rate increases, or that such increases will be adequate to permit the payment of dividends on stocks issued by a Utility Company.

In many regions, including the United States, the Utility Industry is experiencing increasing competitive pressures, primarily in wholesale markets, as a result of consumer demand, technological advances, greater availability of natural gas with respect to electric utility companies and other factors. For example, FERC has implemented regulatory changes to increase access to the nationwide transmission grid by utility and non-utility purchasers and sellers of electricity. A number of countries, including the United States, are considering or have implemented methods to introduce and promote retail competition. Changes in regulation may result in consolidation among domestic utilities and the disaggregation of many vertically integrated utilities into separate generation, transmission and distribution businesses. As a result, additional significant competitors could become active in certain parts of the utility industry.

Renewable Infrastructure Companies Risk

Renewable Infrastructure Companies are a subset of Energy Infrastructure Companies and, as such, are subject to the risks described above under Energy Infrastructure Company Risk. In addition, the future growth of Renewable Infrastructure Companies may be dependent upon on government policies that support renewable power generation and enhance the economic viability of owning renewable electric generation assets. Such policies can include renewable portfolio standard programs, which mandate that a specified percentage of electricity sales come from eligible sources of renewable energy, accelerated cost-recovery systems of depreciation, tax credits and production credits.

The electric power produced, and revenues generated by a renewable energy generation facility, including solar electric or wind energy, is highly dependent on suitable weather conditions. These assets may not be able to operate in extreme weather conditions, such as during a severe freeze. Furthermore, components used in the generation of renewable energy could be damaged by severe weather, such as hailstorms, tornadoes or hurricanes. In addition, replacement and spare parts for key components may be difficult or costly to acquire or may be unavailable. Unfavorable weather and atmospheric conditions could impair the effectiveness of assets or reduce their output beneath their rated capacity or require shutdown of key equipment, impeding operation of renewable assets. Actual climatic conditions at a facility site, particularly wind conditions, may not conform to the historical findings and, therefore, renewable energy facilities may not meet anticipated production levels or the rated capacity of the generation assets, which could adversely affect the business, financial condition and results of operations and cash flows of the Renewable Infrastructure Companies involved in the renewable energy industry.

A portion of revenues from investments in Renewable Infrastructure Assets will be tied, either directly or indirectly, to the wholesale market price for electricity in the markets served. Wholesale market electricity prices are impacted by a number of factors including: the price of fuel (for example, natural gas) that is used to generate electric power; the cost of and management of generation and the amount of excess generating capacity relative to load in a particular market; and conditions (such as extremely hot or cold weather) that impact electrical system demand. Owners of Renewable Infrastructure Assets may attempt to secure fixed prices for their power production through the use of financial hedges; but may not be able to deliver power to collect such fixed price, rendering those hedges ineffective or creating economic losses for Renewable Infrastructure Assets. In addition, there is uncertainty surrounding the trend in electricity demand growth. This volatility and uncertainty in power markets could have a material adverse effect on the assets, liabilities, financial condition, results of operations and cash flow of the companies in which we invest.

Decreases in Subsidies and Changes in Regulations Risk

Poor economic conditions could have an effect on government budgets and threaten the continuation of government subsidies such as regulated revenues, cash grants, U.S. federal income and state tax benefits or state renewables portfolio standards that benefit Renewable Infrastructure Companies. Such conditions may also lead to adverse changes in laws or regulations. The reduction or elimination of renewable generation targets, tariffs, subsidies or tax incentives or adverse changes in law could have a material adverse effect on the profitability of some existing projects. The availability and continuation of public policy support mechanisms will drive a significant part of the economics and viability of clean energy investments, and the curtailment or termination of such subsidies and incentives could adversely affect the feasibility and profitability of Renewable Infrastructure Assets and the growth plan of Renewable Infrastructure Companies. In addition, if the various domestic and international regulations that provide incentives for renewable energy change or expire in a manner that adversely impacts the market for Renewable Infrastructure Companies, the competitiveness of renewable energy generally and the economic value of new projects undertaken by Renewable Infrastructure Companies could be impacted.

Renewable Infrastructure Companies also rely in part on environmental and other regulations of industrial and local government activities, including regulations granting subsidies or mandating reductions in carbon or other greenhouse gas emissions and minimum biofuel content in fuel or use of energy from renewable sources. If the businesses to which such regulations relate were deregulated or if such subsidies or regulations were changed or weakened, the profitability of Renewable Infrastructure Companies could suffer.

Hydrology, Solar and Wind Changes Risk

The revenues and cash flows generated by Renewable Infrastructure Assets are often correlated to the amount of electric power generated, which for some assets is dependent upon available water flows, solar conditions, wind conditions and weather conditions generally. Hydrology, solar, wind and weather conditions have natural variations from season to season and from year to year and may also change permanently because of climate change or other factors, and these changes could impact the profitability of Renewable Infrastructure Assets. A natural disaster could also impact water flows within the watersheds the Renewable Infrastructure Companies in which we invest operate. Wind energy is highly dependent on weather conditions and, in particular, on wind conditions.

Operational Disruption Risk

Renewable Infrastructure Companies are exposed to risks in connection with disruptions of their operations, or to the operations of third parties on which they depend, which may be caused by technical breakdowns at power generation assets, resulting from aged or defective facility components, insufficient maintenance, failed repairs, power outages, adverse weather conditions, natural disasters, labor disputes, ill-intentioned acts or other accidents or incidents. These disruptions could result in shutdowns, delays or long-term decommissioning in production or distribution of energy. This may materially and adversely affect operations or financial condition and cause harm to the reputation of companies in which we invest.

Construction Risk

Renewable Infrastructure Companies may invest in projects that are subject to construction risk and construction delays. The ability of these projects to generate revenues will often depend upon their successful completion of the construction and operation of generating assets. Any shortage, delay or component price change from the suppliers of equipment associated with renewable energy projects could result in construction or installation delays. There have been periods of industry-wide shortage of key components, including solar panels and wind turbines. Delays in construction may also occur as a result of inclement weather, labor disruptions, technical complications or other reasons, and any resulting cost over-runs could negatively impact the income and market values of Renewable Infrastructure Companies.

In addition, tariffs on imports to the United States could affect operating or construction costs for a number of companies in which we invest. The cost of new solar power generation projects could be more challenging as a result of increases in the cost of solar panels or tariffs on imported solar panels imposed by the U.S. government on imported solar cells and modules manufactured in China. If project developers purchase solar panels containing cells manufactured in China, the purchase price for renewable energy equipment and facilities may reflect the tariff penalties mentioned above.

Renewable Infrastructure Technology Risk

Technology related to the production of renewable power and conventional power generation is continually advancing, resulting in a gradual decline in the cost of producing electricity. Renewable Infrastructure Companies may invest in and use newly developed, less proven, technologies in their development projects or in maintaining or enhancing their existing assets. There is no guarantee that such new technologies will perform as anticipated. The failure of a new technology to perform as anticipated may materially and adversely affect the profitability of a particular development project.

Increasing Competition/Market Change Risks

A significant portion of the electric power generation and transmission capacity sold by Renewable Infrastructure Assets is sold under long-term agreements with public utilities, industrial or commercial end-users or governmental entities. If, for any reason, any of the purchasers of power or transmission capacity under these agreements are unable or unwilling to fulfill their related contractual obligations or if they otherwise terminate such agreements prior to the expiration thereof, the business and financial condition of Renewable Infrastructure Companies could be materially and adversely affected. The power generation industry is characterized by intense competition, which may impact the ability of Renewable Infrastructure Companies to replace an expiring or terminated agreement with an agreement on equivalent terms and conditions, including at prices that permit operation of the related facility on a profitable basis, and as a result the affected facility may temporarily or permanently cease operations.

Changes in Tariffs Risk

The revenue that Renewable Infrastructure Assets generate from contracted concessions is often dependent on regulated tariffs or other long-term fixed rate arrangements. Under such concession agreements, a tariff structure is established, and Renewable Infrastructure Companies have limited or no possibility to independently raise tariffs beyond the established rates and indexation or adjustment mechanisms. Similarly, under a long-term power purchase agreement, Renewable Infrastructure Companies may be required to deliver power at a fixed rate for the contract period, with limited escalation rights. In addition, Renewable Infrastructure Companies may be unable to adjust tariffs or rates as a result of fluctuations in prices of raw materials, exchange rates, labor and subcontractor costs during the operating phase of these projects. Moreover, in some cases, if Renewable Infrastructure Assets fail to comply with certain pre-established conditions, the government or customer, as applicable, may reduce the tariffs or rates payable. In addition, during the life of a concession, the relevant government authority may unilaterally impose additional restrictions on tariff rates, subject to the regulatory frameworks applicable in each jurisdiction.

Non-Diversification Risk

We are a non-diversified, closed-end investment company under the 1940 Act and will not be treated as a regulated investment company under the Internal Revenue Code of 1986, as amended, or the Code. Accordingly, there are no regulatory requirements under the 1940 Act or the Code on the minimum number or size of securities we hold. As we may invest up to 15% of our total assets in any single issuer, a decline in value of the securities of such an issuer could significantly impact the value of our portfolio.

Dependence on Limited Number of Customers and Suppliers

Certain Energy Infrastructure Companies in which we may invest depend upon a limited number of customers for a majority of their revenue. Similarly, certain Energy Infrastructure Companies in which we may invest depend upon a limited number of suppliers of goods or services to continue their operations. The recent COVID-19 related downturn in the energy industry put significant pressure on a number of these customers and suppliers and caused many companies operating in the energy industry to file for bankruptcy. Other public health emergencies or widespread market disruptions in the future could have similar effects. Any loss of any such customers or suppliers, including through bankruptcy, could materially adversely affect such Energy Infrastructure Companies’ results of operation and cash flow, and their ability to make distributions or dividends to equity holders could therefore be materially adversely affected.

Capital Markets Risk

Financial markets are volatile, and Energy Infrastructure Companies may not be able to obtain new debt or equity financing on attractive terms or at all. For example, the downturn in commodity prices and economic activity associated with the COVID-19 pandemic negatively impacted the ability of Energy Companies to raise capital, and equity capital in particular, at attractive levels. Downgrades of the debt of Energy Infrastructure Companies by rating agencies during times of distress could exacerbate this challenge. In addition, downgrades of the credit ratings of Energy Infrastructure Companies by ratings agencies may increase the cost of borrowing under the terms of an Energy Infrastructure Company’s credit facility, and a downgrade from investment grade to below investment may cause an Energy Infrastructure Company to be required to post collateral (or additional collateral) by its contractual counterparties, which could reduce the amount of liquidity available to such Energy Infrastructure Company and increase its need for additional funding sources. If funding is not available when needed, or is available only on unfavorable terms, Energy Infrastructure Companies may have to reduce their distributions or dividends to manage their funding needs and may not be able to meet their obligations as they come due. Moreover, without adequate funding, many Energy Infrastructure Companies may be unable to execute their growth strategies, complete future acquisitions, take advantage of other business opportunities or respond to competitive pressures, any of which could have a material adverse effect on their revenues and results of operations.

Financial Institution Instability Risk

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems. For example, on March 10, 2023, Silicon Valley Bank (“SVB”) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver. Similarly, on March 12, 2023, Signature Bank and Silvergate Capital Corp. were each swept into receivership. In addition, counterparties to SVB credit agreements and arrangements, and third parties such as beneficiaries of letters of credit (among others), may experience direct impacts from the closure of SVB and uncertainty remains over liquidity concerns in the broader financial services industry. Similar impacts have occurred in the past, such as during the 2008-2010 financial crisis.

Investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us and the companies in which we invest to acquire financing on acceptable terms or at all.

Political Instability Risk

The Energy Infrastructure Companies in which we may invest are subject to disruption as a result of terrorist activities (including cyber-attacks), war, and other geopolitical events. The U.S. government has issued warnings that energy assets, specifically those related to pipeline and other energy infrastructure, production facilities and transmission and distribution facilities, may be targeted in future terrorist attacks. Internal unrest, acts of violence or strained relations between a government and energy companies or other governments may affect the operations and profitability of Energy Infrastructure Companies in which we invest. Political instability in other parts of the world may also cause volatility and disruptions in the market for the securities of Energy Infrastructure Companies, even those that operate solely in North America.

Weather Risks

Weather conditions and the seasonality of weather patterns play a role in the cash flows of certain Energy Infrastructure Companies. Although most Energy Infrastructure Companies can reasonably predict seasonal weather demand based on normal weather patterns, extreme weather conditions (for instance hurricanes, wildfires and extreme winter storms) demonstrate that no amount of preparation can protect an Energy Infrastructure Company from the unpredictability of the weather. The damage done by extreme weather also may serve to increase insurance premiums for energy assets owned by Energy Infrastructure Companies, could significantly increase the volatility in the supply of energy- related commodities and could adversely affect such companies’ financial condition and ability to pay distributions or dividends to equity holders.

Concentration Risk

Our investments are concentrated in the energy infrastructure sector. The focus of our portfolio on the energy infrastructure sector may present more risks than if our portfolio were broadly diversified over numerous sectors of the economy. A downturn in the energy infrastructure sector, or more generally in the energy industry, would have a larger impact on us than on an investment company that does not concentrate in the energy infrastructure sector. The performance of securities in the energy infrastructure sector may lag the performance of other industries or the broader market as a whole. To the extent that we invest a relatively high percentage of our assets in the obligations of a limited number of issuers, we may be more susceptible than a more widely diversified investment company to any single economic, political or regulatory occurrence.

Interest Rate Risk

Valuations of securities in which we invest are based on numerous factors, including sector and business fundamentals, management expertise, and expectations of future operating results. Most of the securities in which we invest pay quarterly distributions or dividends to investors and are viewed by investors as yield-based investments. As a result, yields for these securities are also susceptible, in the short-term, to fluctuations in interest rates and the equity prices of such securities may decline when interest rates rise. Because we invest in equity securities of Energy Infrastructure Companies, our net asset value and the asset coverage ratios on our senior securities may decline if interest rates rise.

Inflation/Deflation Risk

Inflation risk is the risk that the value of assets or income from investment will be worth less in the future as inflation decreases the value of money. As inflation increases, the real value of our common stock and distributions that we pay declines. In addition, during any periods of rising inflation, the dividend rates or borrowing costs associated with our use of leverage would likely increase. Deflation risk is the risk that prices throughout the economy decline over time — the opposite of inflation. Deflation may have an adverse effect on the creditworthiness of issuers and may make issuer defaults more likely, which may result in a decline in the value of our portfolio.

In an effort to control inflation, the Federal Open Market Committee (“FOMC”), the committee within the Federal Reserve (“Fed”) that sets domestic monetary policy, raised the target range for the federal funds rate seven times in calendar year 2022 to a range of 4.25% to 4.50%. The Fed has signaled that further increases could happen in 2023. Rising rates generally have a negative impact on income-oriented investments such as those in which we invest and could be adversely impacted by these actions. There is no assurance that the action being taken by the Fed will improve the outlook for long-term inflation or whether they might result in a recession. A recession could lead to declined employment, global demand destruction and/or business failures, which may result in a decline in the value of our portfolio. In addition, increased interest rates could increase our cost of borrowing and reduce the return on leverage to common stockholders.

Risk of Conflicting Transactions by the Investment Adviser

Kayne Anderson manages portfolios of other investment companies and client accounts that invest in similar or the same securities as the Company. It is possible that Kayne Anderson would effect a purchase of a security for us when another investment company or client account is selling that same security, or vice versa. Kayne Anderson will use reasonable efforts to avoid adverse impacts on the Company’s transactions as a result of those other transactions, but there can be no assurances that adverse impacts will be avoided.

Equity Securities Risk

The vast majority of our assets are invested in equity securities of Energy Infrastructure Companies. Such securities are subject to general movements in the stock market and a significant drop in the stock market may depress the price of securities to which we have exposure. Equity securities prices fluctuate for several reasons, including changes in the financial condition of a particular issuer, investors’ perceptions of Energy Infrastructure Companies, investors’ perceptions of the energy industry, the general condition of the relevant stock market, or when political or economic events affecting the issuers occur. In addition, Energy Infrastructure Company equity securities held by the Company may decline in price if the issuer fails to make anticipated distributions or dividend payments (or reduces the amount of such payments) because, among other reasons, the issuer experiences a decline in its financial condition. In general, the equity securities of MLPs that are publicly traded partnerships tend to be less liquid than the equity securities of corporations, which means that we could have difficulty selling such securities at the time and price we would like.

Small Capitalization Risk

Certain of the Energy Infrastructure Companies in which we invest may have comparatively smaller capitalizations than other companies whose securities are included in major benchmarked indices. Investing in the securities of smaller Energy Infrastructure Companies presents some unique investment risks. These Energy Infrastructure Companies may have limited product lines and markets, as well as shorter operating histories, less experienced management and more limited financial resources than larger Energy Infrastructure Companies and may be more vulnerable to adverse general market or economic developments. Stocks of smaller Energy Infrastructure Companies may be less liquid than those of larger Energy Infrastructure Companies and may experience greater price fluctuations than larger Energy Infrastructure Companies. In addition, small-cap securities may not be widely followed by the investment community, which may result in reduced demand. This means that we could have greater difficulty selling such securities at the time and price that we would like.

Debt Securities Risks

Debt securities in which we invest are subject to many of the risks described elsewhere in this section. In addition, they are subject to credit risk and other risks, depending on the quality and other terms of the debt security.

Credit Risk

An issuer of a debt security may be unable to make interest payments and repay principal. We could lose money if the issuer of a debt obligation is, or is perceived to be, unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. The downgrade in the credit rating of a security by rating agencies may further decrease its value. Additionally, we may purchase a debt security that has payment-in-kind interest, which represents contractual interest added to the principal balance and due at the maturity date of the debt security in which we invest. It is possible that by effectively increasing the principal balance payable or deferring cash payment of such interest until maturity, the use of payment-in-kind features will increase the risk that such amounts will become uncollectible when due and payable.

Below Investment Grade and Unrated Debt Securities Risk

Below investment grade debt securities (commonly referred to as “junk bonds” or “high yield bonds”) are rated Ba1 or less by Moody’s, BB+ or less by Fitch or Standard & Poor’s, or comparably rated by another rating agency. Below investment grade and unrated debt securities generally pay a premium above the yields of U.S. government securities or debt securities of investment grade issuers because they are subject to greater risks than these securities. These risks, which reflect their speculative character, include the following: greater yield and price volatility; greater credit risk and risk of default; potentially greater sensitivity to general economic or industry conditions; potential lack of attractive resale opportunities (illiquidity); and additional expenses to seek recovery from issuers who default. In addition, the prices of these below investment grade and other unrated debt securities in which we may invest are more sensitive to negative developments, such as a decline in the issuer’s revenues or profitability or a general economic downturn, than are the prices of higher grade securities. Below investment grade and unrated debt securities tend to be less liquid than investment grade securities, and the market for below investment grade and unrated debt securities could contract further under adverse market or economic conditions. In such a scenario, it may be more difficult for us to sell these securities in a timely manner or for as high a price as could be realized if such securities were more widely traded.

Prepayment Risk

Certain debt instruments, particularly below investment grade securities, may contain call or redemption provisions which would allow the issuer thereof to prepay principal prior to the debt instrument’s stated maturity. This is known as prepayment risk. Prepayment risk is greater during a falling interest rate environment as issuers can reduce their cost of capital by refinancing higher yielding debt instruments with lower yielding debt instruments. An issuer may also elect to refinance its debt instruments with lower yielding debt instruments if the credit standing of the issuer improves. To the extent debt securities in our portfolio are called or redeemed, we may be forced to reinvest in lower yielding securities.

Interest Rate Risk for Debt and Equity Securities

Debt securities, and equity securities that pay dividends and distributions, have the potential to decline in value, sometimes dramatically, when interest rates rise or are expected to rise. In general, the values or prices of debt securities vary inversely with interest rates. The change in a debt security’s price depends on several factors, including its maturity. Generally, debt securities with longer maturities are subject to greater price volatility from changes in interest rates. Adjustable rate instruments also react to interest rate changes in a similar manner although generally to a lesser degree (depending, however, on the characteristics of the reset terms).

LIBOR Risk

The United Kingdom’s Financial Conduct Authority, which regulates LIBOR, has ceased making LIBOR available as a reference rate over a phase-out period that began on December 31, 2021. Alternative reference rates have been established or are in development in most major currencies, including with regards to the Secured Overnight Financing Rate (“SOFR”), which is intended to replace U.S. dollar LIBOR. Although the transition process away from LIBOR has become increasingly well-defined, there remains uncertainty regarding the impact of the transition to a new reference rate. At this time, it is not possible to predict the full impact of the elimination of LIBOR and the establishment of an alternative reference rate on the Company or its investments.

Risks Associated with Investing in Initial Public Offerings (“IPOs”)

Securities purchased in IPOs are often subject to the general risks associated with investments in companies with small market capitalizations and, at times, are magnified. Securities issued in IPOs have no trading history, and information about the companies may be available for very limited periods. In addition, the prices of securities sold in an IPO may be highly volatile. At any particular time, or from time to time, we may not be able to invest in IPOs, or to invest to the extent desired, because, for example, only a small portion (if any) of the securities being offered in an IPO may be available to us. In addition, under certain market conditions, a relatively small number of companies may issue securities in IPOs. Our investment performance during periods when we are unable to invest significantly or at all in IPOs may be lower than during periods when we are able to do so. IPO securities may be volatile, and we cannot predict whether investments in IPOs will be successful. As we grow in size, the positive effect of IPO investments on the Company may decrease.

Risks Associated with a Private Investment in a Public Entity (“PIPE”) Transaction

PIPE investors purchase securities directly from a publicly traded company in a private placement transaction, typically at a discount to the market price of the company’s common stock. Because the sale of the securities is not registered under the Securities Act of 1933, as amended (the “Securities Act”), the securities are “restricted” and cannot be immediately resold by the investors into the public markets. Until we can sell such securities into the public markets, our holdings will be less liquid, and any sales will need to be made pursuant to an exemption under the Securities Act. We may purchase equity securities in a PIPE transaction that are structured as convertible preferred equity (that may also pay distributions in kind). At the time a convertible preferred equity investment becomes convertible into common equity, the common equity may be worth less than the conversion price, which would make it uneconomic to convert into common equity and, as a result, significantly reduce the liquidity of the investment.

Privately Held Company Risk

Investing in privately held companies involves risk. For example, privately held companies are not subject to SEC reporting requirements, are not required to maintain their accounting records in accordance with generally accepted accounting principles and are not required to maintain effective internal controls over financial reporting. As a result, we may not have timely or accurate information about the business, financial condition and results of operations of the privately held companies in which we invest. In addition, the securities of privately held companies are generally illiquid, and entail the risks described under “Liquidity Risk.”

Liquidity Risk

Securities with limited trading volumes may display volatile or erratic price movements. Kayne Anderson is one of the largest investors in Energy Infrastructure Companies. Thus, it may be more difficult for us to buy and sell significant amounts of such securities without an unfavorable impact on prevailing market prices. Larger purchases or sales of these securities by us in a short period of time may cause abnormal movements in the market price of these securities. As a result, these securities may be difficult to dispose of at a fair price at the times when we believe it is desirable to do so. Investment of our capital in securities that are less actively traded or over time experience decreased trading volume may restrict our ability to take advantage of other market opportunities.

We also invest in unregistered or otherwise restricted securities. The term “restricted securities” refers to securities that are unregistered or are held by control persons of the issuer and securities that are subject to contractual restrictions on their resale. Unregistered securities are securities that cannot be sold publicly in the United States without registration under the Securities Act, unless an exemption from such registration is available. Restricted securities may be more difficult to value, and we may have difficulty disposing of such assets either in a timely manner or for a reasonable price. In order to dispose of an unregistered security, we, where we have contractual rights to do so, may have to cause such security to be registered. A considerable period may elapse between the time the decision is made to sell the security and the time the security is registered so that we could sell it. Contractual restrictions on the resale of securities vary in length and scope and are generally the result of a negotiation between the issuer and acquiror of the securities. We would, in either case, bear the risks of any downward price fluctuation during that period. The difficulties and delays associated with selling restricted securities could result in our inability to realize a favorable price upon disposition of such securities, and at times might make disposition of such securities impossible.

Our investments in restricted securities may include investments in private companies. Such securities are not registered under the Securities Act until the company becomes a public company. Accordingly, in addition to the risks described above, our ability to dispose of such securities on favorable terms would be limited until the portfolio company becomes a public company.

Portfolio Turnover Risk

Portfolio turnover may vary greatly from year to year. Portfolio turnover rate is not considered a limiting factor in KAFA’s execution of investment decisions. A higher portfolio turnover rate results in correspondingly greater brokerage commissions and other transactional expenses, including taxes related to realized gains, that are borne by us. It could also result in an acceleration of realized gains on portfolio securities held by us (and payment of cash taxes on such realized gains).

Derivatives Risk

We may purchase and sell derivative investments such as exchange-listed and over-the-counter put and call options on securities, equity, fixed income, interest rate and currency indices, and other financial instruments, enter into total return swaps and various interest rate transactions such as swaps. We also may purchase derivative investments that combine features of these instruments. The use of derivatives has risks, including the imperfect correlation between the value of such instruments and the underlying assets, the possible default of the other party to the transaction or illiquidity of the derivative investments. Furthermore, the ability to successfully use these techniques depends on our ability to predict pertinent market movements, which cannot be assured. Thus, the use of derivatives may result in losses greater than if they had not been used, may require us to sell or purchase portfolio securities at inopportune times or for prices other than current market values, may limit the amount of appreciation we can realize on an investment or may cause us to hold a security that we might otherwise sell. Additionally, amounts paid by us as premiums and cash or other assets held in margin accounts with respect to derivative transactions are not otherwise available to us for investment purposes.

We have written covered calls in the past and may do so in the future. As the writer of a covered call option, during the option’s life we give up the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call, but we retain the risk of loss should the price of the underlying security decline. The writer of an option has no control over the time when it may be required to fulfill its obligation as a writer of the option. Once an option writer has received an exercise notice, it cannot effect a closing purchase transaction in order to terminate its obligation under the option and must deliver the underlying security at the exercise price. There can be no assurance that a liquid market will exist when we seek to close out an option position. If trading were suspended in an option purchased by us, we would not be able to close out the option. If we were unable to close out a covered call option that we had written on a security, we would not be able to sell the underlying security unless the option expired without exercise.

Depending on whether we would be entitled to receive net payments from the counterparty on an interest rate swap, which in turn would depend on the general state of short-term interest rates at that point in time, a default by a counterparty could negatively impact the performance of our common stock. In addition, at the time an interest rate transaction reaches its scheduled termination date, there is a risk that we would not be able to obtain a replacement transaction or that the terms of the replacement would not be as favorable as on the expiring transaction. If this occurs, it could have a negative impact on the performance of our common stock. If we fail to maintain any required asset coverage ratios in connection with any use by us of our debt securities, revolving credit facility and other borrowings (collectively, our “Borrowings”) and our preferred stock (together with our Borrowings, “Leverage Instruments”), we may be required to redeem or prepay some or all of the Leverage Instruments. Such redemption or prepayment would likely result in our seeking to terminate early all or a portion of any swap or cap transactions. Early termination of a swap could result in a termination payment by or to us.

Short Sales Risk

Short selling involves selling securities which may or may not be owned and borrowing the same securities for delivery to the purchaser, with an obligation to replace the borrowed securities at a later date. Short selling allows the short seller to profit from declines in market prices to the extent such declines exceed the transaction costs and the costs of borrowing the securities. A short sale creates the risk of an unlimited loss, in that the price of the underlying security could theoretically increase without limit, thus increasing the cost of buying those securities to cover the short position. There can be no assurance that the securities necessary to cover a short position will be available for purchase. Purchasing securities to close out the short position can itself cause the price of the securities to rise further, thereby exacerbating the loss.

Our obligation to replace a borrowed security is secured by collateral deposited with the broker-dealer, usually cash, U.S. government securities or other liquid securities similar to those borrowed. We also are required to segregate similar collateral to the extent, if any, necessary so that the value of both collateral amounts in the aggregate is at all times equal to at least 100% of the current market value of the security sold short. Depending on arrangements made with the broker-dealer from which we borrowed the security regarding payment over of any payments received by us on such security, we may not receive any payments (including interest) on the collateral deposited with such broker-dealer.

Public Health Emergency Risk

Pandemics and other local, national, and international public health emergencies, including outbreaks of infectious diseases such as SARS, H1N1/09 Flu, the Avian Flu, Ebola and the novel coronavirus (“COVID-19”) pandemic, can result in market volatility and disruption, and any similar future emergencies may materially and adversely impact economic production and activity in ways that cannot be predicted, all of which could result in substantial investment losses. Most recently, COVID-19 has caused a worldwide public health emergency, significantly diminished and disrupted global economic production and activity of all kinds, and contributed to both volatility and a severe decline in financial markets.

The full extent of the impact of COVID-19 (and of the resulting precipitous decline and disruption in economic and commercial activity across many of the world’s economies) on global economic conditions, and on the operations, financial condition, and performance of any particular market, industry or business, is impossible to predict, and additional economic disruptions and market volatility may occur as new variants appear and spread. Ongoing and potential additional materially adverse effects, including further global, regional and local economic downturns (including recessions) of indeterminate duration and severity, are possible.

The ongoing COVID-19 crisis and any other public health emergency could have a significant adverse impact on our investments and result in significant investment losses. Of particular relevance to an investment in KYN, volatility in the energy markets, including decreases in demand for (and prices of) energy-related commodities as a result of the impact of COVID-19 on global economic activity, has significantly affected the performance of the energy sector, as well as the performance of Energy Infrastructure Companies in which we invest. Other public health emergencies in the future could have similar impacts.

General Market Conditions Risk

Global economic, political and market conditions, including uncertainty about the financial stability of the United States, could have a significant adverse effect on our business, financial condition and results of operations. The current worldwide financial markets situation, as well as various social and political tensions in the United States and around the world (including wars and other forms of conflict, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics), may contribute to increased market volatility, may have long term effects on the United States and worldwide financial markets, and may cause economic uncertainties or deterioration in the United States and worldwide.

In addition, the continuing conflict between Russia and Ukraine, and resulting market volatility, could adversely affect our business, financial condition or results of operations. In response to the conflict between Russia and Ukraine, the U.S. and other countries have imposed sanctions or other restrictive actions against Russia. The ongoing conflict and the rapidly evolving measures in response could be expected to have a negative impact on the economy and business activity globally and could have a material adverse effect on our portfolio companies and our business, financial condition, cash flows and results of operations. The severity and duration of the conflict and its impact on global economic and market conditions are impossible to predict. In addition, sanctions could also result in Russia taking counter measures or retaliatory actions which could adversely impact our business or the business of our portfolio companies, including, but not limited to, cyberattacks targeting companies, individuals or other infrastructure upon which our business and the business of our portfolio companies rely.

Risks Related to Our Business and Structure

Use of Leverage

We currently utilize Leverage Instruments and intend to continue to do so. Under normal market conditions, our policy is to utilize Leverage Instruments in an amount that represents approximately 25% – 30% of our total assets, including proceeds from such Leverage Instruments. Notwithstanding this policy, based on market conditions at such time, we may use Leverage Instruments in amounts greater than our policy (to the extent permitted by the 1940 Act) or less than our policy. Leverage Instruments have seniority in liquidation and distribution rights over our common stock.

If we are unable to renew or refinance our credit facility prior to maturity or if we are unable to refinance our Notes or MRP Shares as they mature, we may be forced to sell securities in our portfolio to repay debt or MRP Shares as they mature. If we are required to sell portfolio securities to repay outstanding debt or MRP Shares as they mature or to maintain asset coverage ratios, such sales may be at prices lower than what we would otherwise realize if we were not required to sell such securities at such time.

Additionally, we may be unable to refinance our debt or MRP Shares or sell a sufficient amount of portfolio securities to repay debt or MRP Shares as they mature or to maintain asset coverage ratios, which could cause an event of default on our debt securities or MRP Shares.

Leverage Instruments constitute a substantial lien and burden by reason of their prior claim against our income and against our net assets in liquidation. The rights of lenders to receive payments of interest on and repayments of principal of any Borrowings are senior to the rights of holders of common stock and preferred stock, with respect to the payment of distributions or upon liquidation. We may not be permitted to declare dividends and distributions with respect to common stock or preferred stock or purchase common stock or preferred stock unless at such time, we meet certain asset coverage requirements and no event of default exists under any Borrowing. In addition, we may not be permitted to pay distributions on common stock unless all dividends on the preferred stock and/or accrued interest on Borrowings have been paid, or set aside for payment.

In an event of default under any Borrowing, the lenders have the right to cause a liquidation of collateral (i.e., sell portfolio securities and other of our assets) and, if any such default is not cured, the lenders may be able to control the liquidation as well. If an event of default occurs or in an effort to avoid an event of default, we may be forced to sell securities at inopportune times and, as a result, receive lower prices for such security sales. We may also incur prepayment penalties on Notes and MRP Shares that are redeemed prior to their stated maturity dates or mandatory redemption dates.

Certain types of leverage, including the Notes and MRP Shares, subject us to certain affirmative covenants relating to asset coverage and our portfolio composition. In a declining market, we may need to sell securities in our portfolio to maintain asset coverage ratios, which would impact the distributions to us, and as a result, our cash available for distribution to common stockholders. By utilizing Notes and MRP Shares, we may be forced to sell securities at an inopportune time in the future to maintain asset coverage ratios and may be forced to pay additional prepayment penalties on our Notes and MRP Shares. Our Notes and MRP Shares also may impose special restrictions on our use of various investment techniques or strategies or in our ability to pay distributions on common stock and preferred stock in certain instances. In addition, we are subject to certain negative covenants relating to transactions with affiliates, mergers and consolidation, among others. We are also subject to certain restrictions on investments imposed by guidelines of one or more rating agencies, which issue ratings for Leverage Instruments issued by us. These guidelines may impose asset coverage or portfolio composition requirements that are more stringent than those imposed by the 1940 Act. Kayne Anderson does not believe that these covenants or guidelines will impede it from managing our portfolio in accordance with our investment objective and policies.

Interest Rate Hedging Risk

We may hedge against interest rate risk resulting from our leveraged capital structure. We do not intend to hedge interest rate risk of our portfolio holdings. Interest rate transactions that we may use for hedging purposes will expose us to certain risks that differ from the risks associated with our portfolio holdings. There are economic costs of hedging reflected in the price of interest rate swaps and similar techniques, the cost of which can be significant. In addition, our success in using hedging instruments is subject to KAFA’s ability to correctly predict changes in the relationships of such hedging instruments to our leverage risk, and there can be no assurance that KAFA’s judgment in this respect will be accurate. To the extent there is a decline in interest rates, the value of interest rate swaps could decline, and result in a decline in the net asset value of our common stock (and asset coverage ratios for our senior securities). In addition, if the counterparty to an interest rate swap or cap defaults, we would not be able to use the anticipated net receipts under the interest rate swap to offset our cost of financial leverage.

Foreign Investing Risk

We invest in securities of foreign issuers, predominantly those located in Canada and, to a lesser extent, Europe. Canada is a significant exporter of natural resources, such as oil, natural gas and agricultural products. As a result, the Canadian economy is susceptible to adverse changes in certain commodities markets. It is also heavily dependent on trading with key partners, including the United States, Mexico, and China. Any reduction in trading with these key partners may adversely affect the Canadian economy. Canada’s dependency on the economy of the United States, in particular, makes Canada’s economy vulnerable to political and regulatory changes affecting the United States economy.

The European financial markets have continued to experience volatility because of concerns about economic downturns and about high and rising government debt levels of several countries in the European Union (“EU”) and Europe generally. These events have adversely affected the exchange rate of the Euro and the European securities markets, and may spread to other countries in Europe, including countries that do not use the Euro. These events may affect the value and liquidity of certain of our investments. Responses to the financial problems by EU governments, central banks and others, including austerity measures and reforms, may not work, may result in social unrest and may limit future growth and economic recovery or have other unintended consequences. Further defaults or restructurings by governments and others of their debt could have additional adverse effects on economies, financial markets and asset valuations around the world.

The United Kingdom (“U.K.”) left the EU on January 31, 2020, in a process now commonly referred to as “Brexit.” Investments in European issuers face risks associated with the potential uncertainty and consequences following Brexit, including with respect to volatility in exchange rates and interest rates. Brexit could adversely affect European or worldwide political, regulatory, economic or market conditions and could contribute to instability in global political institutions, regulatory agencies and financial markets. Brexit has also led to legal uncertainty and could lead to politically divergent national laws and regulations as a new relationship between the U.K. and EU is defined and the U.K. determines which EU laws to replace or replicate. Any of these effects of Brexit could adversely affect any of the companies to which we have exposure and any other assets in which we invest. The political, economic and legal consequences of Brexit are not yet fully known.

Secessionist movements, such as the Catalan movement in Spain and the independence movement in Scotland, as well as governmental or other responses to such movements, may also create instability and uncertainty in the region. In addition, the national politics of countries in the EU have been unpredictable and subject to influence by disruptive political groups and ideologies. The governments of EU countries may be subject to change and such countries may experience social and political unrest. Unanticipated or sudden political or social developments may result in sudden and significant investment losses. The occurrence of terrorist incidents throughout Europe could also impact financial markets. The impact of these events is not clear but could be significant and far-reaching and could adversely affect the value and liquidity of our investments.

Investments in some foreign securities may involve greater risks than investing in U.S. securities. As compared to U.S. companies, foreign issuers generally disclose less financial and other information publicly and are subject to less stringent and less uniform accounting, auditing and financial reporting standards. Foreign countries typically impose less thorough regulations on brokers, dealers, stock exchanges, corporate insiders and listed companies than does the U.S., and foreign securities markets may be less liquid and more volatile than U.S. markets. Investments in foreign securities generally involve higher costs than investments in U.S. securities, including higher transaction and custody costs as well as additional taxes imposed by foreign governments. In addition, securities trading practices abroad may offer less protection to investors. Political or social instability, civil unrest, acts of terrorism, regional economic volatility, and the imposition of sanctions, confiscations, trade restrictions (including tariffs) and other government restrictions by the United States and/or other governments are other potential risks that could impact an investment in a foreign security. Settlement of transactions in some foreign markets may be delayed or may be less frequent than in the U.S., which could affect the liquidity of our portfolio.

Foreign Currency Risk

Because we invest in foreign (non-U.S.) currencies or in foreign securities that are denominated, trade and/or receive revenues in foreign (non-U.S.) currencies, we are subject to the risk that those foreign currencies may decline in value relative to the U.S. dollar. In the case of currency hedging positions, we are subject to the risk that the U.S. dollar may decline in value relative to the currency being hedged. Currency exchange rates may fluctuate significantly and unpredictably. As a result, our investments in foreign currencies, in foreign securities that are denominated, trade, and/or receive revenues in foreign currencies, or in derivatives that provide exposure to foreign currencies may reduce our returns.

Tax Risks

In addition to other risk considerations, an investment in our common stock will involve certain tax risks, including, but not limited to, the risks summarized below. The federal, state, local and foreign tax consequences of an investment in and holding of our common stock will depend on the facts of each investor’s situation. Investors are encouraged to consult their own tax advisers regarding the specific tax consequences that may affect them.

Taxability of Distributions Received

We cannot assure you what percentage of the distributions paid on our common stock, if any, will be treated as tax-advantaged qualified dividend income or return of capital or what the tax rates on various types of income or gain will be in future years. New legislation could negatively impact the amount and tax characterization of distributions received by our common stockholders. Under current law, qualified dividend income received by individual stockholders is taxed at a maximum federal tax rate of 20% for individuals, provided a holding period requirement and certain other requirements are met. In addition, currently a 3.8% federal tax on net investment income (the “Tax Surcharge”) generally applies to dividend income and net capital gains for taxpayers whose adjusted gross income exceeds $200,000 for single filers or $250,000 for married joint filers.

Tax Risks of Investing in our Securities

A reduction in the return of capital portion of the distributions that we receive from our portfolio investments or an increase in our earnings and profits and portfolio turnover may reduce that portion of our distribution treated as a tax-deferred return of capital and increase that portion treated as a dividend, resulting in lower after-tax distributions to our common and preferred stockholders.

Other Tax Risks

As a limited partner in the MLPs in which we invest, we will be allocated our distributive share of income, gains, losses, deductions and credits from those MLPs. Historically, a significant portion of income from such MLPs has been offset by tax deductions. We will incur a current tax liability on our distributive share of an MLP’s income and gains that is not offset by tax deductions, losses and credits, or our capital or net operating loss carryforwards or other applicable deductions, if any. The percentage of an MLP’s income and gains which is offset by tax deductions, losses and credits will fluctuate over time for various reasons. A significant slowdown in acquisition activity or capital spending by MLPs held in our portfolio could result in a reduction in the depreciation deduction passed through to us, which may, in turn, result in increased current tax liability to us. In addition, changes to the tax code that impact the amount of income, gain, deduction or loss that is passed through to us from the MLP securities in which we invest (for example through changes to the deductibility of interest expense or changes to how capital expenditures are depreciated) may also result in an increased current tax liability to us. For example, the 2017 Tax Cuts and Jobs Act imposed certain limitations on the deductibility of interest expense that could result in less deduction being passed through to us as the owner of an MLP that is impacted by such limitations. We will accrue deferred income taxes for any future tax liability associated with that portion of MLP distributions considered to be a tax-deferred return of capital as well as capital appreciation of our investments. Upon the sale of an MLP security, we may be required to pay previously deferred taxes. A portion of the gain upon disposition of MLP units attributable to Internal Revenue Code Section 751 assets, including depreciation recapture, would be recognized as ordinary income. Ordinary income attributable to Section 751 assets may exceed the net taxable gain realized upon sale and may be recognized even if there is a net taxable loss upon disposition. We could therefore recognize both ordinary income and a capital loss upon disposition of MLP units.

We rely to some extent on information provided by the MLPs, which may not necessarily be timely, to estimate taxable income allocable to the MLP units held in the portfolio and to estimate the associated current or deferred taxes. Such estimates are made in good faith. From time to time, as new information becomes available, we modify our estimates or assumptions regarding our deferred taxes.

The 2017 Tax Cuts and Jobs Act also imposed limitations on the deductibility of net interest expense and limitations on the usage of net operating loss carryforwards (and elimination of carrybacks). These limitations may impact certain deductions to taxable income and may result in an increased current tax liability to us. To the extent certain deductions are limited in any given year, we may not be able to utilize such deductions in future periods if we do not have sufficient taxable income.

Deferred Tax Risks of Investing in our Securities

The Tax Cuts and Jobs Act reduced the federal corporate tax rate from 35% to 21%. Because our deferred tax liability is based primarily on the federal corporate tax rate, the enactment of the bill significantly reduced our deferred tax liability and increased our net asset value. If the federal income tax rate were to increase in the future, as has been proposed by the Biden administration, our deferred tax liability would increase resulting in a corresponding decrease to our net asset value.

The Company periodically reviews the recoverability of its deferred tax assets based on the weight of available evidence. When assessing the recoverability of its deferred tax assets, significant weight is given to the effects of potential future realized and unrealized gains on investments and the period over which these deferred tax assets can be realized. The Company will continue to review and assess the need for a valuation allowance in the future. Significant variability in the fair value of its portfolio of investments may change the Company’s assessment regarding the recoverability of its deferred tax assets. If a valuation allowance is required to reduce any deferred tax asset in the future, or if a change in a valuation allowance is necessary, it could have a material impact on the Company’s net asset value and results of operations in the period of adjustment.

Management Risk; Dependence on Key Personnel of Kayne Anderson

Our portfolio is subject to management risk because it is actively managed. KAFA applies investment techniques and risk analyses in making investment decisions for us, but there can be no guarantee that they will produce the desired results.

We depend upon Kayne Anderson’s key personnel for our future success and upon their access to certain individuals and investments in the energy sector. In particular, we depend on the diligence, skill and network of business contacts of our portfolio managers, who evaluate, negotiate, structure, close and monitor our investments. These individuals manage a number of investment vehicles on behalf of Kayne Anderson and, as a result, do not devote all of their time to managing us, which could negatively impact our performance. Furthermore, these individuals do not have long-term employment contracts with Kayne Anderson, although they do have equity interests and other financial incentives to remain with Kayne Anderson. We also depend on the senior management of Kayne Anderson. The departure of any of our portfolio managers or the senior management of Kayne Anderson could have a material adverse effect on our ability to achieve our investment objective. In addition, we can offer no assurance that KAFA will remain our investment adviser or that we will continue to have access to Kayne Anderson’s industry contacts and deal flow.

Cybersecurity Risk

The information and technology systems relied upon by KYN, KAFA and our service providers (including, but not limited to, fund accountants, custodians, transfer agents, administrators, distributors and other financial intermediaries) and/or the issuers of securities in which we invest may be vulnerable to damage or interruption from computer viruses, network failures, computer and telecommunication failures, infiltration by unauthorized persons, security breaches, usage errors, power outages and catastrophic events such as fires, tornadoes, floods, hurricanes and earthquakes. Although KAFA has implemented measures to manage risks relating to these types of events, if these systems are compromised, become inoperable for extended periods of time or cease to function properly, significant investment may be required to fix or replace them. The failure of these systems and/or of disaster recovery plans could cause significant interruptions in the operations of KYN, KAFA, our service providers and/or issuers of securities in which we invest and may result in a failure to maintain the security, confidentiality or privacy of sensitive data, including personal information relating to investors (and the beneficial owners of investors). Such a failure could also harm the reputation of KYN, KAFA, our service providers and/or issuers of securities in which we invest, subject these entities and their respective affiliates to legal claims or otherwise affect their business and financial performance. There is also a risk that cybersecurity breaches may not be detected, and KYN and its stockholders could be negatively impacted as a result.

Conflicts of Interest of Kayne Anderson

Conflicts of interest may arise because Kayne Anderson and its affiliates generally carry on substantial investment activities for other clients in which the Company will have no interest. Kayne Anderson or its affiliates may have financial incentives to favor certain of such accounts over us. Any of their proprietary accounts and other customer accounts may compete with us for specific trades. Kayne Anderson or its affiliates may buy or sell securities for us which differ from securities bought or sold for other accounts and customers, even though their investment objectives and policies may be similar to ours. Situations may occur when we could be disadvantaged because of the investment activities conducted by Kayne Anderson or its affiliates for their other accounts. Such situations may be based on, among other things, legal or internal restrictions on the combined size of positions that may be taken for us and the other accounts, thereby limiting the size of our position, or the difficulty of liquidating an investment for us and the other accounts where the market cannot absorb the sale of the combined position.

Our investment opportunities may be limited by affiliations of Kayne Anderson or its affiliates with Energy Infrastructure Companies. In addition, to the extent that Kayne Anderson sources and structures private investments in Energy Infrastructure Companies, certain employees of Kayne Anderson may become aware of actions planned by Energy Infrastructure Companies, such as acquisitions, that may not be announced to the public. It is possible that we could be precluded from investing in an Energy Infrastructure Company about which Kayne Anderson has material non-public information; however, it is Kayne Anderson’s intention to ensure that any material non-public information available to certain Kayne Anderson employees not be shared with those employees responsible for the purchase and sale of publicly traded Energy Infrastructure Company securities.

KAFA also manages KMF and Kayne Anderson Renewable Infrastructure Fund, an open-end investment company.

In addition to closed-end and open-end investment companies, KAFA and KACALP manage several private investment funds and separately managed accounts (collectively, “Affiliated Funds”). Some of the Affiliated Funds have investment objectives that are similar to or overlap with ours. Further, Kayne Anderson may at some time in the future, manage other investment funds with the same investment objective as ours or that otherwise create potential conflicts of interest with us.

Investment decisions for us are made independently from those of Kayne Anderson’s other clients; however, from time to time, the same investment decision may be made for more than one fund or account. When two or more clients advised by Kayne Anderson or its affiliates seek to purchase or sell the same publicly traded securities, the securities actually purchased or sold are allocated among the clients on a good faith equitable basis by Kayne Anderson in its discretion in accordance with the clients’ various investment objectives and procedures adopted by Kayne Anderson and approved by our Board of Directors. In some cases, this system may adversely affect the price or size of the position we may obtain. In other cases, however, our ability to participate in volume transactions may produce better execution for us.

We and our affiliates, including Affiliated Funds, may be precluded from co-investing in private placements of securities, including in any portfolio companies that we control. Except as permitted by law, Kayne Anderson will not co-invest its other clients’ assets in the private transactions in which we invest. Kayne Anderson will allocate private investment opportunities among its clients, including us, based on allocation policies that take into account several suitability factors, including the size of the investment opportunity, the amount each client has available for investment and the client’s investment objectives. These allocation policies may result in the allocation of investment opportunities to an Affiliated Fund rather than to us. The policies contemplate that Kayne Anderson will exercise discretion, based on several factors relevant to the determination, in allocating the entirety, or a portion, of such investment opportunities to an Affiliated Fund, in priority to other prospectively interested advisory clients, including us. In this regard, when applied to specified investment opportunities that would normally be suitable for us, the allocation policies may result in certain Affiliated Funds having greater priority than us to participate in such opportunities depending on the totality of the considerations, including, among other things, our available capital for investment, our existing holdings, applicable tax and diversification standards to which we may then be subject and the ability to efficiently liquidate a portion of our existing portfolio in a timely and prudent fashion in the time period required to fund the transaction.

The investment management fee paid to KAFA is based on the value of our assets, as periodically determined. A significant percentage of our assets may be illiquid securities acquired in private transactions for which market quotations will not be readily available. Although we have adopted valuation procedures designed to determine valuations of illiquid securities in a manner that reflects their fair value, there typically is a range of prices that may be established for each individual security. Pursuant to Rule 2a-5, our Board of Directors has designated KAFA as our “Valuation Designee”. As the Valuation Designee, KAFA performs fair value determinations of our portfolio holdings, subject to oversight by and periodic reporting to the Board. KAFA determines the fair value of our portfolio holdings in accordance with our valuation program, as adopted by the Board. As a part of this process, KAFA receives a valuation report from a third-party firm for fair valued (Level 3) securities.

Risk of Owning Securities of Affiliates

From time to time, we may “control” or may be an “affiliate” of one or more of our portfolio companies, as each of these terms is defined in the 1940 Act. In general, under the 1940 Act, we would be presumed to “control” a portfolio company if we and our affiliates owned 25% or more of its outstanding voting securities and would be an “affiliate” of a portfolio company if we and our affiliates owned 5% or more of its outstanding voting securities. The 1940 Act contains prohibitions and restrictions relating to transactions between investment companies and their affiliates (including our investment adviser), principal underwriters and affiliates of those affiliates or underwriters.

Valuation Risk

Market prices may not be readily available for certain of our investments in restricted or unregistered investments in public companies or investments in private companies. The value of such investments will ordinarily be determined based on fair valuations determined by KAFA as our Valuation Designee. Restrictions on resale or the absence of a liquid secondary market may adversely affect our ability to determine our net asset value. The sale price of securities that are not readily marketable may be lower or higher than our most recent determination of their fair value. Additionally, the value of these securities typically requires more reliance on the judgment of KAFA than that required for securities for which there is an active trading market. Due to the difficulty in valuing these securities and the absence of an active trading market for these investments, we may not be able to realize these securities’ true value or may have to delay their sale in order to do so.

Anti-Takeover Provisions

Our Charter, Bylaws and the Maryland General Corporation Law include provisions that could limit the ability of other entities or persons to acquire control of us, to convert us to open-end status, or to change the composition of our Board of Directors. We also have adopted other measures that may make it difficult for a third party to obtain control of us, including provisions of our Charter classifying our Board of Directors in three classes serving staggered three-year terms; and provisions authorizing our Board of Directors to classify or reclassify shares of our stock in one or more classes or series, to cause the issuance of additional shares of our stock, and allowing a majority of our entire Board of Directors to amend our Charter, without stockholder approval, to increase or decrease the number of shares of stock that we have the authority to issue. These provisions, as well as other provisions of our Charter and Bylaws, could have the effect of discouraging, delaying, deferring or preventing a transaction or a change in control that might otherwise be in the best interests of our stockholders. As a result, these provisions may deprive our common stockholders of opportunities to sell their common stock at a premium over the then current market price of our common stock.

Additional Risks Related to Our Common Stock

Market Discount from Net Asset Value Risk

Our common stock has traded both at a premium and at a discount to our net asset value. Shares of closed-end investment companies frequently trade at a discount to their net asset value. This characteristic is a risk separate and distinct from the risk that our net asset value could decrease as a result of our investment activities. Although the value of our net assets is generally considered by market participants in determining whether to purchase or sell shares, whether investors will realize gains or losses upon the sale of our common stock depends upon whether the market price of our common stock at the time of sale is above or below the investor’s purchase price for our common stock. Because the market price of our common stock is affected by factors such as net asset value, distribution levels (which are dependent, in part, on expenses), supply of and demand for our common stock, stability of distributions, trading volume, general market and economic conditions, and other factors beyond our control, we cannot predict whether our common stock will trade at, below or above net asset value.

Leverage Risk to Common Stockholders

The issuance of Leverage Instruments represents the leveraging of our common stock. Leverage is a technique that could adversely affect our common stockholders. Unless the income and capital appreciation, if any, on securities acquired with the proceeds from Leverage Instruments exceed the costs of the leverage, the use of leverage could cause us to lose money. When leverage is used, the net asset value and market value of our common stock will be more volatile. There is no assurance that our use of leverage will be successful.

Our common stockholders bear the costs of leverage through higher operating expenses. Our common stockholders also bear management fees, whereas holders of notes or preferred stock do not bear management fees. Because management fees are based on our total assets, our use of leverage increases the effective management fee borne by our common stockholders. In addition, the issuance of additional senior securities by us would result in offering expenses and other costs, which would ultimately be borne by our common stockholders. Fluctuations in interest rates could increase our interest or dividend payments on Leverage Instruments and could reduce cash available for distributions on common stock. Certain Leverage Instruments are subject to covenants regarding asset coverage, portfolio composition and other matters, which may affect our ability to pay distributions to our common stockholders in certain instances. We may also be required to pledge our assets to the lenders in connection with certain other types of borrowing.

Leverage involves other risks and special considerations for common stockholders including: the likelihood of greater volatility of net asset value and market price of our common stock than a comparable portfolio without leverage; the risk of fluctuations in dividend rates or interest rates on Leverage Instruments; that the dividends or interest paid on Leverage Instruments may reduce the returns to our common stockholders or result in fluctuations in the distributions paid on our common stock; the effect of leverage in a declining market, which is likely to cause a greater decline in the net asset value of our common stock than if we were not leveraged, which may result in a greater decline in the market price of our common stock; and when we use financial leverage, the investment management fee payable to Kayne Anderson may be higher than if we did not use leverage.

While we may from time to time consider reducing leverage in response to actual or anticipated changes in interest rates or actual or anticipated changes in investment values in an effort to mitigate the increased volatility of current income and net asset value associated with leverage, there can be no assurance that we will actually reduce leverage in the future or that any reduction, if undertaken, will benefit our common stockholders. Changes in the future direction of interest rates or changes in investment values are difficult to predict accurately. If we were to reduce leverage based on a prediction about future changes to interest rates (or future changes in investment values), and that prediction turned out to be incorrect, the reduction in leverage would likely result in a reduction in income and/or total returns to common stockholders relative to the circumstance if we had not reduced leverage. We may decide that this risk outweighs the likelihood of achieving the desired reduction to volatility in income and the price of our common stock if the prediction were to turn out to be correct, and determine not to reduce leverage as described above.

Finally, the 1940 Act provides certain rights and protections for preferred stockholders which may adversely affect the interests of our common stockholders. See “Proposal One: Merger — Description of Securities.”

PROPOSAL ONE: MERGER

The Board of Directors of KMF, including the Independent Directors, has unanimously approved the Merger Agreement, declared the Merger advisable and directed that the Merger proposal be submitted to the KMF stockholders for consideration. Upon the closing of the Merger, KMF will be merged with and into a wholly owned subsidiary (“Merger Sub”) of KYN, with KMF’s shares of common stock converted into shares of KYN common stock (although cash will be distributed in lieu of fractional shares). KMF will then cease its separate existence under Maryland law and terminate its registration under the 1940 Act. Immediately following the Merger, it is expected that Merger Sub will be merged with and into KYN. The aggregate NAV of KYN common stock received by KMF common stockholders in the Merger will equal the aggregate NAV of KMF shares held on the business day prior to closing of the Merger (excluding cash distributed by KYN for fractional shares). KYN will be the accounting survivor following the closing of the Merger and will continue to operate after the Merger as a registered, non-diversified, closed-end management investment company with the investment objectives and policies described in this joint proxy statement/prospectus.

Reasons for the Merger and Board Considerations

The Board of Directors of each Company has approved the Merger because they have determined that the Merger is in the best interests of each Company and that the interests of the existing stockholders of each Company will not be diluted as a result of the Merger. In making this determination, the Board of Directors of each Company considered (i) the expected benefits of the transaction for each Company (as outlined in more detail below) and (ii) the fact that both Companies have very similar investment policies, investment strategies and portfolio holdings. The Combined Company will pursue KYN’s investment objective which is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders. The Combined Company intends to achieve this objective by investing at least 80% of total assets in the securities of Energy Infrastructure Companies. Please refer to the Glossary for the meaning of capitalized terms not otherwise defined herein.

Specifically, the Boards of Directors of each Company considered and discussed matters relating to the Merger at executive sessions and meetings of the Boards of Directors (collectively, the “Board meetings”). In advance of the Board meetings, KAFA provided detailed information to the Boards of Directors about the proposed Merger and responded to a number of questions and additional requests for information from the Boards of Directors. In addition, at or prior to the Board meetings, the Boards of Directors met with representatives of KAFA, KAFA’s legal counsel and counsel to the Companies (Paul Hastings LLP) and their independent legal counsel (Dechert LLP). The Independent Directors met separately several times with their independent legal counsel to consider and discuss the Merger. KAFA recommended that the Boards of Directors approve the Merger and in the course of deliberations, KAFA agreed to support a fee waiver for three years effective at the closing of the Merger such that the pro forma, run-rate fees payable to KAFA are equal to the aggregate, run-rate management fees payable if KYN and KMF had remained standalone companies, upon the closing of the Merger, a reduction in the asset tiers for management fee waivers of the pro forma Combined Company, and, after obtaining the necessary stockholder approvals to complete the Merger, a tender offer for at least 15% of the outstanding shares of KMF at 95% of its NAV (which would be completed prior to the Merger closing). The Boards of Directors reviewed the Merger with respect to the interests of both Companies in mind. After careful consideration, the Boards of Directors of each Company, including the Independent Directors, unanimously approved Merger for both Companies.

In approving the Merger and recommending that stockholders of KMF approve the Merger and stockholders of KYN approve the issuance of additional KYN common stock in connection with the Merger, the Boards of Directors, including the Independent Directors, determined that participation in the Merger is in the best interests of both Companies and that the interests of the existing stockholders of both Companies will not be diluted as a result of the Merger. The determination to approve the Merger was made on the basis of each director’s business judgment after consideration of all of the factors deemed relevant to the director taken as a whole, though individual directors may have placed different weights on certain factors.

Some of the factors that the Boards of Directors considered in determining that the Merger is in the best interests of the stockholders include:

●

Merger expected to increase KMF’s distribution level

●

KMF’s stockholders should benefit from enhanced market liquidity and may benefit from improved trading relative to NAV per share

	KYN		KMF		Pro Forma Combined Company⁽¹⁾
Equity capitalization ($ in millions)	$	1,213	$	349	$	1,532
Average daily trading volume⁽²⁾		454		127		NA

As of February 28, 2023.

(1)

Pro forma for the Merger and including the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed).

(2)

90-day average trading volume in thousands of shares.

●

KMF’s stockholders may benefit from a tender offer of common stock to be completed upon the approval and before the closing of the Merger

The tender offer will be conducted in accordance with the requirements of rules adopted under the Securities Exchange Act of 1934, as amended, and KMF will file a Schedule TO containing more detailed information about the tender offer. No action needs be taken by KMF stockholders at this time in order to participate in the tender offer when it occurs. KMF stockholders should read the Schedule TO and other disclosures once they become available. The discussion of the proposed tender offer is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of KMF stock.

●

The Combined Company will have more flexibility than KMF regarding its portfolio of Energy Infrastructure Companies

KMF currently qualifies as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). As long as KMF meets certain portfolio diversification and other requirements that govern its sources of income and timely distribution of earnings to stockholders, KMF will not be subject to federal income tax. For KMF to qualify as a RIC, at the end of each quarter, KMF must have (i) at least 50% of the value of its total assets comprised of investments that are not greater in value than 5% of total assets and (ii) no more than 25% of the value of its total assets invested in the securities of one or more qualified publicly traded partnership (“PTPs”). Currently, these requirements are limiting the types of investments that KMF could make – in particular, the fund’s MLP holdings (which are considered PTPs for the purpose of KMF’s RIC diversification requirement), cannot exceed 25% of its total assets. In contrast, KYN (as a taxable corporation) does not have these same portfolio constraints See “Proposal One: Merger – Investment Objectives and Policies of KYN”. Upon completion of the Merger, the Combined Company will operate as a taxable corporation and pursue KYN’s investment objective. We believe the benefits of additional portfolio flexibility, which enables KYN to invest across a full spectrum of Energy Infrastructure Companies, outweigh the benefits of qualifying as a RIC. See “Proposal One: Merger—Comparison of the Companies”.

●

Potential for reduced management fee in the future as assets appreciate, due to revised KYN management fee waiver

As of February 28, 2023, KYN was subject to a management fee of 1.375% on its $1.9 billion of management fee total assets and KMF was subject to a management fee of 1.25% on its $0.5 billion of management fee total assets. Pro forma for the combination and the proposed tender offer, the Combined Company would have pro forma management fee total assets $2.4 billion, based on the Companies’ assets as of February 28, 2023. Upon completion of the Merger, KAFA has agreed to revise its management fee waiver agreement with KYN to reduce the asset tiers for fee waivers. The initial asset tier for fee waiver will be reset to the pro forma Combined Company management fee total assets as of the closing of the Merger. The revised fee waiver will lower the effective management fee that KYN pays as its assets appreciate. The table below outlines the current and revised management fee waivers assuming the Merger was completed on February 28, 2023:

KYN Asset Tiers for Fee Waiver		Management Fee			Applicable
Current	Revised	Waiver			Management Fee⁽¹⁾
$0 to $4.0 billion	$0 to $2.4 billion⁽²⁾		0.000	%		1.375	%
$4.0 billion to $6.0 billion	$2.4 billion⁽²⁾to $4.0 billion		0.125	%		1.250	%
$6.0 billion to $8.0 billion	$4.0 billion to $6.0 billion		0.250	%		1.125	%
Greater than $8.0 billion	Greater than $6.0 billion		0.375	%		1.000	%

	(1)	Represents the management fee, after giving effect to the fee waiver, applicable to the incremental total assets at each tier.
	(2)	Initial asset tier for fee waiver of $2.4 billion based on the approximate management fee total asset values at each Company as of February 28, 2023. The actual amount of the first asset tier will be reset to the pro forma Combined Company management fee total asset value as of closing.

●

KMF’s stockholders should benefit from the larger asset base of the Combined Company

●

Elimination of duplicative expenses and greater economies of scale

In addition to the items discussed above, the Boards of Directors of both Companies also took into consideration the following items:

●

the terms and conditions of the Merger Agreement, particularly that the Merger will be submitted to the stockholders of KMF for their approval and the issuance of additional KYN common stock in connection with the Merger will be submitted to the stockholders of KYN for their approval, and that KMF common stock will be converted at the specified ratio into shares of common stock of KYN in connection with the Merger;

●

the recommendations of KAFA, as investment adviser to both Companies, with respect to the Merger;

●

the compatibility of the investment objectives and fundamental investment policies of the Companies, the differences in the principal investment strategies and the types of investments employed by each Company as well as the resources required for such investments, and the substantial overlap in the current portfolios of the Companies;

●

the change in investment restrictions of KMF, as a result of KMF being a RIC while KYN is taxed as a corporation;

●

the Companies' comparative historical distribution rates, their frequency and the potential impacts as a result of the Merger;

●

the Companies’ comparative historical discounts and premiums;

●

the aggregate NAV (not the market value) of KYN shares of common stock that stockholders of KMF will receive in the Merger will equal the aggregate NAV (not the market value) of the shares of common stock of KMF that such stockholders own immediately prior to the Merger, and the NAV of the shares of KMF should not be diluted on the basis of NAV;

●

the treatment of holders of preferred stock of KMF in the Merger;

●

KMF and KYN dividing the costs and expenses of the Merger, including preparation and distribution of this joint proxy statement/prospectus, proxy solicitation expenses, SEC registration fees, NYSE listing fees, trustee fees and all other reasonable third party expenses resulting from the Merger, on an equal basis;

●

the potential for greater secondary market liquidity for the common stock, which may result in a narrowing of bid-ask spreads and reduction in price movements when purchasing or selling stock;

●

the reduction in the number of closed-end funds offering similar investment strategies in the market and the total number of similar funds managed by KAFA, thereby potentially attracting greater interest by current and prospective investors;

●

the potential for reduced share price volatility and improved stockholder liquidity;

●

the anticipated effect of the Merger on the tax attributes of the Companies (including both Company’s capital loss carryforwards);

●

that KMF stockholders who do not wish to become stockholders of KYN will have an opportunity to sell their KMF shares on the NYSE and/or participate in a tender offer before the Merger; and

●

the alternatives to the Merger, including share buybacks, tender offers, distribution increases and/or special distributions, adjustments to investment strategies and policies, conversion to interval fund or open-end status, liquidation, and maintaining the status quo.

Investment Objectives and Policies of KYN

This section relates to KYN and its Investment Objective and Policies (other parts of this document relate to both KYN and KMF). Accordingly, references to “we” “us,” “our” or “the Company” in this section are references to KYN.

Our investment objective is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders. Our investment objective is considered a fundamental policy and therefore may not be changed without the approval of the holders of a “majority of the outstanding” voting securities, as such term is defined under the 1940 Act. When used with respect to our voting securities, a “majority of the outstanding” voting securities means (i) 67% or more of the shares present at a meeting, if the holders of more than 50% of the shares are present or represented by proxy, or (ii) more than 50% of the shares, whichever is less. There can be no assurance that we will achieve our investment objective.

Our non-fundamental investment policies may be changed by the Board of Directors without the approval of the holders of a “majority of the outstanding” voting securities, provided that the holders of such voting securities receive at least 60 days’ prior written notice of any change. The following are our non-fundamental investment policies, under normal market conditions:

●

We intend to invest at least 80% of total assets in public and private securities of Energy Infrastructure Companies.

●

We intend to invest at least 50% of our total assets in publicly traded securities of Energy Infrastructure Companies.

●

Under normal market conditions, we may invest up to 50% of our total assets in unregistered or otherwise restricted securities. The types of unregistered or otherwise restricted securities that we may purchase include common equity, preferred equity, convertible equity and other securities of other public and private companies.

●

We may invest up to 15% of our total assets in any single issuer.

●

We may invest up to 20% of our total assets in debt securities, including below investment grade debt securities rated, at the time of investment, at least B3 by Moody’s, B- by Standard & Poor’s or Fitch, comparably rated by another rating agency or, if unrated, determined by KAFA to be of comparable quality. In addition, up to one-quarter of our permitted investments in debt securities (or up to 5% of our total assets) may be invested in unrated debt securities or debt securities that are rated less than B3/B- of public or private companies.

●

We may, but are not required to, use derivative investments and engage in short sales to hedge against interest rate and market risks.

●

Under normal market conditions, our policy is to utilize our debt securities, revolving credit facility and other borrowings, and our preferred stock (collectively, “Leverage Instruments”) in an amount that represents approximately 25% to 30% of our total assets (our “target leverage levels”), including proceeds from such Leverage Instruments. However, we reserve the right at any time, based on market conditions, (i) to reduce our target leverage levels or (ii) to use Leverage Instruments to the extent permitted by the 1940 Act.

Unless otherwise stated, all investment restrictions apply at the time of purchase and we will not be required to reduce a position due solely to market value fluctuations.

Our Portfolio

At any given time, we expect that our portfolio will have some or all of the types of the following types of investments: (i) equity securities of Energy Infrastructure Companies, including Midstream Energy Companies, Renewable Infrastructure Companies and Utility Companies, (ii) debt securities of Energy Infrastructure Companies, and (iii) equity and debt securities of other public and private issuers.

Description of Energy Infrastructure Companies

Energy Infrastructure Companies consist of (i) Midstream Energy Companies, (ii) Renewable Infrastructure Companies and (iii) Utility Companies, each of which is described in further detail below.

Description of Midstream Energy Companies

Midstream Energy Companies are companies that primarily own and operate Midstream Assets, which are the assets used in energy logistics, including, but not limited to, assets used in (a) transporting, storing, gathering, processing, fractionating, distributing, or marketing of natural gas, natural gas liquids, crude oil, refined products or water produced in conjunction with such activities or (b) the capture, transportation or sequestration of carbon dioxide. Midstream Energy Companies may be structured as Master Limited Partnerships or taxed as corporations. For purposes of our investment policies, Midstream Energy Companies include companies that (i) derive at least 50% of their revenue or operating income from operating Midstream Assets or providing services for the operation of such assets or (ii) have Midstream Assets that represent the majority of their assets.

Master Limited Partnerships are entities that are publicly traded and are treated as partnerships for federal income tax purposes. Master Limited Partnerships are typically structured as limited partnerships or as limited liability companies treated as partnerships. The units for these entities are listed and traded on a U.S. securities exchange. To qualify as a Master Limited Partnership, the entity must receive at least 90% of its income from qualifying sources as set forth in Section 7704(d) of the Code. These qualifying sources include natural resource-based activities such as the exploration, development, mining, production, gathering, processing, refining, transportation, storage, distribution and marketing of mineral or natural resources. Limited partnerships have two classes of interests: general partner interests and limited partner interests. The general partner typically controls the operations and management of the partnership through an equity interest in the partnership (typically up to 2% of total equity). Limited partners own the remainder of the partnership and have a limited role in the partnership’s operations and management.

Renewable Infrastructure Companies

Renewable Infrastructure Companies are companies that own and/or operate Renewable Infrastructure Assets, which are assets used in the generation, production, distribution, transportation, transmission, storage and marketing of energy including, but not limited to, electricity, steam, natural gas or transportation fuels from renewable sources such as solar, wind, flowing water (hydroelectric power), geothermal, biomass and organic waste. For purposes of our investment policies, Renewable Infrastructure Companies include companies that (i) derive at least 50% of their revenues or operating income from operating Renewable Infrastructure Assets or providing services for the operation of such assets or (ii) have Renewable Infrastructure Assets that represent the majority of their assets.

Utility Companies

Utility companies are companies that own and/or operate Utility Assets, which are assets, other than Renewable Infrastructure Assets, that are used in the generation, production, distribution, transportation, transmission, storage and marketing of energy, including, but not limited to, electricity, natural gas and steam. For purposes of our investment policies, Utility Companies include companies that (i) derive at least 50% of their revenues or operating income from operating Utility Assets or providing services for the operation of such assets or (ii) have Utility Assets that represent the majority of their assets.

Investment Practices

Covered Calls

We may write call options with the purpose of generating cash from call premiums, generating realized gains and/or reducing our ownership of certain securities. We will only write call options on securities that we hold in our portfolio (i.e., covered calls). A call option on a security is a contract that gives the holder of such call option the right to buy the security underlying the call option from the writer of such call option at a specified price at any time during the term of the option. At the time the call option is sold, the writer of a call option receives a premium (or call premium) from the buyer of such call option. If we write a call option on a security, we have the obligation upon exercise of such call option to deliver the underlying security upon payment of the exercise price. When we write a call option, an amount equal to the premium received by us will be recorded as a liability and will be subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by us as realized gains from investments on the expiration date. If we repurchase a written call option prior to its exercise, the difference between the premium received and the amount paid to repurchase the option is treated as a realized gain or realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security in determining whether we have realized a gain or loss. We, as the writer of the option, bear the market risk of an unfavorable change in the price of the security underlying the written option.

Interest Rate Swaps or Other Hedging Techniques

We may utilize hedging techniques such as interest rate swaps or other hedging techniques to mitigate potential interest rate risk on a portion of our Leverage Instruments. Such interest rate swaps or other hedging activity would principally be used to protect us against higher costs on our Leverage Instruments resulting from increases in interest rates.

Use of Arbitrage and Other Derivative-Based Strategies

We may use short sales, arbitrage and other strategies to try to generate additional return. As part of such strategies, we may (i) engage in paired long-short trades to arbitrage pricing disparities in securities held in our portfolio; (ii) purchase call options or put options; (iii) enter into total return swap contracts; or (iv) sell securities short. Paired trading consists of taking a long position in one security and concurrently taking a short position in another security within the same issuer or in issuers that operate in the same industry. With a long position, we purchase a stock outright; whereas with a short position, we would sell a security that we do not own and must borrow to meet our settlement obligations. We will realize a profit or incur a loss from a short position depending on whether the value of the underlying stock decreases or increases, respectively, between the time the stock is sold and when we replace the borrowed security. See “Risk Factors — Risks Related to Our Investments and Investment Techniques — Short Sales Risk.” A total return swap is a contract between two parties designed to replicate the economics of directly owning a security.

Value of Derivative Instruments

For purposes of determining compliance with the requirement that we invest 80% of our total assets in Energy Infrastructure Companies, we value derivative instruments based on their respective current fair market values.

Other Risk Management Strategies

To a lesser extent, we may use various hedging and other risk management strategies to seek to manage market risks. Such hedging strategies would be utilized to seek to protect against possible adverse changes in the market value of securities held in our portfolio, or to otherwise protect the value of our portfolio. We may execute our hedging and risk management strategy by engaging in a variety of transactions, including buying or selling options or futures contracts on indexes. See “Risk Factors — Risks Related to Our Investments and Investment Techniques — Derivatives Risk.”

Portfolio Turnover

We anticipate that our annual portfolio turnover rate will range between 15% and 25%, but the rate may vary greatly from year to year. Portfolio turnover rate is not considered a limiting factor in KAFA’s execution of investment decisions. For purposes of our investments in MLPs, the types of MLPs in which we intend to invest historically have made cash distributions to limited partners, a substantial portion of which would be treated as a non-taxable return of capital to the extent of our basis. As a result, the tax related to the portion of such distributions treated as return of capital would be deferred until subsequent sale of our MLP units, at which time we would pay any required tax on capital gain. A portion of the gain upon disposition of MLP units attributable to Internal Revenue Code Section 751 assets, including depreciation recapture, would be recognized as ordinary income. Ordinary income attributable to Section 751 assets may exceed the net taxable gain realized upon sale and may be recognized even if there is a net taxable loss upon disposition. We could therefore recognize both ordinary income and a capital loss upon disposition of MLP units. The sooner we sell such MLP units, the sooner we would be required to pay tax on resulting capital gains and/or ordinary income, and the cash available to us to pay distributions to our common stockholders in the year of such tax payment would be less than if such taxes were deferred until a later year. In addition, the greater the number of such MLP units that we sell in any year, i.e., the higher our turnover rate, the greater our potential tax liability for that year. These taxable gains and/or ordinary income may increase our current and accumulated earnings and profits, resulting in a greater portion of our common stock distributions being treated as dividend income to our common stockholders. In addition, a higher portfolio turnover rate results in correspondingly greater brokerage commissions and other transactional expenses that are borne by us. See “— Certain Federal Income Tax Matters.”

Use of Leverage

We generally will seek to enhance our total returns through the use of financial leverage, which may include the issuance of Leverage Instruments. Under normal market conditions, our policy is to utilize Leverage Instruments in an amount that represents approximately 25% - 30% of our total assets, including proceeds from such Leverage Instruments (which equates to 35% - 45% of our net asset value as of November 30, 2022). Notwithstanding this policy, based on market conditions at such time, we may use Leverage Instruments in amounts greater than our policy (to the extent permitted by the 1940 Act) or less than our policy. As of November 30, 2022, our Leverage Instruments represented approximately 21% of our total assets. At November 30, 2022, our asset coverage ratios under the 1940 Act were 602% and 443% for debt and total leverage (debt plus preferred stock), respectively. We target asset coverage ratios that give us ability to withstand declines in the market value of the securities we hold before breaching the financial covenants in our Leverage Instruments. These targets are dependent on market conditions and may vary from time to time. Currently, we are targeting asset coverage ratios that provide at least 40% of cushion relative to our financial covenants (i.e., market values could decline by approximately this amount before our asset coverage ratios would be equal to our financial covenants). Leverage creates a greater risk of loss, as well as potential for more gain, for our common stock than if leverage is not used. Our common stock is junior in liquidation and distribution rights to our Leverage Instruments. We expect to invest the net proceeds derived from any use of Leverage Instruments according to the investment objective and policies described in this joint proxy statement/prospectus.

Leverage creates risk for our common stockholders, including the likelihood of greater volatility of net asset value and market price of our common stock, and the risk of fluctuations in dividend rates or interest rates on Leverage Instruments which may affect the return to the holders of our common stock or will result in fluctuations in the distributions paid by us on our common stock. To the extent the return on securities purchased with funds received from Leverage Instruments exceeds their cost (including increased expenses to us), our total return will be greater than if Leverage Instruments had not been used. Conversely, if the return derived from such securities is less than the cost of Leverage Instruments (including increased expenses to us), our total return will be less than if Leverage Instruments had not been used, and therefore, the amount available for distribution to our common stockholders will be reduced. In the latter case, KAFA in its best judgment nevertheless may determine to maintain our leveraged position if it expects that the long-term benefits of so doing will outweigh the near-term impact of the reduced return to our common stockholders.

The management fees paid to KAFA will be calculated on the basis of our total assets including proceeds from Leverage Instruments. During periods in which we use financial leverage, the management fee payable to KAFA may be higher than if we did not use a leveraged capital structure. Consequently, we and KAFA may have differing interests in determining whether to leverage our assets. Our Board of Directors monitors our use of Leverage Instruments and this potential conflict. The use of leverage creates risks and involves special considerations. See “Risk Factors — Additional Risks Related to Our Common Stock — Leverage Risk to Common Stockholders.”

The Maryland General Corporation Law authorizes us, without prior approval of our common stockholders, to borrow money. In this regard, we may obtain proceeds through Borrowings and may secure any such Borrowings by mortgaging, pledging or otherwise subjecting as security our assets. In connection with such Borrowings, we may be required to maintain minimum average balances with the lender or to pay a commitment or other fee to maintain a line of credit. Any such requirements will increase the cost of such Borrowing over its stated interest rate.

Under the requirements of the 1940 Act, we, immediately after issuing any senior securities representing indebtedness, must have an asset coverage of at least 300% after such issuance. With respect to such issuance, asset coverage means the ratio which the value of our total assets, less all liabilities and indebtedness not represented by senior securities (as defined in the 1940 Act), bears to the aggregate amount of senior securities representing indebtedness issued by us.

The rights of our lenders to receive interest on and repayment of principal of any Borrowings will be senior to those of our common stockholders, and the terms of any such Borrowings may contain provisions which limit certain of our activities, including the payment of distributions to our common stockholders in certain circumstances. Under the 1940 Act, we may not declare any dividend or other distribution on any class of our capital stock, or purchase any such capital stock, unless our aggregate indebtedness has, at the time of the declaration of any such dividend or distribution, or at the time of any such purchase, an asset coverage of at least 300% after declaring the amount of such dividend, distribution or purchase price, as the case may be. Further, the 1940 Act does (in certain circumstances) grant our lenders certain voting rights in the event of default in the payment of interest on or repayment of principal.

Certain types of Leverage Instruments subject us to certain affirmative covenants relating to asset coverage and portfolio composition and may impose special restrictions on our use of various investment techniques or strategies or on our ability to pay distributions on common stock in certain circumstances. In addition, we are subject to certain negative covenants relating to transactions with affiliates, mergers and consolidations among others. It is not anticipated that these covenants or guidelines will impede KAFA from managing our portfolio in accordance with our investment objective and policies.

If an event of default is not cured, under any Borrowing, the lenders have the right to cause our outstanding Borrowings to be immediately due and payable and proceed to protect and enforce their rights by an action at law, suit in equity or other appropriate proceeding. If an event of default occurs or in an effort to avoid an event of default, we may be forced to sell securities at inopportune times and, as a result, receive lower prices for such security sales. We may also incur prepayment penalties on unsecured notes (“Notes”) and MRP Shares that are redeemed prior to their stated maturity dates or mandatory redemption dates.

Under the 1940 Act, we are not permitted to issue preferred stock unless immediately after such issuance the value of our total assets less all liabilities and indebtedness not represented by senior securities is at least 200% of the sum of the liquidation value of the outstanding preferred stock plus the aggregate amount of senior securities representing indebtedness. In addition, we are not permitted to declare any cash dividend or other distribution on our common or preferred stock unless, at the time of such declaration, our preferred stock has an asset coverage of at least 200%. Further, while the MRP Shares are outstanding, we are not permitted to issue preferred stock unless immediately after such issuance the value of our total assets less all liabilities and indebtedness not represented by senior securities is at least 225% of the sum of the liquidation value of the outstanding preferred stock plus the aggregate amount of senior securities representing indebtedness. In addition, we are not permitted to declare any cash dividend or other distribution on our common or preferred stock unless, at the time of such declaration, our preferred stock has an asset coverage of at least 225%. If necessary, we will purchase or redeem our preferred stock to maintain the applicable asset coverage ratio. In order to meet redemption requirements, we may have to liquidate portfolio securities. Such liquidations and redemptions would cause us to incur related transaction costs and could result in capital losses to us. If we have preferred stock outstanding, two of our directors will be elected by the holders of our preferred stock (voting as a class). Our remaining directors will be elected by holders of our common stock and preferred stock voting together as a single class. In the event we fail to pay dividends on our preferred stock for two years, holders of preferred stock would be entitled to elect a majority of our directors.

To the extent that we use additional Leverage Instruments, the Borrowings that we anticipate issuing will have maturity dates ranging from 1 to 12 years from the date of issuance. The preferred stock we anticipate issuing is a mandatory redeemable preferred that must be redeemed within 5 to 12 years from the date of issuance. If we are unable to refinance such Leverage Instruments when they mature, we may be forced to sell securities in our portfolio to repay such Leverage Instruments. Further, if we do not repay the Leverage Instruments when they mature, we will trigger an event of default on our Borrowings (which will increase the interest rate on such Borrowings and give the holders of such Borrowings certain rights) and will trigger a higher dividend rate on our preferred stock.

We may also borrow money as a temporary measure for extraordinary or emergency purposes, including the payment of dividends and the settlement of securities transactions which otherwise might require untimely dispositions of our common stock.

Effects of Leverage — KYN/Acquirer

As of February 28, 2023, we had $260.8 million, aggregate principal amount, of Notes outstanding.

As of February 28, 2023, we did not have any borrowings outstanding under our revolving credit facility. The interest rate payable by us on borrowings under our revolving credit facility with JPMorgan Chase Bank, N.A., Bank of America, N.A., and Sumitomo Mitsui Banking Corporation may vary between one-month SOFR plus 1.40% and one-month SOFR plus 2.25%, depending on asset coverage ratios. Outstanding loan balances accrue interest daily at a rate equal to one-month SOFR plus 1.40% per annum based on asset coverage ratios as of February 28, 2023. We pay a commitment fee equal to a rate of 0.20% per annum on any unused amounts of the $175 million commitment for the revolving credit facility. Our revolving credit facility has a one-year term maturing on February 23, 2024.

As of February 28, 2023, we had $50 million of outstanding borrowings under our term loan. The interest rate payable by us on our borrowings under our term loan is 1.375% on the first $25 million and LIBOR plus 1.30% per annum on the remaining $25 million. Amounts repaid under our term loan cannot be reborrowed. Our term loan matures on August 6, 2024.

As of February 28, 2023, we had $111.6 million aggregate liquidation value of MRP Shares outstanding.

Assuming that our leverage costs remain as described above, our average annual cost of leverage would be 4.19%. Income generated by our portfolio as of February 28, 2023 must exceed 5.6% in order to cover such leverage costs. These numbers are merely estimates used for illustration; actual dividend or interest rates on the Leverage Instruments will vary frequently and may be significantly higher or lower than the rate estimated above.

The following table is furnished in response to requirements of the SEC. It is designed to illustrate the effect of leverage on common stock total return, assuming investment portfolio returns (comprised of income and changes in the value of securities held in our portfolio) of minus 10% to plus 10%. These assumed investment portfolio returns are hypothetical figures and are not necessarily indicative of the investment portfolio returns experienced or expected to be experienced by us. See “Risk Factors.” Further, the assumed investment portfolio total returns are after all of our expenses other than expenses associated with leverage, but such leverage expenses are included when determining the common stock total return. The table further reflects the issuance of Leverage Instruments representing 22% of our total assets (actual leverage at February 28, 2023), and our estimated leverage costs of 4.19%. The cost of leverage is expressed as a blended interest/dividend rate and represents the weighted average cost on our Leverage Instruments.

Assumed Portfolio Total Return (Net of Expenses)			(10.0	)%			(5.0	)%			0.0	%			5.0	%			10.0	%
Common Stock Total Return			(15.7	)%			(8.7	)%			(1.7	)%			5.3	%			12.3	%

Common stock total return is composed of two elements: common stock distributions paid by us and gains or losses on the value of the securities we own. As required by SEC rules, the table above assumes that we are more likely to suffer capital losses than to enjoy capital appreciation. For example, to assume a total return of 0% we must assume that the distributions we receive on our investments is entirely offset by losses in the value of those securities.

Comparison of the Companies

Each Company has an investment portfolio consisting in substantial part of energy infrastructure companies and has similar investment objective and strategies. The table below provides a more detailed comparison of the Companies.

KYN/Acquirer		KMF/Target
*Organization:*
Maryland corporation registered as a non-diversified, closed-end management investment company under the 1940 Act
*Fiscal Year End:*
November 30
*Investment Advisor:* KA Fund Advisors, LLC
*Investment Advisory Fee Structure:*
1.375% of average total assets^(l)		1.250% of average total assets⁽²⁾
*Net Assets as of November 30, 2022:*
$1,448 million		$464 million
*Listing of Common Shares:*
NYSE: KYN		NYSE: KMF
*Investment Objective:*
Provide a high after-tax total return with an emphasis on making cash distributions to stockholders		Provide a high level of total return with an emphasis on making cash distributions to stockholders
*Fundamental Investment Policies:*

Without appropriate approval, KYN may not: ● Change the investment objective listed above ● Purchase or sell real estate unless acquired as a result of ownership of securities or other instruments ● Purchase or sell commodities ● Borrow money or issue senior securities, except to the extent permitted by the 1940 Act or the SEC ● Make loans to other persons except (a) through the lending of its portfolio securities, (b) through the purchase of debt obligations, loan participations and/or engaging in direct corporate loans in accordance with its investment objectives and policies, and (c) to the extent the entry into a repurchase agreement is deemed to be a loan (in each case subject to certain exceptions) ● Act as an underwriter except to the extent that, in connection with the disposition of portfolio securities, it may be deemed to be an underwriter under applicable securities laws ● Concentrate its investments in a particular “industry” (other than investments in the Energy Infrastructure Industry and investments in securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities)		Without appropriate approval, KMF may not: ● Change the investment objective listed above ● Purchase or sell real estate unless acquired as a result of ownership of securities or other instruments ● Purchase or sell commodities ● Borrow money or issue senior securities, except to the extent permitted by the 1940 Act or the SEC ● Make loans to other persons except (a) through the lending of its portfolio securities, (b) through the purchase of debt obligations, loan participations and/or engaging in direct corporate loans in accordance with its investment objectives and policies, and (c) to the extent the entry into a repurchase agreement is deemed to be a loan (in each case subject to certain exceptions) ● Act as an underwriter except to the extent that, in connection with the disposition of portfolio securities, it may be deemed to be an underwriter under applicable securities laws ● Concentrate its investments in a particular “industry” (other than Energy Companies and investments in securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities)

KYN/Acquirer

KMF/Target

*Non-fundamental Investment Policies:*

● Invest at least 80% of total assets in public and private securities of Energy Infrastructure Companies ● Invest at least 50% of our total assets in publicly traded securities of Energy Infrastructure Companies ● Under normal market conditions, invest up to 50% of our total assets in unregistered or otherwise restricted securities. The types of unregistered or otherwise restricted securities that we may purchase include common equity, preferred equity, convertible equity and other securities of other public and private companies. ● Invest up to 15% of our total assets in any single issuer ● Invest up to 20% of our total assets in debt securities, including below investment grade debt securities rated, at the time of investment, at least B3 by Moody’s, B- by Standard & Poor’s or Fitch, comparably rated by another rating agency or, if unrated, determined by KAFA to be of comparable quality. In addition, up to one-quarter of our permitted investments in debt securities (or up to 5% of our total assets) may be invested in unrated debt securities or debt securities that are rated less than B3/B- of public or private companies ● May, but are not required to, use derivative investments and engage in short sales to hedge against interest rate and market risks ● Under normal market conditions, utilize Leverage Instruments in an amount that represents approximately 25% to 30% of total assets		● Invest at least 80% of our total assets in securities of Energy Companies and Infrastructure Companies ● Invest in equity securities (e.g., common equity and preferred equity) and convertible securities of Energy Companies and Infrastructure Companies ● Invest the majority of assets in Energy Companies and Infrastructure Companies that are meaningfully participating in, or benefitting from, the Energy Transition ● Invest up to but not more than 50% of total assets in unregistered or otherwise restricted securities ● Invest up to but not more than 30% of total assets in debt securities, including below-investment-grade debt securities ● Up to but not more than 10% of total assets may be invested in unrated debt securities or below-investment-grade debt securities that are rated less than “B-” (or an equivalent rating) ● Invest up to but not more than 25% (or such higher amount as permitted by any applicable tax diversification rules) of total assets in equity or debt securities of Qualified Publicly Traded Partnerships ● Invest up to 15% of total assets in any single issuer. ● Under normal market conditions, utilize Leverage Instruments in an amount that represents approximately 25% to 30% of total assets

*Tax Treatment:*

Corporation for federal income tax purposes		RIC for federal income tax purposes

(1)

(2)

For the fiscal year ended November 30, 2022, KMF paid management fees at an annual rate of 1.25% of its monthly average total assets. See “— Management — Investment Management Agreement — KMF.”

Management

Directors and Officers

Each Company’s business and affairs are managed under the direction of its Board of Directors, including supervision of the duties performed by KAFA. Each Company’s Board of Directors currently consists of eight directors, seven of whom are considered to be “Independent Directors” as defined in the 1940 Act. Each Board of Directors elects each Company’s officers, who serve at the Board’s discretion, and are responsible for day-to-day operations.

Investment Adviser

KAFA is each Company’s investment adviser and is registered with the SEC under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). KAFA also is responsible for managing each Company’s business affairs and providing certain clerical, bookkeeping and other administrative services. KAFA is a Delaware limited liability company. The managing member of KAFA is KACALP, an investment adviser registered with the SEC under the Advisers Act. Kayne Anderson has one general partner, Kayne Anderson Investment Management, Inc., and a number of individual limited partners. Kayne Anderson Investment Management, Inc. is a Nevada corporation controlled by Richard A. Kayne. Kayne Anderson’s predecessor was established as an independent investment advisory firm in 1984.

KAFA’s management of each Company’s portfolio is led by James C. Baker, Jr. and J.C. Frey. Mr. Baker has served as portfolio manager for each Company since November 2017. Mr. Frey has served as a portfolio manager for KYN since its inception in 2004 and for KMF since its inception in 2010. Each portfolio manager is jointly and primarily responsible for the day-to-day management of each Company’s portfolio. The portfolio managers draw on the support of the investment team in Kayne Anderson’s Energy Infrastructure group, as well as the experience and expertise of the Company’s officers and other senior professionals at Kayne Anderson.

Portfolio Management

James C. Baker, Jr. is a Managing Partner of Kayne Anderson and Co-Managing Partner of KAFA. Mr. Baker has served as each Company’s Chief Executive Officer since June 2019 and as Director, President and co-portfolio manager of each Company since November 2017. Mr. Baker has served as Senior Managing Director of KACALP and the KAFA since February 2008; as President of each Company since June 2016; and as Executive Vice President of KYN from June 2008 to June 2016 and of KMF from August 2010 to June 2016. Mr. Baker has also served as President of Kayne Anderson BDC, Inc. (“KABDC”) since February 2021; Chief Executive Officer of KABDC since June 2021; and President and Chief Executive Officer of Kayne DL 2021, Inc. (“KDL”) since December 2021. Prior to joining Kayne Anderson in 2004, Mr. Baker was Director in Planning and Analysis at El Paso Corporation from April 2004 to December 2004. Prior to that, he was a Director in the energy investment banking group at UBS Securities LLC. At UBS, where he focused on securities underwriting and mergers and acquisitions in the energy industry. Prior to joining UBS in 2000, Mr. Baker was an Associate in the energy investment banking group at PaineWebber Incorporated. He earned a BBA degree in Finance from the University of Texas at Austin in 1995 and an MBA degree in Finance from Southern Methodist University in 1997.

J.C. Frey is a Partner and Senior Managing Director for Kayne Anderson. He has served as each Company’s co-portfolio manager since their inception and was each Company’s Assistant Secretary and Assistant Treasurer from June 2004 (KYN) and November 2010 (KMF) to January 2019. He has served as Executive Vice President of KYN since June 2008 and of KMF since inception. Mr. Frey has served as Managing Partner of KACALP since 2004 and Co-Managing Partner of KAFA since 2006. Mr. Frey began investing in MLPs on behalf of Kayne Anderson in 1998 and has served as portfolio manager of Kayne Anderson’s MLP funds since their inception in 2000. Prior to joining Kayne Anderson in 1997, Mr. Frey was a CPA and audit manager in KPMG Peat Marwick’s financial services group, specializing in banking and finance clients and loan securitizations. Mr. Frey graduated from Loyola Marymount University with a BS degree in Accounting in 1990. In 1991, he received a Master’s degree in Taxation from the University of Southern California.

Company Management

Terry A. Hart is a Partner and Senior Managing Director of Kayne Anderson. Mr. Hart serves as KYN and KMF’s Chief Operating Officer and Assistant Secretary (since April 2022) and previously was each Company’s Chief Financial Officer, Treasurer and Assistant Secretary. Prior to joining Kayne Anderson in 2005, Mr. Hart was most recently a senior vice president and controller at Dynegy, Inc. Prior to that, Mr. Hart served as assistant treasurer and director of structured finance. He began his finance and accounting career in 1992 with Illinova Corporation, which was acquired by Dynegy, Inc. in 2000. Mr. Hart earned a B.S. in Accounting from Southern Illinois University in 1991 and an M.B.A. from the University of Illinois in 1999.

A. Colby Parker is an Assistant Treasurer and Controller of Kayne Anderson. Mr. Parker serves as Chief Financial Officer and Treasurer of KYN and KMF (since April 2022) and previously served as Vice President and Assistant Treasurer of KYN and KMF (from June 2020). Prior to joining Kayne Anderson, Mr. Parker was a senior associate in Ernst & Young’s Houston assurance practice where he performed audits of various public and private companies. Mr. Parker earned a B.B.A. in Accounting and a M.S. in Finance from Texas A&M University in 2010 and is a Certified Public Accountant in the State of Texas.

Michael J. O’Neil is the Chief Compliance Officer of Kayne Anderson. Mr. O’Neil serves as KYN and KMF’s Chief Compliance Officer and Secretary. Prior to joining Kayne Anderson, Mr. O’Neil was a compliance officer at BlackRock Inc., where he was responsible for regulatory compliance matters related to trading and portfolio management activities across equity, fixed income and alternative assets. Mr. O’Neil earned a B.A. in International Business and Management from Dickinson College and an M.B.A. from Boston University.

Ron M. Logan, Jr. is a Partner and Senior Managing Director of Kayne Anderson. Mr. Logan serves as Senior Vice President of KYN and KMF. Prior to joining Kayne Anderson in 2006, Mr. Logan was an independent consultant to several leading energy firms. From 2003 to 2005, he served as Senior Vice President of Ferrellgas Inc. with responsibility for the firm’s supply, wholesale, transportation, storage, and risk management activities. Before joining Ferrellgas, Mr. Logan was employed for six years by Dynegy Midstream Services where he was Vice President of the Louisiana Gulf Coast Region and also headed the company’s business development activities. Mr. Logan began his career with Chevron Corporation in 1984, where he held positions of increasing responsibility in marketing, trading and commercial development through 1997. Mr. Logan earned a B.S. degree in Chemical Engineering from Texas A&M University in 1983 and an M.B.A. degree from the University of Chicago in 1994.

Adriana I. Jimenez is a Vice President and Controller of Kayne Anderson. Ms. Jimenez serves as Vice President of KYN and KMF since December 2021. Prior to joining Kayne Anderson in 2009, Ms. Jimenez was a supervisor of corporate reporting for Dynegy Inc. Prior to that, Ms. Jimenez was staff accountant in the international division and corporate division for Universal Compression Inc. Ms. Jimenez earned a B.S. in Business Administration with Management concentration and a minor in Public Relations from John Brown University in 1998 and is a Certified Public Accountant in the state of Texas.

The principal office of KAFA is located at 811 Main Street, 14th Floor, Houston, Texas 77002. KACALP’s principal office is located at 1800 Avenue of the Stars, Third Floor, Los Angeles, California 90067. For additional information concerning KAFA, including a description of the services to be provided by KAFA, see “—Investment Management Agreement.”

Investment Management Agreement

KYN

Pursuant to an investment management agreement between KYN and KAFA, effective for periods commencing on or after December 12, 2006 (the “KYN Investment Management Agreement”), KYN pays a management fee, computed and paid quarterly at an annual rate of 1.375% of its average quarterly total assets less a fee waiver.

Upon completion of the Merger, KAFA has agreed to revise its management fee waiver agreement with KYN to reduce the asset tiers for fee waivers. The initial asset tier for fee waiver will be reset to the pro forma Combined Company management fee total assets as of the closing of the Merger. The revised fee waiver will lower the effective management fee that KYN pays as its assets appreciate. The table below outlines the current and revised management fee waivers assuming the Merger was completed on February 28, 2023:

KYN Asset Tiers for Fee Waiver		Management Fee			Applicable
Current	Revised	Waiver			Management Fee⁽¹⁾
$0 to $4.0 billion	$0 to $2.4 billion⁽²⁾		0.000	%		1.375	%
$4.0 billion to $6.0 billion	$2.4 billion⁽²⁾to $4.0 billion		0.125	%		1.250	%
$6.0 billion to $8.0 billion	$4.0 billion to $6.0 billion		0.250	%		1.125	%
Greater than $8.0 billion	Greater than $6.0 billion		0.375	%		1.000	%

	(1)	Represents the management fee, after giving effect to the fee waiver, applicable to the incremental total assets at each tier.
	(2)	Initial asset tier for fee waiver of $2.4 billion based on the approximate management fee total asset values at each Company as of February 28, 2023. The actual amount of the first asset tier will be reset to the pro forma Combined Company management fee total asset value as of closing.

In addition to reducing the asset tiers for fee waivers, KAFA has also agreed to waive an amount of management fees (based on KYN and KMF assets at closing of the Merger) such that the pro forma, run-rate fees payable to KAFA are equal to the aggregate, run-rate management fees payable if KYN and KMF had remained standalone companies. The waiver will last for three years and is estimated to be approximately $0.7 million per year based on KYN and KMF assets as of February 28, 2023. The revised asset tiers for fee waivers and the new fee waiver would be effective as of the closing of the Merger and would not be subject to recoupment, either with respect to KYN, KMF or the Combined Company. For the fiscal year ended November 30, 2022, KYN paid management fees at an annual rate of 1.375% of quarterly average total assets.

For purposes of calculating the management fee, the “average total assets” for each quarterly period are determined by averaging the total assets at the last day of that quarter with the total assets at the last day of the prior quarter. KYN’s total assets shall be equal to its average quarterly gross asset value (which includes assets attributable to or proceeds from its use of Leverage Instruments and excludes any deferred tax assets), minus the sum of its accrued and unpaid distribution on any outstanding common stock and accrued and unpaid dividends on any outstanding preferred stock and accrued liabilities (other than liabilities associated with Leverage Instruments issued by us and any accrued taxes). For purposes of determining KYN’s total assets, KYN values derivative instruments based on their current fair market values. Liabilities associated with Leverage Instruments include the principal amount of any Borrowings that KYN issues, the liquidation preference of any outstanding preferred stock, and other liabilities from other forms of borrowing or leverage such as short positions and put or call options held or written by KYN.

In addition to KAFA’s management fee, KYN pays all other costs and expenses of our operations, such as compensation of its directors (other than those employed by Kayne Anderson), custodian, transfer agency, administrative, accounting and distribution expenses, legal fees, borrowing or leverage expenses, marketing, advertising and public/investor relations expenses, expenses of independent auditors, expenses of personnel including those who are affiliates of Kayne Anderson reasonably incurred in connection with arranging or structuring portfolio transactions for KYN, expenses of repurchasing KYN’s securities, expenses of preparing, printing and distributing stockholder reports, notices, proxy statements and reports to governmental agencies, and taxes, if any.

The KYN Investment Management Agreement and related fee waiver agreement has a current term through April 30, 2023 and will continue in effect from year to year so long as its continuation is approved at least annually by KYN’s Board of Directors including a majority of Independent Directors or by the vote of a “majority of our outstanding voting securities” (as such term is defined under the 1940 Act). The Investment Management Agreement may be terminated at any time without the payment of any penalty upon 60 days’ written notice by either party, or by action of the Board of Directors or by a vote of a majority of KYN’s outstanding voting securities, accompanied by appropriate notice. It also provides that it will automatically terminate in the event of its assignment, within the meaning of the 1940 Act. This means that an assignment of the KYN Investment Management Agreement to an affiliate of Kayne Anderson would normally not cause a termination of the KYN Investment Management Agreement.

Because KAFA’s fee is based upon a percentage of KYN’s total assets, KAFA’s fee will be higher to the extent KYN employs financial leverage. As noted, KYN has issued Leverage Instruments in a combined amount equal to approximately 22% of its total assets as of February 28, 2023. A discussion regarding the basis of the KYN Board of Directors’ decision to approve the continuation of the KYN Investment Management Agreement is available in KYN’s May 31, 2022 Semi-Annual Report to Stockholders.

KMF

Pursuant to an investment management agreement (the “KMF Investment Management Agreement”) between KMF and KAFA, KMF pays a management fee, computed and paid monthly at an annual rate of 1.25% of its average total assets.

For the fiscal year ended November 30, 2022, KMF paid management fees at an annual rate of 1.25% of its monthly average total assets.

For purposes of calculating the management fee, the “average total assets” for each monthly period are determined by averaging the total assets at the last day of that month with the total assets at the last day of the prior month. KMF’s total assets shall be equal to its average monthly gross asset value (which includes assets attributable to or proceeds from its use of Leverage Instruments), minus the sum of its accrued and unpaid distribution on any outstanding common stock and accrued and unpaid dividends on any outstanding preferred stock and accrued liabilities (other than liabilities associated with Leverage Instruments issued). For purposes of determining KMF’s total assets, KMF values derivative instruments based on their current fair market values. Liabilities associated with Leverage Instruments include the principal amount of any Borrowings that KMF issues, the liquidation preference of any outstanding preferred stock, and other liabilities from other forms of borrowing or leverage such as short positions and put or call options held or written by KMF.

In addition to KAFA’s management fee, KMF pays all other costs and expenses of its operations, such as compensation of its directors (other than those employed by Kayne Anderson), custodian, transfer agency, administrative, accounting and distribution expenses, legal fees, borrowing or leverage expenses, marketing, advertising and public/investor relations expenses, expenses of independent auditors, expenses of personnel including those who are affiliates of Kayne Anderson reasonably incurred in connection with arranging or structuring portfolio transactions for KMF, expenses of repurchasing KMF’s securities, expenses of preparing, printing and distributing stockholder reports, notices, proxy statements and reports to governmental agencies, and taxes, if any.

The KMF Investment Management Agreement has a current term through April 30, 2023 and will continue in effect from year to year so long as its continuation is approved at least annually by KMF’s Board of Directors including a majority of Independent Directors or by the vote of a majority of our outstanding voting securities. The Investment Management Agreement may be terminated at any time without the payment of any penalty upon 60 days’ written notice by either party, or by action of the Board of Directors or by a vote of a majority of KMF’s outstanding voting securities, accompanied by appropriate notice. It also provides that it will automatically terminate in the event of its assignment, within the meaning of the 1940 Act. This means that an assignment of the KMF Investment Management Agreement to an affiliate of Kayne Anderson would normally not cause a termination of the KMF Investment Management Agreement.

Because KAFA’s fee is based upon a percentage of KMF’s total assets, KAFA’s fee will be higher to the extent KMF employs financial leverage. KMF has issued Leverage Instruments in a combined amount equal to approximately 23% of its total assets as of February 28, 2023. If the Merger is not consummated and KMF continues as a standalone Company, it is expected that KAFA would continue in its role. A discussion regarding the basis of the KMF Board of Directors’ decision to approve the continuation of the KMF Investment Management Agreement will be available in KMF’s May 31, 2022 Semi-Annual Report to Stockholders.

Control Persons

As of February 28, 2023, there were no persons who owned more than 25% of KYN’s or KMF’s outstanding voting securities, and we believe no person should be deemed to control KYN or KMF, as such term is defined in the 1940 Act.

Based on statements publicly filed with the SEC, as of February 28, 2023, one person beneficially owned more than 5% of KYN’s outstanding common stock and two persons beneficially owned more than 5% of KMF’s .outstanding common stock. As of February 28, 2023, KYN and KMF are aware of five and four persons, respectively, each of whom beneficially owns more than 5% of each Company’s outstanding preferred stock.

	KYN					KMF
Name of Beneficial Owner of Common Stock	Number of Shares		Percent of Class⁽¹⁾			Number of Shares		Percent of Class⁽²⁾

Cetera Advisor Networks LLC 200 N Sepulveda Blvd, Suite 1300 El Segundo, California 90245		6,970,480		5.1	%		—		*
Saba Capital Management 405 Lexington Avenue, 58^th Floor New York, NY 10174		307,925		*			4,541,503		9.6	%
Raymond James & Associates, Inc. 880 Carillon Parkway St. Petersburg, FL 33716		926,984		*			3,150,472		6.7	%

Less than 1% of class.

(1)	Based on 136,131,530 shares outstanding as of February 28, 2023.

(2)

Based on 47,197,462 shares outstanding as of February 28, 2023.

Preferred Stock
	KYN					KMF
Name of Owner of Preferred Stock	Number of Shares		Percent of Class⁽¹⁾			Number of Shares		Percent of Class⁽²⁾
All Directors & Executive Officers as a Group (13 persons)		—		—			—		—
MetLife Investment Management, LLC One MetLife Way Whippany, New Jersey 07981		824,000		18.5	%		440,000		26.5	%
Voya Investment Management LLC 5780 Powers Ferry Rd NW, Suite 300 Atlanta, GA 30327-4347		728,047		16.3	%		—		—
Thrivent Financial for Lutherans 901 Marquette Avenue, Suite 2500 Minneapolis, Minnesota 55402		680,000		15.2	%		—		—
Principal Global Investors, LLC 711 High Street Des Moines, IA 50392		646,973		14.5	%		280,000		16.9	%
The Guardian Life Insurance Company of America 10 Hudson Yards New York, NY 10001		440,000		9.9	%		—		—
Mutual of Omaha 3300 Mutual of Omaha Plaza Omaha, NE 68175-1011		201,610		4.5	%		599,657		36.1	%
Lincoln National Life Insurance Company 1301 South Harrison Street Fort Wayne, IN, 46802		—		—			280,000		16.9	%

*	Less than 1% of class.
(1)	Based on 4,464,117 shares outstanding as of February 28, 2023.
(2)	Based on 1,659,657 shares outstanding as of February 28, 2023.

Capitalization

The table below sets forth the capitalization of KYN and KMF as of November 30, 2022, and the pro forma capitalization of the Combined Company as if the Merger had occurred on that date. The information presented in the table is for informational purposes only. If the Merger is consummated, the actual capitalization is likely to be different on the closing date of the transaction as a result of trading activity and changes in net asset value.

	As of November 30, 2022
	KYN/Acquirer			KMF/Target			Pro Forma Combined KYN
	($ in thousands, except per share data)
Cash and Cash Equivalents	$	2,282		$	6,343		$	7,125
Credit Facility/Term Loan⁽¹⁾		50,000			—			50,000
Notes		260,789			80,091			340,880
Mandatory Redeemable Preferred Stock⁽²⁾:
Series R MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (1,673,119 shares issued and outstanding, 1,673,119 shares authorized)		41,828			—			41,828
Series S MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (1,990,998 shares issued and outstanding, 1,990,998 authorized)		49,775			—			49,775
Series T MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (800,000 shares issued and outstanding, 800,000 authorized)		20,000			—			20,000
Series H MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (379,657 shares issued and outstanding, 379,657 authorized)		—			9,491			—
Series I MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (800,000 shares issued and outstanding, 800,000 authorized)		—			20,000			—
Series J MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (480,000 shares issued and outstanding, 480,000 authorized)		—			12,000			—
Series U MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (379,657 shares issued and outstanding, 379,657 authorized)		—			—			9,491
Series V MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (800,000 shares issued and outstanding, 800,000 authorized)		—			—			20,000
Series W MRP Shares, $0.001 par value per share, liquidation preference $25.00 per share (480,000 shares issued and outstanding, 480,000 authorized)		—			—			12,000
Common Stockholders’ Equity:
Common stock, $0.001 par value per share (195,535,883 KYN shares, 198,340,343 KMF shares and 193,876,226 Combined Company shares authorized; 136,131,530 KYN shares, 47,197,462 KMF shares and 173,497,529 Combined Company shares issued and outstanding)⁽²⁾⁽³⁾	$	136		$	47		$	183
Paid-in capital⁽³⁾		1,903,057			765,845			2,602,856
Total distributable earnings (loss)⁽⁴⁾		(455,171	)		(302,272	)		(758,943	)
Net assets applicable to common stockholders	$	1,448,022		$	463,620		$	1,844,096
Shares of common stock outstanding		136,131,530			47,197,462			173,497,529
Net asset value per share	$	10.64		$	9.82		$	10.63

(1)	As of November 30, 2022, KYN had a $200,000 unsecured revolving credit facility (“KYN Credit Facility). As of November 30, 2022, KYN did not have any borrowings outstanding under its KYN Credit Facility. As of November 30, 2022, KYN had $50,000 drawn on its unsecured term loan. As of November 30, 2022, KMF had a $50,000 unsecured revolving credit facility ("KMF Credit Facility") and a $20,000 unsecured revolving credit facility ("KMF Bank Facility"). As of November 30, 2022, KMF did not have any borrowings outstanding under the KMF Credit Facility or the KMF Bank Facility. The pro forma Combined Company assumes the termination of the KMF Credit Facility and KMF Bank Facility.
(2)	Neither KYN nor KMF holds any of its common stock or preferred stock for its own account.
(3)	Reflects the capitalization adjustments giving the effect of the transfer of shares of KYN which KMF stockholders will receive as if the Merger had taken place on November 30, 2022 based on relative net asset values as of November 30, 2022 and pro forma for the effects of the contemplated 15% tender offer at KMF prior to the closing of the Merger (assuming the tender offer is fully subscribed). As of November 30, 2022, KYN's NAV per share was $10.64 and KMF's NAV per share was $9.82. After the effects of the tender offer, KMF’s NAV per share as of November 30, 2022 was estimated to be $9.91. Based on these values, holders of KMF shares would be issued approximately 37 million KYN shares. Pro forma for the Merger, the Combined Company would have 173,497,529 shares issued and outstanding ($0.001 par value per share). Costs related to the Merger, borne by KYN and KMF are currently estimated to be approximately $1,500,000 or 0.1 % of pro forma Combined Company net assets, which equates to $750,000 for KYN and $750,000 for KMF as of November 30, 2022. The $1,500,000 of estimated Merger costs are primarily related to out of pocket legal and proxy solicitation expenses.

Automatic Dividend Reinvestment Plan

This section relates to KYN and its Automatic Dividend Reinvestment Plan (other parts of this document relate to both KYN and KMF). Accordingly, references to “we” “us,” “our” or “the Company” in this section are references to KYN.

We have adopted a Dividend Reinvestment Plan (the “Plan”) that provides that, unless you elect to receive your dividends or distributions in cash, they will be automatically reinvested by the Plan Administrator, American Stock Transfer & Trust Company, in additional shares of our common stock. If you elect to receive your dividends or distributions in cash, you will receive them in cash paid by check mailed directly to you by the Plan Administrator.

No action is required on the part of a registered stockholder to have their cash distribution reinvested in shares of our common stock. Unless you or your brokerage firm decides to opt out of the Plan, the number of shares of common stock you will receive will be determined as follows:

The number of shares to be issued to a stockholder shall be based on share price equal to 95% of the closing price of our common stock one day prior to the dividend payment date.

Our Board of Directors may, in its sole discretion, instruct us to purchase shares of our common stock in the open market in connection with the implementation of the Plan as follows: if our common stock is trading below net asset value at the time of valuation, upon notice from us, the Plan Administrator will receive the dividend or distribution in cash and will purchase common stock in the open market, on the NYSE or elsewhere, for the participants’ accounts, except that the Plan Administrator will endeavor to terminate purchases in the open market and cause us to issue the remaining shares if, following the commencement of the purchases, the market value of the shares, including brokerage commissions, exceeds the net asset value at the time of valuation. Provided the Plan Administrator can terminate purchases on the open market, the remaining shares will be issued by us at a price equal to the greater of (i) the net asset value at the time of valuation or (ii) 95% of the then current market price. It is possible that the average purchase price per share paid by the Plan Administrator may exceed the market price at the time of valuation, resulting in the purchase of fewer shares than if the dividend or distribution had been paid entirely in common stock issued by us.

You may withdraw from the Plan at any time by giving written notice to the Plan Administrator, or by telephone in accordance with such reasonable requirements as we and the Plan Administrator may agree upon. If you withdraw or the Plan is terminated, you will receive a certificate for each whole share in your account under the Plan and you will receive a cash payment for any fractional shares in your account. If you wish, the Plan Administrator will sell your shares and send the proceeds to you, less brokerage commissions. The Plan Administrator is authorized to deduct a $15 transaction fee plus a $0.10 per share brokerage commission from the proceeds.

The Plan Administrator maintains all common stockholders’ accounts in the Plan and gives written confirmation of all transactions in the accounts, including information you may need for tax records. Common stock in your account will be held by the Plan Administrator in non-certificated form. The Plan Administrator will forward to each participant any proxy solicitation material and will vote any shares so held only in accordance with proxies returned to us. Any proxy you receive will include all common stock you have received under the Plan.

There is no brokerage charge for reinvestment of your dividends or distributions in common stock. However, all participants will pay a pro rata share of brokerage commissions incurred by the Plan Administrator when it makes open market purchases.

Automatically reinvesting dividends and distributions does not avoid a taxable event or the requirement to pay income taxes due upon the receipt of dividends and distributions, even though you have not received any cash with which to pay the resulting tax.

If you hold your common stock with a brokerage firm that does not participate in the Plan, you will not be able to participate in the Plan and any distribution reinvestment may be effected on different terms than those described above. Consult your financial advisor for more information.

The Plan Administrator’s fees under the Plan will be borne by us. There is no direct service charge to participants in the Plan; however, we reserve the right to amend or terminate the Plan, including amending the Plan to include a service charge payable by the participants, if in the judgment of the Board of Directors the change is warranted. Any amendment to the Plan, except amendments necessary or appropriate to comply with applicable law or the rules and policies of the SEC or any other regulatory authority, require us to provide at least 30 days written notice to each participant. Additional information about the Plan may be obtained from American Stock Transfer & Trust Company at 6201 15th Avenue, Brooklyn, New York 11219.

Governing Law

Each Company is organized as a corporation under the laws of the State of Maryland. KYN was formed in June 2004 and began investment activities in September 2004 after its initial public offering. KMF was formed in August 2010 and began investment activities in November 2010 after its initial public offering.

Each Company is also subject to federal securities laws, including the 1940 Act and the rules and regulations promulgated by the SEC thereunder, and applicable state securities laws. Each Company is registered as a non-diversified, closed-end management investment company under the 1940 Act.

Description of Securities

This section contains a Description of Securities issued (or to be issued) by KYN (other parts of this document relate to both KYN and KMF). Accordingly, references to “we” “us,” “our” or “the Company” in this section are references to KYN.

The following description is based on relevant portions of the Maryland General Corporation Law and on our Charter and Bylaws. This summary is not necessarily complete, and we refer you to the Maryland General Corporation Law and our Charter and Bylaws for a more detailed description of the provisions summarized below. In addition, the description of our common stock and preferred stock also generally describe the outstanding common stock and preferred stock of KMF (including the KMF MRP Shares that will be replaced with new KYN MRP Shares of KYN in the Merger).

Common Stock

General

As of November 30, 2022, KYN had 136,131,530 shares of common stock issued and outstanding (out of an authorized total of 195,535,883). Shares of KYN’s common stock are listed on the New York Stock Exchange under the symbol “KYN.”

As of November 30, 2022, KMF had 47,197,462 shares of common stock issued and outstanding (out of an authorized total of 198,340,343). Shares of KMF’s common stock are listed on the New York Stock Exchange under the symbol “KMF.”

As of November 30, 2022, neither KYN nor KMF held any of its common stock or preferred stock for its own account.

All common stock offered pursuant to this joint proxy statement/prospectus will be, upon issuance, duly authorized, fully paid and nonassessable. All common stock offered pursuant to this joint proxy statement/prospectus will be of the same class and will have identical rights, as described below. Holders of shares of common stock are entitled to receive distributions when, as and if authorized by the Board of Directors and declared by us out of assets legally available for the payment of distributions. Holders of common stock have no preference, conversion, exchange, sinking fund, redemption or appraisal rights and have no preemptive rights to subscribe for any of our securities. Shares of common stock are freely transferable, except where their transfer is restricted by federal and state securities laws or by contract. All shares of common stock have equal earnings, assets, distribution, liquidation and other rights.

Distributions

Distributions may be paid to the holders of our common stock if, as and when authorized by our Board of Directors and declared by us out of funds legally available therefor.

The distribution rate on our common stock will likely vary from period to period depending on factors including the following:

●

market conditions;

●

the timing of our investments in portfolio securities;

●

the securities comprising our portfolio;

●

changes in interest rates (including changes in the relationship between short-term rates and long-term rates);

●

the amount and timing of the use of borrowings and other leverage by us;

●

the effects of leverage on our common stock (discussed under “— Effects of Leverage”);

●

the timing of the investment of offering proceeds and leverage proceeds in portfolio securities; and

●

our net assets and operating expenses.

Consequently, we cannot guarantee any particular distribution rate on our common stock, and the distribution rate for any given period is not an indication or representation of future distribution rate on the common stock.

Limitations on Distributions

So long as our MRP Shares are outstanding, holders of common stock or other shares of stock, if any, ranking junior to our MRP Shares as to dividends or upon liquidation will not be entitled to receive any distributions from us unless (1) we have declared and paid all accumulated dividends due on the MRP Shares on or prior to the date of such distribution; (2) we have redeemed the full number of MRP Shares required to be redeemed by any provision for mandatory redemption contained in the articles supplementary of such MRP Shares; (3) our asset coverage (as defined in the 1940 Act) with respect to outstanding debt securities and preferred stock would be at least 225%; and (4) the assets in our portfolio have a value, discounted in accordance with guidelines set forth by each applicable rating agency, at least equal to the basic maintenance amount required by such rating agency under its specific rating agency guidelines, in each case, after giving effect to distributions. In determining whether a distribution may be made to holders of common stock under Maryland law, amounts that would be needed, if the Company were to be dissolved, to satisfy the liquidation preference of the MRP Shares will not be added to the Company’s total liabilities.

So long as senior securities representing indebtedness, including the Notes, are outstanding, holders of shares of common stock will not be entitled to receive any distributions from us unless (1) there is no event of default existing under the terms of our Borrowings, including the Notes, (2) our asset coverage (as defined in the 1940 Act) with respect to any outstanding senior securities representing indebtedness would be at least 300% and (3) the assets in our portfolio have a value, discounted in accordance with guidelines set forth by each applicable rating agency, at least equal to the basic maintenance amount required by such rating agency under its specific rating agency guidelines, in each case, after giving effect to such distribution.

Liquidation Rights

Common stockholders are entitled to share ratably in our assets legally available for distribution to stockholders in the event of liquidation, dissolution or winding up, after payment of or adequate provision for all known debts and liabilities, including any outstanding debt securities or other borrowings and any interest thereon. These rights are subject to the preferential rights of any other class or series of our stock, including the MRP Shares. The rights of common stockholders upon liquidation, dissolution or winding up are subordinated to the rights of holders of outstanding Notes and the MRP Shares.

Voting Rights

Each outstanding share of common stock entitles the holder to one vote on all matters submitted to a vote of the common stockholders, including the election of directors. The presence of the holders of shares of stock entitled to cast a majority of all the votes entitled to be cast shall constitute a quorum at a meeting of stockholders. Our Charter provides that, except as otherwise provided in the Bylaws, directors shall be elected by the affirmative vote of the holders of a majority of the shares of stock outstanding and entitled to vote thereon. There is no cumulative voting in the election of directors. Consequently, at each annual meeting of stockholders, the holders of a majority of the outstanding shares of stock entitled to vote will be able to elect all of the successors of the class of directors whose terms expire at that meeting, except that holders of preferred stock, as a class, have the right to elect two directors at all times. Pursuant to our Charter and Bylaws, the Board of Directors may amend the Bylaws to alter the vote required to elect directors.

Under the rules of the NYSE applicable to listed companies, we normally will be required to hold an annual meeting of stockholders in each fiscal year. If we are converted into an open-end company or if for any reason our common stock is no longer listed on the NYSE (or any other national securities exchange the rules of which require annual meetings of stockholders), we may amend our Bylaws so that we are not otherwise required to hold annual meetings of stockholders.

Issuance of Additional Shares

The provisions of the 1940 Act generally require that the public offering price of common stock of a closed-end investment company (less underwriting commissions and discounts) must equal or exceed the NAV of such company’s common stock (calculated within 48 hours of pricing), unless such sale is made with the consent of a majority of the company’s outstanding common stockholders. Any sale of common stock by us will be subject to the requirement of the 1940 Act.

Preferred Stock

In addition to our currently outstanding preferred stock, this section includes a brief description of the terms of the KYN MRP Shares to be issued in the Merger, as if such shares had been outstanding as of the relevant dates. The terms of the KYN MRP Shares will be substantially identical, as of the time of the exchange, to the outstanding KMF MRP Shares for which they are exchanged.

General

The table below sets forth the key terms of each series of KYN’s outstanding MRP Shares as of November 30, 2022, including the KYN Series U MRP Shares, KYN Series V MRP Shares and KYN Series W MRP shares to be issued in exchange for the KMF Series H MRP Shares, KMF Series I MRP Shares and KMF Series J MRP Shares, respectively, in connection with the Merger:

Series	Shares Outstanding⁽¹⁾		Liquidation Value ($ in millions)		Dividend Rate			Mandatory Redemption Date
R		1,673,119		42		3.38	%	February 2027
S		1,990,998		50		3.60	%	February 2030
T		800,000		20		5.07	%	August 2032
U		379,657		9		4.07	%	December 2024
V		800,000		20		Floating	⁽²⁾	June 2026
W		480,000		12		2.44	%	September 2026
		6,123,774	$	153

(1)

Each share has a liquidation preference of $25.00.

(2)

Three month LIBOR plus 1.75%

In this section, we collectively refer to our outstanding preferred stock, together with the KYN MRP Shares, as the “MRP Shares.”

Preference

Our preferred stock (including the MRP Shares) ranks junior to our debt securities (including the Notes), and senior to all common stock. Under the 1940 Act, we may only issue one class of senior equity securities (preferred stock), and we are not permitted to issue preferred stock unless immediately after such issuance the value of our total assets less all liabilities and indebtedness not represented by senior securities is at least 200% of the sum of the liquidation value of the outstanding preferred stock plus the aggregate amount of senior securities representing indebtedness. So long as any MRP Shares are outstanding, additional issuances of preferred stock must be considered to be of the same class as any MRP Shares under the 1940 Act and interpretations thereunder and must rank on a parity with the MRP Shares with respect to the payment of dividends or the distribution of assets upon our liquidation or winding up (“Parity Shares”). Pursuant to the terms of our MRP Shares, we may issue Parity Shares if, upon issuance we meet the asset coverage test of at least 225%. The MRP Shares shall have the benefit of any rights substantially similar to certain mandatory redemption and voting provisions in the articles supplementary for the Parity Shares which are additional or more beneficial than the rights of the holders of the MRP Shares. Such rights incorporated by reference into the articles supplementary for each series of MRP Shares shall be terminated when and if terminated with respect to the other Parity Shares and shall be amended and modified concurrently with any amendment or modification of such other Parity Shares.

Dividends and Dividend Periods

General. Holders of the MRP Shares will be entitled to receive cash dividends, when, as and if authorized by the Board of Directors and declared by us, out of funds legally available therefor, on the initial dividend payment date with respect to the initial dividend period and, thereafter, on each dividend payment date with respect to a subsequent dividend period at the rate per annum (the “Dividend Rate”) equal to the applicable rate (or the default rate) for each dividend period. The applicable rate is computed on the basis of a 360 day year. Dividends so declared and payable shall be paid to the extent permitted under Maryland law and to the extent available and in preference to and priority over any distributions declared and payable on our common stock.

Payment of Dividends, Dividend Periods and Dividend Rate. Dividends on the MRP Shares will be payable quarterly. Dividend periods for each series of the MRP Shares will end on the last day of each February, May, August and November. Dividends will be paid on the first business day following the last day of each dividend period and upon redemption of such series of the MRP Shares. The table below sets forth applicable rate (per annum for fixed rate) for each series of MRP Shares which may be adjusted upon a change in the credit rating of such series of MRP Shares.

Series	Dividend Rate
R		3.38	%
S		3.60	%
T		5.07	%
U		4.07	%
V		3-month LIBOR+ 1.75	%
W		2.44	%

Adjustment to MRP Shares Dividend Rate—Ratings. So long as each series of MRP Shares are rated on any date no less than the equivalent of “A” by Fitch or some other rating agency, then the Dividend Rate will be equal to the applicable rate for such series of MRP Shares. If the lowest credit rating assigned on any date to the then outstanding MRP Shares is equal to one of the ratings set forth in the table below, the Dividend Rate applicable to such outstanding MRP Shares for such date will be adjusted by adding the respective enhanced dividend amount (which shall not be cumulative) set opposite such rating to the applicable rate.

Fitch	Enhanced Dividend Amount
“A-”		0.5	%
“BBB+” to “BBB-”		2.0	%
“BB+” and lower		4.0	%

If no rating agency is rating our MRP Shares, the Dividend Rate (so long as no rating exists) applicable to such series of MRP Shares for such date shall be the rate equal to the applicable rate plus 4.0%, unless the Dividend Rate is the default rate (namely, the applicable rate in effect on such calendar day, without adjustment for any credit rating change on such MRP Shares, plus 5% per annum), in which case the Dividend Rate shall remain the default rate.

Default Rate—Default Period. The Dividend Rate will be the default rate in the following circumstances. Subject to the cure provisions below, a “Default Period” with respect to MRP Shares will commence on a date we fail to (i) pay directly the full amount of any dividends on the MRP Shares payable on the dividend payment date (a “Dividend Default”) or (ii) pay directly, or deposit irrevocably in trust in same-day funds with the paying agent by 1:00 p.m., New York City time, the full amount of any redemption price payable on a mandatory redemption date (a “Redemption Default”).

In the case of a Dividend Default, the Dividend Rate for each day during the Default Period will be equal to the default rate. The “default rate” for any calendar day shall be equal to the applicable rate in effect on such day (without adjustment for any credit rating change on such series of MRP Shares) plus five percent (5%) per annum. Subject to the cure period discussed in the following paragraph, a default period with respect to a Dividend Default or a Redemption Default shall end on the business day on which by 12:00 noon, New York City time, all unpaid dividends and any unpaid redemption price shall have directly paid.

No Default Period with respect to a Dividend Default or Redemption Default (if such default is not solely due to our willful failure) will be deemed to commence if the amount of any dividend or any redemption price due is within three business days (the “Default Rate Cure Period”) after the applicable dividend payment date or redemption date, together with an amount equal to the default rate applied to the amount of such non-payment based on the actual number of days within the Default Rate Cure Period divided by 360.

Upon failure to pay dividends for two years or more, the holders of MRP Shares will acquire certain additional voting rights. See “— Voting Rights.” Such rights shall be the exclusive remedy of the holders of MRP Shares upon any failure to pay dividends on the MRP Shares.

Distributions. Distributions declared and payable shall be paid to the extent permitted under Maryland law and to the extent available and in preference to and priority over any distribution declared and payable on the common stock or any other junior securities. If the cash distributions received from the MLPs in our portfolio exceed the earnings and profits associated with owning such MLPs, it is possible that a portion of a distribution payable on our preferred stock will be paid from sources other than our current or accumulated earnings and profits. The portion of such distribution which exceeds our current or accumulated earnings and profits would be treated as a return of capital to the extent of the stockholder’s basis in our preferred stock, then as capital gain.

Redemption

Term Redemption. We are required to redeem all of the Series R MRP Shares on February 11, 2027, all of the Series S MRP Shares on February 11, 2030, all of the Series T MRP Shares on August 2, 2032, all of the Series U MRP Shares on December 1, 2024, all of the Series V MRP Shares on June 1, 2026 and all of the Series W MRP Shares on September 1, 2026 (each such date, a “Term Redemption Date”).

Optional Redemption. To the extent permitted under the 1940 Act and Maryland law, we may, at our option, redeem the MRP Shares, in whole or in part, out of funds legally available therefor, at any time and from time to time, upon not less than 20 calendar days nor more than 40 calendar days prior notice. The optional redemption price per MRP Share shall be the $25.00 per share (the “Liquidation Preference Amount”) plus accumulated but unpaid dividends and distributions on such series of MRP Shares (whether or not earned or declared by us) to, but excluding, the date fixed for redemption, plus an amount determined in accordance with the applicable articles supplementary for each such series of MRP Shares which compensates the holders of such series of MRP Shares for certain losses resulting from the early redemption of such series of MRP Shares (the “Make-Whole Amount”). Notwithstanding the foregoing, we may, at our option, redeem the MRP Shares within 180 days (60 days in the case of the Series R MRP Shares) prior to the applicable Term Redemption Date for such series of MRP Shares, at the Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by us but excluding interest thereon) to, but excluding, the date fixed for redemption. We shall not give notice of or effect any optional redemption unless (in the case of any partial redemption of a series of MRP Shares) on the date of such notice and on the date fixed for the redemption, the asset coverage with respect to outstanding debt securities and preferred stock is greater than or equal to 225% immediately subsequent to such redemption, if such redemption were to occur on such date.

In addition to the rights to optionally redeem the MRP Shares described above, if the asset coverage with respect to outstanding debt securities and preferred stock is less than or equal to 235%, for any five business days within a ten business day period determined in accordance with the terms of the articles supplementary for such series of MRP Shares, we, upon notice (as provided below) of not less than 12 days, nor more than 40 days’ notice in any case, may redeem such series of MRP Shares at the Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared) to, but excluding, the date fixed for redemption, plus a redemption amount equal to 2% of the liquidation preference amount. The amount of the MRP Shares that may be so redeemed shall not exceed an amount of such series of MRP Shares which results in an asset coverage of more than 250% pro forma for such redemption.

Mandatory Redemption. If, while any MRP Shares are outstanding, we fail to satisfy the asset coverage test as of any valuation date or fail to maintain compliance with the Level 3 Asset Test (as defined in our MRP Shares agreements) on the date of entering into an agreement to make an investment in any Level 3 Asset, and such failure is not cured as of the close of business on the date that is 30 days from such business day (any such day, an “Asset Coverage Cure Date”), the MRP Shares will be subject to mandatory redemption out of funds legally available therefor at the Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by us, but excluding interest thereon) to, but excluding, the date fixed for redemption, plus a redemption amount equal to 1% of the Liquidation Preference Amount.

The number of MRP Shares to be redeemed under these circumstances will be equal to the product of (1) the quotient of the number of outstanding MRP Shares of each series divided by the aggregate number of outstanding shares of preferred stock (including the MRP Shares) which have an asset coverage test greater than or equal to 225% times (2) the minimum number of outstanding shares of preferred stock (including the MRP Shares) the redemption of which, would result in us satisfying the asset coverage test as of the Asset Coverage Cure Date, as applicable (provided that, if there is no such number of MRP Shares of such series the redemption of which would have such result, we shall, subject to certain limitation set forth in the next paragraph, redeem all MRP Shares of such series then outstanding).

We are required to effect such mandatory redemptions not later than 40 days after the Asset Coverage Cure Date, except (1) if we do not have funds legally available for the redemption of, or (2) such redemption is not permitted under our credit facility, any agreement or instrument consented to or agreed to by the applicable preferred stock holders pursuant to the applicable articles supplementary or the note purchase agreements relating to the Notes to redeem or (3) if we are not otherwise legally permitted to redeem the number of MRP Shares which we would be required to redeem under the articles supplementary of such series of MRP Shares if sufficient funds were available, together with shares of other preferred stock which are subject to mandatory redemption under provisions similar to those contained in the articles supplementary for such series of MRP Shares, we shall redeem those MRP Shares, and any other preferred stock which we were unable to redeem, on the earliest practical date on which we will have such funds available, and we are otherwise not prohibited from redeeming pursuant to the credit facility or the note purchase agreements relating to the Notes or other applicable laws. In addition, our ability to make a mandatory redemption may be limited by the provisions of the 1940 Act or Maryland law.

If fewer than all of the outstanding shares of a series of MRP Shares are to be redeemed in an optional or mandatory redemption, we shall allocate the number of shares required to be redeemed pro rata among the holders of such series of MRP Shares in proportion to the number of shares they hold.

Excise Tax. On August 16, 2022, President Biden signed into law the Inflation Reduction Act (the “IRA”), which, among other things, imposes a 1% excise tax on the fair market value of stock repurchased by “covered corporations” beginning in 2023, with certain exceptions. Such excise tax is imposed on the repurchasing corporation itself, not its stockholders from which the stock is repurchased. Because we are a Maryland corporation and our securities are trading on the NYSE, we are a “covered corporation” for this purpose. The amount of such excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. Pending further guidance from the U.S. Department of the Treasury, it remains uncertain whether, and/or to what extent, the excise tax could apply to any redemptions of our MRP Shares.

Limitations on Distributions

So long as we have senior securities representing indebtedness and Notes outstanding, holders of preferred stock will not be entitled to receive any distributions from us unless (1) asset coverage (as defined in the 1940 Act) with respect to outstanding debt securities and preferred stock would be at least 225%, after giving effect to such distributions, (2) full cumulative dividends on the MRP Shares due on or prior to the date of such distribution have been declared and paid, and (3) we have redeemed the full number of MRP Shares required to be redeemed by any provision for mandatory redemption applicable to the MRP Shares, and (4) there is no event of default or default under the terms of our senior securities representing indebtedness or Notes.

Liquidation Rights

In the event of any liquidation, dissolution or winding up, the holders of MRP Shares then outstanding, together with the holders of any other shares of preferred stock ranking in parity with the MRP Shares would be entitled to receive a preferential liquidating distribution, which is expected to equal the liquidation preference per share plus accumulated and unpaid dividends, whether or not earned or declared, but without interest, before any distribution of assets is made to holders of common stock. After payment of the full amount of the liquidating distribution to which they are entitled, the holders of preferred stock will not be entitled to any further participation in any distribution of our assets. If, upon any such liquidation, dissolution or winding up of our affairs, whether voluntary or involuntary, our assets available for distribution among the holders of all outstanding preferred stock shall be insufficient to permit the payment in full to such holders of the amounts to which they are entitled, then available assets shall be distributed among the holders of all outstanding preferred stock ratably in that distribution of assets according to the respective amounts which would be payable on all such shares if all amounts thereon were paid in full. Preferred stock ranks junior to our debt securities upon our liquidation, dissolution or winding up of our affairs.

Voting Rights

Except as otherwise indicated in our Charter or Bylaws, or as otherwise required by applicable law, holders of preferred stock have one vote per share and vote together with holders of common stock as a single class.

The 1940 Act requires that the holders of any preferred stock, voting separately as a single class, have the right to elect at least two directors at all times. The remaining directors will be elected by holders of common stock and preferred stock, voting together as a single class. In addition, the holders of any shares of preferred stock have the right to elect a majority of the directors at any time two years’ accumulated dividends on any preferred stock are unpaid. The 1940 Act also requires that, in addition to any approval by stockholders that might otherwise be required, the approval of the holders of a majority of shares of any outstanding preferred stock, voting separately as a class, would be required to (i) adopt any plan of reorganization that would adversely affect the preferred stock, and (ii) take any action requiring a vote of security holders under Section 13(a) of the 1940 Act, including, among other things, changes in our subclassification as a closed-end investment company or changes in our fundamental investment restrictions. See “Certain Provisions of the Maryland General Corporation Law and our Charter and Bylaws.” As a result of these voting rights, our ability to take any such actions may be impeded to the extent that any shares of our preferred stock are outstanding.

The affirmative vote of the holders of a majority of the outstanding preferred stock determined with reference to a 1940 Act Majority, voting as a separate class, will be required to approve any plan of reorganization (as such term is used in the 1940 Act) adversely affecting such shares or any action requiring a vote of our security holders under Section 13(a) of the 1940 Act. The affirmative vote of the holders of the 1940 Act Majority (as defined in our Charter) of the outstanding preferred stock, voting as a separate class will be required (1) to amend, alter or repeal any of the preferences, rights or powers of holders of our preferred stock so as to affect materially and adversely such preferences, rights or powers, and (2) to approve the creation, authorization or issuance of shares of any class of stock (or the issuance of a security convertible into, or a right to purchase, shares of a class or series) ranking senior to our preferred stock with respect to the payment of dividends or the distribution of assets. The class vote of holders of preferred stock described above will in each case be in addition to any other vote required to authorize the action in question.

Repurchase Rights

We will have the right (to the extent permitted by applicable law) to purchase or otherwise acquire any preferred stock, other than the MRP Shares, so long as (1) asset coverage (as defined in the 1940 Act) with respect to outstanding debt securities and preferred stock would be at least 225%, after giving effect to such transactions, (2) full cumulative dividends on the MRP Shares due on or prior to the date of such purchase or acquisition have been declared and paid and (3) we have redeemed the full number of MRP Shares required to be redeemed by any provision for mandatory redemption applicable to the MRP Shares.

Market

Our MRP Shares are not listed on an exchange or an automated quotation system.

Ratings

As of November 30, 2022, each series of MRP Shares was rated “A+” by Kroll Bond Rating Agency (“KBRA”).

Debt Securities

Under Maryland law and our Charter, we may borrow money, without prior approval of holders of common and preferred stock to the extent permitted by our investment restrictions and the 1940 Act. We may issue debt securities, including additional unsecured fixed and floating rate notes, or other evidence of indebtedness (including bank borrowings or commercial paper) and may secure any such notes or borrowings by mortgaging, pledging or otherwise subjecting as security our assets to the extent permitted by the 1940 Act or rating agency guidelines. Any borrowings will rank senior to the preferred stock and the common stock.

General

As of February 28, 2023, KYN and KMF had $261 million and $80 million aggregate principal amount of Notes, respectively. In addition to these Notes, KMF has entered into a definitive agreement to issue $40 million of Series F Notes. Series F Notes have a 5-year term, a fixed interest rate of 5.18% (per annum) and are expected to be issued in the second fiscal quarter of 2023. The Notes are subordinated in right of payment to any of our secured indebtedness or other secured obligations to the extent of the value of the assets that secure the indebtedness or obligation. The Notes may be prepaid prior to their maturity at our option, in whole or in part, under certain circumstances and are subject to mandatory prepayment upon an event of default.

So long as Notes are outstanding, additional debt securities must rank on a parity with the Notes with respect to the payment of interest and upon the distribution of our assets. The table below sets forth the key terms of each series of the KYN’s and KMF’s Notes (the latter of which will be assumed by KYN in connection with the Merger). The description of certain covenants applicable to KYN’s Notes below also applies to KMF’s Notes.

Series	Principal Outstanding ($ in millions)		Interest Rate			Maturity
KYN
FF	$	17		3.57	%	April 2023
GG		21		3.67	%	April 2025
KK		32		3.93	%	July 2024
NN		16		3.37	%	October 2023
OO		15		3.46	%	October 2024
PP		50		Floating	⁽¹⁾	June 2026
QQ		20		1.81	%	June 2025
RR		45		4.57	%	May 2032
SS		45		4.67	%	August 2034
		261
KMF
D		40		3.34	%	May 2023
H		22		3.72	%	August 2023
I		18		3.82	%	August 2025
	$	80

(1)

Three-month LIBOR plus 1.25%.

Interest

The Notes will bear interest from the date of issuance at the fixed or floating rate shown above. Holders of our floating rate Notes are entitled to receive quarterly cash interest payments at an annual rate that may vary for each rate period. Holders of our fixed rate Notes are entitled to receive semi-annual cash interest payments at an annual rate per the terms of such notes. If we do not pay interest when due, it will trigger an event of default and we will be restricted from declaring dividends and making other distributions with respect to our common stock and preferred stock. In the event the credit rating on any series of Notes falls below “A-” (Fitch equivalent) or the equivalent rating from a nationally recognized statistical ratings organization, the interest rate (including any applicable default rate) on such series will increase by 1% during the period of time such series is rated below “A-”.

Limitations

Under the requirements of the 1940 Act, immediately after issuing any senior securities representing indebtedness, we must have an asset coverage of at least 300%. Asset coverage means the ratio which the value of our total assets, less all liabilities and indebtedness not represented by senior securities, bears to the aggregate amount of senior securities representing indebtedness. Under the 1940 Act, we may only issue one class of senior securities representing indebtedness. So long as any Notes are outstanding, additional debt securities must rank on a parity with Notes with respect to the payment of interest and upon the distribution of our assets. We are subject to certain restrictions related to asset coverage and portfolio composition. Included within these restrictions is a covenant that the Company will not enter into an agreement to make an investment in a Level 3 Asset (as defined in our Notes agreements) if, immediately after giving effect to such investment, the aggregate value of all Level 3 Assets of the Company would exceed 30% of total assets of the Company. Borrowings also may result in our being subject to covenants in credit agreements that may be more stringent than the restrictions imposed by the 1940 Act. For a description of limitations with respect to our preferred stock, see “— Preferred Stock — Limitations on Distributions.”

Prepayment

To the extent permitted under the 1940 Act and Maryland law, we may, at our option, prepay the Notes, in whole or in part in the amounts set forth in the purchase agreements relating to such Notes, at any time from time to time, upon advance prior notice. The amount payable in connection with prepayment of the fixed rate notes is equal to 100% of the amount being repurchased, together with interest accrued thereon to the date of such prepayment and the Make-Whole Amount determined for the prepayment date with respect to such principal amount. The amount payable in connection with prepayment of the floating rate notes is equal to 100% of the amount being repurchased, together with interest accrued thereon to the date of such prepayment and a prepayment premium, if any, and any LIBOR breakage amount, in each case, determined for the prepayment date with respect to such principal amount. In the case of each partial prepayment, the principal amount of a series of Notes to be prepaid shall be allocated among all of such series of Notes at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment. If our asset coverage is greater than 300%, but less than 325%, for any five business days within a ten business day period, in certain circumstances, we may prepay all or any part of the Notes at par plus 2%, so long as the amount of Notes redeemed does not cause our asset coverage to exceed 340%.

Events of Default and Acceleration of Notes; Remedies

Any one of the following events will constitute an “event of default” under the terms of the Notes:

	●	default in the payment of any interest upon a series of debt securities when it becomes due and payable and the continuance of such default for 5 business days;
	●	default in the payment of the principal of, or premium on, a series of debt securities whether at its stated maturity or at a date fixed for prepayment or by declaration or otherwise;

●

default in the performance, or breach, of certain financial covenants, including financial tests incorporated from other agreements evidencing indebtedness pursuant to the terms of the Notes, and covenants concerning the rating of the Notes, timely notification of the holders of the Notes of events of default, the incurrence of secured debt and the payment of dividends and other distributions and the making of redemptions on our capital stock, and continuance of any such default or breach for a period of 30 days;

●

default in the performance, or breach, of any covenant (other than those covenants described above) of ours under the terms of the Notes, and continuance of such default or breach for a period of 30 days after the earlier of (1) a responsible officer obtaining actual knowledge of such default and (2) our receipt of written notice of such default from any holder of such Notes;

●

certain voluntary or involuntary proceedings involving us and relating to bankruptcy, insolvency or other similar laws;

●

KAFA or one of its affiliates is no longer our investment adviser;

	●	if, on the last business day of each of twenty-four consecutive calendar months, the debt securities have a 1940 Act asset coverage of less than 100%;
	●	other defaults with respect to Borrowings in an aggregate principal amount of at least $5 million, including payment defaults and any other default that would cause (or permit the holders of such Borrowings to declare) such Borrowings to be due prior to stated maturity;

●

if our representations and warranties or any representations and warranties of our officers made in connection with transaction relating to the issuance of the Notes prove to have been materially false or incorrect when made; or

●

other certain “events of default” provided with respect to the Notes that are typical for Borrowings of this type.

Upon the occurrence and continuance of an event of default, the holders of a majority in principal amount of a series of outstanding Notes may declare the principal amount of that series of Notes immediately due and payable upon written notice to us. Upon an event of default relating to bankruptcy, insolvency or other similar laws, acceleration of maturity occurs automatically with respect to all series of Notes. At any time after a declaration of acceleration with respect to a series of Notes has been made, and before a judgment or decree for payment of the money due has been obtained, the holders of a majority in principal amount of the outstanding Notes of that series, by written notice to us, may rescind and annul the declaration of acceleration and its consequences if all events of default with respect to that series of Notes, other than the non-payment of the principal of, and interest and certain other premiums relating to, that series of Notes which has become due solely by such declaration of acceleration, have been cured or waived and other conditions have been met.

Liquidation Rights

In the event of (a) any insolvency or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar case or proceeding in connection therewith, relative to us or to our creditors, as such, or to our assets, or (b) any liquidation, dissolution or other winding up of us, whether voluntary or involuntary and whether or not involving insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or any other marshalling of assets and liabilities of ours, then (after any payments with respect to any secured creditor of ours outstanding at such time) and in any such event the holders of our Notes shall be entitled to receive payment in full of all amounts due or to become due on or in respect of all debt securities (including any interest accruing thereon after the commencement of any such case or proceeding), or provision shall be made for such payment in cash or cash equivalents or otherwise in a manner satisfactory to the holders of our Notes, before the holders of any of our common or preferred stock are entitled to receive any payment on account of any redemption proceeds, liquidation preference or dividends from such shares. The holders of our Notes shall be entitled to receive, for application to the payment thereof, any payment or distribution of any kind or character, whether in cash, property or securities, including any such payment or distribution which may be payable or deliverable by reason of the payment of any other indebtedness of ours being subordinated to the payment of our Notes, which may be payable or deliverable in respect of our Notes in any such case, proceeding, dissolution, liquidation or other winding up event.

Unsecured creditors of ours may include, without limitation, service providers including KAFA, custodian, administrator, broker-dealers and the trustee, pursuant to the terms of various contracts with us. Secured creditors of ours may include without limitation parties entering into any interest rate swap, floor or cap transactions, or other similar transactions with us that create liens, pledges, charges, security interests, security agreements or other encumbrances on our assets.

A consolidation, reorganization or merger of us with or into any other company, or a sale, lease or exchange of all or substantially all of our assets in consideration for the issuance of equity securities of another company shall not be deemed to be a liquidation, dissolution or winding up of us.

Voting Rights

Our Notes have no voting rights, except to the extent required by law or as otherwise provided in the terms of the Notes relating to the acceleration of maturity upon the occurrence and continuance of an event of default. In connection with any other borrowings (if any), the 1940 Act does in certain circumstances grant to the lenders certain voting rights in the event of default in the payment of interest on or repayment of principal.

Market

Our Notes are not listed on an exchange or automated quotation system.

Ratings

As of February 28, 2023, each series of our Notes was rated “AAA” by KBRA. In the event the credit rating on any series of our Notes falls below “A-”, the interest rate on such series will increase by 1% during the period of time such series is rated below “A-”. We are required to maintain a current rating from one rating agency with respect to each series of Notes and are prohibited from having any rating of less than investment grade (“BBB-”) with respect to each series of Notes.

Certain Provisions of the Maryland General Corporation Law and KYN’s Charter and Bylaws

The Maryland General Corporation Law and our Charter and Bylaws contain provisions that could make it more difficult for a potential acquirer to acquire us by means of a tender offer, proxy contest or otherwise. These provisions are expected to discourage certain coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of us to negotiate first with our Board of Directors. We believe the benefits of these provisions outweigh the potential disadvantages of discouraging any such acquisition proposals because, among other things, the negotiation of such proposals may improve their terms.

Classified Board of Directors

Our Board of Directors is divided into three classes of directors serving staggered three-year terms. The current terms for the three classes will expire in 2023, 2024 and 2025. Upon expiration of their current terms, directors of each class will be elected to serve until the third annual meeting following their election and until their successors are duly elected and qualify and each year one class of directors will be elected by the stockholders. A classified board may render a change in control of us or removal of our incumbent management more difficult. We believe, however, that the longer time required to elect a majority of a classified Board of Directors will help to ensure the continuity and stability of our management and policies.

Election of Directors

Our Charter and Bylaws provide that the affirmative vote of the holders of a majority of the outstanding shares of stock entitled to vote in the election of directors will be required to elect a director. As noted above, pursuant to our Charter and Bylaws, our Board of Directors may amend the Bylaws to alter the vote required to elect directors.

Number of Directors; Vacancies; Removal

Our Charter provides that the number of directors will be set only by the Board of Directors in accordance with our Bylaws. Our Bylaws provide that a majority of our entire Board of Directors may at any time increase or decrease the number of directors. However, the number of directors may never be less than the minimum number required by the Maryland General Corporation Law or, unless our Bylaws are amended, more than fifteen. We have elected by provision in our Charter to be subject to the provision of Subtitle 8 of Title 3 of the Maryland General Corporation Law regarding the filling of vacancies on the Board of Directors. Accordingly, except as may be provided by the Board of Directors in setting the terms of any class or series of preferred stock, any and all vacancies on the Board of Directors may be filled only by the affirmative vote of a majority of the remaining directors in office, even if the remaining directors do not constitute a quorum, and any director elected to fill a vacancy will serve for the remainder of the full term of the directorship in which the vacancy occurred and until a successor is elected and qualifies, subject to any applicable requirements of the 1940 Act.

Our Charter provides that, subject to the rights of one or more classes or series of preferred stock to elect or remove one or more directors, a director may be removed only for cause, as defined in the Charter, and then only by the affirmative vote of at least two-thirds of the votes entitled to be cast in the election of directors.

Action by Stockholders

Under the Maryland General Corporation Law, stockholder action can be taken only at an annual or special meeting of stockholders or, with respect to the holders of common stock, unless the charter provides for stockholder action by less than unanimous written consent (which is not the case for our Charter), by unanimous written consent in lieu of a meeting. These provisions, combined with the requirements of our Bylaws regarding the calling of a stockholder-requested special meeting of stockholders discussed below, may have the effect of delaying consideration of a stockholder proposal until the next annual meeting.

Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals

Our Bylaws provide that with respect to an annual meeting of stockholders, nominations of persons for election to the Board of Directors and the proposal of business to be considered by stockholders may be made only (1) pursuant to our notice of the meeting, (2) by or at the direction of the Board of Directors or (3) by a stockholder who is a stockholder of record as of the time of giving notice by the stockholder and at the time of the meeting, who is entitled to vote at the meeting and who has complied with the advance notice procedures of the Bylaws. With respect to special meetings of stockholders, only the business specified in our notice of the meeting may be brought before the meeting. Nominations of persons for election to the Board of Directors at a special meeting may be made only (1) pursuant to our notice of the meeting, (2) by or at the direction of the Board of Directors or (3) provided that the Board of Directors has determined that directors will be elected at the meeting, by a stockholder who is a stockholder of record as of the time of giving notice and at the time of the meeting, entitled to vote at the meeting and who has complied with the advance notice provisions of the Bylaws.

Calling of Special Meetings of Stockholders

Our Bylaws provide that special meetings of stockholders may be called by our Board of Directors and certain of our officers. Additionally, our Bylaws provide that, subject to the satisfaction of certain procedural and informational requirements by the stockholders requesting the meeting, a special meeting of stockholders will be called by the secretary of the corporation upon the written request of stockholders entitled to cast not less than a majority of all the votes entitled to be cast at such meeting.

Approval of Extraordinary Corporate Action; Amendment of Charter and Bylaws

Under Maryland law, a Maryland corporation generally cannot dissolve, amend its charter, merge, convert, sell all or substantially all of its assets, engage in a share exchange or engage in similar transactions outside the ordinary course of business, unless advised by the board and approved by the affirmative vote of stockholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter. However, a Maryland corporation may provide in its charter for approval of these matters by a lesser percentage, but not less than a majority of all of the votes entitled to be cast on the matter. Our Charter generally provides for approval of Charter amendments and extraordinary transactions by the stockholders entitled to cast at least a majority of the votes entitled to be cast on the matter. Our Charter also provides that certain extraordinary transactions and Charter amendments, including but not limited to any charter amendment that would make our stock a redeemable security (within the meaning of the 1940 Act) or would cause us, whether by merger or otherwise, to convert from a closed-end company to an open-end company, and any proposal for our liquidation or dissolution, requires the approval of the stockholders entitled to cast at least 80% of the votes entitled to be cast on such matter. However, if such amendment or proposal is approved by at least 80% of our continuing directors (in addition to approval by our Board of Directors), such amendment or proposal may be approved by a majority of the votes entitled to be cast on such a matter. The “continuing directors” are defined in our Charter as our current directors as well as those directors whose nomination for election by the stockholders or whose election by the directors to fill vacancies is approved by a majority of the continuing directors then on the Board of Directors. Our Charter and Bylaws provide that the Board of Directors will have the exclusive power to adopt, alter or repeal any provision of our Bylaws and to make new Bylaws.

Market and Net Asset Value Information

Shares of KYN’s and KMF’s common stock are listed on the NYSE under the symbols “KYN” and “KMF,” respectively. KYN’s and KMF’s common stock commenced trading on the NYSE on September 28, 2004 and November 24, 2010, respectively.

Each Company’s common stock has traded both at a premium and at a discount in relation to its net asset value. As of February 28, 2023, each Company’s common stock was trading at a discount to net asset value, and we cannot assure that the common stock will trade at a premium in the future. Any issuance of common stock may have an adverse effect on prices in the secondary market for the Companies’ common stock by increasing the number of shares of common stock available, which may create downward pressure on the market price for the common stock. Shares of closed-end investment companies frequently trade at a discount to net asset value. See “Risk Factors — Additional Risks Related to Our Common Stock — Market Discount From Net Asset Value Risk.”

The following tables set forth for each of the fiscal quarters indicated the range of high and low closing sales price of the Companies’ common stock and the quarter-end sales price, each as reported on the NYSE, the net asset value per share of common stock and the premium or discount to net asset value per share at which the Companies’ shares were trading. Net asset value is determined on a daily basis. See “—Net Asset Value” for information as to the determination of net asset value.

KYN/Acquirer

	Quarterly Closing Sales Price				Quarter-End Closing
	High		Low		Sales Price		Net Asset Value Per Share of Common Stock⁽¹⁾		Premium/ (Discount) of Sales Price to Net Asset Value⁽²⁾
Fiscal Year 2023
First Quarter	$	9.25	$	8.24	$	8.91	$	10.06		(11.4	)%
Fiscal Year 2022
Fourth Quarter	$	9.58	$	7.97	$	9.04	$	10.64		(15.0	)%
Third Quarter		9.82		7.95		9.09		10.63		(14.5	)
Second Quarter		9.60		8.19		9.42		11.01		(14.4	)
First Quarter		8.80		7.34		8.67		10.15		(14.6	)
Fiscal Year 2021
Fourth Quarter	$	9.00	$	7.66	$	7.77	$	8.91		(12.8	)%
Third Quarter		9.26		7.47		7.93		8.89		(10.8	)
Second Quarter		8.60		6.97		8.23		9.13		(9.9	)
First Quarter		7.22		5.69		6.87		7.82		(12.1	)

(1)

NAV per share is determined as of close of business on the last day of the relevant quarter and therefore may not reflect the NAV per share on the date of the high and low closing sales prices, which may or may not fall on the last day of the quarter. NAV per share is calculated as described under the caption “Net Asset Value.”

(2)

Calculated as of the quarter-end closing sales price divided by the quarter-end NAV.

On February 28, 2023, the last reported sales price of KYN’s common stock on the NYSE was $8.91, which represented a discount of approximately 11.4% to the NAV per share reported by KYN on that date.

As of February 28, 2023, KYN had approximately 136.1 million shares of common stock outstanding and had net assets applicable to common stockholders of approximately $1.4 billion.

KMF/Target

	Quarterly Closing Sales Price				Quarter-End Closing
	High		Low		Sales Price		Net Asset Value Per Share of Common Stock⁽¹⁾		Premium/ (Discount) of Sales Price to Net Asset Value⁽²⁾
Fiscal Year 2023
First Quarter	$	8.05	$	7.21	$	7.40	$	8.91		(16.9	)%
Fiscal Year 2022
Fourth Quarter	$	8.69	$	6.98	$	8.03	$	9.82		(18.2	)%
Third Quarter		9.01		7.06		8.40		10.15		(17.2	)
Second Quarter		8.78		7.57		8.62		10.53		(18.1	)
First Quarter		7.79		6.83		7.62		9.72		(21.6	)
Fiscal Year 2021
Fourth Quarter	$	7.89	$	7.00	$	7.13	$	8.79		(18.9	)%
Third Quarter		7.68		6.87		7.23		8.77		(17.6	)
Second Quarter		7.20		6.27		7.17		8.71		(17.7	)
First Quarter		6.70		5.38		6.14		7.64		(19.6	)

(1)

(2)

Calculated as of the quarter-end closing sales price divided by the quarter-end NAV.

On February 28, 2023, the last reported sales price of KMF’s common stock on the NYSE was $7.40 which represented a discount of approximately 16.9% to the NAV per share reported by KMF on that date.

As of February 28, 2023, KMF had approximately 47.2 million shares of common stock outstanding and had net assets applicable to common stockholders of approximately $420.4 million.

Performance Information

The performance table below illustrates the past performance of an investment in each Company. These total returns are based on net asset values, which reflect the total expenses incurred at each Company for the periods presented and, for KYN, this includes the impact of income taxes. Although total operating expenses including the management fee and income taxes may be higher for the Combined Company, KYN’s performance, inclusive of such expenses, has exceeded that of KMF for the prior 1-, 5-, and 10-year periods, as well as since November 30, 2010 (shortly after KMF’s commencement of operations).

	Total Returns Based on Net Asset Value⁽¹⁾
	1-Year			3-Year			5-Year			10-Year			Since 11/30/10⁽²⁾
KYN/Acquirer		30.5	%		2.6	%		10.0	%		(1.7	)%		21.1	%
KMF/Target		20.9	%		8.7	%		3.7	%		(19.6	)%		10.1	%

(1)

(2)

Net Asset Value

Calculation of Net Asset Value

Each Company determines its net asset value on a daily basis and reports its net asset value on its website, www.kaynefunds.com. Net asset value is computed by dividing the value of all of the Company’s assets (including accrued interest and distributions and current and deferred income tax assets), less all of the Company’s liabilities (including accrued expenses, distributions payable, current and deferred accrued income taxes, and any Borrowings) and the liquidation value of any outstanding preferred stock, by the total number of shares of common stock outstanding.

As a corporation, KYN is obligated to pay federal and state income tax on its taxable income. Accordingly, KYN accrues income tax liabilities and assets to account for taxes. As with any other asset or liability, KYN’s tax assets and liabilities increase or decrease its net asset value. KMF, which currently qualifies as a regulated investment company for tax purposes, does not have any deferred income tax asset nor liability.

KYN invests a portion of its assets in MLPs, which generally are treated as partnerships for federal income tax purposes. As a limited partner in the MLPs, KYN includes its allocable share of the MLP’s taxable income or loss in computing its taxable income or loss. KYN may rely to some extent on information provided by its portfolio investments, which may not necessarily be timely, to estimate taxable income allocable to units/shares held in its portfolio and to estimate the associated deferred tax liability (or deferred tax asset). Such estimates will be made in good faith. From time to time, as new information becomes available, KYN will modify its estimates and/or assumptions regarding income taxes. To the extent KYN modifies its estimates and/or assumptions, its net asset value would likely fluctuate.

Deferred income taxes reflect (i) taxes on unrealized gains/(losses), which are attributable to the difference between fair value and tax cost basis of KYN’s investments, (ii) the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and (iii) the net tax benefit of accumulated net operating and capital losses. To the extent KYN has a net deferred tax asset, consideration is given as to whether or not a valuation allowance is required. The need to establish a valuation allowance for deferred tax assets is assessed periodically based on the Income Tax Topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC 740), that it is more likely than not that some portion or all of the deferred tax asset will not be realized. In KYN’s assessment for a valuation allowance, consideration is given to all positive and negative evidence related to the realization of the deferred tax asset. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability (which are highly dependent on future cash distributions from KYN’s holdings), the duration of statutory carryforward periods and the associated risk that capital or net operating loss carryforwards may expire unused. If a valuation allowance is required to reduce the deferred tax asset in the future, it could have a material impact on KYN’s net asset value and results of operations in the period it is recorded.

Investment Valuation

In December 2020, the SEC adopted Rule 2a-5 under the 1940 Act, establishing requirements to determine fair value in good faith for purposes of the 1940 Act. Pursuant to Rule 2a-5 and effective September 1, 2022, the Board of Directors of each Company designated KAFA as the “Valuation Designee” to perform fair value determinations of the Company’s portfolio holdings, subject to oversight by and periodic reporting to the Board. The Valuation Designee determines the fair value of the Company’s portfolio holdings in accordance with the Company’s valuation program, as adopted by the Board. KAFA’s internal valuation process did not change as a result of Rule 2a-5, and it continues to receive a valuation report from a third-party firm for fair valued (Level 3) securities.

Readily marketable portfolio securities listed on any exchange (including a foreign exchange) other than the NASDAQ Stock Market, Inc. (“NASDAQ”) are valued, except as indicated below, at the last sale price on the business day as of which such value is being determined. If there has been no sale on such day, the securities are valued at the mean of the most recent bid and ask prices on such day. Securities admitted to trade on the NASDAQ are valued at the NASDAQ official closing price. Portfolio securities traded on more than one securities exchange are valued at the last sale price on the business day as of which such value is being determined at the close of the exchange representing the principal market for such securities. The value of foreign securities traded outside of the Americas may be adjusted to reflect events occurring after a foreign exchange closes that may affect the value of the foreign security. In such cases, these foreign securities are valued by an independent pricing service and are categorized as Level 2 securities for purposes of the fair value hierarchy.

Equity securities traded in the over-the-counter market, but excluding securities admitted to trading on the NASDAQ, are valued at the closing bid prices. Debt securities that are considered bonds are valued by using the bid price provided by an independent pricing service or, if such prices are not available or in the judgment of KAFA such prices are stale or do not represent fair value, by an independent broker. For debt securities that are considered bank loans, the fair market value is determined by using the bid price provided by the agent or syndicate bank or principal market maker. When price quotes for securities are not available, or such prices are stale or do not represent fair value in the judgment of KAFA, fair market value will be determined using the Company’s valuation process for securities that are privately issued or otherwise restricted as to resale.

Exchange-traded options and futures contracts are valued at the last sales price at the close of trading in the market where such contracts are principally traded or, if there was no sale on the applicable exchange on such day, at the mean between the quoted bid and ask price as of the close of such exchange.

The Company may hold securities that are privately issued or otherwise restricted as to resale. For these securities, as well as any security for which (a) reliable market quotations are not available in the judgment of KAFA, or (b) the independent pricing service or independent broker does not provide prices or provides a price that in the judgment of KAFA is stale or does not represent fair value, each shall be valued in a manner that most fairly reflects fair value of the security on the valuation date.

For the fiscal year ended November 30, 2022, unless otherwise determined by the Valuation Designee, the following valuation process was used for such securities:

●

Valuation Designee. The applicable investments are valued monthly by KAFA with new investments valued at the time such investment was made. The applicable investments are valued by senior professionals of KAFA who comprise KAFA’s Valuation Committee. KAFA will specify the titles of the persons responsible for determining the fair value of Company investments, including by specifying the particular functions for which they are responsible, and will reasonably segregate fair value determinations from the portfolio management of the Company such that the portfolio manager(s) may not determine, or effectively determine by exerting substantial influence on, the fair values ascribed to portfolio investments.

●

Valuation Firm. Quarterly, a third-party valuation firm engaged by KAFA reviews the valuation methodologies and calculations employed for these securities, unless the aggregate fair value of such security is less than 0.1% of the Company’s total assets.

At November 30, 2022, KYN held 8.2% of its net assets applicable to common stockholders (5.9% of total assets) in securities that were fair valued pursuant to these procedures (Level 3 securities). The aggregate fair value of these securities at November 30, 2022, was $118.6 million.

As of November 30, 2022, KMF held 5.1% of its net assets applicable to common stockholders (4.1% of total assets) in securities that were fair valued pursuant to these procedures (Level 3 securities). The aggregate fair value of these securities at November 30, 2022, was $23.9 million.

Financial Highlights

KYN/Acquirer

The Financial Highlights set forth below are derived from KYN’s financial statements and the accompanying notes thereto for the fiscal year ended November 30, 2022, which, along with the report of PricewaterhouseCoopers LLP thereon, are incorporated by reference into the Statement of Additional Information. Copies of the Statement of Additional Information are available from KYN without charge upon request.

KYN FINANCIAL HIGHLIGHTS

(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2022			2021			2020
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	8.91		$	6.90		$	13.89
Net investment income (loss)⁽²⁾		0.07			(0.08	)		(0.34	)
Net realized and unrealized gain (loss)		2.44			2.74			(5.87	)
Total income (loss) from operations		2.51			2.66			(6.21	)
Common dividends⁽³⁾		(0.78	)		—			—
Common distributions — return of capital		—			(0.65	)		(0.78	)
Total dividends and distributions — common		(0.78	)		(0.65	)		(0.78	)
Offering expenses associated with the issuance of common stock		—			—			—
Effect of issuance of common stock		—			—			—
Effect of shares issued in reinvestment of dividends and distributions		—			—			—
Total capital stock transactions		—			—			—
Net asset value, end of period	$	10.64		$	8.91		$	6.90
Market value per share of common stock, end of period	$	9.04		$	7.77		$	5.89
Total investment return based on common stock market value⁽⁴⁾		27.2	%		44.0	%		(47.3	)%
Total investment return based on net asset value⁽⁵⁾		30.5	%		41.0	%		(44.3	)%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of period	$	1,448,022		$	1,126,479		$	872,914
Ratio of expenses to average net assets
Management fees (net of fee waiver)		2.0	%		1.8	%		2.3	%
Other expenses		0.2			0.3			0.3
Subtotal		2.2			2.1			2.6
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		1.2			1.3			3.6
Income tax expenses		6.1			5.1			—
Total expenses		9.5	%		8.5	%		6.2	%
Ratio of net investment income (loss) to average net assets⁽²⁾		0.7	%		(0.9	)%		(4.0	)%
Net increase (decrease) in net assets to common stockholders resulting from operations to average net assets		24.1	%		31.4	%		(73.8	)%
Portfolio turnover rate		28.2	%		50.8	%		22.3	%
Average net assets	$	1,344,102		$	1,068,396		$	1,063,404
Notes outstanding, end of period⁽⁸⁾	$	260,789		$	209,686		$	173,260
Borrowings under credit facilities, end of period⁽⁸⁾	$	—		$	63,000		$	62,000
Term loan outstanding, end of period⁽⁸⁾	$	50,000		$	50,000		$	—
Mandatory redeemable preferred stock, end of period⁽⁸⁾	$	111,603		$	101,670		$	136,633
Average shares of common stock outstanding		133,664,106			126,447,554			126,420,698
Asset coverage of total debt⁽⁹⁾		601.8	%		480.6	%		529.1	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		442.8	%		365.5	%		334.7	%
Average amount of borrowings per share of common stock during the period⁽¹¹⁾	$	2.79		$	2.43		$	2.88

KYN FINANCIAL HIGHLIGHTS
(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2019			2018			2017			2016
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	16.37		$	15.90		$	19.18		$	19.20
Net investment income (loss)⁽²⁾		(0.26	)		(0.45	)		(0.45	)		(0.61	)
Net realized and unrealized gain (loss)		(0.75	)		2.74			(0.92	)		2.80
Total income (loss) from operations		(1.01	)		2.29			(1.37	)		2.19
Common dividends⁽³⁾		—			(1.80	)		(0.53	)		—
Common distributions — return of capital⁽³⁾		(1.47	)		—			(1.37	)		(2.20	)
Total dividends and distributions —common		(1.47	)		(1.80	)		(1.90	)		(2.20	)
Offering expenses associated with the issuance of common stock		—			(0.01	)⁽¹¹⁾		—			—
Effect of issuance of common stock		—			—			—			—
Effect of shares issued in reinvestment of dividends and distributions		—			(0.01	)		(0.01	)		(0.01	)
Total capital stock transactions		—			(0.02	)		(0.01	)		(0.01	)
Net asset value, end of period	$	13.89		$	16.37		$	15.90		$	19.18
Market value per share of common stock, end of period	$	12.55		$	15.85		$	15.32		$	19.72
Total investment return based on common stock market value⁽⁴⁾		(12.4	)%		14.8	%		(13.8	)%		24.1	%
Total investment return based on net asset value⁽⁵⁾		(6.1	)%		14.2	%		(8.0	)%		14.6	%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of period	$	1,755,216		$	2,066,269		$	1,826,173		$	2,180,781
Ratio of expenses to average net assets Management fees (net of fee waiver)		2.3	%		2.3	%		2.5	%		2.5	%
Other expenses		0.1			0.2			0.1			0.2
Subtotal		2.4			2.5			2.6			2.7
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		2.1			1.9			2.0			2.8
Income tax expenses		—			—			—			7.9
Total expenses		4.5	%		4.4	%		4.6	%		13.4	%
Ratio of net investment income (loss) to average net assets⁽²⁾		(1.6	)%		(2.5	)%		(2.4	)%		(3.4	)%
Net increase (decrease) in net assets to common stockholders resulting from operations to average net assets		(6.3	)%		10.8	%		(7.5	)%		12.5	%
Portfolio turnover rate		22.0	%		25.8	%		17.6	%		14.5	%
Average net assets	$	2,032,591		$	2,127,407		$	2,128,965		$	2,031,206
Notes outstanding, end of period⁽⁸⁾	$	596,000		$	716,000		$	747,000		$	767,000
Borrowings under credit facilities, end of period⁽⁸⁾	$	35,000		$	39,000		$	—		$	43,000
Term loan outstanding, end of period⁽⁸⁾	$	60,000		$	60,000		$	—		$	—
Mandatory redeemable preferred stock, end of period⁽⁸⁾	$	317,000		$	317,000		$	292,000		$	300,000
Average shares of common stock outstanding		126,326,087			118,725,060			114,292,056			112,967,480
Asset coverage of total debt⁽⁹⁾		399.9	%		392.4	%		383.6	%		406.3	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		274.1	%		282.5	%		275.8	%		296.5	%
Average amount of borrowings per share of common stock during the periods⁽¹¹⁾	$	6.09		$	6.52		$	7.03		$	7.06

KYN FINANCIAL HIGHLIGHTS
(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2015			2014			2013
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	36.71		$	34.30		$	28.51
Net investment income (loss)⁽²⁾		(0.53	)		(0.76	)		(0.73	)
Net realized and unrealized gain (loss)		(14.39	)		5.64			8.72
Total income (loss) from operations		(14.92	)		4.88			7.99
Common dividends⁽³⁾		(2.15	)		(2.28	)		(1.54	)
Common distributions — return of capitate)		(0.48	)		(0.25	)		(0.75	)
Total dividends and distributions — common		(2.63	)		(2.53	)		(2.29	)
Offering expenses associated with the issuance of common stock		—			—			—
Effect of issuance of common stock		0.03			0.06			0.09
Effect of shares issued in reinvestment of dividends and distributions		0.01			—			—
Total capital stock transactions		0.04			0.06			0.09
Net asset value, end of period	$	19.20		$	36.71		$	34.30
Market value per share of common stock, end of Period	$	18.23		$	38.14		$	37.23
Total investment return based on common stock market value⁽⁴⁾		(47.7	)%		9.9	%		28.2	%
Total investment return based on net asset value⁽⁵⁾		(42.8	)%		14.8	%		29.0	%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of period	$	2,141,602		$	4,026,822		$	3,443,916
Ratio of expenses to average net assets
Management fees (net of fee waiver)		2.6	%		2.4	%		2.4	%
Other expenses		0.1			0.1			0.1
Subtotal		2.7			2.5			2.5
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		2.4			1.8			2.1
Income tax expense⁽⁷⁾		—			8.3			14.4
Total expenses		5.1	%		12.6	%		19.0	%
Ratio of net investment income (loss) to average net assets⁽²⁾		(1.8	)%		(2.0	)%		(2.3	)%
Net increase (decrease) in net assets to common stockholders resulting from operations to average net assets		(51.7	)%		13.2	%		24.3	%
Portfolio turnover rate		17.1	%		17.6	%		21.2	%
Average net assets	$	3,195,445		$	3,967,458		$	3,027,563
Notes outstanding, end of period⁽⁸⁾	$	1,031,000		$	1,435,000		$	1,175,000
Borrowings under credit facilities, end of period⁽⁸⁾	$	—		$	51,000		$	69,000
Term loan outstanding, end of period⁽⁸⁾	$	—		$	—		$	—
Mandatory redeemable preferred stock, end of period⁽⁸⁾	$	464,000		$	524,000		$	449,000
Average shares of common stock outstanding		110,809,350			107,305,514			94,658,194
Asset coverage of total debt⁽⁹⁾		352.7	%		406.2	%		412.9	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		243.3	%		300.3	%		303.4	%
Average amount of borrowings per share of common stock during the period⁽¹¹⁾	$	11.95		$	13.23		$	11.70

(1)	Based on average shares of common stock outstanding.

(2)	Distributions on the Company’s MRP Shares are treated as an operating expense under GAAP and are included in the calculation of net investment income (loss).

(3)	The information presented for each period is a characterization of the total distributions paid to common stockholders as either a dividend (eligible to be treated as qualified dividend income) or a distribution (return of capital) and is based on the Company’s earnings and profits.

(4)

Total investment return based on market value is calculated assuming a purchase of common stock at the market price on the first day and a sale at the current market price on the last day of the period reported. The calculation also assumes reinvestment of distributions at actual prices pursuant to the Company’s dividend reinvestment plan.

(5)

Total investment return based on net asset value is calculated assuming a purchase of common stock at the net asset value on the first day and a sale at the net asset value on the last day of the period reported. The calculation also assumes reinvestment of distributions at actual prices pursuant to the Company’s dividend reinvestment plan.

(6)	Unless otherwise noted, ratios are annualized.

(7)

For the fiscal years ended November 30, 2020, 2019, 2018, 2017 and 2015, the Company reported an income tax benefit of $190,326 (17.9% of average net assets), $43,357 (2.1% of average net assets), $175,827 (8.3% of average net assets), $86,746 (4.1% of average net assets) and $980,647 (30.7% of average net assets), respectively. The income tax expense is assumed to be 0% because the Company reported a net deferred income tax benefit during the period.

(8)	Principal/liquidation value.

(9)

Calculated pursuant to section 18(a)(1)(A) of the 1940 Act. Represents the value of total assets less all liabilities not represented by Notes (principal value), or any other senior securities representing indebtedness and MRP Shares (liquidation value) divided by the aggregate amount of Notes and any other senior securities representing indebtedness. Under the 1940 Act, the Company may not declare or make any distribution on its common stock nor can it incur additional indebtedness if, at the time of such declaration or incurrence, its asset coverage with respect to senior securities representing indebtedness would be less than 300%.

(10)

Calculated pursuant to section 18(a)(2)(A) of the 1940 Act. Represents the value of total assets less all liabilities not represented by Notes (principal value), any other senior securities representing indebtedness and MRP Shares (liquidation value) divided by the aggregate amount of Notes, any other senior securities representing indebtedness and MRP Shares. Under the 1940 Act, the Company may not declare or make any distribution on its common stock nor can it issue additional preferred stock if at the time of such declaration or issuance, its asset coverage with respect to all senior securities would be less than 200%. In addition to the limitations under the 1940 Act, the Company, under the terms of its MRP Shares, would not be able to declare or pay any distributions on its common stock if such declaration would cause its asset coverage with respect to all senior securities to be less than 225%.

(11)	Represents offering costs incurred in connection with the merger of Kayne Anderson Energy Development Company.

KMF/Target

The Financial Highlights set forth below are derived from KMF’s financial statements and the accompanying notes thereto for the fiscal year ended November 30, 2022, which, along with the report of PricewaterhouseCoopers LLP thereon, are incorporated by reference into the Statement of Additional Information. Copies of the Statement of Additional Information are available from KYN without charge upon request.

KMF FINANCIAL HIGHLIGHTS
(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2022			2021			2020
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	8.79		$	7.02		$	11.31
Net investment income (loss)⁽²⁾		(0.01	)		(0.01	)		(0.15	)
Net realized and unrealized gains (losses)		1.66			2.24			(3.66	)
Total income (loss) from operations		1.65			2.23			(3.81	)
Common dividends — dividend income⁽³⁾		(0.09	)		—			(0.47	)
Common distributions — long-term capital gains⁽³⁾		—			—			—
Common distributions — return of capital⁽³⁾		(0.53	)		(0.46	)		(0.01	)
Total dividends and distributions — common		(0.62	)		(0.46	)		(0.48	)
Offering expenses associated with the issuance of common stock		—			—			—
Effect of shares issued in reinvestment of distributions		—			—			—
Effect of issuance of common stock		—			—			—
Effect of common stock repurchased		—			—			—
Net asset value, end of period	$	9.82		$	8.79		$	7.02
Market value per share of common stock, end of period	$	8.03		$	7.13		$	5.25
Total investment return based on common stock market value⁽⁴⁾		21.8	%		45.1	%		(41.0	)%
Total investment return based on net asset value⁽⁵⁾		20.9	%		33.7	%		(32.7	)%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of Period	$	463,620		$	414,844		$	331,227
Ratio of expenses to average net assets
Management fees⁽⁷⁾		1.7	%		1.7	%		1.9	%
Other expenses		0.3			0.4			0.4
Subtotal		2.0			2.1			2.3
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		1.3			1.3			3.2
Management fee waiver		—			—			—
Excise taxes		—			—			—
Total expenses		3.3	%		3.4	%		5.5	%
Ratio of net investment income (loss) to average net assets⁽²⁾		(0.1	)%		(0.2	)%		(2.0	)%
Net increase (decrease) in net assets applicable to common stockholders resulting from operations to average net assets		17.2%			26.8	%		(50.7	)%
Portfolio turnover rate		16.0%			29.7	%		51.8	%
Average net assets	$	454,311		$	392,637		$	354,957
Notes outstanding, end of period⁽⁸⁾	$	80,091		$	84,515		$	84,515
Credit facility outstanding, end of period		—		$	33,000		$	4,000
Term loan outstanding, end of period⁽⁸⁾		—		$	—		$	—
Mandatory redeemable preferred stock, end of period	$	41,491		$	41,491		$	27,542
Average shares of common stock outstanding		47,197,462			47,197,462			47,197,462
Asset coverage of total debt⁽⁹⁾		730.7	%		488.3	%		505.3	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		481.3	%		360.9	%		385.4	%
Average amount of borrowings per share of common stock during the periods⁽¹⁾	$	2.53		$	2.40		$	2.67

KMF FINANCIAL HIGHLIGHTS
(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2019			2018			2017			2016
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	12.57		$	14.15		$	17.41		$	17.56
Net investment income (loss)⁽²⁾		(0.10	)		(0.18	)		0.14			(0.07	)
Net realized and unrealized gains (losses)		(0.29	)		(0.19	)		(2.10	)		1.43
Total income (loss) from operations		(0.39	)		(0.37	)		(1.96	)		1.36
Common dividends — dividend income⁽³⁾		—			(0.10	)		(0.03	)		(1.50	)
Common distributions — long-term capital gains⁽³⁾		—			—			—			—
Common distributions — return of capital⁽³⁾		(0.93	)		(1.10	)		(1.27	)		—
Total dividends and distributions — common		(0.93	)		(1.20	)		(1.30	)		(1.50	)
Offering expenses associated with the issuance of common stock		—			(0.01	)⁽¹¹⁾		—			—
Effect of shares issued in reinvestment of distributions		—			—			—			(0.01	)
Effect of issuance of common stock		—			—			—			—
Effect of common stock repurchased		0.06			—			—			—
Net asset value, end of period	$	11.31		$	12.57		$	14.15		$	17.41
Market value per share of common stock, end of period	$	9.65		$	10.96		$	12.88		$	15.33
Total investment return based on common stock market value⁽⁴⁾		(4.2	)%		(6.7	)%		(8.7	)%		12.7	%
Total investment return based on net asset value⁽⁵⁾		(2.1	)%		(2.6	)%		(11.7	)%		12.7	%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of Period	$	533,957		$	614,603		$	311,843		$	383,557
Ratio of expenses to average net assets
Management fees⁽⁷⁾		1.8	%		1.8	%		1.7	%		1.8	%
Other expenses		0.3			0.4			0.4			0.5
Subtotal		2.1			2.2			2.1			2.3
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		1.9			1.8			1.7			3.8
Management fee waiver		—			—			—			—
Excise taxes		—			—			—			—
Total expenses		4.0	%		4.0	%		3.8	%		6.1	%
Ratio of net investment income (loss) to average net assets⁽²⁾		(0.8	)%		(1.1	)%		0.9	%		(0.5	)%
Net increase (decrease) in net assets applicable to common stockholders resulting from operations to average net assets		(2.7	)%		(16.1	)%		(11.9	)%		10.3	%
Portfolio turnover rate		30.0	%		21.9	%		25.5	%		48.2	%
Average net assets	$	604,030		$	420,605		$	360,869		$	314,015
Notes outstanding, end of period⁽⁸⁾	$	200,923		$	200,923		$	91,000		$	91,000
Credit facility outstanding, end of period	$	—		$	24,000		$	—		$	—
Term loan outstanding, end of period⁽⁸⁾	$	—		$	—		$	—		$	27,000
Mandatory redeemable preferred stock, end of period	$	75,000		$	75,000		$	35,000		$	35,000
Average shares of common stock outstanding		47,903,748			30,639,065			22,034,170			21,975,582
Asset coverage of total debt⁽⁹⁾		403.1	%		406.6	%		481.1	%		454.7	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		293.5	%		304.9	%		347.5	%		350.7	%
Average amount of borrowings per share of common stock during the periods⁽¹⁾	$	4.25		$	4.39		$	5.16		$	4.86

KMF FINANCIAL HIGHLIGHTS
(amounts in 000’s, except share and per share amounts)

	For the Fiscal Year Ended November 30,
	2015			2014			2013
Per Share of Common Stock⁽¹⁾
Net asset value, beginning of period	$	39.51		$	35.75		$	29.01
Net investment income (loss)⁽²⁾		0.30			(0.01	)		(0.06	)
Net realized and unrealized gains (losses)		(18.42	)		5.61			8.61
Total income (loss) from operations		(18.12	)		5.60			8.55
Common dividends — dividend income⁽³⁾		(1.68	)		(1.57	)		(1.15	)
Common distributions — long-term capital gains⁽³⁾		(2.14	)		(0.34	)		(0.66	)
Common distributions — return of capital⁽³⁾		—			—			—
Total dividends and distributions — common		(3.82	)⁽¹²⁾		(1.91	)		(1.81	)

Offering expenses associated with the issuance of common stock		—			—			—
Effect of shares issued in reinvestment of distributions		(0.01	)		(0.02	)		—
Effect of issuance of common stock		—			—			—
Effect of common stock repurchased		—			0.09			—
Net asset value, end of period	$	17.56		$	39.51		$	35.75
Market value per share of common stock, end of period	$	15.46		$	35.82		$	32.71
Total investment return based on common stock market value⁽⁴⁾		(50.2	)%		15.3	%		23.5	%
Total investment return based on net asset value⁽⁵⁾		(48.7	)%		16.4	%		30.5	%
Supplemental Data and Ratios⁽⁶⁾
Net assets applicable to common stockholders, end of period	$	380,478		$	854,257		$	788,057
Ratio of expenses to average net assets Management fees⁽⁷⁾		1.9	%		1.7	%		1.8	%
Other expenses		0.2			0.2			0.2
Subtotal		2.1			1.9			2.0
Interest expense and distributions on mandatory redeemable preferred stock⁽²⁾		2.5			1.7			1.8
Management fee waiver		—			—			—
Excise taxes		0.4			—			0.1
Total expenses		5.0	%		3.6	%		3.9	%
Ratio of net investment income (loss) to average net assets⁽²⁾		1.0	%		(0.0	)%		(0.2	)%
Net increase (decrease) in net assets applicable to common stockholders resulting from operations to average net assets		(58.3	)%		14.0	%		25.9	%
Portfolio turnover rate		45.3	%		45.3	%		49.1	%
Average net assets	$	672,534		$	887,585		$	726,248
Notes outstanding, end of period⁽⁸⁾	$	185,000		$	235,000		$	205,000
Credit facility outstanding, end of period⁽⁸⁾	$	—		$	—		$	50,000
Term loan outstanding, end of period⁽⁸⁾	$	—		$	46,000		$	—
Mandatory redeemable preferred stock, end of period⁽⁸⁾	$	70,000		$	105,000		$	65,000
Average shares of common stock outstanding		21,657,943			21,897,671			21,969,288
Asset coverage of total debt⁽⁹⁾		343.5	%		441.4	%		434.5	%
Asset coverage of total leverage (debt and preferred stock)⁽¹⁰⁾		249.2	%		321.3	%		346.3	%
Average amount of borrowings per share of common stock during the periods	$	11.16		$	12.84		$	10.51

(1)	Based on average shares of common stock outstanding.
(2)	Distributions on the Fund’s MRP Shares are treated as an operating expense under GAAP and are included in the calculation of net investment income (loss).

(3)

The information presented for each period is a characterization of the total distributions paid to the common stockholders as either dividend income (a portion of which was eligible to be treated as qualified dividend income) or distributions (long-term capital gains or return of capital) and is based on the Fund’s earnings and profits.

(4)

(5)

(6)	Unless otherwise noted, ratios are annualized.

(7)	Ratio reflects total management fee before waiver, if any.

(8)	Principal/liquidation value.

(9)

Calculated pursuant to section 18(a)(1)(A) of the 1940 Act. Represents the value of total assets less all liabilities not represented by Notes (principal value) or any other senior securities representing indebtedness and MRP Shares (liquidation value) divided by the aggregate amount of Notes and any other senior securities representing indebtedness. Under the 1940 Act, the Fund may not declare or make any distribution on its common stock nor can it incur additional indebtedness if at the time of such declaration or incurrence its asset coverage with respect to senior securities representing indebtedness would be less than 300%.

(10)

Calculated pursuant to section 18(a)(2)(A) of the 1940 Act. Represents the value of total assets less all liabilities not represented by Notes (principal value), any other senior securities representing indebtedness and MRP Shares divided by the aggregate amount of Notes, any other senior securities representing indebtedness and MRP Shares (liquidation value). Under the 1940 Act, the Fund may not declare or make any distribution on its common stock nor can it issue additional preferred stock if at the time of such declaration or issuance, its asset coverage with respect to all senior securities would be less than 200%. In addition to the limitations under the 1940 Act, the Fund, under the terms of its MRP Shares, would not be able to declare or pay any distributions on its common stock if such declaration would cause its asset coverage with respect to all senior securities to be less than 225%.

(11)	Represents offering costs incurred in connection with the merger of Kayne Anderson Energy Total Return Fund, Inc. (“KYE”).

(12)	Includes special distribution of $1.80 per share paid in July 2015.

Information about the Merger

The exchange rate for common shares will be determined based on each Company’s respective net asset value per share as of the business day prior to the closing of the Merger (computed in accordance with U.S. Generally Accepted Accounting Principles and consistent with the past practices of each Company).

In addition, KMF’s net asset value shall be adjusted for any merger related expenses and all expenses anticipated to be necessary to conclude the operations of KMF, the latter of which include final federal and state tax returns. These expenses would be incurred by KMF regardless of the Merger, in the ordinary course of business.

Since KYN common shares will be issued at NAV in exchange for the net assets of KMF having a value equal to the aggregate NAV of those KYN common shares, the NAV per share of KYN common shares should remain substantially unchanged immediately following the Merger. Thus, other than the merger expenses to be borne equally by KYN and KMF, the Merger should result in no dilution on the basis of NAV of KYN common shares.

However, as a result of the Merger, a common stockholder of both Companies will hold a reduced percentage of ownership in the larger combined entity than he or she did in any of the separate Companies. No sales charge or fee of any kind will be charged to shareholders of KMF in connection with their receipt of KYN common shares in the Merger. The price of KYN’s shares may fluctuate following the Merger as a result of market conditions or other factors.

The Merger is intended to qualify as a tax-free reorganization. As such, no gain or loss should be recognized by KMF or its shareholders upon the closing of the Merger. However, KMF shareholders generally will recognize gain or loss with respect to cash they receive pursuant to the Merger in lieu of fractional KYN shares.

If the Merger so qualifies, the aggregate tax basis of KYN common shares received by shareholders of KMF should be the same as the aggregate tax basis of the common shares of KMF that were converted into KYN common shares (reduced by any amount of tax basis allocable to a fractional share of common stock for which cash is received). See “—Terms of the Agreement and Plan of Merger” and “—Material U.S. Federal Income Tax Consequences of the Merger” for additional information.

Terms of the Agreement and Plan of Merger

The following is a summary of the material terms and conditions of the Merger Agreement. This summary is qualified in its entirety by reference to the Merger Agreement attached as Appendix A hereto.

The Merger Agreement contemplates that KMF will be merged with and into a wholly owned subsidiary of KYN, with KMF shares converted into shares of KYN common stock (although cash will be distributed in lieu of fractional shares), and the KMF MRP Shares will be exchanged for KYN MRP Shares with substantially identical terms. Immediately following the Merger, it is expected that Merger Sub will be merged with and into KYN.

As a result of the Merger, KMF will:

●

deregister as an investment company under the 1940 Act;

●

cease its separate existence under Maryland law;

●

remove its common shares from listing on the NYSE; and

●

withdraw from registration under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

After the closing of the Merger, shares of KYN common stock will be credited to holders of KMF shares only on a book-entry basis. KYN shall not issue certificates representing shares in connection with the Merger, irrespective of whether KMF shareholders hold their shares in certificated form and all outstanding certificates representing common stock of KMF will be deemed cancelled.

The Merger Agreement provides the time for and method of determining the net value of KMF’s assets (and therefore shares) and the NAV per share of KYN. The valuation will be done immediately after the close of business, as described in the Merger Agreement, on the business day immediately preceding the closing date. Any special shareholder selections (for example, automatic investment plans for current KMF shareholder accounts) will NOT automatically transfer to the new accounts unless newly set up by the affected shareholder.

No sales charge or fee of any kind will be charged to holders of KMF shares in connection with their receipt of KYN common shares in the Merger.

From and after the closing date, KYN will possess all of the properties, assets, rights, privileges and powers and shall be subject to all of the restrictions, liabilities, obligations, disabilities and duties of KMF, all as provided under Maryland law.

Shareholders of KMF are not entitled to dissenters’ rights in connection with the Merger. However, any holder of KMF’s common stock may sell his or her shares on the NYSE at any time prior to the Merger.

The Merger Agreement contains customary representations and warranties of each of KYN and KMF. In addition, the Merger Agreement contains covenants relating to operations during the pendency of closing the Merger, the joint stockholders’ meeting of KYN and KMF to approve the Merger and the issuance of additional KYN common stock in connection with the Merger, certain regulatory filings, the preservation of assets, certain tax matters, the preparation of a shareholder list, the tax status of the merger, the listing of the surviving fund on the NYSE and the delisting, termination and registration as an investment company of KMF. The closing of the Merger is subject to various customary conditions precedent.

The Merger Agreement may be terminated and the Merger may be abandoned, whether before or after approval by stockholders of KYN and KMF:

●

at any time prior to the closing date by mutual written consent of KYN and KMF;

●

by either KYN or KMF:

●

because of a material breach of the Merger Agreement by the other party, subject to a 30-day cure period;

●

if the closing does not occur on or prior to February 29, 2024; or

●

if a governmental authority of competent jurisdiction issues an order or injunction prohibiting the Merger.

The Merger Agreement provides that either Company party thereto may waive compliance with any of the terms or conditions made therein for the benefit of that Company.

Each of the Board of Directors of KYN and KMF has determined with respect to its Company that participation in the Merger is in the best interests of that Company.

Material U.S. Federal Income Tax Consequences of the Merger

The following is a general summary of the material anticipated U.S. federal income tax consequences of the Merger. The discussion is based upon the Code, Treasury regulations, court decisions, published positions of the Internal Revenue Service (“IRS”) and other applicable authorities, all as in effect on the date hereof and all of which are subject to change or differing interpretations (possibly with retroactive effect). The discussion is limited to U.S. persons who hold shares of KMF as capital assets for U.S. federal income tax purposes (generally, assets held for investment). This summary does not address all of the U.S. federal income tax consequences that may be relevant to a particular shareholder or to shareholders who may be subject to special treatment under U.S. federal income tax laws. No ruling has been or will be obtained from the IRS regarding any matter relating to the Merger. No assurance can be given that the IRS would not assert, or that a court would not sustain, a position contrary to any of the tax aspects described below. Prospective investors must consult their own tax advisers as to the U.S. federal income tax consequences of the Merger, as well as the effects of state, local and non-U.S. tax laws.

The U.S. federal income tax consequences with respect to the Merger will be dependent upon the particular facts in existence prior to and at the time of the Merger. In addition, the application of certain aspects of the U.S. federal income tax law to the proposed Merger is unclear and subject to alternative interpretations.

The parties believe that the Merger will be characterized for U.S. federal income tax purposes as a tax-free reorganization under Section 368(a) of the Code. It may, however, be treated as a taxable transaction in which KYN or KMF is deemed to have sold all of their respective assets for U.S. federal income tax purposes and the KYN or KMF stockholders are deemed to have exchanged their respective stock in a taxable sale.

Requirements to Qualify as a Tax-Free Reorganization

Under Code Section 368(a)(1)(A), a statutory merger of one or more corporations into the acquiring corporation generally may qualify as a tax-free reorganization. Additionally, the transaction needs to satisfy the continuity of proprietary interest, continuity of business enterprise, and business purpose requirements, all of which the parties believe should be satisfied in the contemplated Merger.

Even if a transaction would satisfy the general requirements for a tax-free reorganization, the Code provides that an otherwise qualifying reorganization involving an investment company will not qualify as a tax-free reorganization with respect to any such investment company and its shareholders unless the investment company was immediately before the transaction a regulated investment company (“RIC”), a real estate investment trust (“REIT”), or a corporation that meets the diversified investment requirements of Code Section 368(a)(2)(F)(ii). For these purposes, an investment company is defined to include a RIC, a REIT and a corporation in which 50% or more of the value of its total assets are stock and securities and 80% or more of its total assets are held for investment. Under such test, KYN and KMF are each an investment company. An investment company is treated as diversified if it is (i) a RIC, (ii) a REIT or (iii) an investment company in which not more than (y) 25% of its assets are in the stock or securities of one issuer and (z) 50% of its assets are invested in stock or securities of 5 or fewer issuers (the “asset diversification test”). Code Section 368(a)(2)(F)(iv) provides that “under Regulations as prescribed by the Secretary” assets acquired for purposes of satisfying the asset diversification test are excluded in applying the asset diversification test. However, the Treasury Department has never issued any final regulations, although proposed regulations were issued in 1981 and withdrawn in 1998. Conflicting case law exists as to whether statutory provisions such as Code Section 368(a)(2)(F)(iv) are self-executing in absence of required regulations.

Under the withdrawn proposed Treasury regulations, assets acquired for an “impermissible purpose” are excluded. The impermissible purpose need not be the sole purpose. The withdrawn proposed Treasury regulations generally presumed that assets acquired within one year of the investment company failing to be diversified were acquired for an impermissible purpose. This presumption could be overcome by clear and convincing evidence. The withdrawn proposed Treasury regulations provided for certain safe harbors, none of which would have any application to the proposed Merger. The legislative history underlying the enactment of this provision indicated that this rule is not intended to affect a situation in which a corporation purchases or acquires portfolio stock or securities in the ordinary course of its activities.

As of February 28, 2023, the portfolio of each of KYN and KMF satisfies the asset diversification test and RIC requirements, respectively, and it is anticipated that each such portfolios will continue to satisfy the asset diversification test (as interpreted by the IRS in the withdrawn proposed Treasury regulations) and RIC requirements, respectively, through the proposed Merger. Although intended to qualify as a tax-free reorganization, the Merger may or may not qualify as such as to KYN or KMF. The Companies will make their determination as of the time of the Merger, although that determination may be subject to challenge by the IRS.

U.S. Federal Income Tax Consequence if the Merger Qualifies as a Tax-Free Reorganization

If the Merger qualifies as tax-free reorganization as to KYN and KMF within the meaning of Section 368(a) of the Code, the U.S. federal income tax consequences of the Merger can be summarized as follows:

●

No gain or loss will be recognized by KYN or KMF upon the Merger.

●

No gain or loss will be recognized by a stockholder of KMF who receives KYN common stock or KYN MRP Shares pursuant to the Merger (except with respect to cash received in lieu of a fractional share of KYN common stock, as discussed below).

●

The aggregate tax basis of KYN common stock, received by a stockholder of KMF pursuant to the Merger will be the same as the aggregate tax basis of the shares of KMF surrendered in exchange therefor (reduced by any amount of tax basis allocable to a fractional share of common stock for which cash is received).

●

The holding period of KYN common stock, received by a stockholder of KMF pursuant to the Merger will include the holding period of KMF shares of stock surrendered in exchange therefor.

●

A stockholder of KMF that receives cash in lieu of a fractional share of KYN common stock pursuant to the Merger will recognize capital gain or loss with respect to the fractional share of common stock in an amount equal to the difference between the amount of cash received for the fractional share of KYN common stock and the portion of such stockholder’s tax basis in its KMF shares that is allocable to the fractional share. The capital gain or loss will be long-term if the holding period for the KMF shares is more than one year as of the date of the exchange.

●

KYN’s tax basis in the KMF assets received by KYN pursuant to the Merger will equal the tax basis of such assets in the hands of KMF immediately prior to the Merger, and KYN’s holding period of such assets will, in each instance, include the period during which the assets were held by KMF.

●

KYN will be treated as the acquiror for tax purposes and will succeed to any federal tax net operating loss and capital loss carryforwards that KMF has at the time of the Merger. Any such loss carryforward, as well as any net built-in losses with respect to KMF’s assets as of the time of the Merger, will be subject to the limitations on deductibility of such losses following the Merger as set forth in Code Section 382 (“Section 382”). Section 382 generally limits the amount of taxable income that may be offset by loss carryforwards to an amount equal to the product of the fair market value of the loss entity’s stock multiplied by a specified rate issued by the IRS, which for a transaction effected on February 28, 2023 would have been 3.29 percent. To the extent that KMF has a net unrealized gain on its assets at the time of the Merger, the Section 382 limitation could be increased up to the amount of such unrealized gain that is realized following the merger. As of November 30, 2022, KMF had $402 million of capital loss carryforwards that would be subject to this limitation, of which approximately $56 million remain limited by Section 382 in connection with KMF’s merger with Kayne Anderson Energy Total Return Fund, Inc. (“KYE”) in fiscal year 2018. As of November 30, 2022, KMF had $100 million of net unrealized gains on investments for tax purposes. For KMF, as a RIC, capital losses would be eligible to be carried forward indefinitely and generally would not be limited (except to the extent the losses were otherwise limited by KMF’s merger with KYE). Following the Merger, all pre-Merger KMF capital losses would be subject to a five year carryforward period as applicable to taxable corporations (with the first such year following the Merger pro-rated in accordance with IRS regulations). As an illustrative example, if the Merger had occurred on February 28, 2023 and the fair market value of KMF’s equity (including preferred stock) was $402 million¹, the amount of KMF capital loss carryforward that could be used to offset taxable income per Section 382 would be $100 million (the estimated amount of unrealized gains at the time of the merger, subject to these unrealized gains being realized after the Merger) as well as $13 million annually, for a period of five years following the merger (subject to the first year following the Merger being pro-rated). As such, had the Merger occurred on February 28, 2023, KYN would expect to be able to offset up to a maximum of $162 million² of capital gains with KMF capital losses acquired in the Merger. Any KMF capital losses in excess of this amount would expire unused. The realization of the benefit of these capital losses is dependent upon generating sufficient capital gains post-Merger prior to the expiration of the KMF capital losses acquired. It is KYN’s expectation that KMF capital losses available post-Merger will equal, if not exceed, the amount of the KMF net unrealized gain (if any) as of the Merger date such that KYN should not be required to increase its deferred tax liability in connection with the Merger.

Represents the net asset value of KMF as of February 28, 2023 including the effects of the contemplated 15% tender offer occurring prior to the closing of the Merger plus the liquidation preference of MRP Shares outstanding.

Calculated as the estimated amount of unrealized gains as of the Merger date ($100 million) plus the annual Section 382 limitation ($13 million) pro-rated for a period of 4.75 years (pro-rated assuming the Merger was consummated on February 28, 2023).

●

IRS Code Section 384 (“Section 384”) further limits any losses acquired for a period of five years following the Merger such that pre-Merger losses of KMF could not be utilized to offset pre-Merger gains of KYN (nor could pre-Merger gains of KMF be offset against pre-Merger losses of KYN). As such, Section 384 could further limit the utilization of KMF capital losses acquired in connection with the Merger.

U.S. Federal Income Tax Consequence if the Merger Fails to Qualify as a Tax-Free Reorganization

If the Merger fails to qualify as a tax-free reorganization under section 368(a) of the Code because KYN or KMF fail to meet the asset diversification tests of Code Section 368(a)(2)(F) or for any other reason, the transaction will be taxable to the non-diversified investment company and its stockholders. For example, if KMF is treated as a non-diversified investment company, KMF will be deemed to have sold all of its assets to KYN in a taxable transaction, followed by a deemed liquidation of KMF and a distribution of the sales proceeds (the KYN stock) to KMF’s stockholders. Each KMF stockholder would recognize gain or loss on the liquidating distribution in an amount equal to the difference between the fair market value of the KYN stock received in the Merger and such stockholder’s basis in its KMF stock. KYN’s basis in the assets of the combined entity would include (i) its historic basis in the assets previously held by KYN and (ii) the fair market value of the KMF assets as of the date of the Merger. KYN, after the Merger, would not succeed to any net operating or capital loss carryforwards of KMF.

If, alternatively, KYN is treated as a non-diversified investment company, KYN will be deemed to have sold all of its assets to KMF in a taxable transaction with the attendant deemed liquidation. Based upon current market values, KYN anticipates it would recognize a net gain for U.S. federal income tax purposes. Each KYN stockholder would recognize capital gain or loss in an amount equal to the difference between the fair market value of the KYN stock held and the stockholder’s basis in such stock. KYN, after the Merger, would receive a fair market value basis in the assets historically held by KMF and will lose any of its pre-existing net operating loss and capital loss carryforwards.

Reporting Requirements

A KMF stockholder who receives KYN common stock as a result of the Merger may be required to retain records pertaining to the Merger. Each KMF stockholder who is required to file a U.S. federal income tax return and who is a “significant holder” that receives KYN common stock in the Merger will be required to file a statement with the holder’s U.S. federal income tax return setting forth, among other things, the holder’s basis in the KMF shares surrendered and the fair market value of the KYN common stock and cash, if any, received in the Merger. A “significant holder” is a holder of KMF shares who, immediately before the Merger, owned at least 5% of the outstanding KMF shares.

Certain Federal Income Tax Matters

This section relates to KYN and Certain Federal Income Tax Matters related to KYN (other parts of this document relate to both KYN and KMF). Accordingly, references to “we” “us,” “our” or “the Company” in this section are references to KYN.

The following discussion of federal income tax matters is based on the advice of our counsel, Paul Hastings LLP.

This section and the discussion in the “Statement of Additional Information” summarize certain U.S. federal income tax consequences of owning our securities for U.S. taxpayers. This section is current as of the date of this joint proxy statement/prospectus. Tax laws and interpretations change frequently, possibly with retroactive effect, and this summary does not describe all of the tax consequences to all taxpayers. Except as otherwise provided, this summary generally does not describe your situation if you are a non-U.S. person, a broker-dealer, a person who marks its investment to market or does not hold our securities as capital assets within the meaning of Section 1221 of the Code, a tax-exempt entity, bank, insurance company or other investor with special circumstances. In addition, this section does not describe any U.S. state, local or foreign tax consequences. Investors should consult their own tax advisors regarding the tax consequences of the Merger and investing in us.

U.S. Federal Income Taxation of Kayne Anderson Energy Infrastructure Fund, Inc.

We are treated as a corporation for U.S. federal income tax purposes. Thus, we are obligated to pay U.S. federal and state income tax on our corporate taxable income. We invest in MLPs, which generally are treated as partnerships for U.S. federal income tax purposes. As a limited partner in the MLPs, we include our allocable share of the MLP’s taxable income or loss in computing our taxable income. Based upon our review of the historic results of the type of MLPs in which we invest, we expect that the cash flow received by us with respect to our MLP investments generally will exceed the taxable income allocated to us. There is no assurance that our expectation regarding the tax character of MLP distributions will be realized. If this expectation is not realized, there will be greater tax expense borne by us and less cash available to distribute to stockholders. In addition, we will take into account in our taxable income amounts of gain or loss recognized on the sale of MLP units. Currently, the maximum regular U.S. federal income tax rate for a corporation is 21%.

Deferred income taxes reflect (i) taxes on unrealized gains (losses), which are attributable to the difference between fair value and tax cost basis, (ii) the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and (iii) the net tax benefit of accumulated net operating and capital losses. We will accrue a net deferred tax liability if our future tax liability on our unrealized gains exceeds the tax benefit of our accumulated capital or net operating losses, if any. We will accrue a net deferred tax asset if our future tax liability on our unrealized gains is less than the tax benefit of our accumulated capital or net operating losses or if we have net unrealized losses on our investments.

To the extent we have a deferred tax asset, consideration is given as to whether or not a valuation allowance is required. The need to establish a valuation allowance for deferred tax assets is assessed periodically by us based on the criteria established by the Income Tax Topic of the FASB Accounting Standards Codification (ASC 740) that it is more likely than not that some portion or all of the deferred tax asset will not be realized. In the assessment for a valuation allowance, consideration is given to all positive and negative evidence related to the realization of the deferred tax asset. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability (which are highly dependent on future cash distributions from our holdings), the duration of statutory carryforward periods and the associated risk that capital or net operating loss carryforwards may expire unused.

If a valuation allowance is required to reduce the deferred tax asset in the future, it could have a material impact on our net asset value and results of operations in the period it is recorded.

We may rely to some extent on information provided by portfolio investments, which may not necessarily be timely, to estimate taxable income allocable to the units/shares of such companies held in the portfolio and to estimate the associated current and/or deferred tax liability. Such estimates are made in good faith. From time to time, as new information becomes available, we modify our estimates or assumptions regarding the deferred tax liability. We may be subject to withholding taxes on foreign-sourced income and accrues such taxes when the related income is earned.

Our earnings and profits are calculated using accounting methods that may differ from tax accounting methods used by an entity in which we invest. For instance, to calculate our earnings and profits we will use the straight-line depreciation method rather than the accelerated depreciation method. This treatment may, for example, affect our earnings and profits if an MLP in which we invest calculates its income using the accelerated depreciation method. Our earnings and profits would not be increased solely by the income passed through from the MLP, but we would also have to include in our earnings and profits the amount by which the accelerated depreciation exceeded straight-line depreciation.

Because of the differences in the manner in which earnings and profits and taxable income are calculated, we may make distributions out of earnings and profits, treated as tax dividends, in years in which we have no taxable income.

We have not elected and have no current intention to elect to be treated as a RIC under the Code because the extent of our investments in MLPs would generally prevent us from meeting the qualification requirements for RICs. The Code generally provides that a RIC does not pay an entity level income tax provided that it distributes all or substantially all of its income each year and satisfies certain source of income and asset diversification requirements. The RIC taxation rules have no current application to us or to our stockholders.

U.S. Federal Income Taxation of Holders of Our Common Stock

Our distributions are treated as a taxable dividend to the stockholder to the extent of our current or accumulated earnings and profits. If the distribution exceeds our current or accumulated earnings and profits, the distribution will be treated as a return of capital to our common stockholder to the extent of the stockholder’s basis in our common stock, and then the amount of a distribution in excess of a stockholder’s basis would be taxable as capital gain. Common stockholders will receive an IRS Form 1099 from us and will recognize taxable dividend income only to the extent of our current and accumulated earnings and profits.

Generally, a corporation’s earnings and profits are computed based upon taxable income, with certain specified adjustments. As a corporation for tax purposes, our earnings and profits will be calculated using (i) straight-line depreciation rather than accelerated depreciation, and cost rather than a percentage depletion method, and (ii) intangible drilling costs and exploration and development costs amortized over a five-year and ten-year period, respectively. Because of the differences in the manner in which earnings and profits and taxable income are calculated, we may make distributions out of earnings and profits, treated as dividends, in years in which we have no taxable income.

Our distributions that are treated as dividends generally will be taxable as ordinary income to holders, but (i) are expected to be eligible for treatment as “qualified dividend income” that is subject to reduced rates of U.S. federal income tax for noncorporate stockholders, and (ii) may be eligible for the dividends received deduction available to corporate stockholders, in each case provided that certain holding period requirements are met. Under current law, qualified dividend income is taxable to noncorporate stockholders at a maximum U.S. federal income tax rate of 20%. In addition, currently the Tax Surcharge generally applies to dividend income and net capital gains for taxpayers whose adjusted gross income exceeds $200,000 for single filers or $250,000 for married joint filers.

If a distribution exceeds our current and accumulated earnings and profits, such distribution will be treated as a non-taxable reduction to the basis of the stock to the extent of such basis, and thereafter as capital gain to the extent of the excess distribution. Such gain will be long-term capital gain if the holding period for the stock is more than one year. Individuals currently are subject to a maximum U.S. federal income tax rate of 20% on long-term capital gains (prior to the Tax Surcharge, if applicable). Corporations are taxed on capital gains at their ordinary graduated income tax rates.

If a holder of our common stock participates in the Plan, such stockholder will be taxed upon the amount of distributions as if such amount had been received by the participating stockholder in cash and the participating stockholder reinvested such amount in additional common stock, even though such holder has received no cash distribution from us with which to pay such tax.

Sale of Our Common Stock

The sale of our stock by holders will generally be a taxable transaction for U.S. federal income tax purposes. Holders of our stock who sell such shares will generally recognize gain or loss in an amount equal to the difference between the net proceeds of the sale and their adjusted tax basis in the shares sold. If such shares of stock are held as a capital asset at the time of the sale, the gain or loss will be a capital gain or loss, generally taxable as described above. A holder’s ability to deduct capital losses may be limited under the Code.

Investment by Tax-Exempt Investors and Regulated Investment Companies

Employee benefit plans and most other organizations exempt from U.S. federal income tax, including individual retirement accounts and other retirement plans, are subject to U.S. federal income tax on unrelated business taxable income, or UBTI. Because we are a corporation for U.S. federal income tax purposes, an owner of our common stock will not report on its U.S. federal income tax return any of our items of income, gain, loss, deduction or credit. Therefore, a tax-exempt investor will not have UBTI attributable to its ownership or sale of our common stock unless its ownership of our common stock is debt financed. In general, common stock would be debt financed if the tax-exempt owner of common stock incurs debt to acquire our common stock or otherwise incurs or maintains an indebtedness that would not have been incurred or maintained if that common stock had not been acquired.

As stated above, an owner of our common stock will not report on its U.S. federal income tax return any of our items of gross income, gain, loss and deduction. Instead, the owner will report income with respect to our distributions that constitute taxable income to the owner or gain with respect to the sale of our common stock. Thus, distributions with respect to our common stock generally will result in income that is qualifying income for a RIC. Furthermore, any gain from the sale or other disposition of our common stock will constitute gain from the sale of stock or securities and will also result in income that is qualifying income for a RIC. In addition, our common stock will constitute qualifying assets to RICs, which generally must own at least 50% in qualifying assets and not more than 25% in certain non-qualifying assets (such as equity interests in MLPs) at the end of each quarter, provided such RICs do not violate certain percentage ownership limitations with respect to our stock.

Backup Withholding and Information Reporting

Backup withholding of U.S. federal income tax at the current rate of 24% may apply to the distributions on our common stock to be made by us if you fail to timely provide your taxpayer identification number or if we are so instructed by the IRS. Backup withholding is not a separate tax and any amounts withheld from a payment to a U.S. holder under the backup withholding rules are allowable as a refund or credit against the holder’s U.S. federal income tax liability, provided that the required information is furnished to the IRS in a timely manner. Corporations are generally exempt from backup withholding.

Other Taxation

Non-U.S. stockholders, including stockholders who are nonresident alien individuals, may be subject to U.S. withholding tax on certain distributions at a rate of 30% or such lower rates as may be prescribed by any applicable tax treaty.

The Foreign Account Tax Compliance Act (“FATCA”)

Subject to the application of certain intergovernmental agreements, a 30% withholding tax on distributions generally applies if paid to a foreign entity unless: (i) if the foreign entity is a “foreign financial institution,” it undertakes certain due diligence, reporting, withholding and certification obligations, (ii) if the foreign entity is not a foreign financial institution, it identifies certain of its U.S. investors or (iii) the foreign entity is otherwise excepted under FATCA. Under proposed Treasury regulations on which taxpayers may currently rely, FATCA withholding does not apply to proceeds from the sale of or other disposition of our shares. If withholding is required under FATCA on a payment related to your shares, investors that otherwise would not be subject to withholding (or that otherwise would be entitled to a reduced rate of withholding) on such payment generally will be required to seek a refund or credit from the IRS to obtain the benefits of such exemption or reduction. We will not pay any additional amounts in respect to amounts withheld under FATCA. You should consult your tax advisor regarding the effect of FATCA based on your individual circumstances.

State and Local Taxes

Payment and distributions with respect to our common stock and preferred stock also may be subject to state and local taxes.

Tax matters are very complicated, and the U.S. federal, state, local and foreign tax consequences of an investment in and holding of our common stock and preferred stock will depend on the facts of each investor’s situation. Investors are encouraged to consult their own tax advisers regarding the specific tax consequences that may affect them.

Tax Risks

Investing in our securities involves certain tax risks, which are more fully described in “Risk Factors — Risks Related to Our Business and Structure — Tax Risks.”

Required Vote

Stockholder approval of the Merger requires the affirmative vote of the holders of a majority of the outstanding KMF common and preferred stock (voting as a class). For purposes of this proposal, each share of KMF common stock and each share of KMF preferred stock is entitled to one vote. Abstentions and broker non-votes, if any, will have the same effect as votes against approving the Merger since approval is based on the affirmative vote of all votes entitled to be cast. Abstentions and broker non-votes, if any, will be considered present for purposes of determining the presence of a quorum for KMF at the KMF Special Meeting.

Board Recommendation

THE BOARD OF DIRECTORS OF KMF, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT KMF STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE MERGER.

PROPOSAL TWO: ISSUANCE OF ADDITIONAL KYN COMMON STOCK IN CONNECTION WITH THE MERGER

The rules of the NYSE require the stockholders of KYN to approve the issuance of additional KYN common shares in connection with the Merger. Pursuant to the Merger Agreement, which is described more fully under “Proposal One: Merger,” KMF will be merged with and into a wholly owned subsidiary of KYN, with KMF’s shares of common stock converted into shares of KYN common stock (although cash will be distributed in lieu of fractional shares). KMF will then cease its separate existence under Maryland law and terminate its registration under the 1940 Act. Immediately following the Merger, it is expected that Merger Sub will be merged with and into KYN. The aggregate NAV of KYN common stock received by KMF common stockholders in the Merger will equal the aggregate NAV of KMF shares held on the business day prior to closing of the Merger (excluding cash distributed by KYN for fractional shares). KYN will be the accounting survivor following the closing of the Merger and will continue to operate after the Merger as a registered, non-diversified, closed-end management investment company with the investment objectives and policies described in this joint proxy statement/prospectus

The parties believe that the Merger will be characterized for federal income tax purposes as a tax-free reorganization. If the Merger so qualifies, neither KMF nor its stockholders will recognize any gain or loss in connection with the Merger.

The Board of Directors of KYN, based upon its evaluation of all relevant information, anticipates that the Merger will benefit the stockholders of KYN. The Companies have very similar investment strategies and objectives and the Merger will permit each Fund to continue to pursue them in a larger fund. Additionally, the Merger is expected to result in several benefits for stockholders in the Combined Fund, including (i) cost savings through the elimination of duplicative expenses and greater economies of scale, (ii) potential for reduced management fees in the future due to the revised KYN management fee waiver, and (iii) greater financial flexibility through a larger asset base. For additional information about the Merger, including a comparison of KYN and KMF, the reasons for the Merger and the U.S. Federal income tax consequences of the Merger, see “Proposal One: Merger.”

Required Vote

KYN stockholder approval of the issuance of additional KYN common shares in connection with the Merger requires the affirmative vote of the holders of a majority of votes cast by the holders of the issued and outstanding KYN common and preferred stock (voting as a class). For purposes of this proposal, each share of KYN common stock and each share of KYN preferred stock is entitled to one vote. Abstentions, if any, will have the same effect as votes against the issuance of additional KYN common stock in connection with the Merger, since approval is based on the affirmative vote of all votes cast. Broker non-votes, if any, will not count as votes cast and thus will have no effect on the proposal.

Board Recommendation

THE BOARD OF DIRECTORS OF KYN UNANIMOUSLY RECOMMENDS KYN STOCKHOLDERS VOTE “FOR” THE ISSUANCE OF ADDITIONAL KYN COMMON STOCK IN CONNECTION WITH THE MERGER.

MORE INFORMATION ABOUT THE MEETING

Outstanding Stock

As of the Record Date, KYN had 136,131,530 shares of common stock and 4,464,117 shares of preferred stock outstanding.

To the knowledge of management as of the Record Date:

●

one person beneficially owned more than 5% of KYN’s outstanding common stock.

●

five persons beneficially owned more than 5% of KYN’s outstanding preferred stock.

●

directors owned less than 1% of KYN’s outstanding common stock.

●

directors did not own any of KYN’s outstanding preferred stock.

●

officers and directors owned, as a group, less than 1% of KYN’s outstanding common stock.

●

directors and officers, as a group, did not own any of KYN’s outstanding preferred stock.

As of the Record Date, KMF had 47,197,462 shares of common stock and 1,659,657 shares of preferred stock outstanding.

To the knowledge of management as of the Record Date:

●

two persons beneficially owned more than 5% of KMF’s outstanding common stock.

●

four persons beneficially owned more than 5% of KMF’s outstanding preferred stock.

●

directors owned less than 1% of KMF’s outstanding common stock.

●

directors owned did not own any of KMF’s outstanding preferred stock.

●

officers and directors owned, as a group, less than 1% of KMF’s outstanding common stock.

●

directors and officers, as a group, did not own any of KMF’s outstanding preferred stock.

How Proxies Will Be Voted

All proxies solicited by the Boards of Directors that are properly executed and received at or prior to the Meeting, and that are not revoked, will be voted at the Meeting. Votes will be cast in accordance with the instructions marked on the enclosed proxy card. If no instructions are specified, the persons named as proxies will cast such votes in accordance with each Board’s recommendations. Neither KYN nor KMF knows of no other matters to be presented at the Meeting, and no matters other than the Merger may be considered by KMF’s stockholders at the Meeting.

How to Vote

If your shares are held in “Street Name” by a broker or bank, you will receive information regarding how to instruct your bank or broker to cast your votes. If you are a stockholder of record, you may authorize the persons named as proxies on the enclosed proxy card to cast the votes you are entitled to cast at the Meeting by completing, signing, dating and returning the enclosed proxy card. Stockholders of record or their duly authorized proxies may vote in person at the Meeting. However, even if you plan to attend the Meeting, you should still return your proxy card, which will ensure that your vote is cast should your plans change.

For each Company, the expenses of preparing, printing and mailing the enclosed proxy card, the accompanying notice and this joint proxy statement/prospectus, tabulation expenses and all other costs in connection with the solicitation of proxies will be borne equally by the Companies. The Companies may also reimburse banks, brokers and others for their reasonable expenses in forwarding proxy solicitation material to the beneficial owners of the Company’s shares. In order to obtain the necessary quorum for KYN or KMF at the Meeting, additional solicitation may be made by mail, telephone, telegraph, facsimile or personal interview by each Company’s representatives, Kayne Anderson, the Company’s transfer agent, or by brokers or their representatives or by a solicitation firm that may be engaged by the Company to assist in proxy solicitations. The costs associated with all proxy solicitation are expected to be approximately $250,000 for KYN and $250,000 for KMF. Neither Company will pay any of its representatives or Kayne Anderson any additional compensation for their efforts to supplement proxy solicitation.

Dissenters’ or Appraisal Rights

Stockholders do not have dissenters’ or appraisal rights.

Revoking a Proxy

At any time before it has been voted, you may revoke your proxy by: (1) sending a letter revoking your proxy to the Secretary at 811 Main Street, 14th Floor, Houston, TX 77002; (2) properly executing and sending a later-dated proxy to the Secretary at the same address; or (3) attending the Meeting, requesting return of any previously delivered proxy, and voting in person. Attendance at the Meeting will not, by itself, be sufficient to revoke you earlier-executed proxy.

Broker Non-Votes

Broker non-votes occur when a beneficial owner of shares held in “street name” does not give instructions to the broker holding the shares as to how to vote on matters deemed “non-routine.” Generally, if shares are held in street name, the beneficial owner of the shares is entitled to give voting instructions to the broker holding the shares. If the beneficial owner does not provide voting instructions, the broker can still vote the shares with respect to matters that are considered to be “routine,” but cannot vote the shares with respect to “non-routine” matters. Under the rules and interpretations of the NYSE, “non-routine” matters are generally matters that may substantially affect the rights or privileges of stockholders. Each of the approval of the Merger and the issuance of additional shares of KYN common stock in connection with the Merger is considered “non-routine,” and so brokers will not have discretionary voting power with respect to the proposals.

Quorum and Adjournment

The presence, in person or by proxy, of holders of shares entitled to cast a majority of the votes entitled to be cast (without regard to class) constitutes a quorum for KYN and KMF for the purposes of the Meeting. Abstentions and broker non-votes will be counted for purposes of determining whether a quorum is present for KYN and KMF at the Meeting. The chairman may adjourn the Meeting to a date not more than 120 days after the original Record Date without notice other than announcement at the Meeting.

Investment Adviser

KA Fund Advisors, LLC is the investment adviser for each Company. Its principal office is located at 811 Main Street, 14th Floor, Houston, TX 77002.

Administrator

Ultimus Fund Solutions, LLC (the “Administrator”) provides certain administrative services for each Company, including but not limited to preparing and maintaining books, records, and tax and financial reports, and monitoring compliance with regulatory requirements. The Administrator is located at 225 Pictoria Drive, Suite 450, Cincinnati, OH 45246.

Householding of Proxy Materials

The SEC has adopted rules that permit companies and intermediaries (e.g. brokers) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering a single proxy statement and annual report addressed to those stockholders. This process, which is commonly referred to as “householding,” potentially means extra convenience for stockholders and cost savings for companies.

This year, a number of brokers with account holders who are the Company’s stockholders will be “householding” its proxy materials. These brokers will deliver a single copy of the proxy statement and other proxy materials to multiple stockholders sharing an address unless the brokers have received contrary instructions from the affected stockholders. If you have received notice from your broker that it will be “householding” communications to your address, “householding” will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in “householding” and would prefer to receive a separate copy of proxy materials and annual report, please notify your broker. Stockholders sharing an address who currently receive multiple copies of proxy materials and annual report at the same addresses and would like to request “householding” of their communications should contact their brokers.

Stockholder Proposals

The bylaws for KYN and KMF provide that in order for a stockholder to nominate a candidate for election as a director at an annual meeting of stockholders or propose business for consideration at such meeting, which nomination or proposal is not to be included in the Company’s proxy statement, written notice containing the information required by the current Bylaws must be delivered to the Secretary of the Company at 811 Main Street, 14th Floor, Houston, TX 77002, not later than 5:00 p.m. Central Time on the 120th day, and not earlier than the 150th day, prior to the first anniversary of the date of mailing of the notice for the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the 150th day prior to the date of such annual meeting and not later than 5:00 p.m. Central Time on the later of the 120th day prior to the date of such annual meeting or the tenth day following the day on which public announcement of the date of such meeting is first made.

Accordingly, a stockholder nomination or proposal for either Company intended to be considered at the 2024 Annual Meeting must have been received by the Secretary of the Company on or after September 30, 2023 and prior to 5:00 p.m. Central Time on October 30, 2023. However, under the rules of the SEC, if a stockholder wishes to submit a proposal for possible inclusion in the 2024 proxy statement pursuant to Rule 14a-8(e) of the 1934 Act, the Company must receive it not less than 120 calendar days before the anniversary of the date the proxy statement was released to stockholders for the previous year’s annual meeting. Accordingly, a stockholder’s proposal under Rule 14a-8(e) must have been received by the Company on or before October 24, 2023 in order to be included in the proxy statement and proxy card for the 2024 Annual Meeting. All nominations and proposals must be in writing. There are additional requirements regarding proposals of stockholders. A stockholder contemplating submission of a proposal is referred to Rule 14a-8 promulgated under the 1934 Act. The timely submission of a proposal does not guarantee its inclusion in the Company’s proxy materials.

If the Merger is not approved by the stockholders of KMF, or the issuance of additional shares of KYN common stock in connection with the Merger is not approved by the stockholders of KYN, KMF expects to hold its 2024 Annual Meeting of Stockholders in the normal course.

By Order of the Boards of Directors


James C. Baker, Jr.
Chairman of the Boards of Directors
President and Chief Executive Officer
, 2023

APPENDIX A

Execution Version

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”) is made as of this 24^th day of March 2023, by and between Kayne Anderson NextGen Energy & Infrastructure, Inc. (the “Target Fund”), a Maryland corporation with its principal place of business at 811 Main Street, 14th Floor, Houston, Texas 77002, and Kayne Anderson Energy Infrastructure Fund, Inc. (the “Surviving Fund”), a Maryland corporation with its principal place of business at 811 Main Street, 14th Floor, Houston, Texas 77002.

WHEREAS, each of the Target Fund and the Surviving Fund is a closed-end management investment company registered as such under the Investment Company Act of 1940, as amended (the “1940 Act”), and the Target Fund owns securities that are of the character in which the Surviving Fund is permitted to invest;

WHEREAS, it is intended that, for United States federal income tax purposes, (i) the transactions contemplated by this Agreement shall qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) that the Agreement shall constitute a “plan of reorganization” for purposes of the Code;

WHEREAS, the reorganization of the Target Fund will consist of the merger pursuant to the laws of the State of Maryland of the Target Fund with and into a to-be-formed wholly owned subsidiary entity of the Surviving Fund (“Merger Sub”), with the Target Fund surviving, pursuant to which the shares of common stock, par value $0.001 per share, of the Target Fund (the “Target Fund Common Stock”), will be converted at the specified ratio into shares of common stock, par value $0.001 per share, of the Surviving Fund (the “Surviving Fund Common Stock”), and each share of Target Fund Preferred Stock (as defined herein) will be converted into a share of Surviving Fund Preferred Stock (as defined herein), each as provided herein, all upon the terms and conditions set forth in this Agreement (the “Merger”);

WHEREAS, the Board of Directors of the Surviving Fund (the “Surviving Fund Board”), including a majority of directors who are not “interested persons” (as defined in Section 2(a)(19) of the 1940 Act), has determined, with respect to the Surviving Fund, that the Merger is in the best interests of the Surviving Fund and that the interests of the stockholders of the Surviving Fund will not be diluted as a result of the Merger;

WHEREAS, the Board of Directors of the Surviving Fund, including a majority of directors who are not “interested persons” (as defined in Section 2(a)(19) of the 1940 Act), will have determined, with respect to Merger Sub, that the Merger is in the best interests of Merger Sub and that the interests of the equityholder of Merger Sub will not be diluted as a result of the Merger;

WHEREAS, the Board of Directors of the Target Fund (the “Target Fund Board”), including a majority of directors who are not “interested persons” (as defined in Section 2(a)(19) of the 1940 Act), has determined, with respect to the Target Fund, that the Merger is in the best interests of the Target Fund and that the interests of the stockholders of the Target Fund will not be diluted as a result of the Merger;

A-1

NOW, THEREFORE, in consideration of the premises and of the covenants and agreements hereinafter set forth, the parties hereto, intending to be legally bound, covenant and agree as follows:

1 BASIC TRANSACTION

1.1 The Merger. Prior to the Merger, the Surviving Fund shall cause Merger Sub to be formed solely for the purpose of effecting the Merger. Subject to the terms and conditions hereof and on the basis of the representations and warranties contained herein, and in accordance with the laws of the State of Maryland, at the Effective Time (as defined in Section 1.1(f)), the Target Fund shall be merged with and into Merger Sub in accordance with applicable law. As a result of the Merger, the separate legal existence of Merger Sub shall cease, and the Target Fund shall continue as the surviving company and a wholly owned subsidiary of the Surviving Fund. The separate existence of the Surviving Fund shall continue unaffected and unimpaired by the Merger and it shall be governed by the laws of the State of Maryland.

(a) At the Effective Time, as a result of the Merger and without any action on the part of the stockholders of the Target Fund or the stockholders of the Surviving Fund:

(i) each share of Target Fund Common Stock outstanding immediately prior to the Effective Time shall be converted into a number of shares of Surviving Fund Common Stock equal to one times the fraction the numerator of which is the net asset value per share of the Target Fund Common Stock determined in accordance with Section 3 and the denominator of which is the net asset value per share of the Surviving Fund Common Stock determined in accordance with Section 3. Cash shall be paid in lieu of any fractional share resulting from the calculation of the product in the preceding sentence. The aggregate net asset value of the Surviving Fund Common Stock received by the Target Fund stockholders in the Merger will equal, as of the Valuation Time (as defined in Section 3), the aggregate net asset value of the Target Fund Common Stock held by the Target Fund stockholders as of such time;

(ii) the shares of Surviving Fund Common Stock issued and outstanding immediately prior to the Effective Time shall remain outstanding upon the Effective Time and shall be unaffected by the Merger; and

(iii) each share of the Target Fund’s Series H, Series I and Series J preferred stock issued and outstanding immediately prior to the Effective Time (the “Target Fund Preferred Stock”) shall be converted into a share of the Surviving Fund’s newly issued Series U, Series V and Series W preferred stock having substantially identical terms as the respective series of the Target Fund Preferred Stock (the “Surviving Fund Preferred Stock”). The Surviving Fund Preferred Stock will have equal priority with any other outstanding preferred shares of the Surviving Fund as to the payment of dividends and as to the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Surviving Fund. The accrual for the Target Fund Preferred Stock with respect to any accrued and unpaid dividends as of the Closing Date will be assumed by the Surviving Fund and will apply, and be payable on an equivalent share-for-share basis, with respect to the Surviving Fund Preferred Stock on the same dividend payment schedule as applied to the corresponding series of Target Fund Preferred Stock.

A-2

(b) The Closing Date (as defined in Section 1.4) and the Valuation Time must each be on a day on which the New York Stock Exchange (the “NYSE”) is open for trading (a “Business Day”).

(c) The charter of the Surviving Fund as in effect immediately prior to the Effective Time shall be the charter of the Surviving Fund (the “Surviving Fund Charter”), unless and until amended in accordance with its terms and applicable law. The bylaws of the Surviving Fund as in effect immediately prior to the Effective Time shall be the bylaws of the Surviving Fund (the “Surviving Fund Bylaws”), unless and until amended in accordance with its terms and applicable law.

(d) At the Effective Time, the Surviving Fund shall continue in existence, and, without further act or deed and in accordance with applicable law, shall succeed to and possess all of the rights, privileges and powers of the Target Fund, and all of the assets and property of whatever kind and character of the Target Fund shall vest in the Surviving Fund without further act or deed and in accordance with applicable law. The Surviving Fund shall be liable for all of the known and unknown liabilities and obligations of the Target Fund, and any claim or judgment against the Target Fund may be enforced against the Surviving Fund in accordance with applicable law.

(e) The Surviving Fund will issue Surviving Fund Common Stock and Surviving Fund Preferred Stock to Target Fund stockholders upon the conversion of their Target Fund Common Stock or Target Fund Preferred Stock, as applicable, by opening shareholder accounts on the share records of the Surviving Fund in the names of and in the amounts due to the Target Fund stockholders and representing the respective number of shares of the Surviving Fund Common Stock or Surviving Fund Preferred Stock due to those stockholders pursuant to Section 1.1(a). Ownership of Surviving Fund Common Stock will be shown on the books of the Surviving Fund’s transfer agent, and the Surviving Fund will not issue certificates representing Surviving Fund Common Stock in connection with the Merger. All Surviving Fund Common Stock and Surviving Fund Preferred Stock to be issued pursuant to the Merger shall be deemed issued and outstanding as of the Effective Time.

(f) Upon the terms and subject to the conditions of this Agreement, the parties shall cause the Merger to be consummated by filing, as applicable, articles of merger (the “Maryland Articles of Merger”) with the State Department of Assessments and Taxation in accordance with the laws of the State of Maryland. The Merger shall become effective at such date and time as the Surviving Fund and the Target Fund shall agree and specify in the Maryland Articles of Merger (the “Effective Time”).

(g) The Surviving Fund shall, on or after the Closing Date and to the extent directed by its authorized officers, issue and deliver newly issued Series TT, Series UU, Series VV and Series WW Surviving Fund Notes (as defined in Section 2.1(r)) having identical terms as the Target Fund’s Series D, Series F, Series H and Series I unsecured notes (collectively, “Target Fund Notes”), respectively, to the requesting holders of those Target Fund Notes pursuant to an assumption agreement to be entered into by the Surviving Fund. The aggregate principal amount of each Surviving Fund Note to be provided to the holder of the Target Fund Note being replaced will equal the unpaid principal amount of the corresponding Target Fund Note held on the replacement date.

(h) On the Closing Date and in connection with the Closing, the Surviving Fund will assume or satisfy the Target Fund’s obligations under the agreements specified on Schedule A-1.

A-3

1.2 Certificates.

(a) Effective as of the Effective Date, all outstanding certificates representing shares of the Target Fund Common Stock and Target Fund Preferred Stock will be deemed cancelled and shall no longer evidence ownership thereof.

(b) In lieu of delivering certificates for Surviving Fund Common Stock, the Surviving Fund shall credit the Surviving Fund Common Stock to the applicable Target Fund stockholders’ accounts on the books of the Surviving Fund. The Target Fund’s transfer agent shall deliver at Closing a certificate of an authorized officer stating that its records contain the names and addresses of the holders of Target Fund Common Stock and the number and percentage ownership of outstanding shares owned by each such shareholder immediately before the Closing. The Surviving Fund’s transfer agent shall issue and deliver to the Target Fund’s Secretary a confirmation evidencing the Surviving Fund Common Stock to be credited on the Closing Date, or provide evidence satisfactory to the Target Fund that such Surviving Fund Common Stock has been credited to the accounts of the Target Fund’s stockholders on the books of the Surviving Fund. Any replacement Surviving Fund Notes will be delivered to the requesting holders of Target Fund Notes in conformity with the provisions of the Notes Purchase Agreement and assumption agreement applicable to the respective series of Target Fund Notes.

(c) With respect to any holder of Target Fund Common Stock or Target Fund Preferred Stock holding certificates representing shares of Target Fund Common Stock or Target Fund Preferred Stock as of the Closing Date, and subject to the Surviving Fund being informed thereof in writing by the Target Fund, the Surviving Fund will not permit such shareholder to receive shares of Surviving Fund Common Stock or Target Fund Preferred Stock (or to vote as a stockholder of the Surviving Fund) until such shareholder has surrendered his or her outstanding certificates evidencing ownership of Target Fund Common Stock or Target Fund Preferred Stock, or, in the event of lost certificates, posted adequate bond or an affidavit of lost or destroyed certificate. The Target Fund will request its stockholders to surrender their outstanding certificates representing shares of Target Fund Common Stock or Target Fund Preferred Stock or post adequate bond therefor. Dividends or other distributions payable to holders of record of shares of Target Fund Common Stock or Target Fund Preferred Stock as of any date after the Closing Date and before the exchange of certificates by any holder of Target Fund Common Stock or Target Fund Preferred Stock shall be credited to such shareholder, without interest; however, such dividends or other distributions shall not be paid unless and until such shareholder surrenders his or her certificates representing shares of Target Fund Common Stock or Target Fund Preferred Stock for exchange. The Surviving Fund will request the holders of Target Fund Notes to surrender those Target Fund Notes evidencing ownership of Target Fund Notes in exchange for the Surviving Fund Notes to be replaced.

(d) The Surviving Fund shall, on the Closing Date and to the extent directed by its authorized officers, issue and deliver new certificates representing the applicable series of Surviving Fund Preferred Stock to requesting holders of Target Fund Preferred Stock pursuant to an assumption agreement to be entered into by the Surviving Fund.

1.3 Reporting. Any reporting responsibility of the Target Fund is and shall remain the responsibility of the Target Fund up to the Closing Date.

1.4 Actions at Closing. At the closing of the transactions contemplated by this Agreement (the “Closing”) on the date thereof (the “Closing Date”), (i) the Target Fund will deliver to the Surviving Fund the various certificates and documents referred to in Section 6 below, (ii) the Surviving Fund will deliver to the Target Fund the various certificates and documents referred to in Section 5 below, and (iii) the Target Fund and the Surviving Fund will make any filings or recordings required by Maryland law in connection with the Merger, including the filing of the Maryland Articles of Merger.

A-4

2 REPRESENTATIONS AND WARRANTIES

2.1 Representations and Warranties of the Surviving Fund. The Surviving Fund represents and warrants to the Target Fund that the statements contained in this Section 2.1 are correct and complete in all material respects as of the execution of this Agreement on the date hereof. The Surviving Fund represents and warrants to, and agrees with, the Target Fund that:

(a) The Surviving Fund is a corporation duly organized and validly existing under the laws of the State of Maryland and is in good standing with the State Department of Assessments and Taxation of Maryland, and has the power to own all of its assets and to carry on its business as it is now being conducted and to carry out this Agreement.

(b) The Surviving Fund is duly registered under the 1940 Act as a non-diversified, closed-end management investment company (File No. 811-21593) and such registration has not been revoked or rescinded and is in full force and effect. From the inception of its operations to the date hereof, the Surviving Fund has been in compliance in all material respects with the applicable provisions of the 1940 Act and the rules promulgated thereunder by the Securities and Exchange Commission (the “SEC”), except as previously disclosed in writing to the Target Fund. The Surviving Fund’s investment operations from the inception of its operations to the date hereof have been in compliance in all material respects with the investment policies and investment restrictions set forth in its applicable prospectus, annual report to stockholders or other public document filed with the SEC, except as previously disclosed in writing to the Target Fund. The Surviving Fund is qualified as a foreign corporation in every jurisdiction where required, except to the extent that failure to so qualify would not have a material adverse effect on the Surviving Fund.

(c) No consent, approval, authorization or order of any court or governmental authority is required for the consummation by the Surviving Fund of the transactions contemplated herein, except (i) such as have been obtained or will be obtained under the Securities Act of 1933, as amended (the “1933 Act”), the Securities Exchange Act of 1934, as amended (the “1934 Act”), the 1940 Act, the Surviving Fund Charter, the charter of the Target Fund, the Maryland General Corporation Law and the listing rules of the NYSE and (ii) such as may be required by state securities laws.

(d) The Surviving Fund is not, and the execution, delivery and performance of this Agreement by the Surviving Fund will not result, in violation of the laws of the State of Maryland or of the Surviving Fund Charter or the Surviving Fund Bylaws, or of any material agreement, indenture, instrument, contract, lease or other undertaking to which the Surviving Fund is a party or by which it is bound, and the execution, delivery and performance of this Agreement by the Surviving Fund will not result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease, judgment or decree to which the Surviving Fund is a party or by which it is bound.

(e) The Surviving Fund has been furnished with the Target Fund’s Annual Report to Shareholders for the fiscal year ended November 30, 2022.

A-5

(f) Upon its formation and until the Closing Date, Merger Sub will be wholly owned by the Surviving Fund and will not hold any equity interests or rights, options, warrants, convertible or exchangeable securities, subscriptions, calls, puts or other analogous rights, interests, agreements, arrangements or commitments to acquire or otherwise relating to any equity or voting interest of any other person. Merger Sub will have been formed solely for the purpose of effecting the Merger, will not have conducted any business activities and will have no assets or liabilities other than those incidental to its formation.

(g) The Surviving Fund has full power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement has been duly authorized by all necessary action of the Surviving Fund Board, and, subject to approval by stockholders of the Target Fund and the Surviving Fund with respect to the issuance of additional shares of Surviving Fund Common Stock, this Agreement constitutes a valid and binding contract enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws relating to or affecting creditors’ rights generally and court decisions with respect thereto.

(h) At the Closing Date, the Surviving Fund will have good and marketable title to its assets held immediately before the Closing Date, which are free and clear of any material liens, pledges or encumbrances except those previously disclosed to the Target Fund.

(i) No material litigation or administrative proceeding or investigation of or before any court or governmental body is presently pending or to its knowledge threatened against the Surviving Fund or any properties or assets held by it. The Surviving Fund knows of no facts that might form the basis for the institution of such proceedings which would materially and adversely affect its business and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects its business or its ability to consummate the transactions herein contemplated.

(j) There are no material contracts outstanding to which the Surviving Fund is a party that have not been disclosed in the Surviving Fund’s filings with the SEC or will be disclosed in the Registration Statement (as defined in Section 2.1(o) below) or that have not otherwise been disclosed to the Target Fund prior to the date hereof.

A-6

(k) The statement of assets and liabilities, statement of operations, statement of changes in net assets and schedule of portfolio investments (indicating their market values) of the Surviving Fund at, as of and for the fiscal year ended November 30, 2022, audited by PricewaterhouseCoopers LLP, independent registered public accounting firm to the Surviving Fund, copies of which have been furnished to the Target Fund, fairly reflect the financial condition, results of operations, and changes in net assets of the Surviving Fund as of such date and for the period then ended in accordance with accounting principles generally accepted in the United States (“GAAP”) consistently applied, and the Surviving Fund has no known liabilities of a material amount, contingent or otherwise, other than those shown on the statements of assets and liabilities referred to above, or those incurred in the ordinary course of its business since November 30, 2022.

(l) Except as disclosed in accordance with this Section 2.1(l), since November 30, 2022, there has not been any material adverse change in the Surviving Fund’s financial condition, assets, liabilities or business and the Surviving Fund has no known liabilities of a material amount, contingent or otherwise, required to be disclosed in a balance sheet with GAAP other than those shown on the Surviving Fund’s statements of assets, liabilities and capital referred to above, those incurred in the ordinary course of its business as an investment company since November 30, 2022, and those incurred or to be incurred in connection with the Merger. On the date hereof and as of the Closing Date, the Surviving Fund will advise the Target Fund in writing of all known liabilities, contingent or otherwise, whether or not incurred in the ordinary course of business, existing or accrued. For purposes of this Section 2.1(l), customary distributions, changes in portfolio securities, a decline in net asset value per share of the Surviving Fund due to declines in market values of securities in the Surviving Fund’s portfolio or the discharge of the Surviving Fund’s liabilities will not constitute a material adverse change.

(m) All federal and other tax returns and information reports of the Surviving Fund required by law to have been filed, shall have been filed, and are or will be correct in all material respects, and all federal and other taxes shown as due or required to be shown as due on said returns and reports shall have been paid or provision shall have been made for the payment thereof, and, to the best of the Surviving Fund’s knowledge, no such return is currently being amended or under audit and no assessment has been asserted with respect to such returns, except as has been disclosed to the Target Fund. All tax liabilities of the Surviving Fund have been adequately provided for on its books, and no tax deficiency or liability of the Surviving Fund has been asserted and no question with respect thereto has been raised by the Internal Revenue Service or by any state or local tax authority for taxes in excess of those already paid, up to and including the taxable year in which the Closing Date occurs.

(n) The Surviving Fund has not taken any action and does not know of any fact or circumstance that could reasonably be expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.

(o) A registration statement will be or will have been filed with the SEC by the Surviving Fund on Form N-14 relating to the Surviving Fund Common Stock to be issued pursuant to this Agreement, and any supplement or amendment thereto or to the documents therein (as amended, and together with the combined proxy statement and prospectus and statement of additional information contained therein, the “Registration Statement”), on the effective date of the Registration Statement, at the time of the stockholders’ meeting referred to in Section 4 of this Agreement and at the Closing Date, insofar as it relates to the Surviving Fund (i) shall have complied or will comply in all material respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and the rules and regulations thereunder and (ii) did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the prospectus included therein did not or will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this Section 2.1(o) shall not apply to statements in, or omissions from, the Registration Statement made in reliance upon and in conformity with information furnished by the Target Fund for use in the Registration Statement.

A-7

(p) All issued and outstanding shares of Surviving Fund Common Stock and Surviving Fund Preferred Stock (i) have been offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, or applicable exemptions therefrom, (ii) are, and on the Closing Date will be, duly and validly issued and outstanding, fully paid and non-assessable, and (iii) will be held at the time of the Closing by the persons and in the amounts set forth in the records of the transfer agent. The Surviving Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any shares of Surviving Fund Common Stock or Surviving Fund Preferred Stock, nor is there outstanding any security convertible into, or exchangeable for, any shares of Surviving Fund Common Stock or Surviving Fund Preferred Stock.

(q) All issued and outstanding Surviving Fund Notes (i) have been, or on the Closing Date will be, offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, or applicable exemptions therefrom, (ii) are, and on the Closing Date will be, duly executed, authenticated, issued and delivered, (iii) have been, or on the Closing Date will be, at the time of issuance, offered, issued and sold in compliance with any and all applicable asset coverage, parity and other requirements of the 1940 Act and the rules and regulations thereunder, (iv) have been, or on the Closing Date will be, issued in an aggregate amount not exceeding the amount that, upon their issuance, would result in the face value of such Target Fund Notes at issuance, plus any outstanding leverage, equaling 33 1/3% of the Target Fund’s total assets.

(r) The Surviving Fund is authorized to issue 200,000,000 shares of Surviving Fund Common Stock and shares of Surviving Fund Preferred Stock; each outstanding share of which is fully paid, non-assessable and has full voting rights. The Surviving Fund has filed Articles Supplementary with respect to each series of Surviving Fund Preferred Stock before the Closing. Each series of the Surviving Fund’s outstanding unsecured notes (the “Surviving Fund Notes”) is duly executed, authenticated, issued and delivered and constitutes valid and binding obligations of the Surviving Fund.

(s) The offer and sale of the shares of Surviving Fund Common Stock to be issued pursuant to this Agreement will be in compliance with all applicable federal and state securities laws.

(t) At or prior to the Closing Date, the Surviving Fund will have obtained any and all regulatory, board and stockholder approvals necessary to issue the shares of Surviving Fund Common Stock and Surviving Fund Preferred Stock and the Surviving Fund Notes to be issued pursuant to this Agreement.

(u) The books and records of the Surviving Fund made available to the Target Fund are substantially true and correct and contain no material misstatements or omissions with respect to the operations of the Surviving Fund.

(v) No agent, broker, finder or investment or commercial banker, or other person or firm engaged by or acting on behalf of Surviving Fund in connection with the negotiation, execution or performance of this Agreement or any other agreement contemplated hereby, or the consummation of the transactions contemplated hereby, is or will be entitled to any broker’s or finder’s or similar fees or other commissions as a result of the consummation of such transactions.

A-8

2.2 Representations and Warranties of the Target Fund. The Target Fund represents and warrants to the Surviving Fund that the statements contained in this Section 2.2 are correct and complete in all material respects as of the execution of this Agreement on the date hereof. The Target Fund represents and warrants to, and agrees with, the Surviving Fund that:

(a) The Target Fund is a corporation duly organized and validly existing under the laws of the State of Maryland and is in good standing with the State Department of Assessments and Taxation of Maryland, and has the power to own all of its assets and to carry on its business as it is now being conducted and to carry out this Agreement.

(b) The Target Fund is duly registered under the 1940 Act as a closed-end, diversified management investment company (File No. 811-22467), and such registration has not been revoked or rescinded and is in full force and effect. From the inception of its operations to the date hereof, the Target Fund has been in compliance in all material respects with the applicable provisions of the 1940 Act and the rules promulgated thereunder by the SEC, except as previously disclosed in writing to the Surviving Fund. The Target Fund’s investment operations from the inception of its operations to the date hereof have been in compliance in all material respects with the investment policies and investment restrictions set forth in its applicable prospectus, annual report to stockholders or other public document filed with the SEC, except as previously disclosed in writing to the Surviving Fund. The Target Fund is qualified as a foreign corporation in every jurisdiction where required, except to the extent that failure to so qualify would not have a material adverse effect on the Target Fund.

(c) No consent, approval, authorization or order of any other party or any court or governmental authority is required for the consummation by the Target Fund of the transactions contemplated herein, except (i) such as have been obtained or will be obtained under the 1933 Act, the 1934 Act, the 1940 Act, the Surviving Fund Charter, the charter of the Target Fund, the Maryland General Corporation Law and the listing rules of the NYSE, and (ii) such as may be required by state securities laws.

(d) The Target Fund is not, and the execution, delivery and performance of this Agreement by the Target Fund will not result, in violation of the laws of the State of Maryland or of the charter of the Target Fund or the bylaws of the Target Fund, or of any material agreement, indenture, instrument, contract, lease or other undertaking to which the Target Fund is a party or by which it is bound, and the execution, delivery and performance of this Agreement by the Target Fund will not result in the acceleration of any obligation, or the imposition of any fee, payment or penalty, under any agreement, indenture, instrument, contract, lease, judgment or decree to which the Target Fund is a party or by which it is bound.

(e) The Target Fund has been furnished with the Surviving Fund’s Annual Report to Stockholders for the year ended November 30, 2022.

(f) [RESERVED]

(g) The Target Fund has full power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement has been duly authorized by all necessary action of the Target Fund Board, and, subject to approval by stockholders of the Target Fund and the Surviving Fund of the issuance of additional shares of Surviving Fund Common Stock, this Agreement constitutes a valid and binding contract enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws relating to or affecting creditors’ rights generally and court decisions with respect thereto.

A-9

(h) At the Closing Date, the Target Fund will have good and marketable title to its assets held immediately before the Closing Date, which are free and clear of any material liens, pledges or encumbrances except those previously disclosed to the Surviving Fund.

(i) No litigation or administrative proceeding or investigation of or before any court or governmental body is presently pending (in which service of process has been received) or to its knowledge threatened against the Target Fund or any properties or assets held by it. The Target Fund knows of no facts that might form the basis for the institution of such proceedings which would adversely affect its business and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which adversely affects its business or its ability to consummate the transactions herein contemplated.

(j) All material contracts outstanding to which the Target Fund is a party have been disclosed in the Target Fund’s reports filed with the SEC.

(k) The statement of assets and liabilities, statement of operations, statement of changes in net assets and schedule of portfolio investments (indicating their market values) of the Target Fund at, as of and for the fiscal year ended November 30, 2022, audited by PricewaterhouseCoopers LLP, independent registered public accounting firm to the Target Fund, copies of which have been furnished to the Surviving Fund, fairly reflect the financial condition, results of operations, and changes in net assets of the Target Fund as of such date and for the period then ended in accordance with GAAP consistently applied, and the Target Fund has no known liabilities of a material amount, contingent or otherwise, other than those shown on the statements of assets and liabilities referred to above, or those incurred in the ordinary course of its business since November 30, 2022.

(l) Except as disclosed in accordance with this Section 2.2(l), since November 30, 2022, there has not been any material adverse change in the Target Fund’s financial condition, assets, liabilities or business and the Target Fund has no known liabilities of a material amount, contingent or otherwise, required to be disclosed in a balance sheet in accordance with GAAP other than those shown on the Target Fund’s statements of assets, liabilities and capital referred to above, those incurred in the ordinary course of its business as an investment company since November 30, 2022, and those incurred or to be incurred in connection with the Merger. On the date hereof and as of the Closing Date, the Target Fund will advise the Surviving Fund in writing of all known liabilities, contingent or otherwise, whether or not incurred in the ordinary course of business, existing or accrued. For purposes of this Section 2.2(l), customary distributions, changes in portfolio securities, a decline in net asset value per share of the Surviving Fund due to declines in market values of securities in the Target Fund’s portfolio or the discharge of the Target Fund’s liabilities will not constitute a material adverse change.

(m) All federal and other tax returns and information reports of the Target Fund required by law to have been filed, shall have been filed, and are or will be correct in all material respects, and all federal and other taxes shown as due or required to be shown as due on said returns and reports shall have been paid or provision shall have been made for the payment thereof, and, to the best of the Target Fund’s knowledge, no such return is currently being amended or under audit and no assessment has been asserted with respect to such returns. All tax liabilities of the Target Fund have been adequately provided for on its books, and no tax deficiency or liability of the Target Fund has been asserted and no question with respect thereto has been raised by the Internal Revenue Service or by any state or local tax authority for taxes in excess of those already paid, up to and including the taxable year in which the Closing Date occurs.

(n) The Target Fund has not taken any action and does not know of any fact or circumstance that could reasonably be expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.

A-10

(o) The Registration Statement, on the effective date of the Registration Statement, at the time of the stockholders’ meetings referred to in Section 4 of this Agreement and at the Closing Date, insofar as it relates to the Target Fund (i) shall have complied or will comply in all material respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and the rules and regulations thereunder and (ii) did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the prospectus included therein did not or will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this Section 2.2(o) shall apply only to statements in, or omissions from, the Registration Statement made in reliance upon and in conformity with information furnished by the Target Fund for use in the Registration Statement.

(p) All issued and outstanding shares of Target Fund Common Stock and Target Fund Preferred Stock (i) have been offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, or applicable exemptions therefrom, (ii) are, and on the Closing Date will be, duly and validly issued and outstanding, fully paid and non-assessable, and (iii) will be held at the time of the Closing by the persons and in the amounts set forth in the records of the transfer agent as provided in Section 4.6. The Target Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any shares of Target Fund Common Stock or Target Fund Preferred Stock, nor is there outstanding any security convertible into, or exchangeable for, any shares of Target Fund Common Stock or Target Fund Preferred Stock.

(q) All issued and outstanding Target Fund Notes (i) have been offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, or applicable exemptions therefrom, (ii) are, and on the Closing Date will be, duly executed, authenticated, issued and delivered, (iii) have been, at the time of issuance, offered, issued and sold in compliance with any and all applicable asset coverage, parity and other requirements of the 1940 Act and the rules and regulations thereunder, (iv) have been issued in an aggregate amount not exceeding the amount that, upon their issuance, would have resulted in the face value of such Target Fund Notes at issuance, plus any outstanding leverage, equaling 33 1/3% of the Target Fund’s total assets, and (v) will be held at the time of the Closing by the persons and in the amounts set forth in the records of the transfer agent or the Target Fund as provided in Section 4.6.

(r) As of both the Valuation Time and immediately prior to the Effective Time, the Target Fund will have full right, power and authority to effect the transfer of the Investments (as defined below) and any other assets and liabilities of the Target Fund to be transferred to the Surviving Fund pursuant to this Agreement and except as otherwise specified in this Agreement. Immediately prior to the Effective Time, the Target Fund will own the Investments and any such other assets subject to no encumbrances, liens or security interests in favor of any third party creditor of the Target Fund, and without any restrictions upon the transfer thereof, including such restrictions as might arise under the 1933 Act. As used in this Agreement, the term “Investments” shall mean the Target Fund’s investments shown on the schedule of its portfolio of investments as of November 30, 2022 referred to in Section 2.2(k) hereof, as supplemented with such changes as the Target Fund shall make after November 30, 2022, which changes shall be disclosed to the Surviving Fund in an updated schedule of investments, and changes resulting from stock dividends, stock splits, mergers and similar corporate actions through the Closing Date.

(s) The books and records of the Target Fund made available to the Surviving Fund are substantially true and correct and contain no material misstatements or omissions with respect to the operations of the Target Fund.

(t) No agent, broker, finder or investment or commercial banker, or other person or firm engaged by or acting on behalf of the Target Fund in connection with the negotiation, execution or performance of this Agreement or any other agreement contemplated hereby, or the consummation of the transactions contemplated hereby, is or will be entitled to any broker’s or finder’s or similar fees or other commissions as a result of the consummation of such transactions.

A-11

3 computation of net asset value.

The net asset value per share of the Target Fund Common Stock and the Surviving Fund Common Stock shall be such party’s most recently calculated net asset value per share as of the Business Day immediately prior to the Closing Date (the “Valuation Time”), determined using valuation practices consistently applied since such party’s last Annual Report to Stockholders, which also will be substantially and materially consistent with the valuation practices used with respect to such party’s last Annual Report to Stockholders, and shall be subject to adjustment by such party in accordance with Section 1.1(g). The Target Fund’s net asset value per share shall also be adjusted to accrue for all expenses necessary to conclude the operations of the Target Fund. Those net asset value calculations shall reflect the allocation of actual and estimated expenses specified in Section 8.2.

4 COVENANTS

4.1 Operations in the Normal Course. Each party covenants to operate its business in the ordinary course between the date hereof and the Closing Date, it being understood that such ordinary course of business will include purchases and sales of portfolio securities and the declaration and payment of customary distributions. Notwithstanding the forgoing, the Target Fund will manage its portfolio with the same approximate level of trading, turnover and leverage consistent with past practice, except to the extent discussed in advance with the Surviving Fund.

4.2 Stockholders’ Meeting; Merger Sub Equityholder Consent.

(a) The Target Fund and the Surviving Fund will mutually cooperate, using reasonable best efforts, to expeditiously prepare the Registration Statement (including a combined proxy statement and prospectus) and have it declared effective by the SEC as soon as reasonably practicable. The Surviving Fund and the Target Fund agree to reasonably cooperate with any review of financial information and financial statements by PricewaterhouseCoopers LLP that is reasonably required in connection with the preparation and filing of the Registration Statement, including the issuance of any consents by that firm. The Registration Statement (including the proxy statement and prospectus) will comply in all material respects with the applicable provisions of Section 14(a) of the 1934 Act and Section 20(a) of the 1940 Act, and the rules and regulations, respectively, thereunder. Each party will provide the materials and information necessary to prepare the Registration Statement, for inclusion therein, in connection with the stockholders’ meetings of the Target Fund to consider the approval of this Merger and of the Surviving Fund to consider the approval of the issuance of additional shares of Surviving Fund Common Stock in connection with the Merger, each as described herein. If, at any time prior to the effective time of the Merger, a party becomes aware of any untrue statement of material fact or omission to state a material fact required to be stated therein or necessary to make the statements made not misleading in light of the circumstances under which they were made, the party discovering the item shall notify the other party and the parties shall cooperate in promptly preparing, filing and clearing with the SEC and, if appropriate, distributing to stockholders appropriate disclosure with respect to the item.

(b) As soon as reasonably practicable following the effective date of the Registration Statement, the Target Fund and the Surviving Fund shall hold a joint meeting of stockholders for the purpose of approving the Merger and the issuance of additional shares of Surviving Fund Common Stock, each as described herein.

(c) As soon as reasonably practicable following the approval of the Merger and the issuance of additional shares of Surviving Fund Common Stock by the stockholders of the Target Fund and the Surviving Fund, respectively, the Surviving Fund, as the sole equityholder of Merger Sub, shall execute and deliver to the Target Fund a true and correct copy of a written consent approving the Merger that is duly executed by the Surviving Fund in accordance with the governing documents of Merger Sub and the Maryland General Corporation Law.

(d) From and after the date hereof, the Target Fund and the Surviving Fund will reasonably cooperate with each other and their respective representatives with respect to fees, expenses, budgets and strategy regarding the proxy solicitation.

(e) The Target Fund and the Surviving Fund agree to cooperate fully with each other, and will have furnished the information relating to itself to be set forth in the Registration Statement as required by the 1933 Act, the 1934 Act, the 1940 Act, and the rules and regulations thereunder and the state securities or blue sky laws.

A-12

4.3 Regulatory Filings.

(a) Subject to the provisions of this Agreement, the Target Fund and the Surviving Fund will each take, or cause to be taken, all actions, and do or cause to be done, all things reasonably necessary, proper or advisable to cause the conditions to the other party’s obligations to consummate the transactions contemplated hereby to be met or fulfilled and otherwise to consummate and make effective such transactions.

(b) The Surviving Fund will (i) obtain the approvals and authorizations required of it by the 1933 Act, the 1940 Act, the Surviving Fund Charter, the Maryland General Corporation Law, the listing rules of the NYSE and such state securities or blue sky laws as it may deem appropriate in order to consummate the Merger and continue with its operations after the Closing Date, (ii) cause to be delivered to each stockholder of record the Registration Statement and (iii) take all other actions reasonably necessary to obtain any approvals required to complete the transactions contemplated by this Agreement.

(c) The Target fund will (i) obtain the approvals and authorizations required of it by the 1933 Act, the 1940 Act, the Surviving Fund Charter, the Maryland General Corporation Law, the listing rules of the NYSE and such state securities or blue sky laws as it may deem appropriate in order to consummate the Merger, (ii) cause to be delivered to each stockholder of record the Registration Statement and (iii) take all other actions reasonably necessary to obtain any approvals required to complete the transactions contemplated by this Agreement.

(d) The Target Fund undertakes that, if the Merger is consummated, it will file, or cause its agents to file, an application pursuant to Section 8(f) of the 1940 Act for an order declaring that the Target Fund has ceased to be a registered investment company.

4.4 Preservation of Assets. The Surviving Fund agrees that it has no plan or intention to sell or otherwise dispose of the assets of the Target Fund to be acquired in the Merger, except for dispositions made in the ordinary course of business.

4.5 Tax Matters. Each of the parties agrees that by the Closing Date all of its federal and other tax returns and reports required to be filed on or before such date shall have been filed and all taxes shown as due on said returns either have been paid or adequate liability reserves have been provided for the payment of such taxes. In connection with this covenant, the parties agree to cooperate with each other in filing any tax return, amended return or claim for refund, determining a liability for taxes or a right to a refund of taxes or participating in or conducting any audit or other proceeding in respect of taxes. The Surviving Fund agrees to retain for a period of ten (10) years following the Closing Date all returns, schedules and work papers and all material records or other documents relating to tax matters of the Target Fund for its final taxable year and for all prior taxable periods. Any information obtained under this Section 4.5 shall be kept confidential except as otherwise may be necessary in connection with the filing of returns or claims for refund or in conducting an audit or other proceeding. After the Closing Date, the Surviving Fund shall prepare, or cause its agents to prepare, any federal, state or local tax returns, including any Forms 1099, required to be filed and provided to required persons by the Target Fund with respect to its final taxable year ending with the Closing Date and for any prior periods or taxable years for which the due date for such return has not passed as of the Closing Date and further shall cause such tax returns and Forms 1099 to be duly filed with the appropriate taxing authorities and provided to required persons. Notwithstanding the aforementioned provisions of this Section 4.5, any expenses incurred by the Surviving Fund (other than for payment of taxes) in excess of any accrual for such expenses by the Target Fund in connection with the preparation and filing of said tax returns and Forms 1099 after the Closing Date shall be borne by the Surviving Fund.

4.6 Security Holder List. Prior to the Closing Date, the Target Fund shall have made arrangements with its transfer agent to deliver to the Surviving Fund a list of the names and addresses of all of the holders of record of Target Fund Common Stock, Target Fund Preferred Stock and Target Fund Notes on the Closing Date and the respective number of shares of Target Fund Common Stock and Target Fund Preferred Stock owned by each such shareholder, and the respective unpaid principal amount of the applicable series of Target Fund Notes held by each such noteholder, certified by the Target Fund’s transfer agent or President to the best of his or her knowledge and belief.

A-13

4.7 Tax Status of Merger. The Surviving Fund and the Target Fund will (a) use all reasonable best efforts to cause the Merger to constitute a reorganization under Section 368(a) of the Code and (b) shall execute and deliver officer’s certificates containing appropriate representations at such time or times as may be reasonably requested by counsel, including the effective date of the Registration Statement and the Closing Date, for purposes of rendering opinions with respect to the tax treatment of the Merger.

4.8 Preferred Stock. The Surviving Fund will comply with the terms and provisions of the Articles Supplementary for the Series U, Series V and Series W Surviving Fund Preferred Stock, which Articles Supplementary will provide for such Surviving Fund Preferred Stock to have substantially identical terms as the corresponding series of Target Fund Preferred Stock for which it is being exchanged.

4.9 Notes. The Surviving Fund will comply with the terms and provisions of the applicable Notes Purchase Agreement for each respective series of Surviving Fund Notes, which Notes Purchase Agreement will provide for any such Surviving Fund Notes to be issued in replacement of Target Fund Notes to have identical terms as the corresponding series of Target Fund Notes for which they are being exchanged.

4.10 NYSE Listing. The Surviving Fund agrees to use its reasonable best efforts to cause the Surviving Fund Common Stock to be issued pursuant to this Agreement to be listed on the NYSE. The Target Fund and the Surviving Fund agree that, because the Target Fund Preferred Stock was issued in a private placement and is not registered under the 1934 Act, the Surviving Fund Preferred Stock to be issued pursuant to this Agreement is not required to be listed on the NYSE.

4.11 Delisting, Termination of Registration as an Investment Company. The Target Fund agrees that (i) the delisting of the Target Fund Common Stock with the NYSE and (ii) the termination of its registration as an investment company under the 1940 Act will be effected in accordance with applicable law as soon as practicable following the Closing Date.

5 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE TARGET FUND

The obligations of the Target Fund to consummate the transactions provided for herein shall be subject, at the Target Fund’s election, to the following conditions:

5.1 Certificates and Statements by the Surviving Fund.

(a) The Surviving Fund shall have furnished to the Target Fund a certificate signed by its President (or any Vice President), dated the Closing Date, certifying that as of the Closing Date, all representations and warranties made by the Surviving Fund in this Agreement are true and correct in all material respects as if made at and as of such date and the Surviving Fund has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied at or prior to such dates.

(b) The Surviving Fund shall have optionally complied with the requirements of Section 15(f) of the 1940 Act.

5.2 Merger Litigation. There shall be no material litigation pending that claims the proposed Merger is not permitted or authorized, was not validly approved or otherwise would not be valid or legally consummated.

5.3 Regulatory Orders. The Surviving Fund shall have received from any relevant state securities administrator such order or orders as are reasonably necessary or desirable under the 1933 Act, the 1934 Act, the 1940 Act, and any applicable state securities or blue sky laws in connection with the transactions contemplated hereby, and that all such orders shall be in full force and effect.

A-14

6 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SURVIVING FUND

The obligations of the Surviving Fund to consummate the transactions provided for herein shall be subject, at the Surviving Fund’s election, to the following conditions:

6.1 Certificates and Statements by the Target Fund.

(a) The Target Fund shall have furnished a statement of assets, liabilities and capital, together with a schedule of investments with their respective dates of acquisition and tax costs, certified on its behalf by its President (or any Vice President) and its Treasurer, and a certificate executed by both such officers, dated the Closing Date, certifying that there has been no material adverse change in its financial position since November 30, 2022, other than changes in its portfolio securities since that date or changes in the market value of its portfolio securities.

(b) The Target Fund shall have furnished to the Surviving Fund a certificate signed by its President (or any Vice President), dated as of the Closing Date, certifying that as of the Closing Date, all representations and warranties made by the Target Fund in this Agreement are true and correct in all material respects as if made at and as of such date and that the Target Fund has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied at or prior to such date.

6.2 Merger Litigation. There shall be no material litigation pending that claims the proposed Merger is not permitted or authorized, was not validly approved or otherwise would not be valid or legally consummated.

6.3 Custodian’s Certificate. The Target Fund’s custodian shall have delivered to the Surviving Fund a certificate identifying all of the assets of the Target Fund held or maintained by such custodian as of the Valuation Time.

6.4 Books and Records. The Target Fund’s transfer agent shall have provided to the Surviving Fund (i) the originals or true copies of all of the records of the Target Fund in the possession of such transfer agent as of the Closing Date, (ii) a certificate setting forth the number of shares of Target Fund Common Stock outstanding as of the Valuation Time, and (iii) the name and address of each holder of record of any shares and the number of shares held of record by each such shareholder.

7 FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF SURVIVING FUND AND TARGET FUND

If any of the conditions set forth below have not been satisfied on or before the Closing Date with respect to the Target Fund or the Surviving Fund, the other party to this Agreement shall be entitled, at its option, to refuse to consummate the transactions contemplated by this Agreement provided that the terminating party has used its reasonable commercial efforts to satisfy its obligations and the conditions set forth in this Agreement:

7.1 Approval of Merger and Issuance of Surviving Fund Stock.

(a) The Merger shall have been approved by a majority of the outstanding shares of Target Fund Common Stock and Target Fund Preferred Stock (voting together).

(b) The issuance of additional shares of Surviving Fund Common Stock in connection with the Merger shall have been approved by a majority of votes cast by the holders of the issued and outstanding Surviving Fund Common Stock and Surviving Fund Preferred Stock (voting together).

(c) The Surviving Fund shall have delivered to the Target Fund a copy of the resolutions approving this Agreement pursuant to this Agreement adopted by the Surviving Fund Board and the resolutions approving the issuance of additional shares of Surviving Fund Common Stock in connection with the Merger adopted by the Surviving Fund’s stockholders, certified by its secretary; and the Target Fund shall have delivered to the Surviving Fund a copy of the resolutions approving this Agreement adopted by the Target Fund Board and the Target Fund’s stockholders, certified by its secretary.

A-15

7.2 Regulatory Filings.

(a) The SEC shall not have issued an unfavorable advisory report under Section 25(b) of the 1940 Act, nor instituted or threatened to institute any proceeding seeking to enjoin consummation of the Merger under Section 25(c) of the 1940 Act; no other legal, administrative or other proceeding shall be instituted or threatened which would materially affect the financial condition of the Target Fund or would prohibit the Merger.

(b) On the Closing Date, no court or governmental agency of competent jurisdiction shall have issued any order that remains in effect and that restrains or enjoins the Target Fund or the Surviving Fund from completing the transactions contemplated by this Agreement.

7.3 Consents. All of the consents of other parties referenced on Schedule 2.2(c) have been obtained, or the applicable contract has been terminated in respect of the Target Fund.

7.4 Registration Statement. The Registration Statement shall have become effective under the 1933 Act and no stop order suspending the effectiveness thereof shall have been issued and, to the best knowledge of the parties hereto, no investigation or proceeding for that purpose shall have been instituted or be pending.

7.5 Tax Opinion. The Surviving Fund and the Target Fund shall have received the opinion of Paul Hastings LLP, dated as of the Closing Date, substantially to the effect that, based upon certain facts, assumptions and representations made by the Target Fund, the Surviving Fund and their respective authorized officers:

(a) the Merger as provided in this Agreement will constitute a reorganization within the meaning of Section 368(a)(1) of the Code and that the Surviving Fund and the Target Fund will each be a “party to a reorganization” within the meaning of Section 368(b) of the Code;

(b) except for consequences regularly attributable to a termination of the Target Fund’s taxable year, no gain or loss will be recognized to the Target Fund as a result of the Merger or upon the distribution of shares of Surviving Fund Common Stock to holders of shares of Target Fund Common Stock;

(c) no gain or loss will be recognized to the Surviving Fund as a result of the Merger or upon the distribution of shares of Surviving Fund Common Stock to holders of shares of Target Fund Common Stock;

(d) no gain or loss will be recognized to the holders of the Target Fund Common Stock upon the distribution of shares of Surviving Fund Common Stock to holders of shares of Target Fund Common Stock, except to the extent such holders are paid cash in lieu of fractional shares of Surviving Fund Common Stock in the Merger;

(e) the tax basis of the Target Fund assets in the hands of the Surviving Fund will be the same as the tax basis of such assets in the hands of the Target Fund immediately before the consummation of the Merger;

(f) immediately after the Merger, the aggregate tax basis of the Surviving Fund Common Stock received by each holder of Target Fund Common Stock in the Merger (including that of fractional share interests purchased by the Surviving Fund) will be equal to the aggregate tax basis of the shares of Target Fund Common Stock owned by such shareholder immediately before the Merger;

(g) a stockholder’s holding period for Surviving Fund Common Stock (including that of fractional share interests purchased by the Surviving Fund) will be determined by including the period for which he or she held shares of Target Fund Common Stock converted pursuant to the Merger, provided that such shares of Target Fund Common Stock were held as capital assets;

(h) the Surviving Fund’s holding period with respect to the Target Fund’s assets transferred will include the period for which such assets were held by the Target Fund; and

A-16

(i) the payment of cash to the holders of Target Fund Common Stock in lieu of fractional shares of Surviving Fund Common Stock will be treated as though such fractional shares were distributed as part of the Merger and then redeemed by the Surviving Fund with the result that the holder of Target Fund Common Stock will generally have a capital gain or loss to the extent the cash distribution differs from such stockholder’s basis allocable to the fractional shares of Surviving Fund Common Stock.

The delivery of such opinion is conditioned upon the receipt by Paul Hastings LLP of reasonable representations it shall request of the Surviving Fund and the Target Fund. Notwithstanding anything herein to the contrary, neither the Surviving Fund nor the Target Fund may waive the condition set forth in this Section 7.5.

8 BROKER FEES; EXPENSES

8.1 Broker Fees. Neither of the Surviving Fund and the Target Fund owes any broker’s or finder’s fees in connection with the transactions provided for herein.

8.2 Payment of Expenses. All expenses of the Merger will be borne by the Surviving Fund and the Target Fund. Costs will be allocated one-half to the Target Fund and one-half to the Surviving Fund. Such expenses shall include, but not be limited to, all costs related to the preparation and distribution of the Registration Statement, the negotiation and execution of this Agreement, proxy solicitation expenses, SEC registration fees, NYSE listing fees, trustees fees, and all other reasonable third party expenses.

9 COOPERATION FOLLOWING EFFECTIVE DATE

In case at any time after the Closing Date any further action is necessary to carry out the purposes of this Agreement, each of the parties will take such further action (including the execution and delivery of such further instruments and documents) as the other party may reasonably request, all at the sole cost and expense of the requesting party. The Target Fund acknowledges and agrees that from and after the Closing Date, the Surviving Fund shall be entitled to possession of all documents, books, records, agreements and financial data of any sort pertaining to the Target Fund.

10 ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES

10.1 Entire Agreement. The Surviving Fund and the Target Fund agree that neither party has made any representation, warranty or covenant not set forth herein, and that this Agreement and the other documents delivered in connection with this Agreement constitute the entire agreement between the parties.

10.2 Survival of Warranties. The covenants to be performed after the Closing by the Surviving Fund shall survive the Closing. All other representations, warranties and covenants to be performed prior to or at the Closing contained in this Agreement or in any document delivered pursuant hereto or in connection herewith shall not survive the consummation of the transactions contemplated hereunder and shall terminate on the Closing.

A-17

11 TERMINATION AND WAIVERS

11.1 Termination by Mutual Agreement. This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time before the Closing Date by mutual agreement of the Target Fund and the Surviving Fund.

11.2 Termination by Surviving Fund or Target Fund. This Agreement may be terminated by either the Target Fund or the Surviving Fund at its option at or prior to the Closing Date because:

(a) of a material breach by the other party of any representation, warranty, covenant or agreement contained herein to be performed by the other party at or prior to the Closing Date; provided that such other party shall have been given a period of 30 days from the date of notice of such breach to cure such breach and shall have failed to do so;

(b) by either the Surviving Fund or Target Fund if the Effective Time does not occur on or prior to February 29, 2024; or

(c) any governmental authority of competent jurisdiction shall have issued any judgment, injunction, order, ruling or decree or taken any other action restraining, enjoining or otherwise prohibiting this Agreement or the consummation of any of the transactions contemplated herein and such judgment, injunction, order, ruling, decree or other action becomes final and non-appealable; provided that the party seeking to terminate this Agreement pursuant to this Section 11.2(c) shall have used its reasonable best efforts to have such judgment, injunction, order, ruling, decree or other action lifted, vacated or denied.

11.3 Waiver. At any time before the Closing Date, any of the terms or conditions of this Agreement may be waived by either the Target Fund Board or the Surviving Fund Board (whichever is entitled to the benefit thereof), if, in the judgment of such board after consultation with fund counsel, such action or waiver will not have a material adverse effect on the benefits intended in this Agreement to the stockholders or the stockholders, as applicable, of their respective fund, on behalf of which such action is taken. The failure of either Party hereto to enforce at any time any of the provisions of this Agreement shall in no way be construed to be a waiver of any such provision, nor in any way to affect the validity of this Agreement or any part hereof or the right of either Party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to be a waiver of any other or subsequent breach.

12 MATERIAL PROVISIONS

All covenants, agreements, representations and warranties made under this Agreement and any certificates delivered pursuant to this Agreement shall be deemed to have been material and relied upon by each of the parties, notwithstanding any investigation made by them or on their behalf.

A-18

13 AMENDMENTS

This Agreement may be amended, modified or supplemented in such manner as may be deemed necessary or advisable by the authorized officers of the Target Fund and the Surviving Fund; provided, however, that following the joint meeting of the Target Fund and Surviving Fund Stockholders, no such amendment may have the effect of changing the provisions for determining the number of shares of Surviving Fund Common Stock to be issued to the holders of Target Fund Common Stock under this Agreement to the detriment of such stockholders without their further approval.

14 NOTICES

Any notice, report, statement or demand required or permitted by any provisions of this Agreement shall be in writing and shall be given by facsimile, electronic delivery (i.e., email), personal service or prepaid or certified mail addressed to the Surviving Fund or the Target Fund, at its address set forth in the preamble to this Agreement, in each case to the attention of its President.

15 ENFORCEABILITY; HEADINGS; COUNTERPARTS; GOVERNING LAW AND JURISDICTION; SEVERABILITY; ASSIGNMENT; LIMITATION OF LIABILITY

15.1 Enforceability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

15.2 Headings. The Section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

15.3 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original.

15.4 Governing Law and Jurisdiction. This Agreement shall be governed by and construed and interpreted in accordance with the internal laws of the State of Maryland.

15.5 Successors and Assigns. This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by any party without the written consent of the other party. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or corporation, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement.

[Signature Page Follows]

A-19

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed by its duly authorized officer.

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

By: /s/ James C. Baker, Jr.

Name: James C. Baker, Jr.

Title: Chairman of the Board of Directors, President and Chief Executive Officer

KAYNE ANDERSON NEXTGEN ENERGY & INFRASTRUCTURE, INC.

By:	/s/ James C. Baker, Jr.
	Name:	James C. Baker, Jr.
	Title:	Chairman of the Board of Directors, President and Chief Executive Officer

A-20

Schedule A-1

Sixth Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A. dated February 24, 2023.

Credit Agreement with Sumitomo Mitsui Banking Corporation dated August 6, 2021.

A-21

The information in this Statement of Additional Information is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This Statement of Additional Information is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated March [●], 2023

STATEMENT OF ADDITIONAL INFORMATION

RELATING TO THE MERGER OF
KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.
AND
KAYNE ANDERSON NEXTGEN ENERGY & INFRASTRUCTURE, INC.
Dated , 2023

This Statement of Additional Information should be read in conjunction with the joint proxy statement/prospectus dated , 2023 relating to the proposed combination of Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”) and Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”), pursuant to which KMF will be merged with and into a wholly owned subsidiary of KYN (“Merger Sub”), with KMF’s shares of common stock converted into shares of KYN common stock (although cash will be distributed in lieu of fractional shares). Immediately following the Merger, it is expected that Merger Sub will be merged with and into KYN. KMF will then cease its separate existence under Maryland law and terminate its registration under the 1940 Act (the “Merger”). KYN and KMF are each also referred to in this Statement of Additional Information individually as a “Company” and collectively as the “Companies.” KYN following the Merger is referred to in this Statement of Additional Information as the “Combined Company.” References to “we” “us” or “our” in this Statement of Additional Information are references to KYN.

The aggregate NAV of KYN common stock received by KMF common stockholders in the Merger will equal the aggregate NAV of KMF shares held on the business day prior to closing of the Merger (excluding cash distributed by KYN for fractional shares). KYN will be the accounting survivor following the closing of the Merger and will continue to operate after the Merger as a registered, non-diversified, closed-end management investment company with the investment objectives and policies described in the joint proxy statement/prospectus.

In connection with the Merger, each holder of a KMF Series H Mandatory Redeemable Preferred Share (“KMF Series H MRP Shares”), a KMF Series I Mandatory Redeemable Preferred Share (“KMF Series I MRP Shares”) or a KMF Series J Mandatory Redeemable Preferred Share (“KMF Series J MRP Shares” and together with the KMF Series H MRP Shares and the KMF Series I MRP Shares, the “KMF MRP Shares”) will receive in a private placement an equivalent number of newly issued KYN Series U Mandatory Redeemable Preferred Shares (“KYN Series U MRP Shares”), KYN Series V Mandatory Redeemable Preferred Shares (“KYN Series V MRP Shares”) or KYN Series W Mandatory Redeemable Preferred Shares (“KYN Series W MRP Shares” and together with the KYN Series U MRP Shares and the KYN Series V MRP Shares, the “KYN MRP Shares”), as applicable, each having substantially identical terms as the respective KYN MRP Shares. The aggregate liquidation preference of the KYN MRP Shares received by the holders of KMF MRP Shares in the Merger will equal the aggregate liquidation preference of the KMF MRP Shares held immediately prior to the closing of the Merger. The KYN MRP Shares to be issued in the Merger will have equal priority with KYN’s existing outstanding preferred shares as to the payment of dividends and the distribution of assets in the event of a liquidation of KYN. In addition, the preferred shares of KYN, including the KYN MRP Shares to be issued in connection with the Merger, will be senior in priority to KYN common shares as to payment of dividends and the distribution of assets in the event of a liquidation of KYN.

Unless otherwise defined herein, capitalized terms have the meanings given to them in the joint proxy statement/prospectus.

This Statement of Additional Information is not a prospectus and should be read in conjunction with the joint proxy statement/prospectus. A copy of the joint proxy statement/prospectus may be obtained, without charge, by writing to KYN at 811 Main Street, 14th Floor, Houston, TX 77002.

KYN will provide, without charge, upon the written or oral request of any person to whom this Statement of Additional Information is delivered, a copy of any and all documents that have been incorporated by reference in the registration statement of which this Statement of Additional Information is a part.

SAI-1

TABLE OF CONTENTS

	Page

INVESTMENT LIMITATIONS	SAI-3
OUR INVESTMENTS	SAI-6
MANAGEMENT	SAI-11
INDEMNIFICATION OF DIRECTORS AND OFFICERS	SAI-23
CONTROL PERSONS	SAI-24
INVESTMENT ADVISER	SAI-25
NET ASSET VALUE	SAI-27
PORTFOLIO TRANSACTIONS	SAI-29
TAX MATTERS	SAI-31
PROXY VOTING POLICIES	SAI-33
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	SAI-35
PERFORMANCE RELATED AND COMPARATIVE INFORMATION	SAI-35
ADDITIONAL INFORMATION	SAI-35
FINANCIAL STATEMENTS	SAI-35

SAI-2

INVESTMENT LIMITATIONS

This section supplements the disclosure in the joint proxy statement/prospectus and provides additional information on the investment limitations of KYN. Investment limitations identified as fundamental may only be changed with the approval of the holders of a majority of a Company’s outstanding voting securities (which for this purpose and under the 1940 Act means the lesser of (1) 67% of the voting shares represented at a meeting at which more than 50% of the outstanding voting shares are represented or (2) more than 50% of the outstanding voting shares).

Investment limitations stated as a maximum percentage of a Company’s assets are only applied immediately after, and because of, an investment or a transaction to which the limitation is applicable (other than the limitations on borrowing). Accordingly, any later increase or decrease resulting from a change in values, net assets or other circumstances will not be considered in determining whether the investment complies with a Company’s investment limitations. All limitations that are based on a percentage of total assets include assets obtained through leverage.

KYN’s investment objective is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders.

There can be no assurance that KYN will achieve its investment objective.

Fundamental Investment Limitations

Except as described below, we, as a fundamental policy, may not, without the approval of the holders of a majority of the outstanding voting securities:

Change the investment objective listed above.

Purchase or sell real estate unless acquired as a result of ownership of securities or other instruments.

Purchase or sell commodities.

Borrow money or issue senior securities, except to the extent permitted by the 1940 Act or the SEC.

Make loans to other persons except (a) through the lending of our portfolio securities, (b) through the purchase of debt obligations, loan participations and/or engaging in direct corporate loans in accordance with its investment objectives and policies, and (c) to the extent the entry into a repurchase agreement is deemed to be a loan (in each case subject to certain exceptions).

Act as an underwriter except to the extent that, in connection with the disposition of portfolio securities, it may be deemed to be an underwriter under applicable securities laws.

Concentrate our investments in a particular “industry” (other than investments in the Energy Infrastructure Industry and investments in securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities)

Non-fundamental Investment Policies

The following investment policies are considered non-fundamental and may be changed by the Board of Directors without the approval of the holders of a majority of KYN’s voting securities, provided that KYN’s securities holders receive at least 60 days’ prior written notice of any change.

●

We intend to invest at least 80% of total assets in public and private securities of Energy Infrastructure Companies.

●

We intend to invest at least 50% of our total assets in publicly traded securities of Energy Infrastructure Companies.

SAI-3

●

We may invest up to 15% of our total assets in any single issuer.

●

We may, but are not required to, use derivative investments and engage in short sales to hedge against interest rate and market risks.

●

Unless otherwise stated, all investment restrictions apply at the time of purchase and we will not be required to reduce a position due solely to market value fluctuations.

For purposes of the temporary investment positions that we take, and in general (unless otherwise noted), cash and cash equivalents are defined to include, without limitation, the following:

(1)

U.S. Government securities, which are obligations of, or securities guaranteed by, the U.S. Government, its agencies or instrumentalities.

(2)

Certificates of deposit issued against funds deposited in a bank or a savings and loan association. Such certificates are for a definite period of time, earn a specified rate of return, and are normally negotiable. The issuer of a certificate of deposit agrees to pay the amount deposited plus interest to the bearer of the certificate on the date specified thereon. Under current FDIC regulations, the maximum insurance payable as to any one certificate of deposit is $100,000, therefore, certificates of deposit we purchased may not be fully insured.

(3)

Repurchase agreements, which involve purchases of debt securities. At the time we purchase securities pursuant to a repurchase agreement, we simultaneously agree to resell and redeliver such securities to the seller, who also simultaneously agrees to buy back the securities at a fixed price and time. This assures us a predetermined yield during the holding period, since the resale price is always greater than the purchase price and reflects an agreed-upon market rate. Such actions afford an opportunity for us to invest temporarily available cash.

SAI-4

(4)

Commercial paper, which consists of short-term unsecured promissory notes, including variable rate master demand notes issued by corporations to finance their current operations. Master demand notes are direct lending arrangements between us and a corporation. There is no secondary market for such notes. However, they are redeemable by us at any time. KAFA will consider the financial condition of the corporation (e.g., earning power, cash flow, and other liquidity measures) and will continuously monitor the corporation’s ability to meet all its financial obligations, because our liquidity might be impaired if the corporation were unable to pay principal and interest on demand. To be characterized by us as “cash or cash equivalents,” investments in commercial paper will be limited to commercial paper rated in the highest categories by a rating agency and which mature within one year of the date of purchase or carry a variable or floating rate of interest.

(5)

Bankers’ acceptances, which are short-term credit instruments used to finance commercial transactions. Generally, an acceptance is a time draft drawn on a bank by an exporter or an importer to obtain a stated amount of funds to pay for specific merchandise. The draft is then “accepted” by a bank that, in effect, unconditionally guarantees to pay the face value of the instrument on its maturity date. The acceptance may then be held by the accepting bank as an asset or it may be sold in the secondary market at the going rate of interest for a specific maturity.

(6)

Bank time deposits, which are monies kept on deposit with banks or savings and loan associations for a stated period of time at a fixed rate of interest. There may be penalties for the early withdrawal of such time deposits, in which case the yields of these investments will be reduced.

(7)

Shares of money market funds in accordance with the applicable provisions of the 1940 Act.

SAI-5

OUR INVESTMENTS

Description of Energy Infrastructure Companies

Energy Infrastructure Companies consist of (i) Midstream Energy Companies, (ii) Renewable Infrastructure Companies and (iii) Utility Companies, each of which is described in further detail below.

Description of Midstream Energy Companies

Midstream Energy Companies are companies that primarily own and operate Midstream Assets, which are the assets used (a) transporting, storing, gathering, processing, fractionating, distributing, or marketing of natural gas, natural gas liquids, crude oil, refined products or water produced in conjunction with such activities or (b) the capture, transportation or sequestration of carbon dioxide. Midstream Energy Companies may be structured as Master Limited Partnerships or taxed as corporations. For purposes of our investment policies, Midstream Energy Companies include companies that (i) derive at least 50% of their revenue or operating income from operating Midstream Assets or providing services for the operation of such assets or (ii) have Midstream Assets that represent the majority of their assets.

Renewable Infrastructure Companies

Utility Companies

SAI-6

Investment Practices

Covered Calls

Interest Rate Swaps

We may utilize hedging techniques such as interest rate swaps to mitigate potential interest rate risk on a portion of our Leverage Instruments. Such interest rate swaps would principally be used to protect us against higher costs on our Leverage Instruments resulting from increases in short-term interest rates. We anticipate that the majority of our interest rate hedges will be interest rate swap contracts with financial institutions.

Use of Arbitrage and Other Derivative-Based Strategies

We may use short sales, arbitrage and other strategies to try to generate additional return. As part of such strategies, we may (i) engage in paired long-short trades to arbitrage pricing disparities in securities held in our portfolio; (ii) purchase call options or put options; (iii) enter into total return swap contracts; or (iv) sell securities short. Paired trading consists of taking a long position in one security and concurrently taking a short position in another security within the same issuer or in issuers that operate in the same industry. With a long position, we purchase a stock outright; whereas with a short position, we would sell a security that we do not own and must borrow to meet our settlement obligations. We will realize a profit or incur a loss from a short position depending on whether the value of the underlying stock decreases or increases, respectively, between the time the stock is sold and when we replace the borrowed security. A total return swap is a contract between two parties designed to replicate the economics of directly owning a security.

Value of Derivative Instruments

Other Risk Management Strategies

SAI-7

Portfolio Turnover

Use of Leverage

SAI-8

SAI-9

SAI-10

MANAGEMENT

Directors and Officers

KYN’s business and affairs are managed under the direction of its Board of Directors, including the duties performed for KYN under its investment management agreement. The directors set broad policies for KYN and choose its officers.

In accordance with KYN’s charter, the Board of Directors is divided into three classes of approximately equal size. Directors serve terms of three years and until their successors are duly elected and qualified.

Term		Directors
3-year term until 2023		William R. Cordes Barry R. Pearl Carita S. Walker

3-year term until 2024		James C. Baker, Jr. William H. Shea, Jr.

3-year term until 2025		Anne K. Costin Albert L. Richey Caroline A. Winn

The term “Independent Director” is used to refer to a director who is not an “interested person,” as defined in the 1940 Act, of the Company, of Kayne Anderson or of our underwriters in offerings of our securities from time to time as defined in the 1940 Act. None of the Independent Directors nor any of their immediate family members, has ever been a director, officer or employee of Kayne Anderson or its affiliates. James C. Baker, Jr. is an “interested person” or “Interested Director” by virtue of his employment relationship with Kayne Anderson.

The following table includes information regarding KYN’s directors and officers, and their principal occupations and other affiliations during the past five years. The address for all directors is 811 Main Street, 14th Floor, Houston, Texas 77002. All of KYN’s directors also serve on the Board of Directors of Kayne Anderson NextGen Energy & Infrastructure Fund, Inc. (“KMF”). Each of KYN and KMF is a closed-end investment company registered under the 1940 Act that is advised by KAFA.

SAI-11

Independent Directors⁽¹⁾

Name⁽²⁾ (Year Born)	Position(s) Held with Company, Term of Office/ Time of Service	Principal Occupations During Past Five Years	Other Directorships Held by Director/Officer During Past Five Years
William R. Cordes (born 1948)	Director. 3-year term (until the 2023 Annual Meeting of Stockholders)/served since August 2018. Member of Audit Committee (Chair) and Valuation Committee.	Retired from Northern Border Pipeline Company in March 2007 after serving as President from October 2000 to March 2007. Chief Executive Officer of Northern Border Partners, L.P. from October 2000 to April 2006. President of Northern Natural Gas Company from 1993 to 2000. President of Transwestern Pipeline Company from 1996 to 2000.	Current: ● Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”) Prior: ● Kayne Anderson Energy Development Company (“KED”) ● Boardwalk Pipeline Partners, LP ● Northern Border Partners, L.P.

Anne K. Costin (born 1950)	Director. 3-year term (until the 2025 Annual Meeting of Stockholders)/served since inception. Member of Valuation Committee (Chair) and Audit Committee.	Professor at the Amsterdam Institute of Finance from 2007 through 2013. Adjunct Professor in the Finance and Economics Department of Columbia University Graduate School of Business in New York from 2004 through 2007. As of March 1, 2005, Ms. Costin retired after a 28-year career at Citigroup. During the seven years prior to her retirement, Ms. Costin was Managing Director and Global Deputy Head of the Project & Structured Trade Finance product group within Citigroup’s Investment Banking Division.	Current: ● KMF ● Music Guild Orchestra (not-for-profit organization) Prior: ● Kayne Anderson Energy Total Return Fund, Inc. (“KYE”) ● Our Community LA (not-for-profit organization)

Barry R. Pearl (born 1949)	Director. 3-year term (until the 2023 Annual Meeting of Stockholders)/served since August 2018. Member of Audit Committee and Nominating, Corporate Governance and Compensation Committee.	Management consultant to Northstar Midstream, a private developer and operator of petroleum infrastructure assets from March 2016 to July 2018, Executive Vice President of Kealine, LLC, (and its affiliate WesPac Midstream LLC an energy infrastructure developer), from February 2007 to March 2016. Provided management consulting services from January 2006 to February 2007. President of Texas Eastern Products Pipeline Company, LLC (“TEPPCO”), (the general partner of TEPPCO Partners, L.P.,) from February 2001 to December 2005. Chief Executive Officer and director of TEPPCO from May 2002 to December 2005; and Chief Operating Officer from February 2001 to May 2002.	Current: ● KMF ● Magellan Midstream Partners, L.P. Prior: ● KED ● Peregrine Midstream Partners LLC ● Seaspan Corporation ● Targa Resources Partners LP ● TEPPCO Partners, L.P.

Albert L. Richey (born 1949)	Director. 3-year term (until the 2025 Annual Meeting of Stockholders)/served since August 2018. Member of Audit Committee and Valuation Committee.	Retired from Anadarko Petroleum Corporation in August 2016 after serving as Senior Vice President Finance and Treasurer from January 2013 to August 2016; Vice President Special Projects from January 2009 to December 2012; Vice President Corporate Development from 2006 to December 2008; Vice President and Treasurer from 1995 to 2005 and Treasurer from 1987 to 1995.	Current: ● KMF Prior: ● KED ● Boys & Girls Clubs of Houston (not-for-profit organization) ● Boy Scouts of America (not-for-profit organization)

SAI-12

William H. Shea, Jr. (born 1954)	Lead Director. 3-year term (until the 2024 Annual Meeting of Stockholders)/served since March 2008. Member of Nominating, Corporate Governance and Compensation Committee (Chair).	Chief Executive Officer of Jefferson Energy Companies from January 2020 to June 2021. Chief Executive Officer of Mainline Energy Partners, LLC from July 2016 to September 2019. Chief Executive Officer and President of Niska Gas Storage Partners LLC from May 2014 to July 2016. Chief Executive Officer of the general partner of PVR Partners, L.P. (PVR) from March 2010 to March 2014. Chief Executive Officer and President of the general partner of Penn Virginia GP Holdings, L.P. (PVG), from March 2010 to March 2011. Private investor from June 2007 to March 2010. From September 2000 to June 2007, President, Chief Executive Officer and Director (Chairman from May 2004 to June 2007) of Buckeye Partners L.P. (BPL). From May 2004 to June 2007, President, Chief Executive Officer and Chairman of Buckeye GP Holdings L.P. (BGH) and its predecessors.	Current: ● KMF Prior: ● KYE ● BGH ● BPL ● Gibson Energy ULC ● Mainline Energy Partners, LLC ● Niska Gas Storage Partners LLC ● PVG ● PVR ● Penn Virginia Corporation ● USA Compression Partners, LP

Carita S. Walker (1971)	Director. 3-year term (until the 2023 Annual Meeting of Stockholders)/served since June 2022. Member of Nominating, Corporate Governance and Compensation Committee.	Chief Legal Officer at Shell Recharge Solutions — a Shell company since June 2020. Senior Legal Counsel with Qatar Shell Service Company from June 2016 to June 2020.	Current: ● KMF ● Xavier University of Louisiana (not-for-profit organization) ● Environmental Law Institute (not-for-profit organization) Prior: ● Houston Wilderness (not-for-profit organization) ● Oakland Black Chamber of Commerce (not-for-profit organization)

Caroline A. Winn (1963)	Director. 3-year term (until the 2025 Annual Meeting of Stockholders)/served since April 2022. Member of the Audit Committee.	Chief Executive Officer of San Diego Gas & Electric (SDG&E), one of Sempra’s regulated California utilities, since August 2020. Chief Operating Officer of SDG&E from 2017 to 2020.	Current: ● KMF ● SDG&E ● Monarch School (not-for-profit organization) ● Father Joe’s Villages (not-for-profit organization) ● Scripps Institution of Oceanography (not-for-profit organization) Prior: ● Western Energy Institute (not-for-profit organization)

SAI-13

Interested Directors and Non-Director Officers

Name⁽²⁾(Year Born)	Position(s) Held with Company, Term of Office/ Time of Service	Principal Occupations During Past Five Years⁽³⁾	Other Directorships Held by Director/Officer During Past Five Years
James C. Baker, Jr.⁽⁴⁾ (born 1972)	Chairman of the Board of Directors since June 2020, Director, President and Chief Executive Officer. 3-year term (until the 2024 Annual Meeting of Stockholders). Member of Valuation Committee. Elected annually as an officer/served since June 2005.	Partner and Senior Managing Director of Kayne Anderson since February 2008. Co-Managing Partner of KAFA since June 2019. Senior Managing Director of KAFA from February 2008 to June 2019. Chief Executive Officer of KMF since June 2019. President of KMF since June 2016. Executive Vice President of KMF from August 2010 to June 2016. President of Kayne Anderson BDC, Inc. (“KABDC”) since February 2021. Chief Executive Officer of KABDC since June 2021. President and Chief Executive Officer of Kayne DL 2021, Inc. (“KDL”) since December 2021.	Current: ● KMF ● KACALP ● Expression Therapeutics Prior: ● KED ● K-Sea Transportation Partners L.P. ● Petris Technology, Inc. ● ProPetro Services, Inc.

J.C. Frey (born 1968)	Executive Vice President. Elected annually as an officer/served since inception.	Managing Partner of Kayne Anderson since 2004 and Co-Managing Partner of KAFA since 2006. Executive Vice President of KMF since August 2010. Assistant Secretary and Assistant Treasurer of KMF from August 2010 to January 2019.	None

Terry A. Hart (born 1969)	Chief Operating Officer and Assistant Secretary since April 2022. Elected annually as an officer/served since 2005.	Senior Managing Director of Kayne Anderson since January 2020. Managing Director of Kayne Anderson from December 2005 to January 2020 and Chief Financial Officer of KAFA since 2006. Chief Operating Officer of KMF since April 2022. Chief Financial Officer and Treasurer of KMF from August 2010 to March 2022. Assistant Secretary of KMF since January 2019. Chief Financial Officer and Treasurer of KABDC since February 2021. Chief Financial Officer and Treasurer of KDL since December 2021. Chief Financial Officer of Kayne Anderson Acquisition Corp. from December 2016 to November 2018.	Current: ● The Source (not-for-profit organization) Prior: ● KED

A. Colby Parker (born 1987)	Chief Financial Officer and Treasurer since April 2022. Elected annually as an officer/served since January 2019.	Chief Financial Officer and Treasurer of KMF since April 2022. Vice President of KMF from June 2020 to March 2022. Assistant Treasurer of KMF from January 2019 to March 2022. Controller of Kayne Anderson since July 2015.	None

SAI-14

Michael J. O’Neil (born 1983)	Secretary and Chief Compliance Officer. Elected annually as an officer/served as Secretary since 2021 and as Chief Compliance Officer since December 2013.	Secretary of KYN since 2021. Chief Compliance Officer of Kayne Anderson since March 2012 and of KYN since December 2013 and of KA Associates, Inc. (broker-dealer) since January 2013. Chief Compliance Officer of KABDC since February 2021. Secretary of KABDC since June 2021. Chief Compliance Officer and Secretary of KDL since December 2021. A compliance officer at BlackRock Inc. from January 2008 to February 2012.	Current: ● Worcester Academy (not-for-profit organization)

Ron M. Logan, Jr. (born 1960)	Senior Vice President. Elected annually as an officer/served since September 2012.	Senior Managing Director of Kayne Anderson since February 2014. Managing Director of Kayne Anderson from September 2006 to February 2014. Senior Vice President of KMF since June 2012.	Current: ● Streamline Innovations Holdings, Inc. Prior: ● VantaCore Partners LP

Adriana I. Jimenez (born 1976)	Vice President. Elected annually as an officer/served since December 2021.	Vice President of KMF since December 2021. Controller of Kayne Anderson since 2011.	None

(1)

(KYN is managed by KA Fund Advisors, LLC (“KAFA”), an affiliate of Kayne Anderson Capital Advisors, L.P. (“KACALP” and, together with its affiliates, “Kayne Anderson”). The 1940 Act requires the term “Fund Complex” to be defined to include registered investment companies advised by Kayne Anderson, and includes KYN and KMF. Each Independent Director oversees two registered investment companies in the Fund Complex, the Company and KMF, as noted above.

(2)

The address of each director and corporate officer is c/o KA Fund Advisors, LLC, 811 Main Street, 14th Floor, Houston, Texas, 77002.

(3)

In August 2018, Kayne Anderson Energy Total Return Fund, Inc. (“KYE”) merged into Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”) and Kayne Anderson Energy Development Company (“KED”) merged into Kayne Anderson Energy Infrastructure Fund, Inc. (“KYN”), respectively. The table presents principal occupations for each interested director and non-director officer of KYN and KMF and does not set forth the principal occupations, if any, for KYE and KED.

(4)

James C. Baker, Jr. is an “interested person” of the Company as defined in the 1940 Act by virtue of his employment relationship with Kayne Anderson.

SAI-15

Committees of the Board of Directors

The Board of Directors has three standing committees: the Nominating, Corporate Governance and Compensation Committee (the “Nominating Committee”), the Valuation Committee and the Audit Committee.

The tables below show the directors serving on the committees for KYN.

	Audit Committee⁽¹⁾	Valuation Committee	Nominating Committee
Independent Directors
William R. Cordes⁽²⁾	X	X	—
Anne K. Costin⁽³⁾	X	X	—
Barry R. Pearl	X	—	X
Albert L. Richey	X	X	—
William H. Shea, Jr.⁽⁴⁾	—	—	X
Carita S. Walker	—	—	X
Caroline A. Winn	X	—	—
Interested Directors
James C. Baker Jr.	—	X	—

(1)

Each Director serving on the Audit Committee has been individually designated as an audit committee financial expert.

(2)

Chair of the Audit Committee.

(3)

Chair of the Valuation Committee.

(4)

Lead Independent Director and Chair of the Nominating and Governance Committee.

The Nominating Committee is responsible for appointing and nominating independent persons to the respective Board of Directors. Each Nominating Committee member is “independent” under the applicable NYSE listing standards. The Nominating Committee operates under a written charter adopted and approved by the Board (the “Nominating Committee Charter”), a copy of which is available on the Companies’ website (www.kaynefunds.com). If there is no vacancy on the Board, the Board of Directors will not actively seek recommendations from other parties, including stockholders. When a vacancy on the Board of Directors occurs and nominations are sought to fill such vacancy, the Nominating Committee may seek nominations from those sources it deems appropriate in its discretion, including our stockholders. To submit a recommendation for nomination as a candidate for a position on the Board, stockholders shall mail such recommendation to Michael O’Neil, Secretary, at our address: 811 Main Street, 14th Floor, Houston, TX 77002. Such recommendation shall include the following information: (a) evidence of stock ownership of the person or entity recommending the candidate (if submitted by one of our stockholders), (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” in relation to us, 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 Nominating 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 of Directors or during such other time as the Nominating Committee is accepting recommendations, the recommendation will be forwarded to the Chair of the Nominating Committee and counsel to the Independent Directors. Recommendations received at any other time will be kept on file until such time as the Nominating Committee is accepting recommendations, at which point they may be considered for nomination. The Nominating Committee met four times during the fiscal year ended November 30, 2022.

The Valuation Committee operates under a written charter adopted and approved by the Board, a copy of which is available on the Companies’ website (www.kaynefunds.com). Pursuant to Rule 2a-5 under the 1940 Act, and effective September 1, 2022, the Board of Directors of each company designated KAFA, the Company’s investment adviser, as the “Valuation Designee” to perform fair value determinations of each Company’s portfolio holdings, subject to oversight by and periodic reporting to each Company’s Board. The Valuation Designee determines the fair value of the Company’s portfolio holdings in accordance with the Company’s valuation program, as approved by the Board. The Valuation Committee aids the Board in overseeing the Valuation Designee’s performance of fair value determinations. KYN’s Valuation Committee met four times during the fiscal year ended November 30, 2022.

SAI-16

The Audit Committee operates under a written charter (the “Audit Committee Charter”), which was adopted and approved by the Board and established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “1934 Act”). The Audit Committee Charter conforms to the applicable listing standards of the New York Stock Exchange (the “NYSE”). The Audit Committee Charter is available on the Companies’ website (www.kaynefunds.com). The Audit Committee, among others, approves and recommends to the Board the election, retention or termination of the Company’s independent auditors; approves services to be rendered by such auditors; monitors and evaluates each auditors’ performance; reviews the results of the Company’s audit; determines whether to recommend to the Board that the Company’s audited financial statements be included in the Company’s Annual Report; monitors the accounting and reporting policies and procedures of the Company and the Company’s compliance with regulatory requirements; and responds to other matters as outlined in the Audit Committee Charter. Each Audit Committee member is “independent” under the applicable NYSE listing standard. The Audit Committee met four times during the fiscal year ended November 30, 2022.

Director Compensation

Directors and officers who are “interested persons” by virtue of their employment by Kayne Anderson, including all executive officers, serve without any compensation from KYN. For the fiscal year ended November 30, 2020:

●

Each Independent Director who served on the Board of both KYN and KMF received an annual retainer of $125,000 for his or her service on both boards. The Independent Directors, voting separately, have authority to set their compensation. KYN and KMF each paid a pro rata portion of this retainer quarterly based on their total assets for the quarter. As of November 30, 2022, 77% and 23% of the quarterly retainer was allocated to KYN and KMF, respectively.

●

For each of KYN and KMF, the lead Independent Director received additional compensation of $7,500 annually.

●

For each of KYN and KMF, the chairperson of the Audit Committee received additional compensation of $7,500 annually.

●

For each of KYN and KMF, each Independent Director received $2,500 per regular Board meeting attended in person, $2,000 per regular Board meeting attended via telephone and $1,500 per special Board meeting attended via telephone.

●

For each of KYN and KMF, each Audit Committee member received $1,500 per Audit Committee meeting that was more than fifteen minutes in length, and each member of any other Board committee received $500 per other committee meeting that was more than fifteen minutes in length.

●

The Independent Directors were reimbursed for expenses incurred as a result of attendance at meetings of the Board and its committees.

Following completion of the Merger, we expect that the annual retainer, the Lead Independent Director fee, Audit Committee chairperson fee and meeting fees will be the same as those described above. As of November 30, 2022, the retainer would have been allocated 100% to KYN if the Merger had been completed.

The following table sets forth the compensation paid to the Independent Directors by KYN during the fiscal year ended November 30, 2022. Neither KYN nor KMF has a retirement or pension plan or any compensation plan under which KYN’s equity securities were authorized for issuance.

SAI-17

KYN Director Compensation Table

Name	KYN		Total Compensation from the Fund Complex⁽¹⁾
Independent Directors
William R. Cordes	$	123,801	$	182,251
Anne K. Costin		118,176		171,501
Barry R. Pearl		116,176		167,501
Albert L. Richey		116,301		167,751
William H. Shea, Jr.		119,676		174,001
Carita S. Walker⁽²⁾		47,282		65,223
Caroline A. Winn⁽³⁾		64,662		90,145
Interested Director
James C. Baker, Jr.		None		None

(1)

The 1940 Act requires the term “Fund Complex” to be defined to include registered investment companies advised by KAFA, the Company’s investment adviser.

(2)

Ms. Walker was appointed as an Independent Director of each Company on June 22, 2022.

(3)

Ms. Winn was appointed as an Independent Director of each Company on April 27, 2022.

Security Ownership of Management

The following table sets forth the dollar range of KYN’s equity securities and the aggregate dollar range of equity securities in all of the closed-end funds overseen by each director in the same Fund Complex beneficially owned by the directors of KYN as of November 30, 2022 (beneficial ownership being determined in accordance with Rule 16a-1(a)(2) of the Exchange Act). For each director, the Fund Complex includes KYN and KMF.

KYN Common Stock Ownership

Director	Dollar Range of Equity Securities⁽¹⁾	Aggregate Dollar Range of Equity Securities⁽¹⁾ in Funds Overseen by Director in Fund Complex
Independent Directors
William R. Cordes	Over $100,000	Over $100,000
Anne K. Costin	$10,001-$50,000	$10,001-$50,000
Barry R. Pearl	Over $100,000	Over $100,000
Albert L. Richey	Over $100,000	Over $100,000
William H. Shea, Jr.	Over $100,000	Over $100,000
Carita S. Walker	None	None
Caroline A. Winn	None	None
Interested Directors
James C. Baker Jr.	Over $100,000	Over $100,000

(1)

The dollar ranges of equity securities are as follows: None; $1-$10,000; $10,001-$50,000; $50,001-$100,000; over $100,000.

As of November 30, 2022, the Independent Directors (other than Ms. Costin and Mr. Pearl as noted in the table below) and their respective immediate family members did not own beneficially or of record any class of securities of Kayne Anderson or any person directly or indirectly controlling, controlled by, or under common control with Kayne Anderson. As of November 30, 2022, the Independent Directors did not own beneficially or of record any class of securities of the underwriters of the offerings of KYN’s common stock or preferred stock or any class of securities of any person directly or indirectly controlling, controlled by, or under common control with such underwriters.

SAI-18

The table below sets forth information about securities owned by the directors and their respective immediate family members, as of November 30, 2022, in entities directly or indirectly controlling, controlled by, or under common control with, the Companies’ investment adviser or underwriters.

Director

Name of
Owners
and
Relationships to Director

Company⁽¹⁾

Title of Class

Value of Securities

Percent
of Class

Anne K. Costin

Self

Kayne Anderson Capital Income Partners (QP), L.P

Partnership Units

88,760

Kayne Anderson Non-Traditional Investments, L.P.

Partnership Units

55,225

1.2

Kayne Anderson Real Estate Partners VI, L.P

Partnership Units

99,635

Kayne Partners Fund III (QP), L.P.

Partnership Units

32,260

Barry R. Pearl

Self

Kayne Anderson BDC, Inc.

Common Stock

323,964

KA Credit Advisors Holdco, LLC

Membership Interests

30,500

Kayne Anderson Real Estate Partners V, LP

Partnership Units

418,563

Less than 1% of class.

(1)

KACALP may be deemed to “control” each fund by virtue of its role as the fund’s general partner.

As of December 31, 2022, certain officers, and certain employees of Kayne Anderson, including all the executive officers, own, in the aggregate, approximately $18 million of KYN’s common stock.

Information about Each Director’s Qualifications, Experience, Attributes or Skills

The Board of KYN believes that each of its directors has the qualifications, experience, attributes and skills (“Director Attributes”) appropriate to their continued service as directors of the Company. Each of the directors has a demonstrated record of business and/or professional accomplishment that indicates that they have the ability to critically review, evaluate and access information provided to them. Certain of these business and professional experiences are set forth in detail in the tables above under “Information Regarding Director Nominees and Directors.” Each of the directors has experience serving on the Board of the Company and KMF (and/or KED and KYE) for a number of years. In addition, many of the directors have served as members of the board of other public companies, non-profit entities or other organizations. Therefore, they have substantial boardroom experience and, in their service to the Company and KMF (and/or KED and KYE), have gained substantial insight as to the operation of KYN and have demonstrated a commitment to discharging oversight duties as directors in the interests of stockholders.

In addition to the information provided in the tables above, certain additional information regarding the directors and their Director Attributes is provided below. The information provided below, and in the tables above, is not all-inclusive. Many Director Attributes involve intangible elements, such as intelligence, integrity and work ethic, along with the ability to work with other members of the Board, to communicate effectively, to exercise judgment and to ask incisive questions, and commitment to stockholder interests. The Board of KYN annually conducts a self-assessment wherein the effectiveness of the Board and individual directors is reviewed. In conducting its annual self-assessment, the Board has determined that the directors have the appropriate attributes and experience to continue to serve effectively as directors of the Company.

James C. Baker, Jr. Mr. Baker is Chairman, President and Chief Executive Officer of KYN and KMF. He has been Co-Managing Partner of KAFA since June 2019 and Senior Managing Director of Kayne Anderson since February 2008. Mr. Baker was Senior Managing Director of KAFA from February 2008 to June 2019. He previously served as Executive Vice President of KYN from June 2008 to June 2016 and of KMF from August 2010 to June 2016; and as Vice President of KYN from June 2005 to June 2008. Mr. Baker has also served as President of Kayne Anderson BDC, Inc. since February 2021 and as Chief Executive Officer since June 2021. He has been President and Chief Executive Officer of Kayne DL 2021, Inc. since December 2021. Prior to joining Kayne Anderson in 2004, Mr. Baker was a director in the energy investment banking group at UBS Securities LLC. At UBS, he focused on securities underwriting and mergers and acquisitions in the energy industry. Mr. Baker currently serves on the boards of directors of Kayne Anderson and Expression Therapeutics. Mr. Baker previously served on the boards of directors of K-Sea Transportation Partners L.P., Petris Technology, Inc., and ProPetro Services, Inc. Mr. Baker holds a Bachelor of Business Administration in Finance from the University of Texas and a Master of Business Administration from Southern Methodist University. Mr. Baker’s experience at each Company and Kayne Anderson makes him a valued member of the Board of each Company.

SAI-19

William R. Cordes. Mr. Cordes serves as an independent director and audit committee chair of KYN and KMF. He has worked in the natural gas industry for more than 35 years, including positions as Chief Executive Officer of Northern Border Partners, L.P. and President of each of Northern Border Pipeline Company, Northern Natural Gas Company, and Transwestern Pipeline Company. Mr. Cordes began his career with Northern Natural Gas Company in 1970 and held a number of accounting, regulatory affairs and executive positions in the natural gas retail and interstate pipeline divisions of the company. Mr. Cordes previously served on the boards of directors of KED, Boardwalk Pipeline Partners, LP, Northern Border Partners, L.P., the Interstate Natural Gas Association of America and as past Chairman of the Midwest Energy Association. Mr. Cordes graduated from the University of Nebraska with a degree in Business Administration. Mr. Cordes’ extensive executive experience in the MLP sector and the energy industry, as well as his board experience as a director of several energy-related companies, allows him to provide the Board with insight into the energy industry in general and natural gas pipelines in particular.

Anne K. Costin. Ms. Costin serves as an independent director of KYN and KMF. She was previously a professor at the Amsterdam Institute of Finance from 2007 through 2013 and an adjunct professor in the finance and economics department of Columbia University Graduate School of Business from 2004 through 2007. Ms. Costin retired in 2005, after a 28-year career at Citigroup, and during the last seven years of her banking career, she held the position of Managing Director and Global Deputy Head of the Project & Structured Trade Finance product group within Citigroup’s Investment Banking Division. Ms. Costin’s product group provided integrated advice and nonrecourse capital raising in both the bond and bank markets to top tier Citigroup corporate clients in both the developed and emerging markets. Her product group was the acknowledged market leader globally in all relevant league tables. Ms. Costin received a Director’s Certificate from the Director’s Institute at UCLA Anderson School of Management, a PMD degree from Harvard Business School, and a B.A. from the University of North Carolina at Chapel Hill. In addition to her managerial and banking experience, Ms. Costin’s academic professional experience related to financial matters equip her to offer further insights to the Board.

Barry R. Pearl. Mr. Pearl serves as an independent director of KYN and KMF. He most recently served as a management consultant to Northstar Midstream, a private developer and operator of petroleum infrastructure assets from March 2016 to July 2018. Mr. Pearl was Executive Vice President of Kealine, LLC (and its affiliate WesPac Midstream LLC, an energy infrastructure developer) from February 2007 to March 2016. In 2001, Mr. Pearl was elected President of Texas Eastern Products Pipeline Company, LLC (“TEPPCO,” the general partner of TEPPCO Partners, L.P.). During his time at TEPPCO he also held the positions of Chief Operating Officer, Chief Executive Officer, and director. Prior to joining TEPPCO, Mr. Pearl’s experience included such positions as Vice President – Finance and Administration, Treasurer, Secretary and Chief Financial Officer of Maverick Tube Corporation, and Senior Vice President, Business Development, Senior Vice President and Chief Financial Officer of Santa Fe Pacific Pipeline Partners, L.P. In addition to his directorships at KYN and KMF, Mr. Pearl also serves on the board of directors of Magellan Midstream Partners, L.P., as Lead Director and a member of the Audit Committee. Prior directorships include Targa Resources Partners LP, Peregrine Midstream Partners LLC, Seaspan Corporation and as past Chairman of the Executive Committee of the Association of Oil Pipelines. Mr. Pearl graduated from Indiana University in 1970 with a Bachelor of Arts degree in Mathematics. He received a Master of Arts degree in Operations Research from Yale University in 1972 and a Master in Business Administration degree from Denver University in 1975. In addition to his extensive executive experience in the midstream sector and the energy industry, as well as his board experience as a director of several energy-related companies, Mr. Pearl brings to the Board many years of experience as the chairman of the audit committees of several public companies.

Albert L. Richey. Mr. Richey serves as an independent director of KYN and KMF. He retired from Anadarko Petroleum Corporation in August 2016 after serving as Senior Vice President Finance and Treasurer from January 2013 to August 2016. Mr. Richey joined Anadarko in 1987 as Manager of Treasury Operations and held the positions of Vice President, Special Projects, and Vice President, Corporate Development. Mr. Richey’s background in the oil and gas industry includes The Offshore Company (a predecessor company to Transocean Ltd.), United Energy Resources and Sandefer Oil & Gas. Mr. Richey previously served as a member of the boards of directors of the Boys & Girls Clubs of Houston and Boy Scouts of America. Mr. Richey received a Bachelor of Science degree in Commerce in 1971 from the University of Virginia. In 1974, he earned a Master of Business Administration degree from the Darden Graduate School of Business at the University of Virginia. In addition to his background in the energy industry, Mr. Richey’s professional experience related to financial matters and his role as an executive in one of the largest independent domestic exploration and production companies equip him to offer further insights to the Board.

SAI-20

William H. Shea, Jr. Mr. Shea serves as the lead independent director of KYN and KMF. He previously served as the Chief Executive Officer of Jefferson Energy Companies from January 2020 to June 2021, Chief Executive Officer of Mainline Energy Partners, LLC from July 2016 to September 2019, Chief Executive Officer and President of Niska Gas Storage Partners LLC from May 2014 to July 2016, and as the Chief Executive Officer of the general partner of PVR Partners, L.P. (PVR), a midstream MLP from March 2010 to March 2014. Mr. Shea also served as the President and Chief Executive Officer of Penn Virginia GP Holdings L.P. (PVG), which then owned the general partner of PVR. Mr. Shea was previously with Buckeye Partners, L.P. (BPL), a petroleum products MLP, serving as Chairman from May 2004 to July 2007, Chief Executive Officer and President from September 2000 to June 2007 and President and Chief Operating Officer from July 1998 to September 2000. He was also Chairman of Buckeye GP Holdings, L.P. (BGH), the owner of the general partner of BPL, from August 2006 to July 2007 and Chief Executive Officer and President from May 2004 to June 2007. Mr. Shea held various managerial and executive positions during his tenure with Buckeye, which he joined in 1996. Prior to Buckeye, Mr. Shea worked for Union Pacific Corporation, UGI Development Company, and Laidlaw Environmental Services. In addition to his directorships at KYN and KMF, Mr. Shea formerly served on the board of directors of Mainline Energy Partners, LLC, USA Compression Partners, LP, PVG, PVR, Penn Virginia Corporation, BPL, BGH, Gibson Energy ULC, and Niska Gas Storage Partners LLC. Mr. Shea holds a B.A. from Boston College and an M.B.A. from the University of Virginia. Mr. Shea’s extensive executive experience in the midstream sector and the energy industry, as well as his board experience as a director of several energy-related companies allows him to provide the Board with insight into the specific industries in which each Company invests.

Carita S. Walker. Ms. Walker serves as an independent director of KYN and KMF. She currently serves as the Chief Legal Officer at Shell Recharge Solutions, a Shell Company that provides a range of customizable software and services related to energy efficiency and sustainability, including electric vehicle charging solutions. Ms. Walker has numerous years of experience in commercial contracting, mergers and acquisitions, legislative and market development in nascent and novel industries and technologies, and grass-roots advocacy. She is passionate about creating scalable, innovative business solutions, building compliant, safe, and inclusive cultures, and advancing environmental, social, and governance (ESG) initiatives. Ms. Walker is an acknowledged thought leader and active participant in Diversity, Equity, & Inclusion (DE&I) efforts as one of the architects of the Shell Global Legal DE&I plan and a member of the Deloitte Chief Legal Officer DE&I think tank. Ms. Walker did her undergraduate studies at Xavier University of Louisiana, studied at Harvard University in Cambridge, MA, and obtained her law degree from the University of California at Berkeley — School of Law. Ms. Walker’s extensive legal background and experience with one of the largest international energy companies in the world equips her to provide valuable insight to the Board.

Caroline A. Winn. Ms. Winn serves as an independent director of KYN and KMF. She currently serves as chief executive officer for San Diego Gas & Electric (SDG&E), one of Sempra’s regulated California utilities. Ms. Winn has held a broad set of leadership roles during her 30-plus year career in the utility space. An experienced executive and board member, her collaborative, resilient, and transparent leadership style has earned high praise from the industry, regulators, and government officials. Ms. Winn also currently serves on the board of directors of SDG&E and leads SDG&E’s Women’s Leadership Group. In addition, Ms. Winn is a director and member of the audit committee of the board of the Monarch School for underserved youth and serves on the director’s council of the Scripps Institution of Oceanography. Ms. Winn holds a bachelor’s degree in electrical engineering from California State University Sacramento and is a registered professional engineer in the State of California. In addition to her managerial and executive leadership experience, Ms. Winn’s extensive background in the utility industry allows her to provide the Board with valuable insight.

SAI-21

Board Leadership Structure

Each Company’s business and affairs are managed under the direction of its Board, including the duties performed for the Company pursuant to its investment management agreement. Among other things, the Board of each Company sets broad policies for the Company, approves the appointment of the Company’s investment adviser, administrator and officers, and approves the engagement, and reviews the performance of the Company’s independent registered public accounting firm. The role of the Board of each Company and of any individual director is one of oversight and not of management of the day-to-day affairs of the Company.

The Board of each Company currently consists of eight directors, seven of whom are Independent Directors with one lead Independent Director. As part of each regular Board meeting for each Company, the Independent Directors meet separately from Kayne Anderson and, as part of at least one Board meeting each year, with the Company’s Chief Compliance Officer. The Board of each Company reviews its leadership structure periodically as part of its annual self-assessment process and believes that its structure is appropriate to enable the Board to exercise its oversight of the Company.

Under each Company’s Amended and Restated Bylaws, the Board of each Company may designate a Chairman to preside over meetings of the Board and meetings of stockholders, and to perform such other duties as may be assigned to him or her by the Board. Neither Company has an established policy as to whether the Chairman of the Board shall be an Independent Director and believes that having the flexibility to designate its Chairman and reorganize its leadership structure from time to time is in the best interests of the Company and its stockholders.

Presently, Mr. Baker serves as Chairman of the Board of each Company. Mr. Baker is an “interested person” of each Company, as defined in the 1940 Act, by virtue of his employment relationship with Kayne Anderson. Each Company believes that Mr. Baker’s history with the Company, familiarity with the Kayne Anderson investment platform and extensive experience in the field of energy-related investments qualifies him to serve as the Chairman of the Board. Each Board has determined that the composition of the Audit and Nominating Committees being Independent Directors only is an appropriate means to address any potential conflicts of interest that may arise from the Chairman’s status as an interested person of the Company.

Presently, Mr. Shea has been designated as lead Independent Director. While Mr. Shea is the lead Independent Director, all of the Independent Directors play an active role in serving on the Board. The Independent Directors constitute a majority of each Company’s Board and are closely involved in all material deliberations related to the Company. The Board of each Company believes that, with these practices, each Independent Director has a stake in the Board’s actions and oversight role and accountability to the Company and its stockholders.

Board Role in Risk Oversight

Each Company’s Board oversees the services provided by Kayne Anderson, including certain risk management functions. Risk management is a broad concept comprised of many disparate elements (such as, for example, investment risk, issuer and counterparty risk, compliance risk, operational risk and business continuity risk). Consequently, Board oversight of different types of risks is handled in different ways, and the Board of each Company implements its risk oversight function both as a whole and through Board committees. In the course of providing oversight, each Board and its committees receive reports on the Company’s activities, including those related to the Company’s investment portfolio and its financial accounting and reporting. Each Board also meets at least quarterly with the Company’s Chief Compliance Officer, who reports on the compliance of the Company with the federal securities laws and the Company’s internal compliance policies and procedures. The meetings of the Audit Committee of each Company with the Company’s independent registered public accounting firm also contribute to Board oversight of certain internal control risks. In addition, each Board meets periodically with representatives of the Company and Kayne Anderson to receive reports regarding the management of the Company, including those related to certain investment and operational risks, and the Independent Directors of each Company are encouraged to communicate directly with senior management.

Each Company believes that Board roles in risk oversight must be evaluated on a case-by-case basis and that the Board’s existing role in risk oversight is appropriate. Management believes that each Company has robust internal processes in place and a strong internal control environment to identify and manage risks. However, not all risks that may affect a Company can be identified or processes and controls developed to eliminate or mitigate their occurrence or effects, and some risks are beyond any control of the Company or Kayne Anderson, its affiliates or other service providers.

SAI-22

INDEMNIFICATION OF DIRECTORS AND OFFICERS

Maryland law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment as being material to the cause of action. Our Charter contains such a provision which eliminates our directors’ and officers’ liability to the maximum extent permitted by Maryland law, subject to the requirements of the 1940 Act.

Our Charter authorizes us, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to obligate us to indemnify any present or former director or officer or any individual who, while serving as our director or officer and, at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee, from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any such capacity and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding.

Our Bylaws obligate us, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to indemnify any present or former director or officer or any individual who, while serving as our director or officer and, at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee and who is made, or threatened to be made, a party to the proceeding by reason of his or her service in any such capacity from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any such capacity and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding. Our Charter and Bylaws also permit us to indemnify and advance expenses to any individual who served any predecessor of us in any of the capacities described above and any employee or agent of ours or our predecessor, if any.

Maryland law requires a corporation (unless its charter provide otherwise, which is not the case for our Charter) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service in that capacity. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made, or threatened to be made, a party by reason of their service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (1) was committed in bad faith or (2) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment of liability on the basis that a personal benefit was improperly received, unless in either case a court orders indemnification, and then only for expenses. In addition, Maryland law permits a corporation to pay or reimburse reasonable expenses to a director or officer in advance of final disposition of a proceeding upon the corporation’s receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.

In accordance with the 1940 Act, we will not indemnify any person for any liability to which such person would be subject by reason of such person’s willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office.

SAI-23

CONTROL PERSONS

As of February 28, 2023, there were no persons who owned more than 25% of KYN’s outstanding voting securities, and we believe no person should be deemed to control KYN, as such term is defined in the 1940 Act.

Based on statements publicly filed with the SEC, as of February 28, 2023, KYN was aware of one person who owned of record or beneficially 5% or more of KYN’s outstanding common stock:

Name and Address

Shares Held

Percentage of
Outstanding
Shares⁽¹⁾

Cetera Advisor Networks LLC

200 N Sepulveda Blvd, Suite 1300

El Segundo, California 90245

6,970,480

5.1

As of February 28, 2023, the following persons owned of record or beneficially 5% or more of KYN’s MRP Shares:

Name and Address	Shares Held		Percentage of Outstanding Shares⁽¹⁾
MetLife Investment Management, LLC One MetLife Way Whippany, New Jersey 07981		824,000		18.5	%
Voya Investment Management LLC 5780 Powers Ferry Rd NW, Suite 300 Atlanta, GA 30327-4347		728,047		16.3	%
Thrivent Financial for Lutherans 901 Marquette Avenue, Suite 2500 Minneapolis, Minnesota 55402		680,000		15.2	%
Principal Global Investors, LLC 711 High Street Des Moines, IA 50392		646,973		14.5	%
The Guardian Life Insurance Company of America 10 Hudson Yards New York, NY 10001		440,000		9.9	%

(1)

Based on 4,464,117 shares outstanding as of February 28, 2023.

SAI-24

INVESTMENT ADVISER

KAFA is registered with the SEC under the Investment Advisers Act of 1940, as amended. KAFA provides us with professional investment supervision and management and permits any of its officers or employees to serve without compensation as our directors or officers if elected to such positions. KAFA is located at 811 Main Street, 14th Floor, Houston, Texas 77002.

KYN Asset Tiers for Fee Waiver		Management Fee			Applicable
Current	Revised	Waiver			Management Fee⁽¹⁾
$0 to $4.0 billion	$0 to $2.4 billion⁽²⁾		0.000	%		1.375	%
$4.0 billion to $6.0 billion	$2.4 billion⁽²⁾ to $4.0 billion		0.125	%		1.250	%
$6.0 billion to $8.0 billion	$4.0 billion to $6.0 billion		0.250	%		1.125	%
Greater than $8.0 billion	Greater than $6.0 billion		0.375	%		1.000	%

(1)

Represents the management fee, after giving effect to the fee waiver, applicable to the incremental total assets at each tier.

(2)

In addition to reducing the asset tiers for fee waivers, KAFA has also agreed to waive an amount of management fees (based on KYN and KMF assets at closing of the Merger) such that the pro forma, run-rate fees payable to KAFA are equal to the aggregate, run-rate management fees payable if KYN and KMF had remained standalone companies. The waiver will last for three years and is estimated to be approximately $0.7 million per year based on KYN and KMF assets as of February 28, 2023. The revised asset tiers for fee waivers and the new fee waiver would be effective as of the closing of the Merger and would not be subject to recoupment, either with respect to KYN, KMF or the Combined Company. For the fiscal year ended November 30, 2022, KYN paid management fees at an annual rate of 1.375% of quarterly average total assets.

SAI-25

The KYN Investment Management Agreement and related fee waiver agreement will continue in effect from year to year after its current one-year term commencing on May 1, 2022, so long as its continuation is approved at least annually by KYN’s Board of Directors including a majority of Independent Directors or by the vote of a “majority of our outstanding voting securities” (as such term is defined under the 1940 Act). The Investment Management Agreement may be terminated at any time without the payment of any penalty upon 60 days’ written notice by either party, or by action of the Board of Directors or by a vote of a majority of KYN’s outstanding voting securities, accompanied by appropriate notice. It also provides that it will automatically terminate in the event of its assignment, within the meaning of the 1940 Act. This means that an assignment of the KYN Investment Management Agreement to an affiliate of Kayne Anderson would normally not cause a termination of the KYN Investment Management Agreement.

Because KAFA’s fee is based upon a percentage of KYN’s total assets, KAFA’s fee will be higher to the extent KYN employs financial leverage. As noted, KYN has issued Leverage Instruments in a combined amount equal to approximately 21% of its total assets as of November 30, 2022. A discussion regarding the basis of the KYN Board of Directors’ decision to approve the continuation of the KYN Investment Management Agreement is available in KYN’s May 31, 2022 Semi-Annual Report to Stockholders.

Code of Ethics

KYN, KMF and KAFA have each adopted a code of ethics, as required by federal securities laws. Under both codes of ethics, employees who are designated as access persons may engage in personal securities transactions, including transactions involving securities that are currently held by us or, in limited circumstances, that are being considered for purchase or sale by us, subject to certain general restrictions and procedures set forth in our code of ethics. The personal securities transactions of our access persons and those of KAFA will be governed by the applicable code of ethics.

KAFA and its affiliates manage other investment companies and accounts. KAFA may give advice and take action with respect to any of the other funds it manages, or for its own account, that may differ from action taken by KAFA on our behalf. Similarly, with respect to our portfolio, KAFA is not obligated to recommend, buy or sell, or to refrain from recommending, buying or selling any security that KAFA and access persons, as defined by applicable federal securities laws, may buy or sell for its or their own account or for the accounts of any other fund. KAFA is not obligated to refrain from investing in securities held by us or other funds it manages.

KYN, KMF and KAFA have text-only versions of the codes of ethics that will be available on the EDGAR Database on the SEC’s internet web site at www.sec.gov. Those documents can be inspected and copied at the public reference facilities maintained by the SEC in Washington, D.C. Information about the operation of the public reference facilities may be obtained by calling the SEC at (202) 551-8090. Copies of such material may also be obtained from the Public Reference Section of the SEC at 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates. In addition, copies of the codes of ethics may be obtained from us free of charge at (877) 657-3863. You may also e-mail requests for these documents to publicinfo@sec.gov or make a request in writing to the SEC’s Public Reference Section, 100 F Street, N.E., Room 1580, Washington, D.C. 20549.

SAI-26

NET ASSET VALUE

Calculation of Net Asset Value

KYN determines its net asset value on a daily basis and reports its net asset value on KYN’s website, www.kaynefunds.com. Net asset value is computed by dividing the value of all of KYN’s assets (including accrued interest and distributions and current and deferred income tax assets), less all of KYN’s liabilities (including accrued expenses, distributions payable, current and deferred accrued income taxes, and any Borrowings) and the liquidation value of any outstanding preferred stock, by the total number of common shares outstanding. As a corporation, KYN is obligated to pay federal and state income tax on its taxable income. Accordingly, KYN accrues income tax liabilities and assets to account for taxes. As with any other asset or liability, KYN’s tax assets and liabilities increase or decrease its net asset value.

KYN invests a portion of its assets in MLPs, which generally are treated as partnerships for federal income tax purposes. As a limited partner in the MLPs, KYN includes its allocable share of the MLP’s taxable income or loss in computing its taxable income or loss. KYN may rely to some extent on information provided by its portfolio investments, which may not necessarily be timely, to estimate taxable income allocable to the units/shares held in its portfolio and to estimate the associated deferred tax liability (or deferred tax asset). Such estimates will be made in good faith. From time to time, as new information becomes available, KYN will modify its estimates and/or assumptions regarding income taxes. To the extent KYN modifies its estimates and/or assumptions, its net asset value would likely fluctuate.

Investment Valuation

Readily marketable portfolio securities listed on any exchange other than the NASDAQ Stock Market, Inc. (“NASDAQ”) are valued, except as indicated below, at the last sale price on the business day as of which such value is being determined. If there has been no sale on such day, the securities are valued at the mean of the most recent bid and ask prices on such day. Securities admitted to trade on the NASDAQ are valued at the NASDAQ official closing price. Portfolio securities traded on more than one securities exchange are valued at the last sale price on the business day as of which such value is being determined at the close of the exchange representing the principal market for such securities. The value of foreign securities traded outside of the Americas may be adjusted to reflect events occurring after a foreign exchange closes that may affect the value of the foreign security. In such cases, these foreign securities are valued by an independent pricing service and are categorized as a Level 2 security for purposes of the fair value hierarchy.

SAI-27

For the fiscal year ended November 30, 2022, unless otherwise determined by the Valuation Designee, the following valuation process was used for such securities:

●

Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of investments may fluctuate from period to period. Additionally, the fair value of investments may differ from the values that would have been used had a ready market existed for such investments and may differ materially from the values that a Company may ultimately realize.

SAI-28

PORTFOLIO TRANSACTIONS

The following section discusses the accounts managed by our portfolio managers, the structure and method of our portfolio managers’ compensation, and their ownership of our securities. This information is current as of November 30, 2022. KYN and KMF are the registered investment companies managed by our portfolio managers, James C. Baker Jr. and J.C. Frey.

Messrs. Baker and Frey are compensated by KAFA through distributions based on the amount of assets they manage and receive a portion of the advisory fees applicable to those accounts, which, with respect to certain accounts, are based in part, on the performance of those accounts. Some of the other accounts managed by Messrs. Baker and Frey have investment strategies that are similar to ours. However, KAFA manages potential conflicts of interest by allocating investment opportunities in accordance with its allocation policies and procedures.

Other Accounts Managed by Portfolio Managers

The following table reflects information regarding accounts for which the portfolio managers have day-to-day management responsibilities (other than KYN). Accounts are grouped into three categories: (i) registered investment companies, (ii) other pooled investment accounts, and (iii) other accounts, and include accounts that pay advisory fees based on account performance shown in the separate table below. Information is shown as of November 30, 2022. Asset amounts are approximate and have been rounded.

	Registered Investment Companies (Excluding us)				Other Pooled Investment Vehicles				Other Accounts
Portfolio Manager	Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts
			($ in millions)				($ in millions)				($ in millions)
James C. Baker Jr.		1	$	585		—	$	—		—	$	—
J.C. Frey		3	$	850		9	$	1,099		6	$	259

Other Accounts That Pay Performance-Based Advisory Fees Managed by Portfolio Managers

The following table reflects information regarding accounts for which the portfolio managers have day-to-day management responsibilities (other than us) and with respect to which the advisory fee is based on account performance. Information is shown as of November 30, 2022. Asset amounts are approximate and have been rounded.

	Registered Investment Companies (Excluding us)				Other Pooled Investment Vehicles				Other Accounts
Portfolio Manager	Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts
			($ in millions)				($ in millions)				($ in millions)
James C. Baker Jr.		—		—		—	$	—		—	$	—
J.C. Frey		—		—		5	$	550		2	$	88

Messrs. Baker and Frey are compensated by KAFA through partnership distributions from Kayne Anderson based on the amount of assets they manage and they receive a portion of the advisory fees applicable to those accounts, which, with respect to certain amounts, as noted above, are based in part on the performance of those accounts. Some of the other accounts managed by Messrs. Baker and Frey have investment strategies that are similar to ours. However, KAFA manages potential conflicts of interest by allocating investment opportunities in accordance with its allocation policies and procedures. At November 30, 2022, Mr. Baker and Mr. Frey each owned over $1,000,000 of our equity, and through their limited partnership interests in KACALP, which owns shares of our common stock, Messrs. Baker and Frey could be deemed to also indirectly own a portion of our securities.

SAI-29

Portfolio Transactions and Brokerage

Subject to the oversight of the Board of Directors, KAFA is responsible for decisions to buy and sell securities for us and for the placement of our securities business, the negotiation of the commissions to be paid on brokered transactions, the prices for principal trades in securities, and the allocation of portfolio brokerage and principal business. It is the policy of KAFA to seek the best execution at the best security price available with respect to each transaction, and with respect to brokered transactions in light of the overall quality of brokerage and research services provided to KAFA and its advisees. The best price to us means the best net price without regard to the mix between purchase or sale price and commission, if any. Purchases may be made from underwriters, dealers, and, on occasion, the issuers. Commissions will be paid on our futures and options transactions, if any. The purchase price of portfolio securities purchased from an underwriter or dealer may include underwriting commissions and dealer spreads. We may pay mark-ups on principal transactions. In selecting broker/dealers and in negotiating commissions, KAFA considers, among other things, the firm’s reliability, the quality of its execution services on a continuing basis and its financial condition. The selection of a broker-dealer may take into account the sale of products sponsored or advised by KAFA and/or its affiliates. If approved by the Board, KAFA may select an affiliated broker-dealer to effect transactions in our fund, so long as such transactions are consistent with Rule 17e-1 under the 1940 Act.

KAFA has engaged Jones Trading Institutional Services, LLC (“JonesTrading”) to assume trade execution responsibilities for equities and certain derivative securities. KAFA’s operations and compliance departments provide oversight of JonesTrading activities performed on behalf of KAFA. All trades executed by JonesTrading originate within KAFA’s order management system to ensure pre- and post-trade compliance checks are run on each order. Additionally, JonesTrading will perform a secondary check of all trades before being routed to the JonesTrading Execution Management system Fidessa, where additional risk controls are in place. All trades executed by JonesTrading are analyzed on trade date by KAFA personnel and on a quarterly basis by KAFA’s third-party transaction cost analysis provider. On a quarterly basis, KAFA’s trading committee reviews the trading results for all counterparties (including JonesTrading) in their capacity as trading partners.

Section 28(e) of the Securities Exchange Act of 1934, as amended (“Section 28(e)”), permits an investment adviser, under certain circumstances, to cause an account to pay a broker or dealer who supplies brokerage and research services a commission for effecting a transaction in excess of the amount of commission another broker or dealer would have charged for effecting the transaction. Brokerage and research services include (a) furnishing advice as to the value of securities, the advisability of investing, purchasing or selling securities, and the availability of securities or purchasers or sellers of securities; (b) furnishing analyses and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy, and the performance of accounts; and (c) effecting securities transactions and performing functions incidental thereto (such as clearance, settlement, and custody). In light of the above, in selecting brokers, KAFA may consider investment and market information and other research, such as economic, securities and performance measurement research, provided by such brokers, and the quality and reliability of brokerage services, including execution capability, performance, and financial responsibility. Accordingly, the commissions charged by any such broker may be greater than the amount another firm might charge if KAFA determines in good faith that the amount of such commissions is reasonable in relation to the value of the research information and brokerage services provided by such broker to KAFA or to us. KAFA believes that the research information received in this manner provides us with benefits by supplementing the research otherwise available to us. The investment advisory fees paid by us to KAFA under the Investment Management Agreement are not reduced as a result of receipt by KAFA of research services.

KAFA may place portfolio transactions for other advisory accounts that it advises, and research services furnished by firms through which we effect our securities transactions may be used by KAFA in servicing some or all of its accounts; not all of such services may be used by KAFA in connection with us. Because the volume and nature of the trading activities of the accounts are not uniform, the amount of commissions in excess of those charged by another broker paid by each account for brokerage and research services will vary. However, KAFA believes such costs to us will not be disproportionate to the benefits received by us on a continuing basis. KAFA seeks to allocate portfolio transactions equitably whenever concurrent decisions are made to purchase or sell securities by us and another advisory account. In some cases, this procedure could have an adverse effect on the price or the amount of securities available to us. In making such allocations between the us and other advisory accounts, the main factors considered by KAFA are the investment objective, the relative size of portfolio holding of the same or comparable securities, the availability of cash for investment and the size of investment commitments generally held, and the opinions of the persons responsible for recommending investments to us and such other accounts and funds.

For the fiscal years ended November 30, 2020, 2021 and 2022, KYN paid aggregate brokerage commissions of $1,431,950, $752,769 and $528,298, respectively.

SAI-30

TAX MATTERS

The following discussion of federal income tax matters is based on the advice of Paul Hastings LLP, our counsel.

Matters Addressed

This section and the discussion in the joint proxy statement/prospectus (see “Material U.S. Federal Income Tax Consequences of the Merger”) provide a general summary of certain U.S. federal income tax consequences to the persons who purchase, own and dispose of our securities. It does not address all U.S. federal income tax consequences that may apply to an investment in our securities or to particular categories of investors, some of which may be subject to special rules. Unless otherwise indicated, this discussion is limited to taxpayers who are U.S. persons, as defined herein. The discussion that follows is based on the provisions of the Code and Treasury regulations promulgated thereunder as in effect on the date hereof and on existing judicial and administrative interpretations thereof. These authorities are subject to change and to differing interpretations, which could apply retroactively. Potential investors should consult their own tax advisors in determining the U.S. federal, state, local, foreign and any other tax consequences to them of the purchase, ownership and disposition of our securities. This discussion does not address all tax consequences that may be applicable to a U.S. person that is a beneficial owner of our securities, nor does it address, unless specifically indicated, the tax consequences to, among others, (i) persons that may be subject to special treatment under U.S. federal income tax law, including, but not limited to, banks, insurance companies, thrift institutions, regulated investment companies, real estate investment trusts, tax-exempt organizations and dealers in securities or currencies, (ii) persons that will hold our securities as part of a position in a “straddle” or as part of a “hedging,” “conversion” or other integrated investment transaction for U.S. federal income tax purposes, (iii) persons whose functional currency is not the United States dollar or (iv) persons that do not hold our securities as capital assets within the meaning of Section 1221 of the Code.

For purposes of this discussion, a “U.S. person” is (i) an individual citizen or resident of the United States, (ii) a corporation (or other entity that is treated as a corporation for U.S. federal tax purposes) organized in or under the laws of the United States or any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more U.S. persons have the authority to control all the substantial decisions of such trust.

Tax Characterization for U.S. Federal Income Tax Purposes

We are treated as a corporation for U.S. federal income tax purposes. Thus, we are obligated to pay U.S. federal income tax on our net taxable income. We are also obligated to pay state income tax on our net taxable income, either because the states follow the federal treatment or because the states separately impose a tax on us. We invest our assets principally in MLPs, which generally are treated as partnerships for U.S. federal income tax purposes. As a partner in the MLPs, we report our allocable share of the MLP’s taxable income, loss, deduction, and credits in computing our taxable income. Based upon our review of the historic results of the type of MLPs in which we invest, we expect that the cash flow received by us with respect to our MLP investments generally will exceed the taxable income allocated to us. There is no assurance that our expectation regarding the tax character of MLP distributions will be realized. If this expectation is not realized, there will be greater tax expense borne by us and less cash available to distribute to stockholders. In addition, we will take into account in our taxable income amounts of gain or loss recognized on the sale of MLP units. Currently, the maximum regular U.S. federal income tax rate for a corporation is 21%.

On August 16, 2022, the Inflation Reduction Act (the “IRA”) was signed into law. The IRA imposes a corporate alternative minimum tax equal to the excess of 15% of a corporation’s adjusted financial statement income over its corporate alternative minimum foreign tax credit. However, the IRA only imposes this corporate alternative minimum tax on corporations subject to the rules and regulations of subchapter C of the Code (“C-Corporation) and such C-Corporations that, for three taxable years, have an average adjusted financial statement income greater than $1 billion. Although we are treated as a C-Corporation for U.S. federal income tax purposes and the calculation of adjusted financial statement income is complex, we do not currently expect to be subject to this newly imposed corporate alternative minimum tax.

The MLPs in which we invest are generally treated as partnerships for U.S. federal income tax purposes. As a partner in such MLPs, we will be required to report our allocable share of partnership income, gain, loss, deduction and expense, whether or not any cash is distributed from the MLPs.

SAI-31

The MLPs in which we invest are in the energy sector, primarily operating midstream energy assets; therefore, we anticipate that the majority of our items of income, gain, loss, deductions and expenses are related to energy ventures. However, some items are likely to relate to the temporary investment of our capital, which may be unrelated to energy ventures.

In general, energy ventures have historically generated taxable income less than the amount of cash distributions that they produced, at least for periods of the investment’s life cycle. We anticipate that we will not incur U.S. federal income tax on a significant portion of our cash flow received, particularly after taking into account our current operating expenses. However, our particular investments may not perform consistently with historical patterns in the industry, and as a result, tax may be incurred by us with respect to certain investments.

Although we hold our interests in MLPs for investment purposes, we are likely to sell interests in particular MLPs from time to time. On any such sale, we will recognize gain or loss based upon the difference between the consideration received for tax purposes on the sale and our adjusted tax basis in the interest sold. The consideration received is generally the amount paid by the purchaser plus any debt of the MLP allocated to us that will shift to the purchaser on the sale. Our initial tax basis in an MLP is generally the amount paid for the interest, but is decreased for any distributions of cash received by us in excess of our allocable share of taxable income and decreased by our allocable share of net losses. Thus, although cash in excess of taxable income and net tax losses may create a temporary economic benefit to us, they will increase the amount of gain (or decrease the amount of loss) on the sale of an interest in an MLP. As a corporation, we are not eligible for the favorable U.S. federal income tax rates applicable to long-term capital gains for individuals. Thus, we are subject to U.S. federal income tax on our long-term capital gains at ordinary corporate income tax rates of up to 21%.

We have not elected, and we do not expect to elect, to be treated as a regulated investment company for U.S. federal income tax purposes. In order to qualify as a regulated investment company, the income, assets and distributions of the company must meet certain minimum threshold tests. Due to the extent of our investments in MLPs, we would not be able to meet such tests. In contrast to the tax rules that will apply to us, a regulated investment company generally does not pay corporate income tax, taking into consideration a deduction for dividends paid to its stockholders. At the present time, the regulated investment company taxation rules have no application to us, including the current limitation on investment in MLPs by regulated investment companies.

Tax Consequences to Investors

The U.S. federal income tax consequences to the owners of our securities will be determined by their income, gain or loss on their investment in our securities rather than in the underlying MLPs. Gain or loss on an investment in our securities generally will be determined based on the difference between the proceeds received by the stockholder on a taxable disposition of our securities compared to such stockholder’s adjusted tax basis in our securities. The initial tax basis in our securities will be the amount paid for such securities plus certain transaction costs. Distributions that we pay on our securities will constitute taxable income to a stockholder to the extent of our current and accumulated earnings and profits. We will inform securities holders of the taxable amount of our distributions and the amount constituting qualified dividend income eligible for U.S. federal taxation at long-term capital gain rates. Distributions paid with respect to our securities that exceed our current and accumulated earnings and profits will be treated by holders as a return of capital to the extent of the holder’s adjusted tax basis and, thereafter, as capital gain. The owners of our common stock will receive a Form 1099 from us based upon the distributions made (or deemed to have been made) rather than based upon the income, gain, loss or deductions of the MLPs.

The Foreign Account Tax Compliance Act (“FATCA”)

A 30% withholding tax on our payments of interest, distributions with respect to our stock, and on gross proceeds from the sale or other disposition of our shares generally applies if paid to a foreign entity unless: (i) if the foreign entity is a “foreign financial institution,” it undertakes certain due diligence, reporting, withholding and certification obligations, (ii) if the foreign entity is not a “foreign financial institution,” it identifies certain of its U.S. investors or (iii) the foreign entity is otherwise excepted under FATCA.

Under proposed Treasury regulations, which may be relied upon by taxpayers until final Treasury regulations are published, there is not FATCA withholding on capital gains distributions and gross proceeds from a sale or disposition of our stock. If withholding is required under FATCA on a payment related to your shares, investors that otherwise would not be subject to withholding (or that otherwise would be entitled to a reduced rate of withholding) on such payment generally will be required to seek a refund or credit from the IRS to obtain the benefits of such exemption or reduction. Application of this withholding tax does not depend on whether a payment would otherwise be exempt from U.S. federal withholding tax under other exemptions described with respect to Non-U.S. Holders. We will not pay any additional amounts in respect to amounts withheld under FATCA. You should consult your tax advisor regarding the effect of FATCA based on your individual circumstances.

SAI-32

PROXY VOTING POLICIES

SEC-registered advisers that have the authority to vote (client) proxies (which authority may be implied from a general grant of investment discretion) are required to adopt policies and procedures reasonably designed to ensure that the adviser votes proxies in the best interests of its clients. Registered advisers also must maintain certain records on proxy voting. In many cases, we will invest in securities that do not generally entitle us to voting rights in our portfolio companies. When we do have voting rights, we will delegate the exercise of such rights to KAFA, to whom our Board has delegated the authority to develop policies and procedures relating to proxy voting. KAFA’s proxy voting policies and procedures are summarized below.

In determining how to vote, officers of KAFA will consult with each other and our other investment professionals, taking into account the interests of our investors as well as any potential conflicts of interest. When KAFA’s investment professionals identify a potential conflict of interest regarding a vote, the vote and the potential conflict will be presented to KAFA’s Proxy Voting Committee for a final decision. If KAFA determines that such conflict prevents KAFA from determining how to vote on the proxy proposal in the best interest of the Company, KAFA shall either (1) vote in accordance with a predetermined specific policy to the extent that KAFA’s policies and procedures include a pre-determined voting policy for such proposal or (2) disclose the conflict to our Board and obtain the Board’s consent prior to voting on such proposal.

An officer of KAFA will keep a written record of how all such proxies are voted. KAFA will retain records of (1) its proxy voting policies and procedures, (2) all proxy statements received regarding investor’s securities (or it may rely on proxy statements filed on the SEC’s EDGAR system in lieu thereof), (3) all votes cast on behalf of investors, (4) investor written requests for information regarding how KAFA voted proxies of that investor and any written response to any (written or oral) investor requests for such information, and (5) any documents prepared by KAFA that are material to making a decision on a proxy vote or that memorialized such decision. The aforementioned proxy voting records will be maintained, preserved and easily accessible for a period of not less than five years. KAFA may rely on one or more third parties to make and retain the records of proxy statements and votes cast.

Information regarding how proxies relating to our portfolio securities are voted during the 12-month period ended June 30th of any year will be made available on or around August 30th of that year, (i) without charge, upon request, by calling (877) 657-3863 (toll-free/collect); and (ii) on the SEC’s website at www.sec.gov.

KAFA has adopted proxy voting guidelines that provide general direction regarding how it will vote on a number of significant and recurring ballot proposals. These guidelines are not mandatory voting policies, but rather are an indication of general voting preferences. We take great care to evaluate proxy voting matters on a case-by-case basis. There may be instances where we deviate from the guidelines in order to protect the long-term interests of our investors. The following are a few examples of these guidelines:

Boards and Directors

Board Independence

KAFA generally votes for proposals for a majority independent board for public companies, and votes for proposals for key committees (including audit, compensation and nominating/governance committees) to be comprised of exclusively independent directors.

Independent Chair

KAFA generally votes for proposals for an independent chairman. In the event of a combined Chairman/CEO role, we expect widely held companies to have a lead independent director. Lead independent directors should be empowered to work with the Chairman to set board agendas and convene meetings of the independent directors.

SAI-33

Shareholder Rights

Right to Call a Special Meeting

KAFA generally supports proposals that permit shareholders the right to call a special meeting, with reasonable thresholds established regarding the percentage of outstanding stock that shareholders must hold in order to convene a special meeting.

Proxy Access

KAFA generally supports proposals that permit shareholders who hold no less than three percent of a company’s voting shares for a minimum of two years to advance non-management board candidates that comprise no more than 20% of the total board.

Compensation

Executive Compensation Principles

KAFA generally votes for proposals regarding compensation plans that align the economic interests of management with those of shareholders, that are reasonable and that are tied to long-term financial performance that includes both financial and operational outcomes.

Say on Pay

KAFA generally votes for proposals that provide shareholders with the opportunity to provide feedback on compensation through “say on pay” votes.

Environmental and Social Issues

Sustainability Reporting

KAFA generally supports shareholder proposals that request boards and management to improve their disclose of material environmental, social and governance risks. Such proposals should not be overly costly or burdensome.

Political Contributions

KAFA generally supports proposals that request boards and management to disclose political contributions, as we believe shareholders have the right to know if corporate funds are being utilized for lobbying activities to influence public policy.

SAI-34

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The 2022 Audited Financial Statements incorporated by reference into this Statement of Additional Information, have been audited by PricewaterhouseCoopers LLP, independent registered public accounting firm, and are included in reliance upon their report given upon the authority of such firm as experts in accounting and auditing. PricewaterhouseCoopers LLP provides auditing services to us. The principal business address of PricewaterhouseCoopers LLP is 601 South Figueroa, Los Angeles, California 90017.

PERFORMANCE RELATED AND COMPARATIVE INFORMATION

We may quote certain performance-related information and may compare certain aspects of our portfolio and structure to other substantially similar closed-end funds. In reports or other communications to our stockholders or in advertising materials, we may compare our performance with that of (i) other investment companies listed in the rankings prepared by Lipper, Inc. (“Lipper”), Morningstar Inc. or other independent services; publications such as Barron’s, Business Week, Forbes, Fortune, Institutional Investor, Kiplinger’s Personal Finance, Money, Morningstar Mutual Fund Values, The New York Times, The Wall Street Journal and USA Today; or other industry or financial publications, (ii) the Standard and Poor’s Index of 500 Stocks, the Alerian Midstream Energy Index, the Alerian MLP Index, the NASDAQ Composite Index and other relevant indices and industry publications or (iii) composite returns based on assumed weightings of various energy infrastructure indices and exchange traded funds that track such indices. Comparison of ourselves to an alternative investment should be made with consideration of differences in features and expected performance. We may obtain data from sources or reporting services, such as Bloomberg Financial and Lipper, that we believe to be generally accurate.

Our performance will vary depending upon market conditions, the composition of our portfolio and our operating expenses. Consequently, any given performance quotation should not be considered representative of our performance in the future. In addition, because performance will fluctuate, it may not provide a basis for comparing an investment in our portfolio with certain bank deposits or other investments that pay a fixed yield for a stated period of time. Investors comparing our performance with that of other investment companies should give consideration to the quality and type of the respective investment companies’ portfolio securities.

Past performance is not indicative of future results. At the time owners of our securities sell our securities, they may be worth more or less than the original investment.

ADDITIONAL INFORMATION

A Registration Statement on Form N-14, including amendments thereto, relating to the common stock and preferred stock offered hereby, has been filed by us with the SEC. The joint proxy statement/prospectus and this Statement of Additional Information do not contain all of the information set forth in the Registration Statement, including any exhibits and schedules thereto. Please refer to the Registration Statement for further information with respect to us and the offering of our securities. Statements contained in the joint proxy statement/prospectus and this Statement of Additional Information as to the contents of any contract or other document referred to are not necessarily complete and in each instance reference is made to the copy of such contract or other document filed as an exhibit to a Registration Statement, each such statement being qualified in all respects by such reference. Copies of the Registration Statement may be inspected without charge at the SEC’s principal office in Washington, D.C., and copies of all or any part thereof may be obtained from the SEC upon the payment of certain fees prescribed by the SEC.

FINANCIAL STATEMENTS

Each of KYN’s and KMF’s financial statements and financial highlights, the accompanying notes thereto, and the report of PricewaterhouseCoopers LLP thereon for the fiscal year ended November 30, 2022 (the “2022 Audited Financial Statements”), contained in its Annual Report to Stockholders on Form N-CSR for the fiscal year ended November 30, 2022, were filed by it with the SEC on January 26, 2023 (the “2022 Annual Reports”).

SAI-35

The 2022 Audited Financial Statements and the 2022 Annual Reports are hereby incorporated by reference into, and are made part of, this Statement of Additional Information.

You can obtain, without charge, copies of the 2022 Audited Financial Statements, the 2022 Annual Reports and this Statement of Additional Information. Copies of this Statement of Additional Information and annual reports, including the 2022 Annual Reports, semi-annual and quarterly reports to stockholders (when available), and additional information about KYN and KMF may be obtained by calling toll-free at (877) 657-3863, or by writing to us at 811 Main Street, 14th Floor, Houston, Texas 77002, Attention: Investor Relations Department or by visiting our website at www.kaynefunds.com. The information contained in or accessed through, KYN’s of KMF’s website is not a part of this joint proxy statement/prospectus or Statement of Additional Information.

You may also obtain a copy of such reports, proxy statements, the joint proxy statement/prospectus and this Statement of Additional Information (and other information regarding the Companies) from the SEC’s Public Reference Room in Washington, D.C. Information relating to the Public Reference Room may be obtained by calling the SEC at (202) 551-8090. Such materials, as well as the Companies’ annual and semi-annual reports (when available) and other information regarding the Companies, are also available on the SEC’s website (www.sec.gov). You may also e-mail requests for these documents to publicinfo@sec.gov or make a request in writing to the SEC’s Public Reference Room, 100 F Street, N.E., Washington, D.C.

Supplemental Financial Information

For more information regarding the change in operating expenses expected as a result of the Merger, please see “Summary—Proposal One: Merger—Fees and Expenses for Common Stockholders of the Companies as of November 30, 2022” in the joint proxy statement/prospectus.

There is not expected to be any material change in the investment portfolio for the combined Company following the Merger. In addition, there are no material differences in accounting policies between the Companies.

SAI-36

Kayne Anderson Energy Infrastructure Fund, Inc.

STATEMENT OF ADDITIONAL INFORMATION

, 2023

PART C — OTHER INFORMATION

Item 15.

Indemnification

Maryland law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment as being material to the cause of action. The Registrant’s charter contains such a provision which eliminates our directors’ and officers’ liability to the maximum extent permitted by Maryland law, subject to the requirements of the 1940 Act.

The Registrant’s charter authorizes the Registrant, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to obligate itself to indemnify any present or former director or officer or any individual who, while a director or officer of the Registrant and at the request of the Registrant, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee, from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any such capacity and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding. The Registrant’s bylaws obligate the Registrant, to the maximum extent permitted by Maryland law and subject to the requirements of the 1940 Act, to indemnify any present or former director or officer or any individual who, while a director or officer of the Registrant and at the request of the Registrant, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee and who is made, or threatened to be made, a party to the proceeding by reason of his or her service in that capacity from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any of the foregoing capacities and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding. The charter and bylaws also permit the Registrant to indemnify and advance expenses to any individual who served a predecessor of the Registrant in any of the capacities described above and any employee or agent of the Registrant or a predecessor of the Registrant.

Maryland law requires a corporation (unless its charter provides otherwise, which the Registrant’s charter does not) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service in that capacity. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made, or threatened to be made, a party by reason of their service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (1) was committed in bad faith or (2) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment of liability on the basis that personal benefit was improperly received, unless in either case a court orders indemnification and then only for expenses. In addition, Maryland law permits a corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.

In accordance with the 1940 Act, the Registrant will not indemnify any person for any liability to which such person would be subject by reason of such person’s willful malfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office.

Insofar as indemnification for liability arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

C-1

Item 16:

Exhibits

1.1		Registrant’s Articles of Amendment and Restatement is incorporated herein by reference to Exhibit 99.1 of Pre-Effective Amendment No. 3 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-116479 and 811-21593) as filed with the Securities and Exchange Commission on September 1, 2004.
1.2		Registrant’s Articles Supplementary for Series R Mandatory Redeemable Preferred Shares is incorporated herein by reference to 1.2 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
1.3		Registrant’s Articles Supplementary for Series S Mandatory Redeemable Preferred Shares is incorporated herein by reference to 1.2 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
1.4		Registrant’s Articles Supplementary for Series T Mandatory Redeemable Preferred Shares — filed herewith.
2		Registrant’s Amended and Restated Bylaws of Registrant is incorporated herein by reference to Exhibit 99.1 of Pre-Effective Amendment No. 4 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-116479 and 811-21593) as filed with the Securities and Exchange Commission on September 16, 2004.
3		None.
4		Agreement and Plan of Merger — filed herewith as Appendix A to Part A of this Registration Statement.
5.1		Form of Common Share Certificate is incorporated herein by reference to Exhibit (d)(1) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-140488 and 811-21593) as filed with the Securities and Exchange Commission on February 7, 2007.
5.3		Form of Stock Certificate for the Registrant’s Series R Mandatory Redeemable Preferred Shares is incorporated herein by reference to 5.3 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
5.4		Form of Stock Certificate for the Registrant’s Series S Mandatory Redeemable Preferred Shares is incorporated herein by reference to 5.3 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
5.5		Form of Stock Certificate for the Registrant’s Series T Mandatory Redeemable Preferred Shares — filed herewith.
6.1		Amended and Restated Investment Management Agreement between Registrant and Kayne Anderson Capital Advisors, L.P. is incorporated herein by reference to Exhibit (g)(1) of Pre-Effective Amendment No. 1 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-140488 and 811-21593) as filed with the Securities and Exchange Commission on March 23, 2007.
6.2		Assignment of Investment Management Agreement from Kayne Anderson Capital Advisors, L.P. to KA Fund Advisors, LLC is incorporated herein by reference to Exhibit (g)(2) of Pre-Effective Amendment No. 1 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-140488 and 811-21593) as filed with the Securities and Exchange Commission on March 23, 2007.
6.3		Amendment dated June 13, 2012 to Amended and Restated Investment Management Agreement between Registrant and KA Fund Advisors, LLC is incorporated herein by reference to Exhibit (g)(3) of the Registrant’s Registration Statement on Form N-2 (File Nos. 333-183599 and 811-21593) as filed with the Securities and Exchange Commission on August 28, 2012.

C-2

6.4		Letter Agreement between Registrant and KA Fund Advisors, LLC dated December 11, 2014 relating to Waiver of Certain Fees under Amended and Restated Investment Management Agreement dated as of December 12, 2006 is incorporated herein by reference to Exhibit (g)(4) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-201950 and 811-21593) as filed with the Securities and Exchange Commission on February 6, 2015.
6.5		Second Amended and Restated Letter Agreement between Registrant and KA Fund Advisors, LLC relating to Waiver of Certain Fees under Amended and Restated Investment Management Agreement dated as of December 12, 2006 is incorporated by reference to Exhibit 6.6 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
6.6		Form of Third Amended and Restated Letter Agreement between Registrant and KA Fund Advisors, LLC relating to Waiver of Certain Fees under Amended and Restated Investment Management Agreement dated as of December 12, 2006 — filed herewith.
7.1		Form of Underwriting Agreement for Newly-Issued Common Stock is incorporated herein by reference to Exhibit (h)(1) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-217551 and 811-21593) as filed with the Securities and Exchange Commission on April 28, 2017.
7.2		Form of Underwriting Agreement for Newly-Issued Preferred Stock is incorporated herein by reference to Exhibit (h)(2) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-217551 and 811-21593) as filed with the Securities and Exchange Commission on April 28, 2017.
7.3		Form of Controlled Equity Offering^SM Sales Agreement for Newly-Issued Common Stock is incorporated herein by reference to Exhibit (h)(3) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-217551 and 811-21593) as filed with the Securities and Exchange Commission on April 28, 2017.
7.4		Form of Underwriting Agreement for Newly-Issued Debt Securities is incorporated herein by reference to Exhibit (h)(4) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-217551 and 811-21593) as filed with the Securities and Exchange Commission on April 28, 2017.
8		None
9.1		Form of Custody Agreement is incorporated herein by reference to Exhibit 99.6 of Pre-Effective Amendment No. 4 to the Registrant’s Registration on Form N-2 (File Nos. 333-116479 and 811-21593) as filed with the Securities and Exchange Commission on September 16, 2004.
9.2		Assignment of Custody Agreement from Custodial Trust Company to JPMorgan Chase Bank, N.A is incorporated herein by reference to Exhibit (j)(2) of Pre-Effective Amendment No. 1 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-165775 and 811-21593) as filed with the Securities and Exchange Commission on May 24, 2010.
10		None
11		Opinion of Venable LLP—to be filed by amendment.
12		Tax Opinions of Paul Hastings LLP—to be filed by amendment.
13.1		Form of Transfer Agency Agreement is incorporated herein by reference to Exhibit 99.3 of Pre-Effective Amendment No. 5 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-116479 and 811-21593) as filed with the Securities and Exchange Commission on September 27, 2004.
13.2		Note Purchase Agreement for Series DD Notes, Series EE Notes, Series FF Notes and Series GG Notes dated April 16, 2013 is incorporated herein by reference to Exhibit (k)(18) of Post-Effective Amendment No. 7 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-183599 and 811-21593) as filed with the Securities and Exchange Commission on August 30, 2013.
13.3		Amendment to Note Purchase Agreement for Series DD Notes to Series GG Notes dated November 5, 2020 is incorporated herein by reference to Exhibit 13.6 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.

C-3

13.4		Note Purchase Agreement for Series II Notes, Series JJ Notes and Series KK Notes, dated as of April 30, 2014 is incorporated herein by reference to Exhibit (k)(26) of Post-Effective Amendment No. 4 to the Registrant’s Registration Statement on Form N-2 (File Nos. 333-193497 and 811-21593) as filed with the Securities and Exchange Commission on July 23, 2014.
13.5		Amendment to Note Purchase Agreement for Series JJ Notes to Series KK Notes dated November 5, 2020 is incorporated herein by reference to Exhibit 13.8 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
13.6		Note Purchase Agreement for Series LL, Series MM, Series NN and Series OO, dated as of October 29, 2014, is incorporated herein by reference to Exhibit (k)(26) of Registrant’s Registration Statement on Form N-2 (File Nos. 333-201950 and 811-21593) as filed with the Securities and Exchange Commission on February 6, 2015.
13.7		Amendment to Note Purchase Agreement for Series MM Notes to Series OO Notes dated November 5, 2020 is incorporated herein by reference to Exhibit 13.10 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
13.8		Note Purchase Agreement for Series PP Notes to Series QQ Notes dated May 11, 2021 is incorporated herein by reference to Exhibit 13.11 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
13.9		Notes Purchase Agreement for Series RR Notes and Series SS Notes dated May 18, 2022 — filed herewith.
13.10		Securities Exchange Agreement for Series O to Series S Mandatory Redeemable Preferred Shares dated November 5, 2020 is incorporated herein by reference to Exhibit 13.14 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
13.11		Securities Purchase Agreement for Series T Mandatory Redeemable Preferred Shares dated May 18, 2022 — filed herewith.
13.12		Sixth Amended and Restated Credited Agreement dated as of February 24, 2023 between the Registrant and JPMorgan Chase Bank, N.A. — filed herewith.
13.13		Term Loan Credit Agreement dated as of August 6, 2021 between the Registrant and Sumitomo Mitsui Banking Corporation is incorporated herein by reference to Exhibit 13.13 of the Registrant’s Registration Statement on Form N-14 (File Nos. 333-260457 and 811-21593) as filed with the Securities and Exchange Commission on October 25, 2021.
13.14		Closed-End Fund Services Agreement among the Registrant, Ultimus Fund Solutions, LLC and the other parties thereto dated February 1, 2022 — filed herewith.
14.1		Consent of PricewaterhouseCoopers LLP, the Registrant’s Independent Auditors and Kayne Anderson NextGen Energy & Infrastructure, Inc.'s Independent Auditors — filed herewith.
15		Not applicable.
16		Powers of Attorney—filed herewith.
17		Forms of proxy—to be filed by amendment.
18		Calculation of filing fee tables — filed herewith.

Item 17.

Undertakings

(1) The undersigned Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this registration statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the 1933 Act, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.

(2) The undersigned Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the registration statement and will not be used until the amendment is effective, and that, in determining any liability under the 1933 Act, each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them.

C-4

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in this City of Houston and State of Texas, on the 27^th day of March 2023.

	KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

	By:	/s/ James C. Baker Jr.
		James C. Baker Jr.
		Title: Chairman, President and Chief
		Executive Officer

Pursuant to the requirements of the 1933 Act, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:

Signature	Title	Date

/s/ James C. Baker Jr.	Chairman, President and	March 27, 2023
James C. Baker Jr.	Chief Executive Officer (Principal Executive Officer)

/s/ A. Colby Parker	Chief Financial Officer and Treasurer	March 27, 2023
A. Colby Parker	(Principal Financial and Accounting Officer)

*	Director	March 27, 2023
Anne K. Costin

*	Director	March 27, 2023
William R. Cordes

*	Director	March 27, 2023
Barry R. Pearl

*	Director	March 27, 2023
Albert L. Richey

*	Director	March 27, 2023
William H. Shea, Jr.

*	Director	March 27, 2023
Carita S.Walker

*	Director	March 27, 2023
Caroline A. Winn

*By: /s/ R. William Burns
R. William Burns		Attorney-in-Fact (Pursuant to Powers of Attorney filed herewith)		March 27, 2023

C-5

EXHIBIT INDEX

1.4		Registrant’s Articles Supplementary for Series T Mandatory Redeemable Preferred Shares — filed herewith.
4		Agreement and Plan of Merger — filed herewith as Appendix A to Part A of this Registration Statement.
5.5		Form of Stock Certificate for the Registrant’s Series T Mandatory Redeemable Preferred Shares — filed herewith.
6.6		Form of Third Amended and Restated Letter Agreement between Registrant and KA Fund Advisors, LLC relating to Waiver of Certain Fees under Amended and Restated Investment Management Agreement dated as of December 12, 2006 — filed herewith.
13.9		Notes Purchase Agreement for Series RR Notes and Series SS Notes dated May 18, 2022 — filed herewith.
13.11		Securities Purchase Agreement for Series T Mandatory Redeemable Preferred Shares dated May 18, 2022 — filed herewith.
13.12		Sixth Amended and Restated Credited Agreement dated as of February 24, 2023 between the Registrant and JPMorgan Chase Bank, N.A. — filed herewith.
13.14		Closed-End Fund Services Agreement among the Registrant, Ultimus Fund Solutions, LLC and the other parties thereto dated February 1, 2022 — filed herewith.
14.1		Consent of PricewaterhouseCoopers LLP, the Registrant’s Independent Auditors and Kayne Anderson NextGen Energy & Infrastructure, Inc.'s Independent Auditors — filed herewith.
16		Powers of Attorney — filed herewith.
18		Calculation of filing fee tables — filed herewith.

C-6

EX-99.1(4) 2 ea151744_ex1-4.htm EXHIBIT 1.4

Exhibit 1.4

Kayne Anderson Energy Infrastructure Fund, Inc.

Articles Supplementary

Series T Mandatory Redeemable Preferred Shares

Kayne Anderson Energy Infrastructure Fund, Inc. (the “Company”), a Maryland corporation, certifies to the State Department of Assessments and Taxation of Maryland that:

FIRST: Under a power contained in Article V of the charter of the Company (which, as restated, amended or supplemented from time to time, together with these Articles Supplementary, is referred to herein as the “Charter”), the Board of Directors by duly adopted resolutions classified and designated 800,000 shares of authorized but unissued Common Stock (as defined in the Charter) as shares of a new series of Preferred Stock (as defined in the Charter) designated as Series T Mandatory Redeemable Preferred Shares, liquidation preference $25.00 per share, with the following preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption, which, upon any restatement of the Charter, shall become part of Article V of the Charter, with any necessary or appropriate renumbering or relettering of the sections or subsections hereof.

MRP Shares

Designation

Preferred Shares. 800,000 shares of Common Stock are classified and designated as Series T Mandatory Redeemable Preferred Shares, liquidation preference $25.00 per share (the “MRP Shares”).

The initial Dividend Period for the MRP Shares shall be the period from and including the Original Issue Date thereof to and including August 31, 2022. Each MRP Share will have a dividend rate equal to 5.07% per annum and, for the avoidance of doubt, will be subject to adjustment pursuant to Section 2(c) hereof. Each MRP Share shall have such other preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption, in addition to those required by applicable law or set forth in the Charter applicable to shares of Preferred Stock, as are set forth herein. The MRP Shares shall constitute a separate series of Preferred Shares.

Subject to the provisions of Section 3(i) and Section 6 hereof, the Board of Directors of the Company may, in the future, authorize the issuance of additional Preferred Shares with the same preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption and other terms herein described, except that the initial Dividend Period, the Applicable Rate for the initial Dividend Period and the initial Dividend Payment Date shall be as set forth in the Articles Supplementary relating to such additional Preferred Shares.

Exhibit 1-2

As used herein, capitalized terms not otherwise defined herein shall have the meanings provided in Section 12 hereof.

Section 1. Number of Shares; Ranking.

(a) The number of authorized MRP Shares is 800,000 shares. No fractional MRP Shares shall be issued.

(b) Any MRP Shares which at any time have been redeemed or purchased by the Company shall, after redemption or purchase, be returned to the status of authorized but unissued Common Stock of the Company, until reclassified by the Board of Directors.

(c) The MRP Shares shall rank on a parity with shares of any other class or series of Preferred Shares as to the payment of dividends to which the shares are entitled and the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company.

(d) No Holder of MRP Shares shall have, solely by reason of being a Holder, any preemptive right, or, unless otherwise determined by the Board of Directors, other right to acquire, purchase or subscribe for any MRP Shares, Common Shares or other securities of the Company which it may hereafter issue or sell.

(e) No Holder of MRP Shares shall be entitled to exercise the rights of an objecting stockholder under Title 3, Subtitle 2 of the Maryland General Corporation Law (the “MGCL”) or any successor provision, except that each such Holder shall be entitled to exercise such rights if and so long as any of the holders of Common Shares or Preferred Shares is entitled to exercise such rights.

Section 2. Dividends.

(a) The Holders of MRP Shares shall be entitled to receive quarterly cumulative cash dividends, when, as and if authorized by the Board of Directors and declared by the Company, out of funds legally available therefor, at the rate per annum equal to the Applicable Rate (or the Default Rate), and no more, payable on the respective dates determined as set forth in paragraph (b) of this Section 2. Dividends on Outstanding MRP Shares shall accumulate from and including the Original Issue Date.

(b) (i) Dividends shall be payable quarterly when, as and if authorized by the Board of Directors and declared by the Company beginning on the initial Dividend Payment Date, on MRP Shares, and with respect to any Dividend Period thereafter on the first (1st) Business Day following each Quarterly Dividend Date.

(ii) Except as otherwise set forth herein, the Company shall pay an aggregate amount of federal funds or similar same-day funds, equal to the dividends to be paid to all Holders of such shares on each Dividend Payment Date in accordance with Section 14 of the Securities Purchase Agreement. The Company shall not be required to establish any reserves for the payment of dividends.

Exhibit 1-3

(iii) Each dividend on MRP Shares shall be paid on the Dividend Payment Date therefor to the Holders as their names appear on the share ledger or share records of the Company at the close of business on the fifth (5th) day prior to the Quarterly Dividend Date (or if such day is not a Business Day, the next preceding Business Day). Dividends in arrears for any past Dividend Period may be declared and paid at any time, without reference to any regular Dividend Payment Date, to the Holders as their names appear on the share ledger or share records of the Company at the close of business on a date, not exceeding 5 days preceding the payment date thereof, as may be fixed by the Board of Directors. No interest will be payable in respect of any dividend payment or payments which may be in arrears.

(c) (i) So long as the MRP Shares are rated by an NRSRO on any date no less than the equivalent of “A” by Fitch (and no less than an equivalent of such rating by each NRSRO), the dividend rate on such Outstanding MRP Shares (the “Dividend Rate”) shall be the Applicable Rate. If the lowest credit rating assigned on any date to the MRP Shares by any NRSRO is equal to the equivalent of one of the ratings set forth in the table below, the Dividend Rate for the MRP Shares shall be adjusted by adding the respective enhanced dividend amount (which shall not be cumulative) set opposite such equivalent rating to the Applicable Rate.

Fitch Equivalent	Enhanced Dividend Amount

“A-”	0.5%
“BBB+” to “BBB-”	2.0%
“BB+” or below	4.0%

The Company shall, at all times, use its reasonable best efforts to cause at least one NRSRO to maintain a current rating on the MRP Shares. If, notwithstanding the foregoing requirements of this Section 2(c)(i), no NRSRO is rating the Outstanding MRP Shares, the Dividend Rate (so long as no such rating exists) on the Outstanding MRP Shares shall be equal to the Applicable Rate plus 4.0% unless the Dividend Rate is the Default Rate, in which case the Dividend Rate shall remain the Default Rate.

(ii) Subject to the cure provisions below, a “Default Period” will commence on any Dividend Payment Date or any date on which the Company would be required to redeem any MRP Shares regardless of whether any of the conditions of the Special Proviso in Section 3(a)(iv) were applicable, if the Company either fails to pay directly in accordance with Section 14 of the Securities Purchase Agreement or, in the case of clause (B) below, fails to deposit irrevocably in trust in federal funds or similar immediately available funds, with the Paying Agent by 1:00 pm, New York City time, (A) the full amount of any dividend payable on the Dividend Payment Date (a “Dividend Default”) or (B) the full amount of any redemption price payable with respect to any redemption required hereunder regardless of whether any of the conditions of the Special Proviso exists (the “Redemption Date”) (a “Redemption Default,” and together with a Dividend Default, is hereinafter referred to as “Default”). Subject to the cure provisions of Section 2(c)(iii) below, a Default Period with respect to a Dividend Default or a Redemption Default shall end on the Business Day on which, by 12:00 noon, New York City time, all unpaid dividends and any unpaid redemption price shall have been directly paid in accordance with Section 14 of the Securities Purchase Agreement. In the case of a Default, the Dividend Rate for each day during the Default Period will be equal to the Default Rate.

Exhibit 1-4

(iii) No Default Period with respect to a Dividend Default or Redemption Default (if such default is not solely due to the willful failure of the Company) shall be deemed to commence if the amount of any dividend or any redemption price due is paid in accordance with Section 14 of the Securities Purchase Agreement within three Business Days (the “Default Rate Cure Period”) after the applicable Dividend Payment Date or Redemption Date, together with an amount equal to the Default Rate applied to the amount of such non-payment based on the actual number of days within the Default Rate Cure Period divided by 360.

(iv) The amount of dividends per share payable on each Dividend Payment Date of each Dividend Period (including the first Dividend Period) shall be computed by multiplying the Applicable Rate (or the Default Rate) for such Dividend Period by a fraction, the numerator of which shall be 90 and the denominator of which shall be 360, multiplying the amount so obtained by the liquidation preference per MRP Share, and rounding the amount so obtained to the nearest cent. Dividends payable on any MRP Shares for any period of less than a full quarterly Dividend Period, including upon any redemption of such shares on any date other than on a Dividend Payment Date, shall be computed by multiplying the Applicable Rate (or the Default Rate) for such period by a fraction, the numerator of which shall be the actual number of days in such period and the denominator of which shall be 360, multiplying the amount so obtained by the liquidation preference per MRP Share, and rounding the amount so obtained to the nearest cent.

(d) Any dividend payment made on MRP Shares shall first be credited against the earliest accumulated but unpaid dividends due with respect to such MRP Shares.

(e) For so long as the MRP Shares are Outstanding, except as contemplated herein, the Company will not declare, pay or set apart for payment any dividend or other distribution (other than a dividend or distribution paid in shares of, or options, warrants or rights to subscribe for or purchase, Common Shares or other shares of capital stock, if any, ranking junior to the MRP Shares as to dividends or upon liquidation) with respect to Common Shares or any other shares of the Company ranking junior to or on a parity with the MRP Shares as to dividends or upon liquidation, or call for redemption, redeem, purchase or otherwise acquire for consideration any Common Shares or any other such junior shares (except by conversion into or exchange for shares of the Company ranking junior to the MRP Shares as to dividends and upon liquidation) or any such parity shares (except by conversion into or exchange for shares of the Company ranking junior to or on a parity with the MRP Shares as to dividends and upon liquidation), unless (1) immediately after such transaction the MRP Shares Asset Coverage would be achieved and the Company would satisfy the MRP Shares Basic Maintenance Amount, (2) full cumulative dividends on the MRP Shares due on or prior to the date of the transaction have been declared and paid, and (3) the Company has redeemed the full number of MRP Shares required to be redeemed by any provision for mandatory redemption contained in Section 3(a) (without regard to the provisions of the Special Proviso).

Exhibit 1-5

Section 3. Redemption.

(a) (i) The Company may, at its option, redeem in whole or in part out of funds legally available therefor, MRP Shares at any time and from time to time, upon not less than 20 days nor more than 40 days’ notice as provided below, at the sum of (A) the MRP Liquidation Preference Amount (as defined herein) plus accumulated but unpaid dividends and distributions on the MRP Shares (whether or not earned or declared by the Company, but excluding interest thereon), to, but excluding, the date fixed for redemption, plus (B) the Make-Whole Amount (which in no event shall be less than zero), if any; provided, however, the Company may, at its option, redeem the MRP Shares within 180 days prior to Term Redemption Date at the MRP Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by the Company, but excluding interest thereon) to, but excluding the date fixed for redemption. Notwithstanding the foregoing, the Company shall not give a notice of or effect any redemption pursuant to this Section 3(a)(i) unless (in the case of any partial redemption of MRP Shares), on the date on which the Company intends to give such notice and on the date of redemption, the Company would satisfy the MRP Shares Basic Maintenance Amount and the MRP Shares Asset Coverage is greater than or equal to 225% immediately subsequent to such redemption, if such redemption were to occur on such date.

(ii) In addition to subparagraph (a)(i) of this Section, if the MRP Shares Asset Coverage is less than or equal to 235%, for any five Business Days within a ten-Business Day period, determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination within the ten-Business Day period, the Company, upon not less than 12 days nor more than 40 days’ notice as provided below, may redeem the MRP Shares at the MRP Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by the Company, but excluding interest thereon) to, but excluding, the date fixed for redemption, plus a redemption amount equal to 2% of the MRP Liquidation Preference Amount. The amount of MRP Shares that may be redeemed under this provision shall not exceed an amount of MRP Shares which results in a MRP Shares Asset Coverage of more than 250% pro forma for such redemption, determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination.

(iii) If the Company (i) fails to maintain on any Valuation Date, the MRP Shares Asset Coverage or the MRP Shares Basic Maintenance Amount (any such day, an “Asset Coverage Cure Date”) or (ii) is not in compliance with the Level 3 Asset Test on the date of entering into an agreement to make an Investment in any Level 3 Asset immediately after giving effect to such Investment on a pro forma basis (any such day, a “Level 3 Asset Cure Date”), the Company shall, subject to Section 3(a)(iv), redeem the MRP Shares at the MRP Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by the Company, but excluding interest thereon) to, but excluding, the date fixed for redemption, plus a redemption amount equal to 1% of the MRP Liquidation Preference Amount. The number of MRP Shares to be redeemed upon the Company’s failure to maintain the MRP Shares Asset Coverage or the MRP Shares Basic Maintenance Amount on any Valuation Date will be equal to the product of (A) the quotient of the number of Outstanding MRP Shares divided by the aggregate number of outstanding Preferred Shares of the Company (including the MRP Shares) which have an asset coverage test greater than or equal to 225% times (B) the minimum number of outstanding Preferred Shares of the Company (including the MRP Shares) the redemption of which would result in the Company satisfying the MRP Shares Asset Coverage and MRP Shares Basic Maintenance Amount as of a date that is no more than 30 days after an Asset Coverage Cure Date (provided that, if there is no such number of MRP Shares the redemption of which would have such result, the Company shall, subject to Section 3(a)(iv), redeem all MRP Shares then Outstanding). For the purpose of measuring compliance with the Level 3 Asset Test, the value of the proposed Investment shall be the value of such Investment calculated as of the date of the agreement to make such Investment, and the value of all other assets on any date of determination shall be the value thereof calculated as of the Business Day immediately prior to the date of the agreement to make such proposed Investment. In the event that the Company is not in compliance with the Level 3 Asset Test on the date of making an Investment in any Level 3 Asset, the Company shall redeem all MRP Shares then outstanding. Notwithstanding the foregoing, if the Company (i) satisfies the MRP Shares Asset Coverage and MRP Shares Basic Maintenance Amount as of a date that is no more than 30 days after an Asset Coverage Cure Date before taking into account any redemptions of Preferred Shares or (ii) regains compliance with the Level 3 Asset Test as of a date that is no more than 30 days after a Level 3 Asset Cure Date, the Company shall not be obligated to redeem any Preferred Shares under this Section 3(a)(iii). The asset coverage in respect of the MRP Shares provided for in this Section 3(a)(iii) shall be determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination.

(iv) In determining the MRP Shares to be redeemed in accordance with the foregoing Section 3(a) in the case of a partial redemption, the Company shall allocate the number of shares to be redeemed pursuant to this Section 3 pro rata among the Holders of MRP Shares in proportion to the number of shares they hold. The Company shall effect any redemption pursuant to subparagraph (a)(iii) of this Section 3 no later than 40 calendar days after the Asset Coverage Cure Date or the Level 3 Asset Cure Date, as the case may be (a “Mandatory Redemption Date”), provided, that if (1) the Company does not have funds legally available for the redemption of, or (2) is not permitted under the JPMorgan Credit Agreement, any agreement or instrument consented to by the holders of a 1940 Act Majority of the Outstanding Preferred Shares pursuant to Section 4(f)(iii) or the note purchase agreements relating to the Kayne Notes to redeem or (3) is not otherwise legally permitted to redeem, the number of MRP Shares which would be required to be redeemed by the Company under subparagraph (a)(iii) of this Section 3 if sufficient funds were available, together with shares of other Preferred Shares which are subject to mandatory redemption under provisions similar to those contained in this Section 3 (the foregoing provisions of clauses (1), (2) and (3) of this proviso being referred to as the “Special Proviso”), the Company shall redeem those MRP Shares, and other Preferred Shares which it was unable to redeem, on the earliest practicable date on which the Company will have such funds available and is otherwise not prohibited from redeeming pursuant to any of the JPMorgan Credit Agreement, or the note purchase agreements relating to the Kayne Notes or other applicable laws, upon notice pursuant to Section 3(b) to record owners of the MRP Shares to be redeemed and the Paying Agent. At the Company’s election, the Company either will make a direct payment to the Holders of the MRP Shares or deposit with the Paying Agent funds sufficient to redeem the specified number of MRP Shares with respect to a redemption required under subparagraph (a)(iii) of this Section 3, by 1:00 p.m., New York City time, on or prior to the Mandatory Redemption Date.

Exhibit 1-6

(v) The Company shall redeem all Outstanding MRP Shares on the Term Redemption Date at the MRP Liquidation Preference Amount plus accumulated but unpaid dividends and distributions thereon (whether or not earned or declared by the Company, but excluding interest thereon), to, but excluding, the Term Redemption Date.

(b) In the event of a redemption pursuant to Section 3(a), the Company will, if required by law or regulation, file a notice of its intention to redeem with the Commission under Rule 23c-2 under the 1940 Act or any successor provision to the extent applicable. In addition, the Company shall deliver a notice of redemption (the “Notice of Redemption”) containing the information set forth below to the Paying Agent and the Holders of MRP Shares to be redeemed not less than 20 days (in the case of Section 3 (a)(i)), 12 days (in the case of Section 3(a)(ii)), or 3 Business Days (in the case of Section 3(a)(iii)) and not more than 40 days prior to the applicable redemption date. Subject to the provisions of the Securities Purchase Agreement regarding notices to the Holders, the Notice of Redemption will be addressed to the Holders of MRP Shares at their addresses appearing on the share records of the Company. Such Notice of Redemption will set forth (1) the date fixed for redemption, (2) the number and identity of MRP Shares to be redeemed, (3) the redemption price (specifying the amount of accumulated dividends to be included therein and the amount of the Make-Whole Amount, if any, or the redemption premium, if any), (4) that dividends on the shares to be redeemed will cease to accumulate on such date fixed for redemption (so long as redeemed), and (5) the provision of these terms of the MRP Shares under which redemption shall be made. No defect in the Notice of Redemption or in the transmittal or mailing thereof will affect the validity of the redemption proceedings, except as required by applicable law.

(c) Notwithstanding the provisions of paragraph (a) of this Section 3, but subject to Section 5(b), no MRP Shares may be redeemed unless all dividends in arrears on the Outstanding MRP Shares and all shares of capital stock of the Company ranking on a parity with the MRP Shares with respect to payment of dividends or upon liquidation have been or are being contemporaneously paid or set aside for payment; provided, however, that the foregoing shall not prevent the purchase or acquisition by the Company of all Outstanding MRP Shares pursuant to the successful completion of an otherwise lawful purchase or exchange offer made on the same terms to, and accepted by, Holders of all Outstanding MRP Shares.

(d) Upon payment in accordance with Section 14 of the Securities Purchase Agreement on or prior to the date fixed for redemption and the giving of the Notice of Redemption to the Paying Agent and the Holders of the MRP Shares under paragraph (b) of this Section 3, dividends on such shares shall cease to accumulate and such shares shall no longer be deemed to be Outstanding for any purpose (including, without limitation, for purposes of calculating whether the Company has maintained the MRP Shares Asset Coverage or met the MRP Shares Basic Maintenance Amount), and all rights of the Holder of the shares so called for redemption shall cease and terminate, except the right of such Holder to receive the redemption price specified herein, but without any interest or other additional amount. To the extent that the purchase price required to effect such redemption is paid pursuant to Section 14.3 of the Securities Purchase Agreement, such redemption price shall be paid by the Paying Agent to the Holders and, upon written request, the Company shall be entitled to receive from the Paying Agent, promptly after the date fixed for redemption, any cash deposited with the Paying Agent in excess of (1) the aggregate redemption price of the MRP Shares called for redemption on such date and (2) such other amounts, if any, to which Holders of MRP Shares called for redemption may be entitled. Notwithstanding any provision of the Securities Purchase Agreement, any funds so deposited that are unclaimed at the end of two years from such redemption date shall, to the extent permitted by law, be paid to the Company upon its written request, after which time the Holders so called for redemption may look only to the Company for payment of the redemption price and all other amounts, if any, to which they may be entitled.

Exhibit 1-7

(e) To the extent that any redemption for which a Notice of Redemption has been given is not made by reason of the Special Proviso, such redemption shall be made as soon as practicable to the extent such funds become legally available or such redemption is no longer otherwise prohibited. Failure to redeem MRP Shares shall be deemed to exist when the Company shall have failed, for any reason whatsoever, to pay in accordance with Section 14 of the Securities Purchase Agreement the redemption price with respect to any shares for which such Notice of Redemption has been given in accordance with Sections 3(a) and 3(b) hereof. Notwithstanding the fact that the Company may not have redeemed MRP Shares for which a Notice of Redemption has been given, dividends may be declared and paid on MRP Shares and shall include those MRP Shares for which Notice of Redemption has been given but for which deposit of funds has not been made.

(f) All moneys paid to the Paying Agent pursuant to Section 14 of the Securities Purchase Agreement for payment of the redemption price of MRP Shares called for redemption shall be held in trust by the Paying Agent for the benefit of Holders of MRP Shares to be redeemed.

(g) Except for the provisions described above, nothing contained in these terms of the MRP Shares limits any right of the Company to purchase or otherwise acquire any MRP Shares at any price, whether higher or lower than the price that would be paid in connection with an optional or mandatory redemption, so long as, at the time of any such purchase, (1) there is no arrearage in the payment of dividends on, or the mandatory or optional redemption price with respect to, any MRP Shares for which Notice of Redemption has been given, (2) the Company is in compliance with the MRP Shares Asset Coverage and MRP Shares Basic Maintenance Amount after giving effect to such purchase or acquisition on the date thereof and (3) an offer to purchase or otherwise acquire any MRP Shares is made by the Company pro rata to the Holders of all of the MRP Shares at the time outstanding upon the same terms and conditions with respect to MRP Shares. If fewer than all the Outstanding MRP Shares are redeemed or otherwise acquired by the Company, the Company shall give notice of such transaction to the Paying Agent to the extent that the purchase price required to effect such redemption is paid pursuant to Section 14.3 of the Securities Purchase Agreement, in accordance with the procedures agreed upon by the Board of Directors.

(h) In the case of any redemption pursuant to this Section 3, only whole MRP Shares shall be redeemed, and in the event that any provision of the Charter would require redemption of a fractional share, the Company or the Paying Agent, as applicable, shall be authorized to round up so that only whole shares are redeemed.

(i) Notwithstanding anything herein to the contrary, the Board of Directors may authorize, create or issue any class or series of shares of capital stock, including other series of mandatory redeemable preferred shares, ranking on a parity with the MRP Shares with respect to the payment of dividends or the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company (“Parity Shares”), to the extent permitted by the 1940 Act, if, (i) upon issuance, the Company would meet the MRP Shares Asset Coverage and the MRP Shares Basic Maintenance Amount and (ii) in the event the holders of such Parity Shares have the benefit of any rights substantially similar to Sections 2(e), 3(a)(iii), 4(f)(iv) or 4(l) which are additional to or more beneficial than the rights of the Holders of the MRP Shares under such sections, these Articles Supplementary shall be deemed to include such additional or more beneficial rights for the benefit of the Holders of the MRP Shares. Such rights incorporated herein shall be terminated when and if terminated with respect to such other Parity Shares and shall be deemed amended or modified concurrently with any amendment or modification of such other Parity Shares but, in no event, shall any such termination, amendment or modification affect the remaining rights of the Holders of the MRP Shares).

Exhibit 1-8

Section 4. Voting Rights.

(a) Except for matters which do not require the vote of Holders of MRP Shares under the 1940 Act and except as otherwise provided in the Charter or Bylaws, herein or as otherwise required by applicable law, (1) each Holder of MRP Shares shall be entitled to one vote for each MRP Share held on each matter submitted to a vote of stockholders of the Company, and (2) the holders of Outstanding Preferred Shares and Common Shares shall vote together as a single class on all matters submitted to stockholders; provided, however, that the holders of Outstanding Preferred Shares shall be entitled, as a class, to the exclusion of the holders of shares of all other classes of stock of the Company, to elect two Directors of the Company at all times. Subject to the foregoing rights of the Holders of the MRP Shares, the identity and class (if the Board of Directors is then classified) of the nominees for such Directors may be fixed by the Board of Directors. Subject to paragraph (b) of this Section 4, the holders of Outstanding Common Shares and Preferred Shares, voting together as a single class, shall elect the balance of the Directors.

(b) During any period in which any one or more of the conditions described below shall exist (such period being referred to herein as a “Voting Period”), the number of Directors constituting the Board of Directors shall automatically increase by the smallest number that, when added to the two Directors elected exclusively by the holders of Preferred Shares would constitute a majority of the Board of Directors as so increased by such smallest number; and the holders of Preferred Shares shall be entitled, voting as a class on a one-vote-per-share basis (to the exclusion of the holders of all other securities and classes of shares of the Company), to elect such smallest number of additional Directors, together with the two Directors that such holders are in any event entitled to elect. A Voting Period shall commence:

(i) if at the close of business on any Dividend Payment Date accumulated dividends (whether or not earned or declared) on Preferred Shares equal to at least two full years’ dividends shall be due and unpaid; or

(ii) if at any time holders of any Preferred Shares are entitled under the 1940 Act to elect a majority of the Directors of the Company.

If a Voting Period has commenced pursuant to Section 4(b)(i), the Voting Period shall not end until all such accumulated dividends are paid to the holders of Preferred Shares or have been otherwise provided for in a manner approved by the holders of the Preferred Shares. Upon the termination of a Voting Period, the voting rights described in this paragraph (b) of Section 4 shall cease, subject always, however, to the revesting of such voting rights in the holders of Preferred Shares upon the further occurrence of any of the events described in this paragraph (b) of Section 4.

Exhibit 1-9

(c) As soon as practicable after the accrual of any right of the holders of Preferred Shares to elect additional Directors as described in paragraph (b) of this Section 4, the Company shall call a special meeting of such holders, and mail a notice of such special meeting to such holders, such meeting to be held not less than 10 nor more than 30 calendar days after the date of mailing of such notice. If the Company fails to send such notice or if a special meeting is not called at the expense of the Company, it may be called by any such holder on like notice. The record date for determining the holders entitled to notice of and to vote at such special meeting shall be the close of business on the fifth Business Day preceding the day on which such notice is mailed. At any such special meeting and at each meeting of holders of Preferred Shares held during a Voting Period at which Directors are to be elected, a majority of such holders, voting as a separate class (to the exclusion of the holders of all other securities and classes of capital stock of the Company), shall be entitled to elect the number of Directors prescribed in paragraph (b) of this Section 4 on a one-vote-per-share basis.

(d) The terms of office of all persons who are Directors of the Company at the time of a special meeting of Holders of the MRP Shares and holders of other Preferred Shares to elect Directors shall continue, notwithstanding the election at such meeting by the Holders of the MRP Shares and such holders of other Preferred Shares of the number of Directors that they are entitled to elect, and the persons so elected by such holders, together with the two incumbent Directors elected by such holders and the remaining incumbent Directors, shall constitute the duly elected Directors of the Company.

(e) Simultaneously with the termination of a Voting Period, the terms of office of the additional Directors elected by the Holders of the MRP Shares and holders of other Preferred Shares pursuant to paragraph (b) of this Section 4 shall terminate, the number of Directors constituting the Board of Directors shall decrease accordingly, the remaining Directors shall constitute the Directors of the Company and the voting rights of such holders to elect additional Directors pursuant to paragraph (b) of this Section 4 shall cease, subject to the provisions of the last sentence of paragraph (b) of this Section 4.

(f) So long as any of the Preferred Shares are Outstanding, the Company will not, without the affirmative vote of the holders of a majority of the outstanding Preferred Shares determined with reference to a “majority of outstanding voting securities” as that term is defined in Section 2(a)(42) of the 1940 Act (a “1940 Act Majority”), voting as a separate class:

(i) amend, alter or repeal (including by merger, consolidation or otherwise) any of the preferences, rights or powers of such class of Preferred Shares so as to adversely affect such preferences, rights or powers and will not amend any provision of the Charter or Bylaws in a manner which would restrict or limit the ability of the Company to comply with the terms and provisions of the Securities Purchase Agreement;

Exhibit 1-10

(ii) amend alter or repeal (including by merger, consolidation or otherwise) any of the provisions of the Charter or Bylaws if such amendment, alteration or repeal would adversely affect any privilege, preference, right or power of the MRP Shares or the Holders thereof;

(iii) enter into, become a party to, be bound by or adopt or allow to exist any agreement or instrument or any evidence of indebtedness which contains restrictive covenants intended to limit the right of the Company to make dividends, distributions, redemptions or repurchases of Preferred Shares (each a “Restricted Payment Covenant”) which are more restrictive than the most restrictive of the provisions of Sections 10.4(b) or (c) of the Note Purchase Agreement dated as of April 16, 2013 (as amended prior to May 18, 2022), Sections 10.4(b) or (c) of the Note Purchase Agreement dated as of April 30, 2014 (as amended prior to May 18, 2022), Sections 10.4(b) or (c) of the Note Purchase Agreement dated as of October 29, 2014 (as amended prior to May 18, 2022), Sections 10.4(b) or (c) of the Note Purchase Agreement dated as of May 11, 2021(as amended prior to the May 18, 2022), Sections 10.4(b) or (c) of the Note Purchase Agreement dated as of May 18, 2022 or Section 6.6 of the JPMorgan Credit Agreement or Section 6.6 of the Sumitomo Credit Agreement, in each case, as such Note Purchase Agreement, JPMorgan Credit Agreement and Sumitomo Credit Agreement are in effect on May 18, 2022 (other than Restricted Payment Covenants that are more restrictive as a result of (1) a change in the laws or regulations or the Rating Agency Guidelines to which the Company is subject or (2) dividends, distributions, redemptions or repurchases of Preferred Shares being blocked or restricted as a result of the occurrence of any default or event of default as such terms are defined under any such agreement or instrument). For the avoidance of doubt, an amendment to, or adoption of, a covenant (other than a Restricted Payment Covenant) in any instrument or agreement evidencing indebtedness of the Company (including, without limitation the Note Purchase Agreement dated as of April 16, 2013 (as amended prior to May 18, 2022), the Note Purchase Agreement dated as of April 30, 2014 (as amended prior to May 18, 2022), the Note Purchase Agreement dated as of October 29, 2014 (as amended prior to May 18, 2022), the Note Purchase Agreement dated as of May 11, 2021 (as amended prior to May 18, 2022), the Note Purchase Agreement dated as of May 18, 2022 and the JPMorgan Credit Agreement (as amended prior to May 18, 2022) and the Sumitomo Credit Agreement (as amended prior to May 18, 2022) shall not require the affirmative vote of a 1940 Act Majority of the Holders of the Preferred Shares pursuant to this Section 4(f)(iii);

(iv) create, authorize or issue shares of any class of capital stock ranking on a parity with the Preferred Shares with respect to the payment of dividends or the distribution of assets, or any securities convertible into, or warrants, options or similar rights to purchase, acquire or receive, such shares of capital stock ranking on a parity with the Preferred Shares or reclassify any authorized shares of capital stock of the Company into any shares ranking on a parity with the Preferred Shares (except that, notwithstanding the foregoing, but subject to the provision of Section 3(i), the Board of Directors, without the vote or consent of the holders of the Preferred Shares may from time to time authorize, create and classify, and the Company, to the extent permitted by the 1940 Act, may from time to time issue, shares or series of Preferred Shares, including other series of Mandatory Redeemable Preferred Shares, ranking on a parity with the MRP Shares with respect to the payment of dividends and the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company, and may authorize, reclassify and/or issue any additional MRP Shares, including shares previously purchased or redeemed by the Company, subject to (i) continuing compliance by the Company with MRP Shares Asset Coverage requirement and MRP Shares Basic Maintenance Amount and, in all material respects, the other provisions of these Articles Supplementary, and (ii) the payment in full of all accrued and unpaid dividends on the MRP Shares and the effectuation of all redemptions required in respect of the MRP Shares, in each case, without regard to the Special Proviso in Section 3(a)(iv) except to the extent the proceeds of the issuance of such Preferred Shares are used to pay such dividends in full and to effect all such redemptions);

Exhibit 1-11

(v) liquidate or dissolve the Company;

(vi) create, incur or suffer to exist, or agree to create, incur or suffer to exist, or consent to cause or permit in the future (upon the happening of a contingency or otherwise) the creation, incurrence or existence of any material lien, mortgage, pledge, charge, security interest, security agreement, conditional sale or trust receipt or other material encumbrance of any kind upon any of the Company’s assets as a whole, except (A) liens the validity of which are being contested in good faith by appropriate proceedings, (B) liens for taxes that are not then due and payable or that can be paid thereafter without penalty, (C) liens, pledges, charges, security interests, security agreements or other encumbrances arising in connection with any indebtedness senior to the MRP Shares or arising in connection with any futures contracts or options thereon, interest rate swap or cap transactions, forward rate transactions, put or call options, short sales of securities or other similar transactions, (D) liens, pledges, charges, security interests, security agreements or other encumbrances arising in connection with any indebtedness permitted under clause (vii) below and (E) liens to secure payment for services rendered, including, without limitation, services rendered by the Company’s custodian and the Paying Agent;

(vii) create, authorize, issue, incur or suffer to exist any indebtedness for borrowed money or any direct or indirect guarantee of such indebtedness for borrowed money or any direct or indirect guarantee of such indebtedness, except the Company may borrow and issue indebtedness as may be permitted by the Company’s investment restrictions or as may be permitted by the 1940 Act; provided, however, that transfers of assets by the Company subject to an obligation to repurchase shall not be deemed to be indebtedness for purposes of this provision to the extent that after any such transaction the Company meets the MRP Shares Basic Maintenance Amount;

(viii) create, authorize or issue of any shares of capital stock of the Company which are senior to the MRP Shares with respect to the payment of dividends, the making of redemptions, liquidation preference or the distribution of assets of the Company.

(g) The affirmative vote of the holders of a 1940 Act Majority of the Outstanding Preferred Shares, voting as a separate class, shall be required to approve any plan of reorganization (as such term is used in the 1940 Act) adversely affecting such shares or any action requiring a vote of security holders of the Company under Section 13(a) of the 1940 Act.

Exhibit 1-12

(h) The affirmative vote of the holders of a 1940 Act Majority of the MRP Shares, voting separately as a series, shall be required with respect to any matter that materially and adversely affects the rights, preferences, or powers of the MRP Shares in a manner different from that of other separate series of classes of the Company’s shares of capital stock. The vote of holders of any shares described in this Section 4(h) will in each case be in addition to a separate vote of the requisite percentage of Common Shares and/or Preferred Shares, if any, necessary to authorize the action in question.

(i) Unless otherwise required by law, Holders of MRP Shares shall not have any relative rights or preferences or other special rights other than those specifically set forth herein. The Holders of MRP Shares shall have no rights to cumulative voting.

(j) The foregoing voting provisions will not apply with respect to the MRP Shares if, at or prior to the time when a vote is required, such shares have been (i) redeemed or (ii) called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(k) Any vote, amendment, waiver, or consent granted or to be effected by any Holder of MRP Shares that has agreed to transfer such MRP Shares to the Company or any Affiliate of the Company and has agreed to provide such waiver, vote, amendment or modification as a condition to such transfer shall be void and of no effect except as to such Holder.

(l) So long as any of the Preferred Shares are Outstanding, the Company will not, without the affirmative vote of (1) the holders of a 1940 Act Majority of the outstanding Preferred Shares, voting as a separate class, and (2) the holders of a 1940 Act Majority of the holders of the MRP Shares, voting as a separate series, create, authorize or issue shares of any class of capital stock ranking senior to the Preferred Shares with respect to the payment of dividends or the distribution of assets, or any securities convertible into, or warrants, options or similar rights to purchase, acquire or receive, such shares of capital stock ranking senior to the Preferred Shares or reclassify any authorized shares of capital stock of the Company into any shares ranking senior to the Preferred Shares.

(m) The Holders of MRP Shares shall have exclusive voting rights on any Charter amendment that would alter the contract rights, as expressly set forth in the Charter, of only the MRP Shares.

Section 5. Liquidation Rights.

(a) Upon the dissolution, liquidation or winding up of the affairs of the Company, whether voluntary or involuntary, the Holders of MRP Shares then Outstanding, together with holders of shares of any Preferred Shares ranking on a parity with the MRP Shares upon dissolution, liquidation or winding up, shall be entitled to receive and to be paid out of the assets of the Company (or the proceeds thereof) available for distribution to its stockholders after satisfaction of claims of creditors of the Company, but before any distribution or payment shall be made in respect of the Common Shares, an amount equal to the liquidation preference with respect to such shares. The liquidation preference for MRP Shares shall be $25.00 per share, plus an amount equal to all accumulated dividends thereon (whether or not earned or declared but without interest) to the date payment of such distribution is made in full or a sum sufficient for the payment thereof is set apart with the Paying Agent. No redemption premium shall be paid upon any liquidation even if such redemption premium would be paid upon optional or mandatory redemption of the relevant shares. In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or otherwise, is permitted under the MGCL, amounts that would be needed, if the Company were to be dissolved at the time of distribution, to satisfy the liquidation preference of the MRP Shares will not be added to the Company’s total liabilities.

Exhibit 1-13

(b) If, upon any liquidation, dissolution or winding up of the affairs of the Company, whether voluntary or involuntary, the assets of the Company available for distribution among the holders of all outstanding Preferred Shares shall be insufficient to permit the payment in full to holders of the amounts to which they are entitled, then the available assets shall be distributed among the holders of all outstanding Preferred Shares ratably in any distribution of assets according to the respective amounts which would be payable on all the shares if all amounts thereon were paid in full.

(c) Upon the dissolution, liquidation or winding up of the affairs of the Company, whether voluntary or involuntary, until payment in full is made to the Holders of MRP Shares of the liquidation distribution to which they are entitled, (1) no dividend or other distribution shall be made to the holders of Common Shares or any other class of shares of capital stock of the Company ranking junior to MRP Shares upon dissolution, liquidation or winding up and (2) no purchase, redemption or other acquisition for any consideration by the Company shall be made in respect of the Common Shares or any other class of shares of capital stock of the Company ranking junior to MRP Shares upon dissolution, liquidation or winding up.

(d) A consolidation, reorganization or merger of the Company with or into any company, trust or other legal entity, or a sale, lease or exchange of all or substantially all of the assets of the Company in consideration for the issuance of equity securities of another company, trust of other legal entity shall not be deemed to be a liquidation, dissolution or winding up, whether voluntary or involuntary, for the purposes of this Section 5.

(e) After the payment to the holders of Preferred Shares of the full preferential amounts provided for in this Section 5, the holders of Preferred Shares as such shall have no right or claim to any of the remaining assets of the Company.

(f) Subject to the rights of the holders of shares of any series or class or classes of stock ranking on a parity with MRP Shares with respect to the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company, after payment shall have been made in full to the Holders of the MRP Shares as provided in paragraph (a) of this Section 5, but not prior thereto, any other series or class or classes of stock ranking junior to MRP Shares with respect to the distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company shall, subject to any respective terms and provisions (if any) applying thereto, be entitled to receive any and all assets remaining to be paid or distributed, and the Holders of the MRP Shares shall not be entitled to share therein.

Exhibit 1-14

Section 6. Certain Other Restrictions.

If the Rating Agency Guidelines require the Company to receive a prior written confirmation that certain actions would not impair the rating then assigned by the Rating Agency to the MRP Shares, then the Company will not engage in such actions unless it has received written confirmation from each such Rating Agency that such actions would not impair the rating then assigned by such Rating Agency.

Section 7. Compliance Procedures for Asset Maintenance Tests.

For so long as any MRP Shares are Outstanding and an NRSRO which so requires is then rating such shares, the Company shall deliver to each rating agency which is then rating MRP Shares and any other party specified in the Rating Agency Guidelines all certificates that are set forth in the respective Rating Agency Guidelines at such times and containing such information as set forth in the respective Rating Agency Guidelines.

Section 8. Notice.

All notices and communications provided for hereunder shall be in accordance with Section 18 of the Securities Purchase Agreement, except as otherwise provided in these terms of the MRP Shares or by the MGCL for notices of stockholders’ meetings.

Section 9. Waiver.

Without limiting Section 4(k) and Section 4(l) above, to the extent permitted by Maryland law, holders of a 1940 Act Majority of the outstanding Preferred Shares, acting collectively or voting separately from any other series, may by affirmative vote waive any provision hereof intended for their respective benefit in accordance with such procedures as may from time to time be established by the Board of Directors.

Section 10. Termination.

If no MRP Shares are Outstanding, all rights and preferences of such shares established and designated hereunder shall cease and terminate, and all obligations of the Company under these terms of the MRP Shares, shall terminate.

Section 11. Rating Agency Requests.

(a) In the event the Company has been requested by an NRSRO which is then rating the MRP Shares to take any action with respect to the MRP Shares to maintain the rating of such NRSRO thereon and such action would require the vote of the Holders of MRP Shares, if the Company shall give written notice of such request in reasonable detail of such action by the related NRSRO in writing to each Holder of MRP Shares in accordance with the requirements of Schedule A to the Securities Purchase Agreement, (but only by delivery by nationally recognized courier service of hard copies and only if such “courier” receives written acknowledgement of receipt by such Holder) (such notice being referred to as the “Company Request”), a Holder shall be deemed to have agreed to the matters requested by the Company in such Company Request if such Holder does not object to the Company Request within 30 days after receipt of the Company Request.

Exhibit 1-15

(b) Subject to the provisions of these terms of the MRP Shares, including Section 11(a), the Board of Directors may, by resolution duly adopted, without stockholder approval (except as otherwise provided by these terms of the MRP Shares or required by applicable law), modify these terms of the MRP Shares to reflect any modification hereto which the Board of Directors is entitled to adopt pursuant to the terms of Section 11(a) hereof.

Section 12. Definitions.

As used herein, the following terms shall have the following meanings (with terms defined in the singular having comparable meanings when used in the plural and vice versa), unless the context otherwise requires:

“Affiliate” means, at any time, and with respect to any Person, any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person. As used in this definition, “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

“Agency Discounted Value” means the quotient of the Market Value of an Eligible Asset divided by the applicable Rating Agency Discount Factor, provided that with respect to an Eligible Asset that is currently callable, Agency Discounted Value will be equal to the quotient as calculated above or the call price, whichever is lower, and that with respect to an Eligible Asset that is prepayable, Agency Discounted Value will be equal to the quotient as calculated above or the par value, whichever is lower.

“Applicable Rate” means 5.07% per annum, as adjusted (if applicable) in accordance with Section 2(c)(i) hereof.

“Asset Coverage Cure Date” has the meaning set forth in Section 3(a)(iii).

“Basic Maintenance Amount” has the meaning set forth in such Rating Agency Guidelines.

“Board of Directors” or “Board” means the Board of Directors of the Company or any duly authorized committee thereof as permitted by applicable law.

“Business Day” means (a) for the purposes of an optional redemption pursuant to Section 3(a)(i) only, any day other than a Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of these Articles Supplementary, any day other than a Saturday, a Sunday or a day on which commercial banks in New York, New York, or Houston, Texas are required or authorized to be closed.

Exhibit 1-16

“Commission” means the United States Securities and Exchange Commission.

“Common Shares” means the shares of Common Stock, par value $.001 per share, of the Company.

“Default” has the meaning set forth in Section 2(c)(ii) hereof.

“Default Period” has the meaning set forth in Section 2(c)(ii) hereof.

“Default Rate” means, with respect to the MRP Shares, for any calendar day, the Applicable Rate in effect on such day (without adjustment for any credit rating change on the MRP Shares) plus 5% per annum.

“Default Rate Cure Period” has the meaning set forth in Section 2(c)(iii) hereof.

“Dividend Default” has the meaning set forth in Section 2(c)(ii) hereof.

“Dividend Payment Date” with respect to the MRP Shares means the first (1st) Business Day of the month next following each Dividend Period.

“Dividend Period” means, with respect to the MRP Shares, the period from and including the Original Issue Date, and ending on and including the next following Quarterly Dividend Date, and each subsequent period from but excluding a Quarterly Dividend Date and ending on and including the next following Quarterly Dividend Date.

“Dividend Rate” has the meaning set forth in Section 2(c)(i) hereof.

“Eligible Assets” means assets of the Company, if any, set forth in the Rating Agency Guidelines of each Rating Agency as eligible for inclusion in calculating the Agency Discounted Value of the Company’s assets in connection with the Rating Agency’s rating of any series of MRP Shares.

“Fitch” means Fitch Ratings and its successors at law.

“Holder” means, with respect to MRP Shares, the registered holder of MRP Shares as the same appears on the share ledger or share records of the Company.

“Investment” means any advance, loan, extension of credit or capital contribution to, or purchase any stock, bonds, notes, debentures or other securities of or any assets constituting a business unit of or any other investment in any Person.

Exhibit 1-17

“JPMorgan Credit Agreement” means that certain Fifth Amended and Restated Credit Agreement dated as of February 25, 2022 among the Company, the banks and other financial institutions parties thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the financial institutions thereto, as amended, modified, supplemented, replaced or refinanced from time to time.

“Kayne Notes” shall mean the $243,110,425 in principal amount of the Company’s currently outstanding senior unsecured notes and any additional series of such notes which may be issued from time to time by the Company.

“Level 3 Asset” means, at any time, any Investment of the Company (a) for which there are no Level 1 Inputs or Level 2 Inputs (in each case within the meaning of Topic ASC 820, Fair Value Measurements and Disclosures), or (b) the value of which is determined by reference to Level 3 Inputs (within the meaning of Topic ASC 820).

“Level 3 Asset Cure Date” has the meaning set forth in Section 3(a)(iii) hereof.

“Level 3 Asset Test” means, as of any date of determination, the aggregate value of all Level 3 Assets of the Company being equal to 30% or less of the aggregate amount of all assets of the Company determined in accordance with generally accepted accounting principles applicable to the Company.

“Make-Whole Amount” for each MRP Share means, with respect to any MRP Share, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the MRP Liquidation Preference Amount of such MRP Share over the amount of such MRP Liquidation Preference Amount, provided that the Make-Whole Amount may in no event be less than zero. For the purposes of determining the Make-Whole Amount, the following terms have the following meanings:

(1) “Discounted Value” means, with respect to the MRP Liquidation Preference Amount of any MRP Share, the amount obtained by discounting all Remaining Scheduled Payments with respect to such MRP Liquidation Preference Amount from their respective scheduled due dates to the Settlement Date with respect to such MRP Liquidation Preference Amount, in accordance with accepted financial practice and at a discount factor (applied quarterly on a Quarterly Dividend Date) equal to the Reinvestment Yield with respect to such MRP Liquidation Preference Amount.

(2) “Reinvestment Yield” means, with respect to the MRP Liquidation Preference Amount of any MRP Share, 0.50% over the yield to maturity implied by (i) the “Ask-Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the Settlement Date with respect to such MRP Liquidation Preference Amount, on the display designated as “Page PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded on the run U.S. Treasury securities (“Reported”) having a maturity equal to the Remaining Average Life of such MRP Liquidation Preference Amount as of such Settlement Date. If there are no such U.S. Treasury securities Reported having a maturity equal to such Remaining Average Life, then such implied yield to maturity will be determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted financial practice and (ii) interpolating linearly between the “Ask Yields” Reported for the applicable most recently issued actively traded on-the-run U.S. Treasury securities with the maturities (1) closest to and greater than such Remaining Average Life and (2) closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the dividend rate of the applicable MRP Shares.

Exhibit 1-18

If such yields are not Reported or the yields Reported as of such time are not ascertainable (including by way of interpolation), then “Reinvestment Yield” means, with respect to the MRP Liquidation Preference Amount of any MRP Shares, the sum of (x) 0.50% plus (y) the yield to maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such MRP Liquidation Preference Amount, in Federal Reserve Statistical Release H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity having a term equal to the Remaining Average Life of such MRP Liquidation Preference Amount as of such Settlement Date. If there is no such U.S. Treasury constant maturity having a term equal to such Remaining Average Life, such implied yield to maturity will be determined by interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the dividend rate of the applicable MRP Shares.

(3) “Remaining Average Life” means, with respect to any MRP Liquidation Preference Amount, the number of years (calculated to the nearest one-twelfth year) that will elapse between the Settlement Date with respect to such MRP Liquidation Preference Amount and the scheduled due date of such Remaining Scheduled Payment.

(4) “Remaining Scheduled Payments” means, with respect to the MRP Liquidation Preference Amount of any MRP Share, all payments of such MRP Liquidation Preference Amount and dividends thereon at the Applicable Rate or the Default Rate (as applicable) as if they were paid on each Quarterly Dividend Payment Date after the Settlement Date with respect to such MRP Liquidation Preference Amount if no payment of such MRP Liquidation Preference Amount were made prior to the Term Redemption Dates, provided that if such Settlement Date is not a Quarterly Dividend Payment Date, then the amount of the next succeeding scheduled dividend payment will be reduced by the amount of dividends accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 3.

(5) “Settlement Date” means, with respect to the MRP Liquidation Preference Amount of any MRP Share, the date on which such MRP Liquidation Preference Amount is to be prepaid pursuant to Section 3.

Exhibit 1-19

“Mandatory Redemption Date” has the meaning set forth in Section 3(a)(iv) hereof.

“Market Value” means the market value of an asset of the Company determined as follows: Readily marketable portfolio securities listed on any exchange other than the NASDAQ are valued, except as indicated below, at the last sale price on the Business Day as of which such value is being determined. If there has been no sale on such day, the securities are valued at the mean of the most recent bid and asked prices on such day. Securities admitted to trade on the NASDAQ are valued at the NASDAQ official closing price. Portfolio securities traded on more than one securities exchange are valued at the last sale price on the Business Day as of which such value is being determined at the close of the exchange representing the principal market for such securities. Equity securities traded in the over-the-counter market, but excluding securities admitted to trading on the NASDAQ, are valued at the closing bid prices. Fixed income securities are valued by the Company using a pricing service. For securities that are privately issued or illiquid, as well as any other portfolio security held by the Company for which, in the judgment of the Company’s investment adviser, reliable market quotations are not readily available, the pricing service does not provide a valuation, or provides a valuation that in the judgment of that investment adviser is stale or does not represent fair value, valuations will be determined in a manner that most fairly reflects fair value of the security on the valuation date under procedures adopted by the Board of Directors of the Company.

“MGCL” has the meaning set forth in Section 1(e) hereof.

“MRP Liquidation Preference Amount” means, for the MRP Shares, liquidation preference, $25.00 per share.

“MRP Shares” means the Series T Mandatory Redeemable Preferred Shares of the Company.

“MRP Shares Asset Coverage” means asset coverage, as determined in accordance with Section 18(h) of the 1940 Act, as in effect on the date of issuance of the MRP Shares, of at least 225% with respect to all outstanding Senior Securities and Preferred Shares, including all outstanding MRP Shares, determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination; provided, that for purposes of calculating total assets as used in such asset coverage test, the Company shall exclude the value of Level 3 Assets in excess of 20% of total assets.

“MRP Shares Basic Maintenance Amount” means, so long as a Ratings Agency is then rating any series of the Outstanding MRP Shares, the maintenance of Eligible Assets with an aggregate Discounted Value at least equal to the Basic Maintenance Amount, as separately determined; provided, however, (i) if no NRSRO is rating any series of the Outstanding MRP Shares or (ii) if the Ratings Agency does not incorporate the Basic Maintenance Amount in its Rating Agency Guidelines, the Company shall be deemed to have Eligible Assets with an aggregate Discounted Value in excess of the Basic Maintenance Amount for the purposes of this definition.

“1940 Act” means the Investment Company Act of 1940, as amended from time to time.

Exhibit 1-20

“1940 Act Majority” has the meaning set forth in Section 4(f) hereof.

“Notice of Redemption” is defined in Section 3(b).

“NRSRO” means any of DBRS, Inc., Fitch Ratings, Inc., Kroll Bond Rating Agency, Inc., Moody's Investors Service, Inc. or S&P Global Ratings, a division of S&P Global, or any of their successors at law.

“Original Issue Date” means August 2, 2022.

“Outstanding” or “outstanding” means, with respect to the MRP Shares as of any date, the MRP Shares theretofore issued by the Company except, without duplication, any MRP Shares theretofore canceled, redeemed or repurchased by the Company, or with respect to which the Company has given notice of redemption and irrevocably deposited with the Paying Agent sufficient funds to redeem such MRP Shares. Notwithstanding the foregoing, (A) for purposes of voting rights (including the determination of the number of shares required to constitute a quorum), any of the MRP Shares to which the Company or any Affiliate of the Company shall be the Holder shall be disregarded and not deemed outstanding, and (B) for purposes of determining the MRP Shares Basic Maintenance Amount, MRP Shares held by the Company shall be disregarded and not deemed outstanding but shares held by any Affiliate of the Company shall be deemed outstanding.

“Parity Shares” shall have the meaning set forth in Section 3(i) hereof.

“Paying Agent” shall have the meaning set forth in the Securities Purchase Agreement.

“Person” or “person” means and includes an individual, a corporation, a partnership, a trust, a company, an unincorporated association, a joint venture or other entity or a government or any agency or political subdivision thereof.

“Preferred Shares” means the shares of Preferred Stock, par value $0.001 per share, including the MRP Shares, of the Company from time to time.

“Quarterly Dividend Date” means the last day of each February, the 31st of each May, the 31st of each August and the 30th of each November.

“Rating Agency” means each NRSRO then providing a rating for any series of MRP Shares.

“Rating Agency Discount Factor” means the discount factors, if any, set forth in the Rating Agency Guidelines of each Rating Agency for use in calculating the Agency Discounted Value of the Company’s assets in connection with the Rating Agency’s rating of any series of MRP Shares.

Exhibit 1-21

“Rating Agency Guidelines” means the guidelines provided by each Rating Agency, as may be amended from time to time, in connection with such Rating Agency’s rating of any series of MRP Shares.

“Redemption Date” has the meaning set forth in Section 2(c)(ii) hereof. “Redemption Default” has the meaning set forth in Section 2(c)(ii) hereof. “Restricted Payment Covenant” has the meaning set forth in Section 4(f)(iii) hereof.

“Securities Purchase Agreement” means the Securities Purchase Agreement dated May 18, 2022, as amended from time to time, of the Company in respect of the MRP Shares.

“Senior Securities” means indebtedness for borrowed money of the Company including, without limitation, the Kayne Notes, bank borrowings and (without duplication) other indebtedness of the Company within the meaning of Section 18 of the 1940 Act.

“Special Proviso” shall have the meaning set forth in Section 3(a)(iv).

“Sumitomo Credit Agreement” means that certain Loan Agreement dated as of August 6, 2021 between the Company and Sumitomo Mitsui Banking Corporation, as amended, modified, supplemented, replaced or refinanced from time to time.

“Term Redemption Date” means August 2, 2032.

“Valuation Date” means every Friday, or, if such day is not a Business Day, the next preceding Business Day; provided, however, that the first Valuation Date may occur on any other date established by the Company; provided, further, however, that such first Valuation Date shall be not more than one week from the date on which MRP Shares initially are issued.

“Voting Period” shall have the meaning set forth in Section 4(b) hereof.

Section 13. Interpretation.

References to sections, subsections, clauses, sub-clauses, paragraphs and subparagraphs are to such sections, subsections, clauses, sub-clauses, paragraphs and subparagraphs contained herein, unless specifically identified otherwise.

SECOND: The MRP Shares have been classified and designated by the Board of Directors under the authority contained in the Charter.

THIRD: These Articles Supplementary have been approved by the Board of Directors in the manner and by the vote required by law.

FOURTH: These Articles Supplementary shall be effective at 9:00 a.m., Eastern time, on August 2, 2022.

FIFTH: The undersigned Chief Financial Officer of the Company acknowledges these Articles Supplementary to be the corporate act of the Company and, as to all matters or facts required to be verified under oath, the undersigned Chief Financial Officer acknowledges that, to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

[Signature Page Follows]

Exhibit 1-22

IN WITNESS WHEREOF, the Company has caused these Articles Supplementary to be signed in its name and on its behalf by its Chief Financial Officer and Treasurer and attested to by its Chief Operating Officer on this day of August, 2022.

Attest:		Kayne Anderson Energy Infrastructure Fund, Inc.

				(SEAL)
Name:		Name:
Title:	Chief Operating Officer	Title:	Chief Financial Officer and Treasurer

Exhibit 1-23

EX-99.5(5) 3 ea151744_ex5-5.htm EXHIBIT 5.5

Exhibit 5.5

Form of Certificate Representing Series T MRP Shares

SEE REVERSE
FOR IMPORTANT
NOTICE ON
TRANSFER
RESTRICTIONS
AND OTHER
INFORMATION

Number Series T MRP-«Number»

«Shares» Series T

Mandatory Redeemable Preferred Shares

$.001 par value per share

PPN 486606 *32

KAYNE ANDERSON ENERGY INFRASTRUCTURE
FUND, INC.

a Maryland Corporation

[____] Series T Mandatory Redeemable Preferred Shares

THIS CERTIFIES THAT: «Name» is the registered holder of «Sharesspelled» («Shares») Series T Mandatory Redeemable Preferred Shares of KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC. (the “Corporation”) transferable only on the share register of the Corporation by the holder hereof, in person or by duly authorized attorney, upon surrender of this certificate properly endorsed or assigned. This certificate and the shares represented hereby are issued and shall be held subject to all the provisions of the charter of the Corporation, including the Articles Supplementary for the Series T Mandatory Redeemable Preferred Shares, and the Bylaws of the Corporation, and any amendments thereto, a copy of each of which is on file at the office of the Corporation, to all of which the holder of this certificate, by acceptance hereof, assents and agrees to be bound.

WITNESS the Seal of the Corporation and the signatures of its duly authorized officers this ___ day of ______________, 2022.


President		Treasurer

Exhibit 2

(to Securities Purchase Agreement)

FOR VALUE RECEIVED ___________________________________________________________________ HEREBY SELLS, ASSIGNS, AND TRANSFERS UNTO ________________________________________________________ ________________________________________________________ (_________________) SHARES REPRESENTED BY THE WITHIN CERTIFICATE AND DOES HEREBY IRREVOCABLY CONSTITUTE AND APPOINT ________________________________________________________________ ATTORNEY TO TRANSFER THE SAID SHARES ON THE SHARE REGISTER OF THE WITHIN NAMED CORPORATION WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.

DATED __________________



		(Stockholder)


		(Stockholder)

NOTICE: THE SIGNATURE ON THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATSOEVER.

IMPORTANT NOTICE

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR UNDER THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED OR RESOLD UNLESS REGISTERED UNDER THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM THE REQUIREMENT FOR SUCH REGISTRATION IS AVAILABLE.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER AS SET FORTH IN THAT CERTAIN SECURITIES PURCHASE AGREEMENT DATED MAY 18, 2022 BY AND BETWEEN THE CORPORATION AND THE HOLDER HEREOF, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE CORPORATION. A COPY OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT ITS PRINCIPAL EXECUTIVE OFFICE.

THE CORPORATION WILL FURNISH TO ANY STOCKHOLDER, ON REQUEST AND WITHOUT CHARGE, A FULL STATEMENT OF THE INFORMATION REQUIRED BY SECTION 2-211(b) OF THE MARYLAND GENERAL CORPORATION LAW WITH RESPECT TO THE DESIGNATIONS AND ANY PREFERENCES, CONVERSION AND OTHER RIGHTS, VOTING POWERS, RESTRICTIONS, LIMITATIONS AS TO DIVIDENDS AND OTHER DISTRIBUTIONS, QUALIFICATIONS, AND TERMS AND CONDITIONS OF REDEMPTION OF THE STOCK OF EACH CLASS WHICH THE CORPORATION HAS AUTHORITY TO ISSUE AND, IF THE CORPORATION IS AUTHORIZED TO ISSUE ANY PREFERRED OR SPECIAL CLASS IN SERIES, (I) THE DIFFERENCES IN THE RELATIVE RIGHTS AND PREFERENCES BETWEEN THE SHARES OF EACH SERIES TO THE EXTENT SET, (II) THE AUTHORITY OF THE BOARD OF DIRECTORS TO SET SUCH RIGHTS AND PREFERENCES OF SUBSEQUENT SERIES AND (III) A STATEMENT OF THE NUMBER OF SHARES CONSTITUTING EACH CLASS OR SERIES OF STOCK AND THE DESIGNATION THEREOF. THE FOREGOING SUMMARY DOES NOT PURPORT TO BE COMPLETE AND IS SUBJECT TO AND QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE CHARTER OF THE CORPORATION, A COPY OF WHICH WILL BE SENT WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS. SUCH REQUEST MUST BE MADE TO THE SECRETARY OF THE CORPORATION AT ITS PRINCIPAL OFFICE.

2-2

EX-99.6(6) 4 ea151744_ex6-6.htm EXHIBIT 6.6

Exhibit 6.6

KA Fund Advisors, LLC

811 Main Street, 14th Floor

Houston, Texas 77002

(713) 493-2020

Effective [___], 2023

Kayne Anderson Energy Infrastructure Fund, Inc.

811 Main Street, 14th Floor

Houston, Texas 77002

Re:

Waiver of Certain Fees under that Certain Amended and Restated Investment Management Agreement dated as of December 12, 2006

Ladies and Gentlemen:

This letter agreement (this “Agreement”), to become effective upon successful completion of the merger (the “Merger”) of Kayne Anderson NextGen Energy & Infrastructure, Inc. (“KMF”) with and into a wholly owned subsidiary of Kayne Anderson Energy Infrastructure Fund, Inc. (the “Company”), is by and between the Company, a Maryland corporation, and KA Fund Advisors, LLC, a Delaware limited liability company and the investment adviser to the Company and KMF (“KAFA”), and it hereby amends and restates that certain amended and restated letter agreement by and between the Company and KAFA effective as of August 6, 2021 (the “Prior Agreement”). This Agreement is intended to memorialize the waiver of certain fees KAFA is otherwise entitled to receive pursuant to that certain Amended and Restated Investment Management Agreement, dated as of December 12, 2006, by and between the Company and KAFA, as amended from time to time (the “IMA”).

This Agreement will become valid and enforceable upon the closing of the Merger (the “Effective Date”). In the event that the Merger is not completed, the Prior Agreement will remain in full force and effect.

Pursuant to Section 8(a) of the IMA, as full compensation for all administrative and investment and advisory services furnished or provided by KAFA, the Company pays KAFA a management fee, computed and paid quarterly, at an annual rate of 1.375% of the total assets (calculated as described in the IMA) of the Company for such quarter (the “Management Fee”).

KAFA has agreed to waive a portion of the Management Fee it is otherwise entitled to receive pursuant to the IMA such that the effective annual rates of the Management Fee will be 1.375% with respect to average total assets of the Company of up to $[*]¹ billion, 1.25% with respect to average total assets of the Company of between $[*]¹ billion and $4.0 billion, 1.125% with respect to average total assets of the Company of between $4.0 billion and $6.0 billion, and 1.0% with respect to average total assets of the Company of over $6.0 billion. Average total assets of the Company will be calculated in the manner provided in the IMA.

¹First fee waiver tier to be based on the pro forma combined Company assets under management at the time of the merger.

-1-

KAFA has further agreed to waive a portion of the Management Fee it is otherwise entitled to receive pursuant to the IMA, in an amount equal to [*]²per year, for a period of three years after the Effective Date (the “Post-Merger Fee Waiver”).

Any amount waived by KAFA pursuant to this Agreement may not be recouped by KAFA.

This Agreement shall become effective, and the Prior Agreement shall terminate, upon the Effective Date, for an initial term of three years (the “Initial Term”). Upon expiration of the Initial Term, the Post-Merger Fee Waiver will terminate. The remainder of this Agreement may be renewed for additional one-year terms upon the approval by KAFA and by the Board of Directors of the Company (the “Board”), including a majority of the Directors who are not “interested persons,” as such term is defined in the Investment Company Act of 1940, as amended, of the Company (the “Independent Directors”). Notwithstanding the foregoing, this Agreement shall terminate and be of no further force or effect (i) automatically upon the termination of the IMA; and (ii) if the Company, with the approval of the Board, including a majority of the Independent Directors, notifies KAFA in writing of the termination of this Agreement.

This Agreement supersedes and terminates, as of the Effective Date, all prior agreements between the Company and KAFA relating to waivers by KAFA of the Management Fee payable pursuant to the IMA.

Except as otherwise specified herein, the IMA and all covenants, agreements, terms and conditions thereof shall continue in full force and effect, subject to the terms and provisions thereof and hereof.

Please confirm your notice of and agreement to the foregoing by signing where indicated below.

Very truly yours,		ACCEPTED AND AGREED:

KA FUND ADVISORS, LLC		KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

By:	Kayne Anderson Capital Advisors, L.P.	By:
	its Managing Member	Name:
		Title:

	By:
	Name:
	Title:

² Final amount to be determined based on KMF’s assets under management at the closing of the Merger multiplied by 12.5bps (0.125%).

-2-

EX-99.13(9) 5 ea151744_ex13-9.htm EXHIBIT 13.9

Exhibit 13.9

Execution Version

Kayne Anderson Energy Infrastructure Fund, Inc.

$45,000,000 4.57% Series RR Senior Unsecured Notes due May 18, 2032

$45,000,000 4.67% Series SS Senior Unsecured Notes due August 2, 2034

Note Purchase Agreement

Dated as of May 18, 2022

Table of Contents

Section	Heading	Page

Section 1.	Authorization of Notes	1

Section 1.1.	Description of the Notes	1
Section 1.2.	Interest Rate	1

Section 2.	Sale and Purchase of Notes	2

Section 3.	Closings	2

Section 4.	Conditions to Closings	3

Section 4.1.	Representations and Warranties	3
Section 4.2.	Performance; No Default	3
Section 4.3.	Compliance Certificates	3
Section 4.4.	Opinions of Counsel	3
Section 4.5.	Purchase Permitted By Applicable Law, Etc	4
Section 4.6.	Sale of Other Notes	4
Section 4.7.	Payment of Special Counsel Fees	4
Section 4.8.	Private Placement Number	4
Section 4.9.	Changes in Corporate Structure	4
Section 4.10.	Funding Instructions	4
Section 4.11.	Rating of Notes	5
Section 4.12.	Proceedings and Documents	5

Section 5.	Representations and Warranties of The Company	5

Section 5.1.	Organization; Power and Authority	5
Section 5.2.	Authorization, Etc	5
Section 5.3.	Disclosure	6
Section 5.4.	No Subsidiaries	6
Section 5.5.	Financial Statements; Material Liabilities	6
Section 5.6.	Compliance with Laws, Other Instruments, Etc	6
Section 5.7.	Governmental Authorizations, Etc	6
Section 5.8.	Litigation; Observance of Statutes and Orders	6
Section 5.9.	Taxes	7
Section 5.10.	Title to Property; Leases	7
Section 5.11.	Licenses, Permits, Etc	7
Section 5.12.	Compliance with ERISA	7
Section 5.13.	Private Offering by the Company	7
Section 5.14.	Use of Proceeds; Margin Regulations	8
Section 5.15.	Existing Indebtedness	8
Section 5.16.	Foreign Assets Control Regulations, Etc	8

-i-

Section 5.17.	Status under Certain Statutes	9
Section 5.18.	Ranking of Obligations	9

Section 6.	Representations of The Purchasers	9

Section 6.1.	Purchase for Investment	9
Section 6.2.	Source of Funds	10

Section 7.	Information as to the Company	11

Section 7.1.	Financial and Business Information	11
Section 7.2.	Officer’s Certificate	14
Section 7.3.	Visitation	15

Section 8.	Payment and Prepayment of the Notes	16

Section 8.1.	Maturity and Payment	16
Section 8.2.	Optional Prepayments with Make-Whole Amount and Special Optional Prepayments	16
Section 8.3.	Allocation of Partial Prepayments	18
Section 8.4.	Maturity; Surrender, Status, Etc	18
Section 8.5.	Purchase of Notes	18
Section 8.6.	Make-Whole Amount; Prepayment Premium	19
Section 8.7.	Adjustment Period	20

Section 9.	Affirmative Covenants	20

Section 9.1.	Compliance with Law	20
Section 9.2.	Insurance	21
Section 9.3.	Maintenance of Properties	21
Section 9.4.	Payment of Taxes	21
Section 9.5.	Corporate Existence, Etc	21
Section 9.6	Books and Records	22
Section 9.7.	Asset Coverage	22
Section 9.8.	Current Rating on the Notes	22
Section 9.9.	Most Favored Lender Status	22
Section 9.10.	Ranking of Obligations	23
Section 9.11.	Maintenance of Status	23

Section 10.	Negative Covenants	23

Section 10.1.	Transactions with Affiliates	23
Section 10.2.	Merger, Consolidation, Etc	24
Section 10.3.	Economic Sanctions, Etc	24
Section 10.4.	Certain Other Restrictions	24
Section 10.5.	No Subsidiaries	25
Section 10.6.	Secured Debt	25
Section 10.7.	Level 3 Assets	25

-ii-

Section 11.	Events of Default	25

Section 12.	Remedies on Default, Etc	27

Section 12.1.	Acceleration	27
Section 12.2.	Other Remedies	27
Section 12.3.	Rescission	28
Section 12.4.	No Waivers or Election of Remedies, Expenses, Etc	28

Section 13.	Registration; Exchange; Substitution of Notes	28

Section 13.1.	Registration of Notes	28
Section 13.2.	Transfer and Exchange of Notes	29
Section 13.3.	Replacement of Notes	29

Section 14.	Payments on Notes	29

Section 14.1.	Place of Payment	29
Section 14.2.	Home Office Payment	30
Section 14.3.	Agency Agreement	30
Section 14.4.	FATCA Information	30

Section 15.	Expenses, Etc	31

Section 15.1.	Transaction Expenses	31
Section 15.2.	Certain Taxes	31
Section 15.3.	Survival	31

Section 16.	Survival of Representations and Warranties; Entire Agreement	32

Section 17.	Amendment and Waiver	32

Section 17.1.	Requirements	32
Section 17.2.	Solicitation of Holders of Notes	32
Section 17.3.	Binding Effect, Etc	33
Section 17.4.	Notes Held by Company, Etc	33

Section 18.	Notices	33

Section 19.	Reproduction of Documents	34

Section 20.	Confidential Information	34

Section 21.	Substitution of Purchaser	35

-iii-

Section 22.	Miscellaneous	36

Section 22.1.	Successors and Assigns	36
Section 22.2.	Payments Due on Non-Business Days	36
Section 22.3.	Accounting Terms	36
Section 22.4.	Severability	36
Section 22.5.	Construction, Etc	36
Section 22.6.	Counterparts; Electronic Contracting	37
Section 22.7.	Governing Law	37
Section 22.8.	Jurisdiction and Process; Waiver of Jury Trial	38

Signature

Schedule A	—	Information Relating to Purchasers

Schedule B	—	Defined Terms

Schedule 4.9.	—	Merger

Schedule 5.3	—	Disclosure Materials

Schedule 5.5	—	Financial Statements

Schedule 5.15	—	Existing Indebtedness

Exhibit 1-A	—	Form of 4.57% Series RR Senior Unsecured Notes due May 18, 2032

Exhibit 1-B	—	Form of 4.67% Series SS Senior Unsecured Notes due August 2, 2034

Exhibit 4.4(a)	—	Form of Opinion of Special Counsel to the Company

Exhibit 4.4(b)	—	Form of Opinion of Special Counsel to the Purchasers

Exhibit 13.1	—	Form of Legend

Exhibit 14.3	—	Form of Agency Agreement

-iv-

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

Kayne Anderson Energy Infrastructure Fund, Inc.

811 Main Street, 14th Floor
Houston, Texas 77002

$45,000,000 4.57% Series RR Senior Unsecured Notes due May 18, 2032

$45,000,000 4.67% Series SS Senior Unsecured Notes due August 2, 2034

as of May 18, 2022

To Each of The Purchasers Listed in

Schedule A Hereto:

Ladies and Gentlemen:

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC., a Maryland corporation (the “Company”), agrees with each of the purchasers whose names appear at the end hereof (each, a “Purchaser” and, collectively, the “Purchasers”) as follows:

Section 1. Authorization of Notes.

Section 1.1. Description of the Notes. The Company will authorize the issue and sale of $90,000,000 aggregate principal amount of its senior notes consisting of

(i) $45,000,000 aggregate principal amount of 4.57% Series RR Senior Unsecured Notes due May 18, 2032 (the “Series RR Notes”), and

(ii) $45,000,000 aggregate principal amount of 4.67% Series SS Senior Unsecured Notes due August 2, 2034 (the “Series SS Notes,” together with the Series RR Notes are collectively, the “Notes”) shall be substantially in the form set out in Exhibits 1-A and 1-B, respectively.

Certain capitalized and other terms used in this Agreement are defined in Schedule B; and, for purposes of this Agreement, the rules of construction set forth in Section 22.5 shall govern.

Section 1.2. Interest Rate.

(a) The Series RR Notes shall bear interest (computed on the basis of a 360-day year of twelve 30-day months) on the unpaid principal balance thereof from the date of issuance at a fixed rate equal to 4.57% per annum payable semiannually on the 19th day of each June and December in each year (commencing December 19, 2022) and at maturity until the unpaid principal balance thereof shall have become due and payable (whether at maturity, upon notice of prepayment or otherwise) and shall bear interest on overdue principal (including any overdue required or optional prepayment of principal) and premium, if any, and (to the extent legally enforceable) on any overdue installment of interest at the Default Rate until paid. Interest shall be subject to adjustment in accordance with Section 8.7.

(b) The Series SS Notes shall bear interest (computed on the basis of a 360-day year of twelve 30-day months) on the unpaid principal balance thereof from the date of issuance at a fixed rate equal to 4.67% per annum payable semiannually on the 19th day of each June and December in each year (commencing December 19, 2022) and at maturity until the unpaid principal balance thereof shall have become due and payable (whether at maturity, upon notice of prepayment or otherwise) and shall bear interest on overdue principal (including any overdue required or optional prepayment of principal) and premium, if any, and (to the extent legally enforceable) on any overdue installment of interest at the Default Rate until paid. Interest shall be subject to adjustment in accordance with Section 8.7.

Section 2. Sale and Purchase of Notes.

Subject to the terms and conditions of this Agreement, the Company will issue and sell to each Purchaser and each Purchaser will purchase from the Company, at the respective Closings provided for in Section 3, Notes of the respective Series and in the principal amount specified opposite such Purchaser’s name in Schedule A at the purchase price of 100% of the principal amount thereof. The Purchasers’ obligations hereunder are several and not joint obligations and no Purchaser shall have any liability to any Person for the performance or non-performance of any obligation by any other Purchaser hereunder.

Section 3. Closings.

The sale and purchase of the Notes to be purchased by each Purchaser shall occur at the offices of Chapman and Cutler LLP, 320 South Canal Street, Chicago, Illinois 60606, at 10:00 a.m., Chicago time, at (i) a closing on May 18, 2022 (the “First Closing”) with respect to the Series RR Notes and (ii) a closing on August 2, 2022 the “Second Closing,” each of the First Closing and the Second Closing are a “Closing”) with respect to the Series SS Notes. At each Closing, the Company will deliver or cause to be delivered to each Purchaser the Notes to be purchased by such Purchaser in the form of a single Note for each Series to be so purchased at such Closing (or such greater number of Notes in denominations of at least $250,000 as such Purchaser may request) dated the date of such Closing and registered in such Purchaser’s name (or in the name of its nominee), against delivery by such Purchaser to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to account number [] for credit to account: Kayne Anderson Energy Infrastructure Fund, Inc. ; Ref: Notes. If at any Closing the Company shall fail to tender such Notes to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure by the Company to tender such Notes or any of the conditions specified in Section 4 not having been fulfilled to such Purchaser’s satisfaction.

Section 4. Conditions to Closings.

Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such Purchaser at the applicable Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at such Closing, of the following conditions:

Section 4.1. Representations and Warranties. The representations and warranties of the Company in this Agreement shall be correct when made and at the time of each Closing.

Section 4.2. Performance; No Default. The Company shall have performed and complied with all agreements and conditions contained in this Agreement required to be performed or complied with by it prior to or at the applicable Closing and from the date of this Agreement to the date of the applicable Closing assuming that Sections 9 and 10 are applicable from the date of this Agreement. From the date of this Agreement until the applicable Closing, before and after giving effect to the issue and sale of the applicable Notes (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing.

Section 4.3. Compliance Certificates.

(a) Officer’s Certificate. The Company shall have delivered to such Purchaser an Officer’s Certificate, dated the date of the applicable Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

(b) Secretary’s Certificate. The Company shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of the applicable Closing, certifying as to (i) the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the Notes and this Agreement and (ii) the Company’s organizational documents as then in effect.

Section 4.4. Opinions of Counsel. Such Purchaser shall have received opinions in form and substance satisfactory to such Purchaser, dated the date of each Closing (a) from Paul Hastings LLP, counsel for the Company, and from Venable LLP, special Maryland counsel to the Company, together covering the matters set forth in Exhibit 4.4(a) and covering such other matters incident to the transactions contemplated hereby as such Purchaser or its counsel may reasonably request (and the Company hereby instructs its counsel to deliver such opinions to the Purchasers) and

(b) from Chapman and Cutler LLP, the Purchasers’ special counsel in connection with such transactions, substantially in the form set forth in Exhibit 4.4(b) and covering such other matters incident to such transactions as such Purchaser may reasonably request.

Section 4.5. Purchase Permitted By Applicable Law, Etc. On the date of each Closing such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each jurisdiction to which such Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (b) not violate any applicable law or regulation (including, without limitation, Regulation T, U or X of the Board of Governors of the Federal Reserve System) assuming the required preparation, execution, delivery and filing of the applicable Federal Reserve Board forms (such as Forms U-1 and G-1 through 4) and (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof. If requested by such Purchaser, such Purchaser shall have received an Officer’s Certificate certifying as to such matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase is so permitted.

Section 4.6. Sale of Other Notes. Contemporaneously with each Closing the Company shall sell to each other Purchaser, and each other Purchaser, shall purchase the Notes to be purchased by it at the applicable Closing as specified in Schedule A.

Section 4.7. Payment of Special Counsel Fees. Without limiting the provisions of Section 15.1, the Company shall have paid on or before each Closing the reasonable fees, charges and disbursements of the Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to such Closing.

Section 4.8. Private Placement Number. A Private Placement Number issued by PPN CUSIP Unit of CUSIP Global Services (in cooperation with the SVO) shall have been obtained for each Series of Notes.

Section 4.9. Changes in Corporate Structure. The Company shall not have changed its jurisdiction of incorporation or organization, as applicable, or, except as disclosed in Schedule 4.9 or any mergers, consolidations, or acquisitions consummated after the First Closing that are permitted under Section 10.2, been a party to any merger or consolidation or succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5.

Section 4.10. Funding Instructions. At least five (5) Business Days prior to the date of each Closing, each Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company confirming the information specified in Section 3 including (i) the name and address of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and number into which the purchase price for the applicable Notes is to be deposited. Each Purchaser has the right, but not the obligation, upon written notice (which may be by email) to the Company, to elect to deliver a micro deposit (less than $50.00) to the account identified in the written instructions no later than two (2) Business Days prior to such Closing. If a Purchaser delivers a micro deposit, a Responsible Officer must verbally verify the receipt and amount of the micro deposit to such Purchaser on a telephone call initiated by such Purchaser prior to such Closing. The Company shall not be obligated to return the amount of the micro deposit, nor will the amount of the micro deposit be netted against the Purchaser’s purchase price of the Notes.

Section 4.11. Rating of Notes. The Notes shall have been given a Rating Letter of not less than “AAA” by Kroll prior to the date of issuance thereof and evidence of such will have been provided to the Purchasers (which shall include the information described in Section 9.8 and shall include the related Private Letter Rating Rationale Report with respect to such rating).

Section 4.12. Proceedings and Documents. All corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory to such Purchaser and its special counsel, and such Purchaser and its special counsel shall have received all such counterpart originals or certified or other copies of such documents as such Purchaser or such special counsel may reasonably request and shall receive such information as may be reasonably necessary to complete any Holder Forms.

Section 5. Representations and Warranties of The Company.

The Company represents and warrants to each Purchaser that:

Section 5.1. Organization; Power and Authority. The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has the corporate power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement and the Notes and to perform the provisions hereof and thereof. The Company is a non-diversified, closed-end management investment company as such term is used in the 1940 Act.

Section 5.2. Authorization, Etc. This Agreement and the Notes have been duly authorized by all necessary corporate action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

Section 5.3. Disclosure. This Agreement and the documents, certificates or other writings delivered to the Purchasers by or on behalf of the Company, including through its agents, BofA Securities, Inc. and Citigroup Global Markets Inc., in connection with the transactions contemplated hereby and identified in Schedule 5.3, and the financial statements listed in Schedule 5.5 (this Agreement and such documents, certificates or other writings and such financial statements delivered to each Purchaser prior to May 3, 2022 being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Except as disclosed in the Disclosure Documents, since November 30, 2021 there has been no change in the financial condition, operations, business or properties of the Company except changes that individually or in the aggregate would not reasonably be expected to have a Material Adverse Effect.

Section 5.4. No Subsidiaries. The Company has no Subsidiaries as of the date of the First Closing, and as of the Second Closing, the Company has no Subsidiaries other than any Controlled Portfolio Entities acquired or formed after the First Closing.

Section 5.5. Financial Statements; Material Liabilities. The Company has delivered to each Purchaser copies of the financial statements of the Company listed on Schedule 5.5. All of said financial statements (including in each case the related schedules and notes) fairly present in all material respects the financial position of the Company as of the respective dates specified in such Schedule and the results of its operations and cash flows for the respective periods so specified and have been prepared in accordance with GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year-end adjustments). The Company does not have any Material liabilities that are not disclosed in the Disclosure Documents.

Section 5.6. Compliance with Laws, Other Instruments, Etc. The execution, delivery and performance by the Company of this Agreement and the Notes will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of the Company under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter, regulations or by-laws, shareholders agreement or any other Material agreement or instrument to which the Company is bound or by which the Company or any of its properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to the Company or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company, including, without limitation, the Securities Act and the 1940 Act.

Section 5.8. Litigation; Observance of Statutes and Orders. (a) There are no actions, suits, investigations or proceedings pending or, to the knowledge of the Company, threatened against or affecting the Company or any property of the Company in any court or before any arbitrator of any kind or before or by any Governmental Authority that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

(b) The Company is not in violation of any order, judgment, decree or ruling of any court, any arbitrator of any kind or any Governmental Authority and is not in violation of any applicable law, ordinance, rule or regulation of any Governmental Authority (including Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations that are referred to in Section 5.16), which violation would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 5.9. Taxes. The Company has filed all income tax returns that are required to have been filed in any jurisdiction, and has paid all taxes shown to be due and payable on such returns and all other taxes and assessments payable by them, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which is not individually or in the aggregate Material or (ii) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which the Company has established adequate reserves in accordance with GAAP. The U.S. federal income tax liabilities of the Company has been finally determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up to and including the fiscal year ended November 30, 2017.

Section 5.10. Title to Property; Leases. The Company has good and sufficient title to its Material properties, including all such properties reflected in the most recent audited balance sheet referred to in Section 5.5 or purported to have been acquired by the Company after said date (except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens prohibited by this Agreement, except for those defects in title and Liens that, individually or in the aggregate, would not have a Material Adverse Effect. All Material leases are valid and subsisting and are in full force and effect in all material respects.

Section 5.11. Licenses, Permits, Etc. The Company owns or possesses all licenses, permits, franchises, authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without known conflict with the rights of others, except for those conflicts that, individually or in the aggregate, would not have a Material Adverse Effect.

Section 5.12. Compliance with ERISA. Neither the Company nor any ERISA Affiliate maintains, contributes to or is obligated to maintain or contribute to, or has, at any time in the past six years, maintained, contributed to or been obligated to maintain or contribute to, any employee benefit plan which is subject to Title I or Title IV of ERISA or Section 4975 of the Code. Neither the Company nor any ERISA Affiliate is, or has ever been at any time within the past six years, a “party in interest” (as defined in section 3(14) of ERISA) or a “disqualified person” (as defined in Section 4975 of the Code) with respect to any such plan.

Section 5.13. Private Offering by the Company. Neither the Company nor anyone acting on its behalf has offered the Notes or any similar Securities for sale to, or solicited any offer to buy the Notes or any similar Securities from, or otherwise approached or negotiated in respect thereof with, any Person other than the Purchasers and not more than 35 other Institutional Investors, each of which has been offered the Notes at a private sale for investment. Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of Section 5 of the Securities Act or to the registration requirements of any Securities or blue sky laws of any applicable jurisdiction.

Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply the proceeds of the sale of the Notes as permitted under the 1940 Act including for the refinancing of existing Indebtedness, making new portfolio investments and for general corporate purposes. Assuming the required preparation, execution, delivery and filing of the applicable Federal Reserve Board forms by the Purchasers (such as Forms U-1 and G-1 through 4, as applicable), each Purchaser’s purchase of the Notes specified under this Agreement will not cause a violation of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), Regulation X of said Board (12 CFR 224) or Regulation T of said Board (12 CFR 220).

Section 5.15. Existing Indebtedness. (a) Except as described therein, Schedule 5.15 sets forth a complete and correct list of all outstanding Indebtedness of the Company as of April 30, 2022 (including descriptions of the obligors and obligees, principal amounts outstanding, any collateral therefor, and any Guaranty thereof), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Indebtedness of the Company. The Company is not in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Indebtedness of the Company and no event or condition exists with respect to any Indebtedness of the Company the outstanding principal amount of which exceeds $5,000,000 that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Indebtedness to become due and payable before its stated maturity or before its regularly scheduled dates of payment.

(b) The Company is not a party to, or otherwise subject to any provision contained in, any instrument evidencing Indebtedness of the Company, any agreement relating thereto or any other agreement or statute (including, but not limited to, its charter or other organizational document) which limits the amount of, or otherwise imposes restrictions on the incurring of, Indebtedness of the Company, except for the 1940 Act or as specifically indicated in Schedule 5.15.

Section 5.16. Foreign Assets Control Regulations, Etc. (a) Neither the Company nor any Controlled Entity (i) is a Blocked Person, (ii) has been notified that its name appears or may in the future appear on a State Sanctions List or (iii) is a target of sanctions that have been imposed by the United Nations or the European Union.

(b) Neither the Company nor any Controlled Entity (i) has violated, been found in violation of, or been charged or convicted under, any applicable U.S. Economic Sanctions Laws, Anti-Money Laundering Laws or Anti-Corruption Laws or (ii) to the Company’s knowledge, is under investigation by any Governmental Authority for possible violation of any U.S. Economic Sanctions Laws, Anti-Money Laundering Laws or Anti-Corruption Laws.

(i) constitutes or will constitute funds obtained on behalf of any Blocked Person or will otherwise be used by the Company or any Controlled Entity, directly or indirectly, (A) in connection with any investment in, or any transactions or dealings with, any Blocked Person, (B) for any purpose that would cause any Purchaser to be in violation of any U.S. Economic Sanctions Laws or (C) otherwise in violation of any U.S. Economic Sanctions Laws;

(ii) will be used, directly or indirectly, in violation of, or cause any Purchaser to be in violation of, any applicable Anti-Money Laundering Laws; or

(iii) will be used, directly or indirectly, for the purpose of making any improper payments, including bribes, to any Governmental Official or commercial counterparty in order to obtain, retain or direct business or obtain any improper advantage, in each case which would be in violation of, or cause any Purchaser to be in violation of, any applicable Anti-Corruption Laws.

(d) The Company has established procedures and controls which it reasonably believes are adequate (and otherwise comply with applicable law) to ensure that the Company and each Controlled Entity is and will continue to be in compliance with all applicable U.S. Economic Sanctions Laws, Anti-Money Laundering Laws and Anti-Corruption Laws.

Section 5.17. Status under Certain Statutes. The Company is subject to regulation under the 1940 Act. The Company is, and immediately after giving effect to the issuance of the Notes will be, in compliance with the 1940 Act, including, but not limited to, all leverage provisions specified in the 1940 Act. The Company is not subject to regulation under the Public Utility Holding Company Act of 2005, the ICC Termination Act of 1995, or the Federal Power Act.

Section 5.18. Ranking of Obligations. The Company’s payment obligations under this Agreement and the Notes will, upon issuance of the Notes, rank pari passu, without preference or priority, with all other unsecured and unsubordinated Indebtedness of the Company and senior to any mandatorily redeemable Preferred Stock issued by the Company.

Section 6. Representations of The Purchasers.

Section 6.1. Purchase for Investment. (a) Each Purchaser severally represents that it is purchasing the Notes for its own account or for one or more separate accounts maintained by such Purchaser or for the account of one or more pension or trust funds and not with a view to the distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all times be within such Purchaser’s or their control. Each Purchaser understands that the Notes have not been registered under the Securities Act or the securities laws of any state or foreign jurisdiction and may be resold, transferred or otherwise disposed of only if registered pursuant to the provisions of the Securities Act and any applicable state or foreign securities laws or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes.

(b) Each Purchaser is duly authorized to enter into this Agreement, and the person signing this Agreement on behalf of the Purchaser is authorized to do so, under all applicable governing documents (e.g., partnership agreement, trust instrument, pension plan, certificate of incorporation, bylaws, or operating agreement). This Agreement constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(c) Each Purchaser (and any account which is a separate legal entity contemplated in Section 6.1(a)) is an “accredited investor” as defined in Rule 501(a) promulgated under the Securities Act .

Section 6.2. Source of Funds. Each Purchaser severally represents that at least one of the following statements is an accurate representation as to each source of funds (a “Source”) to be used by such Purchaser to pay the purchase price of the Notes to be purchased by it hereunder:

(a) the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60 in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained by the same employer (or affiliate thereof as defined in PTE 95-60 or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile; or

(b) the Source is a separate account that is maintained solely in connection with such Purchaser’s fixed contractual obligations under which the amounts payable, or credited, to any employee benefit plan (or its related trust) that has any interest in such separate account (or to any participant or beneficiary of such plan (including any annuitant)) are not affected in any manner by the investment performance of the separate account; or

(c) the Source is either (i) an insurance company pooled separate account, within the meaning of PTE 90-1 or (ii) a bank collective investment fund, within the meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the Company in writing pursuant to this clause (c), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of all assets allocated to such pooled separate account or collective investment fund; or

(d) the Source constitutes assets of an “investment fund” (within the meaning of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM Exemption), no employee benefit plan’s assets that are managed by the QPAM in such investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, represent more than 20% of the total client assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling or controlled by the QPAM maintains an ownership interest in the Company that would cause the QPAM and the Company to be “related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the identity of such QPAM and (ii) the names of any employee benefit plans whose assets in the investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization, represent 10% or more of the assets of such investment fund, have been disclosed to the Company in writing pursuant to this clause (d);or

(e) the Source constitutes assets of a “plan(s)” (within the meaning of Part IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the INHAM nor a person controlling or controlled by the INHAM (applying the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10% or more interest in the Company and

(i) the identity of such INHAM and (ii) the name(s) of the employee benefit plan(s) whose assets constitute the Source have been disclosed to the Company in writing pursuant to this clause (e); or

(f) the Source is a governmental plan; or

(g) the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified to the Company in writing pursuant to this clause (g); or

(h) the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA.

As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and “separate account” shall have the respective meanings assigned to such terms in section 3 of ERISA.

Section 7. Information as to the Company.

Section 7.1. Financial and Business Information. The Company shall deliver or cause to be delivered to each Purchaser until it purchases a Note and then each holder of a Note that is an Institutional Investor:

(a) Quarterly Statements — within 60 days (or such shorter period as is 15 days after the mailing of the Company’s quarterly report to its stockholders) after the end of each quarterly fiscal period in each fiscal year of the Company (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of,

(i) an unaudited balance sheet of the Company, as at the end of such quarter, and

(ii) unaudited statements of operations and changes in net assets of the Company, for the portion of the fiscal year ending with such quarter,

all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year-end adjustments, provided that the Company shall be deemed to have made such delivery of such quarterly financial statements if it shall have timely made such quarterly financial statements available on its home page on the worldwide web (at the date of this Agreement located at http://www.kaynefunds.com) and shall have given to such holder of Notes prior notice of such availability on its home page in connection with each delivery (such availability and notice thereof being referred to as “Electronic Delivery”) provided, further, that the Company agrees also to deliver hard copies of such financial statements within the time period required above to any holder of Notes who has requested such delivery in writing, unless such written request was made within the last 10 days of the end of such time period, in which case, the Company will deliver such financial statements no later than 10 days after the conclusion of the time period required above;

(b) Annual Statements — within 105 days (or such shorter period as is 15 days greater than the period applicable to the filing of the Company’s Annual Report on Form N- CSR (the “Form N-CSR”) with the SEC regardless of whether the Company is subject to the filing requirements thereof) after the end of each fiscal year of the Company, duplicate copies of,

(i) a balance sheet and schedule of investments of the Company, as at the end of such year, and

(ii) statements of operations and changes in net assets of the Company, for such year,

all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion thereon (without a “going concern” or similar qualification or exception and without any qualification or exception as to the scope of the audit on which such opinion is based except for any “going concern” or similar exception resulting from the impending maturity of any indebtedness or any prospective breach of a financial covenant) of independent public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances, provided that the delivery within the time period specified above of the Company’s Form N-CSR for such fiscal year prepared in accordance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.1(b), and provided, further, that the Company shall be deemed to have made such delivery of such Form N-CSR if it shall have timely made Electronic Delivery thereof provided, further, that the Company agrees also to deliver hard copies of such financial statements within the time period required above to any holder of Notes who has requested such delivery in writing within the time period required above, unless such written request was made within the last 10 days of the end of such time period, in which case, the Company will deliver such financial statements no later than 10 days after the conclusion of the time period required above;

(i) one copy of each quarterly or annual financial statement, each regular or periodic report sent to the Company’s stockholders, each notice sent to the Company’s stockholders, each proxy statement and similar document filed with the SEC, each registration statement that shall have become effective (without exhibits except as expressly requested by such Purchaser until it purchases a Note and then such holder) and each final prospectus and all amendments thereto filed by the Company with the SEC; provided that Company shall be deemed to have made such delivery of such materials if it shall have made timely Electronic Delivery thereof, and

(ii) if requested by any holder of Notes, each financial statement, report or notice sent by the Company to its principal lending banks as a whole (excluding information sent to such banks in the ordinary course of administration of a bank facility, such as information relating to pricing and borrowing availability) or to any NRSRO.

(d) Notice of Default or Event of Default — promptly, and in any event within five Business Days after a Responsible Officer becoming aware of the existence of any Default or Event of Default, a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto;

(e) ERISA Matters — promptly, and in any event within five Business Days after a Responsible Officer becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto:

(i) with respect to any Plan, any reportable event, as defined in section 4043(c) of ERISA and the regulations thereunder, for which notice thereof has not been waived pursuant to such regulations as in effect on the date hereof;

(ii) the taking by the PBGC of steps to institute, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan;

(iii) any event, transaction or condition that could result in the incurrence of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if such liability or Lien, taken together with any other such liabilities or Liens then existing, would reasonably be expected to have a Material Adverse Effect; or

(iv) receipt of notice of the imposition of a Material financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non-U.S. Plans;

(f) Resignation or Replacement of Auditors — within 10 days following the date on which the Company’s auditors resign or the Company elects to change auditors, as the case may be, notification thereof, together with such further information as the Required Holders may request; provided that, the Company shall be deemed to have made such delivery of such notification if it shall have timely filed an 8-K with the SEC reporting such change;

(g) NRSRO Rating — upon receipt from any NRSRO currently rating the Notes of evidence of such rating (or change thereto), the Company shall deliver such evidence to the holders of the Notes. The evidence required to be delivered pursuant to this clause (g) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which documents are electronically mailed to the holder of Notes; and

(h) Requested Information — with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or properties of the Company (including, without limitation, actual copies of the quarterly and annual reports of the Company) or relating to the ability of the Company to perform its obligations under this Agreement and under the Notes as from time to time may be reasonably requested by such Purchaser until it purchases a Note and then such holder of Notes (including any such information as may be reasonably necessary to complete any Holder Forms).

Section 7.2. Officer’s Certificate. Each set of financial statements delivered to a Purchaser until it purchases a Note and then a holder of a Note pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a Senior Financial Officer setting forth (which, in the case of Electronic Delivery of any such financial statements, shall be by separate delivery of such certificate to each holder of Notes promptly upon the making of such Electronic Delivery):

(a) Covenant Compliance — the information (including detailed calculations) required in order to establish whether the Company was in compliance with the requirements of Sections 9.7, 10.4(b), 10.4(c) and 10.6 and any Additional Covenant incorporated herein pursuant to Section 9.9 during the quarterly or annual period covered by the statements then being furnished (including with respect to each such Section, where applicable, the calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Sections, and the calculation of the amount, ratio or percentage then in existence). In the event that the Company has made an election to measure any financial liability using fair value (which election is being disregarded for purposes of determining compliance with this Agreement pursuant to Section 22.3) as to the period covered by any such financial statement, such Senior Financial Officer’s certificate as to such period shall include a reconciliation from GAAP with respect to such election); and

(b) Event of Default — a statement that such Senior Financial Officer has reviewed the relevant terms hereof and has made, or caused to be made, under his or her supervision, a review of the transactions and conditions of the Company from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists, specifying the nature and period of existence thereof and what action the Company shall have taken or proposes to take with respect thereto.

Documents required to be delivered pursuant to this Section 7.2 may be delivered, electronically and, if so delivered shall be deemed to have been delivered on the date on which executed certificates or other documents are electronically mailed to the holder of a Note.

Section 7.3. Visitation. The Company shall permit the representatives of each Purchaser until it purchases a Note and then each holder of a Note that is an Institutional Investor:

(a) No Default — if no Default or Event of Default then exists, at the expense of such Purchaser or such holder of Notes and upon reasonable prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company with the Company’s officers, and, with the consent of the Company (which consent will not be unreasonably withheld) to visit the other offices and properties of the Company, not more than twice each calendar year; and

(b) Default — if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices or properties of the Company, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes said accountants to discuss the affairs, finances and accounts of the Company), all at such times and as often as may be reasonably requested.

Section 8. Payment and Prepayment of the Notes

Section 8.1. Maturity and Payment. As provided therein, the entire unpaid principal balance of each Note shall be due and payable on the Maturity Date thereof.

Section 8.2. Optional Prepayments with Make-Whole Amount and Special Optional Prepayments.

Section 8.2.1. Optional Prepayments of the Notes with Make-Whole Amount. The Company may, at its option, and to the extent prepayment of the Notes (specifically including the applicable Make-Whole Amount and accrued interest on the Notes) in accordance with the provisions of this Section 8.2.1 is permitted under the 1940 Act and Maryland law, upon notice as provided below, prepay at any time all, or from time to time any part of, the Notes, or if within 90 days prior to final maturity date of a particular Series, so long as no Default or Event of Default exists, that particular Series, in an amount not less than 5% of the aggregate principal amount of the Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid, together with interest accrued thereon to the date of such prepayment, and the Make-Whole Amount determined for the prepayment date with respect to such principal amount. The Company will give each holder of the Notes and the Paying Agent written notice of each optional prepayment under this Section 8.2.1 not less than 12 days (or 7 days in the case of any notice of prepayment in connection with a prepayment to cure any default under Sections 9.7(a) or 9.7(b), or both) and not more than 75 days prior to the date fixed for such prepayment. Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of each Series of the Notes to be prepaid on such date, the principal amount of each Note of such Series held by such holder to be prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as to the estimated Make-Whole Amount due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation. Two Business Days prior to such prepayment date, the Company shall deliver to each holder of Notes a certificate of a Senior Financial Officer specifying the calculation of such Make-Whole Amount as of the specified prepayment date.

Section 8.2.2. Special Optional Prepayments. If the 1940 Act Senior Notes Asset Coverage is less than or equal to 325%, for any five (5) Business Days within a ten (10) Business Day period determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination within the ten Business Day period, the Company may, at its option, and to the extent prepayment of the Notes (specifically including the applicable Make-Whole Amount and accrued interest on the Notes) in accordance with the provisions of this Section 8.2.2 is permitted under the 1940 Act and Maryland law, upon notice as provided below, prepay all or any part of the Notes at 100% of the principal amount so prepaid, together with interest accrued thereon to the date of such prepayment, and the Make-Whole Amount determined for the prepayment date with respect to such principal amount. Notwithstanding anything to the contrary set forth herein, the Make-Whole Amount for the Notes prepaid pursuant to this Section 8.2.2 shall be equal to two percent (2%) of the principal amount so prepaid; provided, however, that (a) the amount of Notes to be prepaid pursuant to this Section 8.2.2 shall at no time exceed an amount which results in a 1940 Act Senior Notes Asset Coverage of more than 340% pro forma for such prepayment, determined on the basis of values calculated as of a time within 48 hours (not including Sundays or holidays) next preceding the time of such determination, (b) immediately after giving effect to such prepayment, the aggregate amount of Indebtedness for borrowed money of the Company shall be less than the aggregate amount of Indebtedness for borrowed money of the Company immediately prior to such prepayment by the amount of Notes so prepaid and (c) the Company may not borrow under its revolving credit facility immediately prior to such prepayment for the purpose of financing such prepayment. The Company will give each holder of the Notes being prepaid pursuant to this Section 8.2.2 and the Paying Agent written notice of each optional prepayment under this Section 8.2.2 not less than 12 days and not more than 75 days prior to the date fixed for such prepayment. Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of the Notes to be prepaid on such date, the principal amount of each Note held by such holder to be prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and the Make-Whole Amount due in connection with such prepayment.

Section 8.2.3. Prepayments of Notes One Month Prior to Maturity at Par. Notwithstanding anything contained herein to the contrary, so long as no Default or Event of Default exists, the Company may, at its option, upon notice as provided below redeem all of the Notes of a particular Series on or after the date which is 30 days prior to maturity of such Series of Notes at 100% of the principal amount of such Notes, together with interest on such Notes accrued to the date of prepayment and without any Make-Whole Amount. The Company will give each holder of Notes subject to such redemption and the Paying Agent written notice of each optional prepayment under this Section 8.2.3 not less than 12 days and not more than 75 days prior to the date fixed for such prepayment. Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of each Note to be prepaid on such date and the interest to be paid on the prepayment date.

Section 8.2.4. Optional Prepayment during Extended 10-Day Period. The Company may, upon notice as required below, prepay Notes to cure a Default under Section 11(c) (consisting solely of a Default under Section 9.7), at 100% of the principal amount so prepaid, together with interest accrued thereon to the date of such prepayment, and the Make-Whole Amount (referred to below) determined for such prepayment date with respect to the principal amount. The Company will give each holder of Notes written notice of each prepayment under this Section 8.2.4 prior to the end of the Initial 30-Day Period. Such notice shall specify such date (which shall be a Business Day) prior to the end of the Extended 10-Day Period, the aggregate principal amount of Notes to be prepaid, the principal amount of Notes held by such holder to be prepaid, and the interest and Make-Whole Amount (referred to below). In the event the Company makes any partial prepayment of Notes, the Existing Notes and any other Senior Securities to cure any Default under Section 11(c) during the Extended 10-Day Period, the principal amount of Notes, Existing Notes and any other Senior Securities to be prepaid shall be allocated among all of the Notes, Existing Notes and other Senior Securities at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment. Notwithstanding anything to the contrary set forth herein, the Make-Whole Amount for the Notes prepaid during the Extended 10 Day Period shall be equal to one percent (1%) of the principal amount so repaid, provided, however, that the amount of Notes, the Existing Notes and the other Senior Securities to be repaid during the Extended 10-Day Period shall at no time exceed an amount necessary for the Company to be in pro forma compliance with Section 9.7 after giving effect to such repayment.

Section 8.3. Allocation of Partial Prepayments. In the case of each partial prepayment of the Notes pursuant to Section 8.2.1, 8.2.2, 8.2.3. or 8.2.4, the principal amount of the Notes to be prepaid shall be allocated among all of the Notes at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment, provided, that in the case of any prepayment of a particular Series of Notes within 90 days prior to the final maturity date thereof pursuant to Section 8.2.1 or within 30 days prior to the final maturity date thereof pursuant to Section 8.2.3, the principal amount of the Notes of such Series to be prepaid shall be allocated among all of the Notes of such Series at the time outstanding in proportion, as nearly as practicable to the respective unpaid principal amount thereof not theretofore called for prepayment.

Section 8.4. Maturity; Surrender, Status, Etc. In the case of each prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment (which shall be a Business Day), together with interest on such principal amount accrued to such date and the applicable Make-Whole Amount. From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the interest and Make-Whole Amount, interest on such principal amount shall cease to accrue. Any Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of any Note.

Section 8.5. Purchase of Notes. The Company will not and will not permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes except (a) upon the payment or prepayment of the Notes in accordance with the terms of this Agreement and the Notes or (b) pursuant to an offer to purchase made by the Company or an Affiliate pro rata to the holders of all of the Notes at the time outstanding upon the same terms and conditions with respect to the Notes. Any such offer shall provide each holder with sufficient information to enable it to make an informed decision with respect to such offer, and shall remain open for at least 20 Business Days. If the holders of more than 50% of the principal amount of the Notes, then outstanding accept such offer, the Company shall promptly notify the remaining holders of such fact and the expiration date for the acceptance by holders of Notes of such offer shall be extended by the number of days necessary to give each such remaining holder at least 10 Business Days from its receipt of such notice to accept such offer. The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to any provision of this Agreement and no Notes may be issued in substitution or exchange for any such Notes. Notwithstanding anything contained in this Section 8.5 to the contrary, if and so long as any Default or Event of Default shall have occurred and be continuing, any prepayment of the Notes pursuant to the provisions of Section 8.5. shall be allocated among all of the Notes of all Series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof.

Section 8.6. Make-Whole Amount. “Make-Whole Amount” means, with respect to any Note, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount of such Called Principal, provided that the Make-Whole Amount may in no event be less than zero. For the purposes of determining the Make-Whole Amount, the following terms have the following meanings:

“Called Principal” means, with respect to any Note, the principal of such Note that is to be prepaid pursuant to Section 8.2.1 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

“Discounted Value” means, with respect to the Called Principal of any Note, the amount obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice and at a discount factor (applied on the same periodic basis as that on which interest on such Note is payable) equal to the Reinvestment Yield with respect to such Called Principal.

“Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (a) .50% (50 basis points) plus (b) the yield to maturity implied by the “Ask Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as “Page PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”) having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date. If there are no such U.S. Treasury securities Reported having a maturity equal to such Remaining Average Life, then such implied yield to maturity will be determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted financial practice and (ii) interpolating linearly between the “Ask Yields” Reported for the applicable most recently issued actively traded on-the-run U.S. Treasury securities with the maturities (1) closest to and greater than such Remaining Average Life and (2) closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.

If such yields are not Reported or the yields Reported as of such time are not ascertainable (including by way of interpolation), then “Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (x) .50% (50 basis points) plus (y) the yield to maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity having a term equal to the Remaining Average Life of such Called Principal as of such Settlement Date. If there is no such U.S. Treasury constant maturity having a term equal to such Remaining Average Life, such implied yield to maturity will be determined by interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.

“Remaining Average Life” means, with respect to any Called Principal, the number of years obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by multiplying (a) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (b) the number of years, computed on the basis of a 360-day year comprised of twelve 30-day months and calculated to two decimal places, that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.

“Remaining Scheduled Payments” means, with respect to the Called Principal of any Note, all payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, provided that if such Settlement Date is not a date on which interest payments are due to be made under the terms of the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.2.1 or Section 12.1.

“Settlement Date” means, with respect to the Called Principal of any Note, the date on which such Called Principal is to be prepaid pursuant to Section 8.2.1 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

Section 8.7. Adjustment Period. Without limiting the provisions of Section 9.8, in addition to all other amounts due and payable hereunder and under the Notes, the interest rate applicable to each Series of Notes (including any Default Rate applicable thereto) shall be increased by an amount equal to 1.00% per annum during any Adjustment Period.

Section 9. Affirmative Covenants.

From the date of this Agreement until the First Closing and thereafter so long as any of the Notes are outstanding, the Company covenants that:

Section 9.1. Compliance with Law. Without limiting Section 10.3, the Company will comply with all laws, ordinances or governmental rules or regulations to which it is subject, including, without limitation, ERISA, the USA PATRIOT Act, Environmental Laws and the other laws and regulations that are referred to in Section 5.16, and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of its properties or to the conduct of its businesses, in each case to the extent necessary to ensure that non-compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such licenses, certificates, permits, franchises and other governmental authorizations would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. Without limiting the foregoing, the Company shall remain in material compliance, at all times with the 1940 Act, including, but not limited to, all leverage provisions specified in the 1940 Act.

Section 9.2. Insurance. The Company will maintain, with financially sound and reputable insurers, insurance with respect to its properties and businesses against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated.

Section 9.3. Maintenance of Properties. The Company will maintain and keep, or cause to be maintained and kept, its properties in good repair, working order and condition (other than ordinary wear and tear), so that the business carried on in connection therewith may be properly conducted at all times, provided that this Section 9.3 shall not prevent the Company from discontinuing the operation and the maintenance of any of its properties if such discontinuance is desirable in the conduct of its business and the Company has concluded that such discontinuance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 9.4. Payment of Taxes. The Company will file all income tax or similar tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges, or levies payable by it, to the extent the same have become due and payable and before they have become delinquent, provided that the Company need not pay any such tax, assessment, charge or levy if (i) the amount, applicability or validity thereof is contested by the Company on a timely basis in good faith and in appropriate proceedings, and the Company has established adequate reserves therefor in accordance with GAAP on the books of the Company or (ii) the nonpayment of all such taxes, assessments, charges and levies would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 9.5. Corporate Existence, Etc. Subject to Section 10.2, the Company will at all times preserve and keep in full force and effect its corporate existence. Subject to Section 10.2, the Company will at all times preserve and keep in full force and effect all rights and franchises of the Company unless, in the good faith judgment of the Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise would not, individually or in the aggregate, have a Material Adverse Effect.

Section 9.6. Books and Records. The Company will maintain proper books of record and account in conformity with GAAP and all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction over the Company, as the case may be.

Section 9.7. Asset Coverage. (a) The Company shall maintain, as of each Valuation Date, the 1940 Act Asset Coverage.

(b) The Company shall satisfy, as of each Valuation Date, the Basic Maintenance Test.

Section 9.8. Current Rating on the Notes. The Company shall at all times maintain a current rating given by a NRSRO of at least Investment Grade with respect to the Notes and shall not at any time have any rating given by a NRSRO of less than Investment Grade with respect to the Notes. Evidence of such rating (which may be in the form of a report, a letter, any combination of the foregoing or similar communication) shall (a) refer to the Private Placement Number issued by PPN CUSIP Unit of CUSIP Global Services (in cooperation with the SVO) in respect of each Series of Notes, (b) not include any prohibition against a holder sharing such evidence with the SVO or any other regulatory authority having jurisdiction over such holder, (c) be delivered by the Company to the holders at least annually (on or before the anniversary of the date of the First Closing) and promptly upon any change in the rating an updated Rating Letter evidencing such rating and an updated Rating Rationale Report with respect to such rating along with any other information or details requested by the SVO.

Section 9.9. Most Favored Lender Status. In the event that the Company shall at any time after the date of this Agreement enter into, assume or otherwise become bound by or obligated under any agreement creating or evidencing Indebtedness of the Company in excess of $10,000,000 in principal amount (other than Indebtedness permitted by Section 10.6) (a “Reference Agreement”) containing one or more Additional Covenants, the terms of this Agreement shall, without any further action on the part of the Company or any of the holders of the Notes, be deemed to be amended automatically to include each Additional Covenant contained in such Reference Agreement. The Company further covenants to promptly execute and deliver at its expense (including, without limitation, the fees and expenses of counsel for the holders of the Notes) an amendment to this Agreement in form and substance satisfactory to the Required Holders evidencing the amendment of this Agreement to include such Additional Covenants, provided that the execution and delivery of such amendment shall not be a precondition to the effectiveness of such amendment as provided for in this Section 9.9, but shall merely be for the convenience of the parties hereto.

Notwithstanding the foregoing, (A) if any Additional Covenant that has been incorporated herein pursuant to this Section 9.9 is subsequently amended or modified in the relevant Reference Agreement, such Additional Covenant, as amended or modified, shall be deemed incorporated by reference into this Agreement and replace such Additional Covenant as originally incorporated, mutatis mutandi, as if set forth fully in this Agreement, effective beginning on the date on which such amendment or modification is effective under the relevant Reference Agreement and (B) if any Additional Covenant that has been incorporated herein pursuant to this Section 9.9 is subsequently removed or terminated from the relevant Reference Agreement or the Company is otherwise no longer required to comply therewith under the relevant Reference Agreement, the Company, beginning on the effective date such Additional Covenant is removed or terminated from the relevant Reference Agreement or the Company otherwise no longer required to comply with such Additional Covenant, shall no longer be or remain obligated to comply with such Additional Covenant hereunder. In the event that an Additional Covenant is amended, modified, removed or terminated pursuant to this Section 9.9 and the Company and the Required Holders previously entered into an amendment to incorporate such Additional Covenant herein, the holders of the Notes, upon the request of the Company, shall enter into an amendment to this Agreement to reflect such amendment, modification, removal or termination of such Additional Covenant; provided that the failure of the holders of the Notes and the Company to execute and deliver any such amendment shall not adversely affect the automatic incorporation of any amended or modified Additional Covenants into, or the automatic removal or termination of Additional Covenants from, this Agreement as provided above in this Section 9.9.

Section 9.10. Ranking of Obligations. The Company’s payment obligations under this Agreement and the Notes shall at all times rank pari passu, without preference or priority, with all other unsecured and unsubordinated Indebtedness and senior to any mandatorily redeemable Preferred Stock issued by the Company.

Section 9.11. Maintenance of Status. The Company will remain a non-diversified, closed- end company registered with the SEC under the 1940 Act. The Company will also invest at least 80% of its Total Assets in the securities of energy infrastructure companies (as more fully described in the Company’s investment policies as in effect on November 30, 2021).

Although it will not be a Default or Event of Default if the Company fails to comply with any provision of Section 9 on or after the date of this Agreement and prior to the First Closing, if such a failure occurs, then any of the Purchasers at any Closing may elect not to purchase the Notes on the date of such Closing that is specified in Section 3.

Section 10. Negative Covenants.

From the date of this Agreement until the First Closing and thereafter, so long as any of the Notes are outstanding, the Company covenants that:

Section 10.1. Transactions with Affiliates. The Company will comply with the 1940 Act provisions, rules and regulations relating to transactions (including without limitation the purchase, lease, sale or exchange of properties of any kind or the rendering of any service) with any Affiliate and such transactions shall be pursuant to the reasonable requirements of the Company’s business and upon terms fair and reasonable to the Company.

Section 10.2. Merger, Consolidation, Etc. The Company will not consolidate with or merge with any other Person or convey, transfer or lease all or substantially all of its assets in a single transaction or series of transactions to any Person unless:

(a) the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease all or substantially all of the assets of the Company as an entirety, as the case may be, shall be a solvent corporation or limited liability company organized and existing under the laws of the United States or any State thereof (including the District of Columbia), and, if the Company is not such corporation or limited liability company, (i) such corporation or limited liability company shall have executed and delivered to each holder of any Notes its assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the Notes and (ii) such corporation or limited liability company shall have caused to be delivered to each holder of any Notes an opinion of nationally recognized independent counsel, or other independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; and

(b) immediately before and immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing.

No such conveyance, transfer or lease of substantially all of the assets of the Company shall have the effect of releasing the Company or any successor corporation or limited liability company that shall theretofore have become such in the manner prescribed in this Section 10.2 from its liability under this Agreement or the Notes.

Section 10.3. Economic Sanctions, Etc. The Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the Notes) with any Person if such investment, dealing or transaction (i) would cause any Purchaser or holder or any affiliate of such Purchaser or holder to be in violation of, or subject to sanctions under, any law or regulation applicable to such Purchaser or holder, or (ii) is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws.

Section 10.4. Certain Other Restrictions. (a) If the Rating Agency Guidelines require the Company to receive a prior written confirmation that certain actions would not impair the rating then assigned by the Rating Agency to a Senior Security, then the Company will not engage in such actions, unless it has received written confirmation from each such Rating Agency that such actions would not impair the rating then assigned by such Rating Agency.

(b) The Company will not declare, pay or set apart for payment any dividend or other distribution (other than a dividend or distribution paid in shares of, or options, warrants or rights to subscribe for or purchase, common shares or other shares of capital stock of the Company) upon any class of shares of capital stock of the Company or redeem, purchase or otherwise acquire any capital stock of the Company, unless, in every such case, immediately after such transaction, the 1940 Act Asset Coverage would be achieved after deducting the amount of such dividend, distribution, redemption price or purchase price, as the case may be; provided, however, that dividends may be declared upon, and the Company may redeem, purchase or otherwise acquire any Preferred Stock of the Company if the Notes and any other Senior Securities have an asset coverage (as determined in accordance with Section 18(h) of the 1940 Act as in effect on the date of this Agreement) of at least 200% at the time of declaration of dividends or the date of redemption or purchase, after deducting the amount of such dividend, redemption price or purchase price.

(c) A declaration of a dividend or other distribution on or purchase or redemption of any common or preferred shares of capital stock of the Company is prohibited (i) at any time that an Event of Default has occurred and is continuing or (ii) if after giving effect to such declaration, the Company would not satisfy the Basic Maintenance Test.

Section 10.5. No Subsidiaries. The Company will not at any time have any Subsidiaries other than such entities from time to time that may represent portfolio investments consistent with the Company’s investment objective and strategies (such entities being referred to as “Controlled Portfolio Entities”), which Controlled Portfolio Entities shall not be consolidated with the Company for the purposes of any covenants, agreements or other determinations hereunder.

Section 10.6. Secured Debt. The Company will not at any time permit the aggregate unpaid principal amount of all Indebtedness of the Company secured by Liens on any assets of the Company (“Secured Indebtedness”) to be outstanding for more than 60 days at a time without re-payment thereof and, in addition, will not permit Secured Indebtedness to exceed 5% of the Total Assets at the time of incurrence of any such Indebtedness, provided for purposes of this section, short sales, futures transactions and swap transactions effected in accordance with the 1940 Act and applicable interpretive guidance issued by the SEC will not be prohibited or restricted by this covenant.

Section 10.7. Level 3 Assets. The Company will not enter into an agreement to make Investments that are Level 3 Assets if, immediately after giving effect to such Investments on a pro forma basis, the aggregate value of all Level 3 Assets of the Company exceeds 30% of Total Assets. For the purpose of measuring compliance with this Section 10.7, the value of the assets shall be determined on the basis of values calculated as of a time within 48 hours (not including Saturdays and Sundays or holidays) next preceding the time of the date of determination.

Although it will not be a Default or Event of Default if the Company fails to comply with any provision of Section 10 on or after the date of this Agreement and prior to the First Closing, if such a failure occurs, then any of the Purchasers at any Closing may elect not to purchase the Notes on the date of such Closing that is specified in Section 3.

Section 11. Events of Default.

An “Event of Default” shall exist if any of the following conditions or events shall occur and be continuing:

(a) the Company defaults in the payment of any principal, Make-Whole Amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise; or

(b) the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or

(c) the Company defaults in the performance of or compliance with any term contained in Sections 7.1(d), 9.7, 9.8, 10.4(b), 10.4(c), 10.6, 10.7 and any Additional Covenant incorporated herein pursuant to Section 9.9, and such default is not remedied within 30 days; provided that in the case of any such default under Section 9.7, such 30- day period (the “Initial 30- Day Period”) shall be extended by an additional 10-day period (the “Extended 10-Day Period”) if the Company shall have given notice prior to the end of such Initial 30-Day Period of an optional prepayment of such principal amount of Notes pursuant to Section 8.2, the Existing Notes pursuant to Section 8.2 of the Existing Note Purchase Agreements and any other Senior Securities which, when consummated, shall be sufficient to cure such default); or

(d) the Company defaults in the performance of or compliance with any term contained herein (other than those referred to in Sections 11(a), (b) and (c)) and such default is not remedied within 30 days after the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and (ii) the Company receiving written notice of such default from any holder of a Note (any such written notice to be identified as a “notice of default” and to refer specifically to this Section 11(d)); or

(e) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in this Agreement or in any writing furnished in connection with the transactions contemplated hereby proves to have been false or incorrect in any material respect on the date as of which made; or

(f) (i) the Company is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make-whole amount or interest on any Indebtedness that is outstanding in an aggregate principal amount of at least $5,000,000 beyond any period of grace provided with respect thereto, or (ii) the Company is in default in the performance of or compliance with any term of any evidence of any Indebtedness in an aggregate outstanding principal amount of at least $5,000,000 or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition such Indebtedness has become, or has been declared (or one or more Persons are entitled to declare such Indebtedness to be) due and payable before its stated maturity or before its regularly scheduled dates of payment; or

(g) the Company (i) is generally not paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or

(h) a court or Governmental Authority of competent jurisdiction enters an order appointing, without consent by the Company, a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company, or any such petition shall be filed against the Company and such petition shall not be dismissed within 60 days; or

(i) a final judgment or judgments for the payment of money aggregating in excess of $5,000,000 are rendered against the Company and which judgments are not, within 60 days after entry thereof, bonded, discharged or stayed pending appeal, or are not discharged within 60 days after the expiration of such stay; or

(j) KA Fund Advisors, LLC or one of its Affiliates is no longer the advisor of the Company; or

(k) if, pursuant to Section 18(a)(1)(C)(ii) of the 1940 Act, on the last day of each of twenty-four consecutive calendar months the Notes shall have an asset coverage of less than 100%; or

(l) if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of any amortization period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Plan may become a subject of any such proceedings, (iii) the aggregate “amount of unfunded benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under all Plans, determined in accordance with Title IV of ERISA, shall exceed $35,000,000, (iv) the aggregate present value of accrued benefit liabilities under all funded Non-U.S. Plans exceeds the aggregate current value of the assets of such Non-U.S. Plans allocable to such liabilities, (v) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, (vi) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, (vii) the Company or any Subsidiary establishes or amends any employee welfare benefit plan that provides post-employment welfare benefits in a manner that would increase the liability of the Company or any Subsidiary thereunder, (viii) the Company or any Subsidiary fails to administer or maintain a Non-U.S. Plan in compliance with the requirements of any and all applicable laws, statutes, rules, regulations or court orders or any Non-U.S. Plan is involuntarily terminated or wound up, or (ix) the Company or any Subsidiary becomes subject to the imposition of a financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non-U.S. Plans; and any such event or events described in clauses (i) through (ix) above, either individually or together with any other such event or events, could reasonably be expected to have a Material Adverse Effect. As used in this Section 11(k), the terms “employee benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to such terms in section 3 of ERISA; or As used in Section 11(l), the terms “employee benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to such terms in section 3 of ERISA.

SECTION 12. REMEDIES ON DEFAULT, ETC.

Section 12.1. Acceleration. (a) If an Event of Default with respect to the Company described in Section 11(g) or (h) (other than an Event of Default described in clause (i) of Section 11(g) or described in clause (vi) of Section 11(g) by virtue of the fact that such clause encompasses clause (i) of Section 11(g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable.

(b) If any other Event of Default has occurred and is continuing, the Required Holders may at any time at its or their option, by notice or notices to the Company, declare all the Notes then outstanding to be immediately due and payable.

(c) If any Event of Default described in Section 11(a) or (b) has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of Default may at any time, at its or their option, by notice or notices to the Company, declare all of the Notes held by it or them to be immediately due and payable.

Upon any Notes becoming due and payable under this Section 12.1, whether automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest thereon (including, but not limited to, interest accrued thereon at the applicable Default Rate) and (y) the Make-Whole Amount, determined in respect of such principal amount (to the full extent permitted by applicable law) shall all be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived. The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from repayment by the Company (except as herein specifically provided for) and that the provision for payment of a Make-Whole Amount, in the event that the Notes are prepaid or are accelerated as a result of an Event of Default, is intended to provide compensation for the deprivation of such right under such circumstances.

Section 12.2. Other Remedies. If any Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.

Section 12.3. Rescission. At any time after any Notes have been declared due and payable pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all overdue interest on the Notes, all principal of and Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal, Make-Whole Amount, if any, and (to the extent permitted by applicable law) any overdue interest in respect of the Notes, at the applicable Default Rate, (b) neither the Company nor any other Person shall have paid any amounts which have become due solely by reason of such declaration, (c) all Events of Default and Defaults, other than non-payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (d) no judgment or decree has been entered for the payment of any monies due pursuant hereto or to the Notes. No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon.

Section 12.4. No Waivers or Election of Remedies, Expenses, Etc. No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies. No right, power or remedy conferred by this Agreement or by any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise. Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all costs and expenses of such holder incurred in any enforcement or collection under this Section 12, including, without limitation, reasonable attorneys’ fees, expenses and disbursements.

Section 13. Registration; Exchange; Substitution of Notes.

Section 13.1. Registration of Notes. Each Purchaser and each subsequent holder of the Notes severally acknowledges and agrees that any Notes received in connection with this Agreement will bear the legend set forth on Exhibit 13.1. The Company or its agent on the Company’s behalf shall keep at its principal executive office a register for the registration and registration of transfers of Notes. The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each transferee of one or more Notes shall be registered in such register. If any holder of one or more Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes shall also be registered in such register as an owner and holder thereof and (b) at any such beneficial owner’s option, either such beneficial owner or its nominee may execute any amendment, waiver or consent pursuant to this Agreement. Prior to due presentment for registration of transfer, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary. The Company shall give to any holder of a Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes.

Section 13.2. Transfer and Exchange of Notes. Upon surrender of any Note to the Company or its agent at the address and to the attention of the designated officer (all as specified in Section 18(iii)), for registration of transfer or exchange (and in the case of a surrender for registration of transfer accompanied by a written instrument of transfer duly executed by the registered holder of such Note or such holder’s attorney duly authorized in writing and accompanied by the relevant name, address and other information for notices of each transferee of such Note or part thereof), within ten Business Days thereafter, the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new Notes of the same Series (as requested by the holder thereof) in exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note. Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of Exhibit 1-A or 1-B, as applicable. Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon. The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes. Notes shall not be transferred in denominations of less than $250,000, provided that if necessary to enable the registration of transfer by a holder of its entire holding of Notes of a Series, one Note of such Series may be in a denomination of less than $250,000. Notwithstanding anything to the contrary in this Section 13.2, no Notes shall be resold, transferred or otherwise disposed of unless such Notes are registered pursuant to the provisions of the Securities Act and any applicable state or foreign securities laws or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes. Each holder of Notes will be deemed, by its acceptance thereof, (i) to have made the representations set forth in Section 6 of this Agreement and (ii) to have agreed to the confidentiality provisions set forth in Section 20 of this Agreement.

Section 13.3. Replacement of Notes. Upon receipt by the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and

(a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such Note is, or is a nominee for, an original Purchaser or another holder of a Note with a minimum net worth of at least $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or

(b) in the case of mutilation, upon surrender and cancellation thereof,

within ten Business Days thereafter, the Company at its own expense shall execute and deliver, in lieu thereof, a new Note of the same Series, dated and bearing interest from the date to which interest shall have been paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.

Section 14. Payments on Notes.

Section 14.1. Place of Payment. Subject to Section 14.2, payments of principal, Make-Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in New York, New York at the principal office of The Bank of New York Mellon located at 240 Greenwich Street, 7E, New York, New York 10286. The Company may at any time, by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction.

Section 14.2. Home Office Payment. So long as any Purchaser or its nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal, Make-Whole Amount, if any, interest and all other amounts becoming due hereunder by the method and at the address specified for such purpose below such Purchaser’s name in Schedule A, or by such other method or at such other address as such Purchaser shall have from time to time specified to the Company and the Paying Agent (which notice to the Paying Agent will be in accordance with Section 11(ii) of the Agency Agreement) in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, such Purchaser shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1. Prior to any sale or other disposition of any Note held by a Purchaser or its nominee, such Purchaser will, at its election, either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2. The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by a Purchaser under this Agreement and that has made the same agreement relating to such Note as the Purchasers have made in this Section 14.2.

Section 14.3. Agency Agreement. The Company and the holders of the Notes agree that in addition to the other provisions of this Section 14, the Company can make optional prepayments on the Notes pursuant to Sections 8.2.1, 8.2.2, 8.2.3 and 8.2.4 pursuant to the Agency Agreement substantially in the form of Exhibit 14.3 hereto or in such other form as is reasonably acceptable to the Company and the Required Holders. The Company shall deliver to the Paying Agent under the Agency Agreement copies of all notices and certificates under Sections 8.2.1, 8.2.2, 8.2.3 and 8.2.4 delivered by the Company to any holder of Notes concurrently with the delivery thereof to such holder.

Section 14.4. FATCA Information. By acceptance of any Note, the holder of such Note agrees that such holder will with reasonable promptness duly complete and deliver to the Company, or to such other Person as may be reasonably requested by the Company, from time to time (a) in the case of any such holder that is a United States Person, such holder’s United States tax identification number or other Forms reasonably requested by the Company necessary to establish such holder’s status as a United States Person under FATCA and as may otherwise be necessary for the Company to comply with its obligations under FATCA and (b) in the case of any such holder that is not a United States Person, such documentation prescribed by applicable law (including as prescribed by section 1471(b)(3)(C)(i) of the Code) and such additional documentation as may be necessary for the Company to comply with its obligations under FATCA and to determine that such holder has complied with such holder’s obligations under FATCA or to determine the amount (if any) to deduct and withhold from any such payment made to such holder. Nothing in this Section 14.4 shall require any holder to provide information that is confidential or proprietary to such holder unless the Company is required to obtain such information under FATCA and, in such event, the Company shall treat any such information it receives as confidential.

Section 15. Expenses, Etc.

Section 15.1. Transaction Expenses. Whether or not the transactions contemplated hereby are consummated, the Company will pay all costs and expenses (including reasonable attorneys’ fees of a special counsel and, if reasonably required by the Required Holders, local or other counsel) incurred by the Purchasers and each other holder of a Note in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement or the Notes (whether or not such amendment, waiver or consent becomes effective), including, without limitation: (a) the reasonable costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement or the Notes or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement or the Notes, or by reason of being a holder of any Note, (b) the reasonable costs and expenses, including financial advisors’ fees, incurred in connection with the insolvency or bankruptcy of the Company or in connection with any work-out or restructuring of the transactions contemplated hereby and by the Notes and (c) the costs and expenses incurred in connection with the initial filing of this Agreement and all related documents and financial information with the SVO, provided that such costs and expenses under this clause (c) shall not exceed $3,500 per Series. The Company will pay, and will save each Purchaser and each other holder of a Note harmless from (i), all claims in respect of any fees, costs or expenses if any, of brokers and finders (other than those, if any, retained by a Purchaser or other holder in connection with its purchase of the Notes), (ii) any and all wire transfer fees that any bank or other financial institution deducts from any payment under such Note to such holder or otherwise charges to a holder of a Note with respect to a payment under such Note and (iii) any judgment, liability, claim, order, decree, fine, penalty, cost, fee, expense (including reasonable attorneys’ fees and expenses) or obligation resulting from the consummation of the transactions contemplated hereby, including the use of the proceeds of the Notes by the Company.

Section 15.2. Certain Taxes. The Company agrees to pay all stamp, documentary or similar taxes or fees which may be payable in respect of the execution and delivery or the enforcement of this Agreement or the execution and delivery (but not the transfer) or the enforcement of any of the Notes in the United States or any other jurisdiction where the Company has assets or of any amendment of, or waiver or consent under or with respect to, this Agreement or of any of the Notes, and to pay any value added tax due and payable in respect of reimbursement of costs and expenses by the Company pursuant to this Section 15, and will save each holder of a Note to the extent permitted by applicable law harmless against any loss or liability resulting from nonpayment or delay in payment of any such tax or fee required to be paid by the Company hereunder.

Section 15.3. Survival. The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement or the Notes, and the termination of this Agreement.

Section 16. Survival of Representations and Warranties; Entire Agreement.

All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note or portion thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of such Purchaser or any other holder of a Note. All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement. Subject to the preceding sentence, this Agreement and the Notes embody the entire agreement and understanding between each Purchaser and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.

Section 17. Amendment and Waiver.

Section 17.1. Requirements. This Agreement and the Notes may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders, except that (a) no amendment or waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to any Purchaser unless consented to by such Purchaser in writing, and (b) no such amendment or waiver may, without the written consent of each holder of Notes affected thereby (i) subject to the provisions of Section 12 relating to acceleration or rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of interest or of the Make-Whole Amount on, the Notes, (ii) change the percentage of the principal amount of the Notes the holders of which are required to consent to any such amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.

Section 17.2. Solicitation of Holders of Notes.

(a) Solicitation. The Company will provide each Purchaser and each holder of Notes (irrespective of the amount of Notes then owned by it) with sufficient information, sufficiently far in advance of the date a decision is required, to enable such holder of Notes to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes. The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this Section 17 to each Purchaser and holder of Notes promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite Purchasers or holders of Notes.

(b) Payment. The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security or provide other credit support, to any Purchaser or holder of Notes as consideration for or as an inducement to the entering into by any Purchaser or holder of Notes of any waiver or amendment of any of the terms and provisions hereof or of the Notes unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each Purchaser and holder of Notes even if such Purchaser or holder of Notes did not consent to such waiver or amendment.

(c) Consent in Contemplation of Transfer. Any consent made pursuant to this Section 17 by the holder of any Note that has transferred or has agreed to transfer such Note to (i)the Company, (ii) any Affiliate of the Company or (iii) any other Person in connection with, or in anticipation of, such other Person acquiring, making a tender offer for or merging with the Company and/or any of its Affiliates, in each case in connection with such consent, shall be void and has provided or has agreed to provide such written consent as a condition to such transfer shall be void and of no force or effect except solely as to such holder, and any amendments effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of Notes that were acquired under the same or similar conditions) shall be void and of no force or effect except solely as to such holder.

Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to as provided in this Section 17 applies equally to all Purchasers and holders of Notes and is binding upon them and upon each future holder of any Note and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver. No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon. No course of dealing between the Company and the Purchaser or holder of Notes nor any delay in exercising any rights hereunder or under any Note shall operate as a waiver of any rights of any Purchaser or holder of Notes. As used herein, the term “this Agreement” and references thereto shall mean this Agreement as it may from time to time be amended or supplemented.

Section 17.4. Notes Held by Company, Etc. Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or consent to be given under this Agreement or the Notes, or have directed the taking of any action provided herein or in the Notes to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding.

Section 18. Notices.

All notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by a recognized overnight delivery service (with charges prepaid). Any such notice must be sent:

(i) if to any Purchaser or its nominee, to such Purchaser or nominee at the address specified for such communications in Schedule A, or at such other address as such Purchaser or nominee shall have specified to the Company in writing,

(ii) if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or

(iii) if to the Company, to the Company at its address set forth at the beginning hereof to the attention of Chief Executive Officer, or at such other address as the Company shall have specified to the holder of each Note in writing.

Notices under this Section 18 will be deemed given only when actually received.

Section 19. Reproduction Of Documents.

This Agreement and all documents relating thereto, including, without limitation, (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by any Purchaser at any Closing (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to any Purchaser, may be reproduced by such Purchaser by any photographic, photostatic, electronic, digital, or other similar process and such Purchaser may destroy any original document so reproduced. The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such Purchaser in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.

Section 20. Confidential Information.

For the purposes of this Section 20, “Confidential Information” means information delivered to any Purchaser by or on behalf of the Company in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by such Purchaser as being confidential information of the Company, provided that such term does not include information that (a) was publicly known or otherwise known to such Purchaser prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by such Purchaser or any person acting on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by the Company or (d) constitutes financial statements delivered to such Purchaser under Section 7.1 that are otherwise publicly available. Each Purchaser will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by such Purchaser in good faith to protect confidential information of third parties delivered to such Purchaser, provided that such Purchaser may deliver or disclose Confidential Information to (i) its directors, trustees, officers, employees, agents, attorneys and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by its Notes), (ii) its financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with the terms of this Section 20, (iii) any other holder of any Note, (iv) any Institutional Investor to which it sells or offers to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (v) any Person from which it offers to purchase any Security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (vi) any federal or state regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or the SVO or, in each case, any similar organization, or any nationally recognized rating agency that requires access to information about such Purchaser’s investment portfolio, or (viii) any other Person to which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to such Purchaser, (x) in response to any subpoena or other legal process, (y) in connection with any litigation to which such Purchaser is a party or (z) if an Event of Default has occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under such Purchaser’s Notes and this Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement. On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying the provisions of this Section 20. A holder of a Note, by receipt of Confidential Information, hereby also acknowledges that trading in the Company's Securities may be prohibited under applicable laws, rules and regulations and that it has implemented policies to comply with applicable laws, rules and regulations and to prohibit any such prohibited trades.

In the event that as a condition to receiving access to information relating to the Company or its Subsidiaries in connection with the transactions contemplated by or otherwise pursuant to this Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede any such other confidentiality undertaking.

Section 21. Substitution of Purchaser.

Each Purchaser shall have the right to substitute any one of its Affiliates as the purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both such Purchaser and such Affiliate, shall contain such Affiliate’s agreement to be bound by this Agreement and shall contain a confirmation by such Affiliate of the accuracy with respect to it of the representations set forth in Section 6. Upon receipt of such notice, any reference to such Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such Affiliate in lieu of such original Purchaser. In the event that such Affiliate is so substituted as a Purchaser hereunder and such Affiliate thereafter transfers to such original Purchaser all of the Notes then held by such Affiliate, upon receipt by the Company of notice of such transfer, any reference to such Affiliate as a “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer to such Affiliate, but shall refer to such original Purchaser, and such original Purchaser shall again have all the rights of an original holder of the Notes under this Agreement.

Section 22. Miscellaneous.

Section 22.1. Successors and Assigns. All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including, without limitation, any subsequent holder of a Note) whether so expressed or not, except that, subject to Section 10.2, the Company may not assign or otherwise transfer any of its rights or obligations hereunder or under the Notes without the prior written consent of each holder. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto and their respective successors and assigns permitted hereby) any legal or equitable right, remedy or claim under or by reason of this Agreement.

Section 22.2. Payments Due on Non-Business Days. Anything in this Agreement or the Notes to the contrary notwithstanding (but without limiting the requirement in Section 8.4 that the notice of any optional prepayment specify a Business Day as the date fixed for such prepayment), any payment of principal of or Make-Whole Amount, or interest on any Note that is due on a date other than a Business Day shall be made on the next succeeding Business Day and without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day; provided that if the maturity date of any Note is a date other than a Business Day, the payment otherwise due on such maturity date shall be made on the next succeeding Business Day and shall include the additional days elapsed in the computation of interest payable on such next succeeding Business Day.

Section 22.3. Accounting Terms. All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP. For purposes of determining compliance with the financial covenants contained in this Agreement, any election by the Company to measure an item of Indebtedness using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification Topic No. 825-10-25 – Fair Value Option, or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.

Section 22.4. Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.

Section 22.5. Construction, Etc. Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.

Defined terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein) and, for purposes of the Notes, shall also include any such notes issued in substitution therefor pursuant to Section 13, (b) subject to Section 22.1, any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections and Schedules shall be construed to refer to Sections of, and Schedules to, this Agreement, and (e) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.

For the avoidance of doubt, all Schedules and Exhibits attached to this Agreement and all Additional Covenants incorporated herein pursuant to Section 9.9 shall be deemed to be a part hereof.

The Notes are issued under and are subject to the terms and provisions of this Agreement and no other indenture of the Company.

Section 22.6. Counterparts; Electronic Contracting. This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. The parties agree to electronic contracting and signatures with respect to this Agreement and the other related documents (other than the Notes). Delivery of an electronic signature to, or a signed copy of, this Agreement and such other related documents (other than the Notes) by facsimile, email or other electronic transmission shall be fully binding on the parties to the same extent as the delivery of the signed originals and shall be admissible into evidence for all purposes.

Section 22.7. Governing Law. This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would permit the application of the laws of a jurisdiction other than such State.

Section 22.8. Jurisdiction and Process; Waiver of Jury Trial. (a) The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising out of or relating to this Agreement or the Notes. To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

(b) The Company agrees, to the fullest extent permitted by applicable law, that a final judgment in any suit, action or proceeding of the nature referred to in Section 22.8(a) brought in any such court shall be conclusive and binding upon it subject to rights of appeal, as the case may be, and may be enforced in the courts of the United States of America or the State of New York (or any other courts to the jurisdiction of which it or any of its assets is or may be subject) by a suit upon such judgment.

(c) The Company consents to process being served by or on behalf of any holder of Notes in any suit, action or proceeding of the nature referred to in Section 22.8(a) by mailing a copy thereof by registered, certified priority or express mail (or any substantially similar form of mail), postage prepaid, return receipt or delivery confirmation requested, to it at its address specified in Section 18 or at such other address of which such holder shall then have been notified pursuant to said Section. The Company agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.

(c) Nothing in this Section 22.8 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes may have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

(d) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

* * * * *

If you are in agreement with the foregoing, please sign the form of agreement on a counterpart of this Agreement and return it to the Company, whereupon this Agreement shall become a binding agreement between you and the Company.

	Very truly yours,

	KAYNE ANDERSON ENERGY INFRASTRUCTURE
	FUND, INC.

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Brighthouse Life Insurance Company

	By:	Brighthouse Services, LLC, as adviser
	By:	Barings LLC as Investment Adviser

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

Brighthouse Life Insurance Company

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

Principal Life Insurance Company

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	VOYA RETIREMENT INSURANCE AND ANNUITY
	COMPANY

	RELIAST AR LIFE INSURANCE COMPANY

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	THE GUARDIAN LIFE INSURANCE COMPANY OF
	AMERICA

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Great-West Life & Annuity Insurance
	Company

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

	The Lincoln National Life Insurance
	Company

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

UNUM LIFE INSURANCE COMPANY OF AMERICA

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

NOTE PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

Jackson National Life Insurance Company

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

United of Omaha Life Insurance Company

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

RGA GLOBAL REINSURANCE COMPANY, LTD.

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

CMFG Life Insurance Company

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

This Agreement is hereby accepted and agreed to as of the date hereof.

COUNTRY LIFE INSURANCE COMPANY

Kayne Anderson Energy Infrastructure Fund, Inc.

Note Purchase Agreement

Information Related to Purchasers

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

Brighthouse Life Insurance Company	Series RR	$4,000,000
300 South Tryon Street – Suite 2500 Charlotte, NC 28202	Series SS	$2,000,000

SCHEDULE A
(to Note Purchase Agreement)

Name and Address of Purchaser

Series of
Notes to be
Purchased

Principal Amount
of Notes to be
Purchased

Deferred Salary Plan of the Electrical Industry

Series Rr

$3,000,000

A-2

A-3

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

Missouri Reinsurance, Inc.	Series RR		$1,000,000

A-4

A-5

Name and Address of Purchaser

Series of
Notes to be
Purchased

Principal Amount
of Notes to be
Purchased

New York State Insurance Fund

Series SS

$1,000,000

A-6

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

Principal Life Insurance Company	Series RR		$2,750,000
	Series RR		$250,000
	Series SS		$3,250,000
	Series SS		$250,000
	Series SS		$250,000

A-7

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

Principal Life Insurance Company-	Series RR		$1,000,000
Principal PRT Separate Account	Series SS		$1,250,000

A-8

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Voya Retirement Insurance and Annuity Series RR $3,750,000

Company Series SS $1,750,000

A-9

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

RELIASTAR LIFE INSURANCE COMPANY Series RR $250,000

Series SS

$250,000

A-10

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Voya Investment Trust Co., as Trustee Series RR $2,000,000

for the Voya Private Credit Trust Fund
Series SS $1,000,000

A-11

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

The Guardian Life Insurance Company of America (PRIF-W)

Series RR $3,000,000

A-12

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

The Guardian Life Insurance Company of America (PRIF-L)	Series RR		$1,000,000

A-13

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

The Guardian Life Insurance Company of America (PRIF-W)

Series SS $2,000,000

A-14

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

The Guardian Insurance & Annuity Company, Inc.

Series SS $1,000,000

A-15

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Great-West Life & Annuity Insurance Series RR $3,000,000

Company Series SS $6,000,000

A-16

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

The Lincoln National Life Insurance Series RR $2,000,000

Company Series RR $2,000,000

A-17

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

The Lincoln National Life Insurance Company

Series SS $5,000,000

A-18

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Unum Life Insurance Company of America

Series RR $3,000,000

Provident Investment Management, LLC Private Placements One Fountain Square Chattanooga, Tennessee 37402 Series SS $6,000,000

A-19

Name and Address of Purchaser

Series of
Notes to be
Purchased

Principal Amount
of Notes to be
Purchased

Jackson National Life Insurance Company

Series RR

$7,000,000

A-20

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

United of Omaha Life Insurance Company

Series SS $4,000,000

A-21

Name and Address of Purchaser	Series of Notes to be Purchased	Principal Amount of Notes to be Purchased

Rga Global Reinsurance Company Ltd.	Series RR		$3,000,000

A-22

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Cmfg Life Insurance Company Series RR $1,000,000

A-23

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Union Security Insurance Company Series SS $3,000,000

A-24

Name and Address of Purchaser Series of
Notes to be
Purchased Principal Amount
of Notes to be
Purchased

Country Life Insurance Company Series SS $2,000,000

A-25

Defined Terms

As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:

“Additional Covenant” shall mean any covenant in respect of the financial condition or financial position of the Company, including, but not limited to, covenants that specify or require the maintenance of certain financial ratios applicable to the Company, and the default provision related thereto (regardless of whether such provision is labeled or otherwise characterized as a covenant or a default).

“Adjustment Period” shall mean, with respect to any calculation of the applicable interest rate in respect of the Notes, any period of time during which any Series of Notes has a current rating of less than “A-” by Fitch or less than its equivalent by any other NRSRO.

“Affiliate” means, at any time, and with respect to any Person, any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

“Agency Agreement” shall mean the Agency Agreement dated as of May 18, 2022 , by and among the Company, the Purchasers and the Paying Agent, in substantially in the form of Exhibit 14.3 hereto.

“Anti-Corruption Laws” means any law or regulation in a U.S. or any non-U.S. jurisdiction regarding bribery or any other corrupt activity, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act 2010.

“Anti-Money Laundering Laws” means any law or regulation in a U.S. or any non-U.S. jurisdiction regarding money laundering, drug trafficking, terrorist-related activities or other money laundering predicate crimes, including the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy Act) and the USA PATRIOT Act.

“Basic Maintenance Test” means the requirement to maintain Eligible Assets with an aggregate Agency Discounted Value equal to at least the basic maintenance amount required by each Rating Agency under its respective Rating Agency Guidelines, as separately determined; provided, however, if the Rating Agency does not have a basic maintenance amount requirement, the Company shall be deemed to have Eligible Assets with an aggregate Agency Discounted Value in excess of the basic maintenance amount for purposes of this definition.

Schedule B

(to Note Purchase Agreement)

“Blocked Person” means (a) a Person whose name appears on the list of Specially Designated Nationals and Blocked Persons published by OFAC, (b) a Person, entity, organization, country or regime that is blocked or a target of sanctions that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that is an agent, department or instrumentality of, or is otherwise beneficially owned by, controlled by or acting on behalf of, directly or indirectly, any Person, entity, organization, country or regime described in clause (a) or (b).

“Business Day” means (a) for the purposes of Section 8.6 only, any day other than a Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a day on which commercial banks in New York, New York, or Houston, Texas are required or authorized to be closed.

“Capital Lease” means, at any time, a lease with respect to which the lessee is required concurrently to recognize the acquisition of an asset and the incurrence of a liability in accordance with GAAP.

“Closing” is defined in Section 3.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder from time to time.

“Company” means Kayne Anderson Energy Infrastructure Fund, Inc. , a Maryland corporation or any successor that becomes such in the manner prescribed in Section 10.2.

“Confidential Information” is defined in Section 20.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise; and the terms “Controlled” and “Controlling” shall have meanings correlative to the foregoing.

“Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their or the Company’s respective Controlled Affiliates and (b) if the Company has a parent company, such parent company and its Controlled Affiliates.

“Default” means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice or both, become an Event of Default.

“Default Rate” means, with respect to any Series of the Notes, that rate of interest per annum that is the greater of (i) 2.00% above the rate of interest stated in clause (a) of the first paragraph of the Notes of such Series or (ii) 2.00% over the rate of interest publicly announced by The Bank of New York Mellon in New York, New York as its “base” or “prime” rate. The Default Rate shall be subject to Section 8.7.

B-2

“Disclosure Documents” is defined in Section 5.3.

“Electronic Delivery” is defined in Section 7.1(a).

“Eligible Assets” means assets of the Company set forth in the Rating Agency Guidelines of each Rating Agency as eligible for inclusion in calculating the Agency Discounted Value of the Company’s assets in connection with the Rating Agency’s rating of Senior Securities.

“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including but not limited to those related to Hazardous Materials.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code.

“Event of Default” is defined in Section 11.

“FATCA” means (a) sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), together with any current or future regulations or official interpretations thereof, (b) any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the United States of America and any other jurisdiction, which (in either case) facilitates the implementation of the foregoing clause (a), and (c) any agreements entered into pursuant to section 1471(b)(1) of the Code.

“Existing Note Purchase Agreements” means (i) that certain Note Purchase Agreement dated as of April 16, 2013 between the Company and the purchasers of notes signatory thereto, as amended, modified, replaced or refinanced from time to time, (ii) that certain Note Purchase Agreement dated as of April 30, 2014 between the Company and the purchasers of notes signatory thereto, as amended, modified, replaced or refinanced from time to time, (iii) that certain Note Purchase Agreement dated as of October 29, 2014 between the Company and the purchasers of notes signatory thereto, as amended, modified, replaced or refinanced from time to time and (iv) that certain Note Purchase Agreement dated as of May 11, 2021 between the Company and the purchasers of notes signatory thereto, as amended, modified, replaced or refinanced from time to time.

“Existing Notes” means the notes issued under the Existing Note Purchase Agreements, as amended, modified, replaced or refinanced from time to time.

B-3

“Extended 10-Day Period” shall have the meaning set forth in Section 11(c) of this Agreement.

“First Closing” is defined in Section 3.

“Fitch” means Fitch Ratings and its successors at law.

“Floor” means zero basis points.

“Form N-CSR” is defined in Section 7.1(b).

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America.

“Governmental Authority” means

(a) the government of

(i) the United States of America or any State or other political subdivision thereof, or

(ii) any other jurisdiction in which the Company conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company, or

(b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

“Governmental Official” means any governmental official or employee, employee of any government-owned or government-controlled entity, political party, any official of a political party, candidate for political office, official of any public international organization or anyone else acting in an official capacity.

“Guaranty” means, with respect to any Person, any obligation (except the endorsement in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any indebtedness, dividend or other obligation of any other Person in any manner, whether directly or indirectly, including (without limitation) obligations incurred through an agreement, contingent or otherwise, by such Person:

(a) to purchase such indebtedness or obligation or any property constituting security therefor;

(b) to advance or supply funds (i) for the purchase or payment of such indebtedness or obligation, or (ii) to maintain any working capital or other balance sheet condition or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such indebtedness or obligation;

B-4

(c) to lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such indebtedness or obligation of the ability of any other Person to make payment of the indebtedness or obligation; or

(d) otherwise to assure the owner of such indebtedness or obligation against loss in respect thereof.

In any computation of the indebtedness or other liabilities of the obligor under any Guaranty, the indebtedness or other obligations that are the subject of such Guaranty shall be assumed to be direct obligations of such obligor.

“Hazardous Material” means any and all pollutants, toxic or hazardous wastes or other substances that might pose a hazard to health and safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release, discharge, spillage, seepage or filtration of which is or shall be restricted, prohibited or penalized by any applicable law including, but not limited to, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar restricted, prohibited or penalized substances.

“holder” means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the Company pursuant to Section 13.1 provided, however, that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any related definitions in this Schedule A, “holder” shall mean the beneficial owner of such Note whose name and address appears in such register.

“Holder Forms” means any forms required to be filed by a holder of Notes pursuant to the 1940 Act or as required by the Federal Reserve Board.

“Indebtedness” with respect to any Person means, at any time, without duplication,

(a) its liabilities for borrowed money and its redemption obligations in respect of mandatorily redeemable Preferred Stock;

(b) its liabilities for the deferred purchase price of property acquired by such Person (excluding accounts payable arising in the ordinary course of business but including all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property);

(d) all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for such liabilities);

B-5

(e) all its liabilities in respect of letters of credit or instruments serving a similar function issued or accepted for its account by banks and other financial institutions (whether or not representing obligations for borrowed money);

(f) the aggregate Swap Termination Value of all Swap Contracts of such Person; and

(g) any Guaranty of such Person with respect to liabilities of a type described in any of clauses (a) through (f) hereof.

Indebtedness of any Person shall include all obligations of such Person of the character described in clauses (a) through (g) to the extent such Person remains legally liable in respect thereof notwithstanding that any such obligation is deemed to be extinguished under GAAP.

“Initial 30-Day Period” is defined in Section 11(c).

“Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note holding (together with one or more of its affiliates) more than 5% of the aggregate principal amount of the Notes then outstanding, (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form, and

(d) any Related Fund of any holder of any Note.

“Investment” means any advance, loan, extension of credit or capital contribution to, or purchase any stock, bonds, notes, debentures or other Securities of or any assets constituting a business unit of or any other investment in any Person.

“Investment Grade” shall mean a rating of at least “BBB-” or higher by Fitch or its equivalent by any other NRSRO.

“Kroll” means Kroll Bond Rating Agency, Inc. or its successors at law.

“Level 3 Asset” means, at any time, any Investment of the Company (a) for which there are no Level 1 Inputs or Level 2 Inputs (in each case within the meaning of Topic ASC 820, Fair Value Measurements and Disclosures), or (b) the value of which is determined by reference to Level 3 Inputs (within the meaning of Topic ASC 820).

“Lien” means, with respect to any Person, any mortgage, lien, pledge, charge, security interest or other encumbrance, or any interest or title of any vendor, lessor, lender or other secured party to or of such Person under any conditional sale or other title retention agreement or Capital Lease, upon or with respect to any property or asset of such Person (including in the case of stock, stockholder agreements, voting trust agreements and all similar arrangements).

“Make-Whole Amount” is defined in Section 8.6.

B-6

“Market Value” means the market value of an asset of the Company determined as follows: Readily marketable portfolio securities listed on any exchange other than the NASDAQ are valued, except as indicated below, at the last sale price on the Business Day as of which such value is being determined. If there has been no sale on such day, the securities are valued at the mean of the most recent bid and asked prices on such day. Securities admitted to trade on the NASDAQ are valued at the NASDAQ official closing price. Portfolio securities traded on more than one securities exchange are valued at the last sale price on the Business Day as of which such value is being determined at the close of the exchange representing the principal market for such securities. Equity securities traded in the over-the-counter market, but excluding securities admitted to trading on the NASDAQ, are valued at the closing bid prices. Fixed income securities with a remaining maturity of 60 days or more are valued by the Company using a pricing service. When price quotations are not available, fair market value will be based on prices of comparable securities. Fixed income securities maturing within 60 days are valued on an amortized cost basis. For securities that are privately issued or illiquid, as well as any other portfolio security held by the Company for which, in the judgment of the Company’s investment adviser, reliable market quotations are not readily available, the pricing service does not provide a valuation, or provides a valuation that in the judgment of that investment adviser is stale or does not represent fair value, valuations will be determined in a manner that most fairly reflects fair value of the security on the valuation date under procedures adopted by the Board of Directors of the Company,

“Material” means material in relation to the business, operations, affairs, financial condition, assets or properties of the Company.

“Material Adverse Effect” means a material adverse effect on (a) the business, operations, affairs, financial condition, assets or properties of the Company taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the Notes or (c) the validity or enforceability of this Agreement or the Notes.

“Maturity Date” is defined in the first paragraph of each Note.

“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is defined in section 4001(a)(3) of ERISA).

“NAIC” means the National Association of Insurance Commissioners or any successor thereto.

“1940 Act” means the Investment Company Act of 1940, and the rules and regulations promulgated thereunder and all exemptive relief, if any, obtained by the Company thereunder, as the same may be amended from time to time.

“1940 Act Asset Coverage” means asset coverage required by the 1940 Act Senior Notes Asset Coverage and by the 1940 Act Total Leverage Asset Coverage; provided, that for purposes of calculating total assets as used in such asset coverage test, the Company shall exclude the value of Level 3 Assets in excess of 20% of total assets.

B-7

“1940 Act Senior Notes Asset Coverage” means, asset coverage as defined by Section 18(h) of the 1940 Act as in effect on the date of this Agreement of at least 300% with respect to Senior Securities, determined on the basis of values calculated as of a time within 48 hours next preceding that of such determination.

“1940 Act Total Leverage Asset Coverage” means, asset coverage as defined by Section 18(h) of the 1940 Act as in effect on the date of this Agreement of at least 200% with respect to Senior Securities and Preferred Stock, determined on the basis of values calculated as of a time within 48 hours next preceding the time of such determination.

“Non-U.S. Plan” means any plan, fund or other similar program that (a) is established or maintained outside the United States of America by the Company or any Subsidiary primarily for the benefit of employees of the Company or one or more Subsidiaries residing outside the United States of America, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and (b) is not subject to ERISA or the Code.

“Notes” is defined in Section 1.

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“OFAC Sanctions Program” means any economic or trade sanction that OFAC is responsible for administering and enforcing. A list of OFAC Sanctions Programs may be found at http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.

“Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other officer of the Company whose responsibilities extend to the subject matter of such certificate.

“Paying Agent” means The Bank of New York Mellon Trust Company, N.A. and its successors and assigns under the Agency Agreement.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto.

“Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, business entity or Governmental Authority.

“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject to Title I of ERISA that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability.

B-8

“Preferred Stock” means any class of capital stock of a Person that is preferred over any other class of capital stock (or similar equity interests) of such Person as to the payment of dividends or the payment of any amount upon liquidation or dissolution of such Person.

“property” or “properties” means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate.

“Purchaser” or “Purchasers” means each of the purchasers that has executed and delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as any such assignment complies with Section 13.2), provided, however, that any Purchaser of a Note that ceases to be the registered holder or a beneficial owner (through a nominee) of such Note as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the meaning of “Purchaser” of such Note for the purposes of this Agreement upon such transfer.

“Qualified Institutional Buyer” means any Person who is a “qualified institutional buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.

“Rating Agency” means each NRSRO then providing a rating for Senior Securities.

“Rating Agency Guidelines” means the guidelines provided by each Rating Agency, as may be amended from time to time, in connection with such Rating Agency’s rating of Senior Securities.

“Rating Letter” means a letter issued by a NRSRO in connection with any private long term credit rating for the Notes, which (a) sets forth the long term credit rating for the Notes, (b) refers to the Private Placement Number issued by CUSIP Unit of CUSIP Global Services in respect of the Notes, (c) addresses the likelihood of payment of both principal and interest on the Notes (which requirement shall be deemed satisfied if either (x) such letter includes confirmation that the rating reflects the NRSRO’s assessment of the Company’s ability to make timely payment of principal and interest on the Notes or a similar statement or (y) such letter is silent as to the NRSRO’s assessment of the likelihood of payment of both principal and interest and does not include any indication to the contrary), (d) includes such other information describing the relevant terms of the Notes as may be required from time to time by the SVO or any other Governmental Authority having jurisdiction over any holder of any Notes and (e) shall not be subject to confidentiality provisions or other restrictions which would prevent or limit the letter from being shared with the SVO or any other Governmental Authority having jurisdiction over any holder of any Notes.

B-9

“Rating Rationale Report” means, with respect to any Rating Letter, a report issued by the NRSRO in connection with such Rating Letter setting forth an analytical review of the Notes explaining the transaction structure, methodology relied upon, and, as appropriate, analysis of the credit, legal, and operational risks and mitigants supporting the assigned rating for the Notes, in each case, on the letterhead of the NRSRO or its controlled website and generally consistent with the work product that an NRSRO would produce for a similar publicly rated security and otherwise in form and substance generally required by the SVO or any other Governmental Authority having jurisdiction over any holder of any Notes from time to time. Such report shall not be subject to confidentiality provisions or other restrictions which would prevent or limit the report from being shared with the SVO or any other Governmental Authority having jurisdiction over any holder of any Notes.

“Reference Agreement” is defined in Section 9.9.

“Related Fund” means, with respect to any holder of any Note, any fund or entity that (i) invests in Securities or bank loans, and (ii) is advised or managed by such holder, the same investment advisor as such holder or by an affiliate of such holder or such investment advisor.

“Required Holders” means, at any time, (i) on or after the date of this Agreement and prior to the Second Closing, the Purchasers of the Series SS Notes and the holders of more than 50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates) and (ii) on or after the Second Closing, the holders of more than 50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates).

“Responsible Officer” means any Senior Financial Officer and any other officer of the Company with responsibility for the administration of the relevant portion of this Agreement.

“SEC” means the Securities and Exchange Commission of the United States, or any successor thereto.

“Second Closing” is defined in Section 3.

“Securities” or “Security” shall have the meaning specified in Section 2(1) of the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“Senior Financial Officer” means the chief financial officer, principal accounting officer, treasurer or comptroller of the Company.

“Senior Securities” means indebtedness for borrowed money of the Company including, without limitation, the Notes, bank borrowings and (without duplication) indebtedness of the Company within the meaning of Section 18 of the 1940 Act.

B-10

“Series” shall refer to any series of Notes issued under this Agreement.

“Series RR Notes” is defined in Section 1 of this Agreement.

“Series SS Notes” is defined in Section 1 of this Agreement.

“State Sanctions List” means a list that is adopted by any state Governmental Authority within the United States of America pertaining to Persons that engage in investment or other commercial activities in Iran or any other country that is a target of economic sanctions imposed under U.S. Economic Sanctions Laws.

“Subsidiary” means, as to any Person, any other Person in which such first Person or one or more of its Subsidiaries or such first Person and one or more of its Subsidiaries owns sufficient equity or voting interests to enable it or them (as a group) ordinarily, in the absence of contingencies, to elect a majority of the directors (or Persons performing similar functions) of such second Person, and any partnership or joint venture if more than a 50% interest in the profits or capital thereof is owned by such first Person or one or more of its Subsidiaries or such first Person and one or more of its Subsidiaries (unless such partnership or joint venture can and does ordinarily take major business actions without the prior approval of such Person or one or more of its Subsidiaries). Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company.

“SVO” means the Securities Valuation Office of the NAIC or any successor to such Office.

“Swap Contract” means (a) any and all interest rate swap transactions, basis swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward foreign exchange transactions, cap transactions, floor transactions, currency options, spot contracts or any other similar transactions or any of the foregoing (including, but without limitation, any options to enter into any of the foregoing), and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., or any International Foreign Exchange Master Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amounts(s) determined as the mark-to-market values(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts.

“Total Assets” shall mean the aggregate amount of all assets of the Company determined in accordance with GAAP applicable to the Company.

B-11

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

“United States Person” has the meaning set forth in Section 7701(a)(30) of the Code.

“USA PATRIOT Act” means United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001 and the rules and regulations promulgated thereunder from time to time in effect.

“U.S. Economic Sanctions Laws” means those laws, executive orders, enabling legislation or regulations administered and enforced by the United States pursuant to which economic sanctions have been imposed on any Person, entity, organization, country or regime, including the Trading with the Enemy Act, the International Emergency Economic Powers Act, the Iran Sanctions Act, the Sudan Accountability and Divestment Act and any other OFAC Sanctions Program.

B-12

Merger

On March 4, 2022, the Company completed the previously announced merger with Fiduciary/Claymore Energy Infrastructure Fund (“FMO”). Pursuant to the terms of the merger agreement approved by FMO shareholders, FMO was merged with and into the Company, and shareholders received newly issued shares of the Company’s common stock in exchange for their shares of FMO, the aggregate net asset value of which equal the aggregate net asset value of FMO common shares, as determined at the close of business on March 4, 2022. A total of 9.7 million shares of new common stock of the Company were issued as a result of the merger. The merger qualified as a tax-free reorganization under Section 368(a) of the Internal Revenue Code. Immediately following the merger, the Company’s combined net assets were $1.4 billion and the Company had 136.1 million shares of common stock outstanding.

Schedule 4.9

(to Note Purchase Agreement)

Disclosure Materials

1. Investor Presentation dated April 22, 2022.

2. Offering Letter from BofA Securities, Inc. and Citigroup Global Markets Inc. dated April 22, 2022.

3. KYN Quarterly Commentary & Performance Data Q1 2022, dated April 7, 2022.

Schedule 5.3

(to Note Purchase Agreement)

Financial Statements

The Company’s Annual Report for the fiscal year ended November 30, 2017.

The Company’s Annual Report for the fiscal year ended November 30, 2018.

The Company’s Annual Report for the fiscal year ended November 30, 2019.

The Company’s Annual Report for the fiscal year ended November 30, 2020.

The Company’s Annual Report for the fiscal year ended November 30, 2021.

The Company’s Quarterly Report for the fiscal quarter ended February 28, 2022.

Schedule 5.5

(to Note Purchase Agreement)

Existing Indebtedness as of April 30, 2022

Instrument	Obligor	Obligee	Principal Amount Outstanding		Collateral
Revolving Credit Facility	Company	JP Morgan Chase Bank, N.A., as administrative agent along with several banks and financial institutions	$	141,000,000	None
Senior Notes:	Company	Holder of Notes			None
Series CC			$	11,574,907
Series FF			$	16,570,512
Series GG			$	21,419,150
Series JJ			$	16,476,932
Series KK			$	32,246,665
Series MM			$	27,322,124
Series NN			$	15,774,041
Series OO			$	14,777,933
Series P Mandatory Redeemable Preferred Stock	Company	Holders of Shares	$	10,066,950	None
Series Q Mandatory Redeemable Preferred Stock	Company	Holders of Shares	$	25,335,325	None
Series R Mandatory Redeemable Preferred Stock	Company	Holders of Shares	$	41,827,975	None
Series S Mandatory Redeemable Preferred Stock	Company	Holders of Shares	$	49,774,950	None

In addition to the agreements evidencing or relating to the Indebtedness described above, (i) each of the Articles Supplementary relating to the Series P, Q, R, S and T Mandatory Redeemable Preferred Stock of the Company impose certain restrictions on the incurring of Indebtedness of the Company and (ii) the Loan Agreement, dated August 6, 2021, by and between the Company and Sumitomo Mitsu Banking Corporation.

(to Note Purchase Agreement)

Schedule 5.15

(to Note Purchase Agreement)

[Form of Series RR Note]

This Note has not been registered under the Securities Act of 1933, as amended (the “securities act”) or under the securities laws of any state or foreign jurisdiction and may not be transferred or resold unless registered under the Securities Act and all applicable state or foreign securities laws or unless an exemption from the requirement for such registration is available.

Kayne Anderson Energy Infrastructure Fund, Inc.

4.57% Series RR Senior Unsecured Note due May 18, 2032

No. RRR-[_______]	[Date]
$[________]	PPN: 486606 N*3

For Value Received, the undersigned, Kayne Anderson Energy Infrastructure Fund, Inc. (herein called the “Company”), a corporation organized and existing under the laws of the State of Maryland, hereby promises to pay to [ ], or registered assigns, the principal sum of [ ] Dollars (or so much thereof as shall not have been prepaid) on May 18, 2032 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance hereof at the rate of 4.57% per annum from the date hereof, payable semiannually, on the 19th day of June and December in each year, (i) commencing with December 19, 2022 for any Note dated before December 19, 2022 and (ii) the June 19 or December 19 next succeeding the date hereof for any Note dated on or after December 19, 2022 , and at maturity, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount, payable semi-annually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate equal to the Default Rate.

In addition to any other amounts of interest payable hereunder, the interest rate applicable to this Note is subject to increase pursuant to and in accordance with the requirements of Section 8.7 of the Note Purchase Agreement (referred to below).

Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at The Bank of New York Mellon in New York, New York or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to the Note Purchase Agreement, dated as of May 18, 2022 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have made the representations set forth in Section 6 of the Note Purchase Agreement and (ii) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement. Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.

Exhibit 1-A

(to Note Purchase Agreement)

This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer, accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.

If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.

This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would permit the application of the laws of a jurisdiction other than such State.

	Kayne Anderson Energy Infrastructure Fund, Inc.

	By
		Name:
		Title:

E-1-A-2

[Form of Series SS Note]

This note has not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or under the securities laws of any state or foreign jurisdiction and may not be transferred or resold unless registered under the Securities Act and all applicable state or foreign securities laws or unless an exemption from the requirement for such registration is available.

Kayne Anderson Energy Infrastructure Fund, Inc.

4.67% Series SS Senior Unsecured Note due August 2, 2034

No. RSS-[_______]	[Date]
$[________]	PPN: 486606 N@1

For Value ReceiveD, the undersigned, Kayne Anderson Energy Infrastructure FUnd, INc. (herein called the “Company”), a corporation organized and existing under the laws of the State of Maryland, hereby promises to pay to [____________], or registered assigns, the principal sum of [_____________] Dollars (or so much thereof as shall not have been prepaid) on August 2, 2034 (the “Maturity Date”), with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance hereof at the rate of 4.67% per annum from the date hereof, payable semiannually, on the 19th day of June and December in each year, commencing with the June 19 or December 19 next succeeding the date hereof, and at maturity, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount, payable semi-annually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate equal to the Default Rate.

Exhibit 1-B

(to Note Purchase Agreement)

This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.

	Kayne Anderson Energy Infrastructure Fund, Inc.

	By
		Name:
		Title:

E-1-B-2

Form of Opinion of Special Counsel
to the Company

[See Attached]

May 18, 2022

56869.00181

Each of the Purchasers Party to the Purchase Agreement on the date hereof (“Purchasers”)

Re:	Kayne Anderson Energy Infrastructure Fund, Inc. – Private Offering of 4.57% Series RR Senior Unsecured Notes due May 18, 2032 (collectively, the “Notes”)

Ladies and Gentlemen:

We have acted as counsel to Kayne Anderson Energy Infrastructure Fund, Inc., a Maryland corporation (the “Company”), in connection with the issuance and sale by the Company of the Notes to you pursuant to the Note Purchase Agreement, dated as of May 18, 2022 (the “Purchase Agreement”), among the Company and the Purchasers relating to the issuance and sale (the “Offering”) on the date hereof to the Purchasers of $45,000,000 aggregate principal amount of the Company’s 4.57% Series RR Senior Unsecured Notes due May 18, 2032 (collectively, the “Notes”). This opinion letter is being furnished pursuant to Section 4.4(a) of the Purchase Agreement. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Purchase Agreement.

As such counsel and for purposes of our opinions set forth below, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, certificates of public officials and other instruments as we have deemed necessary or appropriate as a basis for the opinions set forth herein, including, without limitation:

(i)

the Purchase Agreement;

(ii)

the Notes;

(iii)

completed Federal Reserve Forms G-3 of even date herewith, executed by the Company and delivered to each Purchaser (collectively, the “Purpose Statements”);

(iv)

a Certificate of Status of Foreign Corporation of the Secretary of State of the State of California with respect to the Company, dated May 10, 2022 (the “California Good Standing Certificate”);

(v)

a Certificate of Fact of the Secretary of State of the State of Texas with respect to the Company, dated May 9, 2022 (the “Texas Good Standing Certificate” and, together with the California Good Standing Certificate, the “Good Standing Certificates”);

(vi)

the Registration Statement on Form N-8A filed by the Company on April 11, 2005 with the Securities and Exchange Commission under the Investment Company Act of 1940, as amended; and

(vii)

certificates of officers and representatives of the Company.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 2

In addition to the foregoing, we have made such investigations of law as we have deemed relevant and necessary as a basis for the opinions expressed below.

The Purchase Agreement and the Notes are referred to herein, individually, as a “Transaction Document” and collectively, as the “Transaction Documents.”

In such examination and in rendering the opinions expressed below, we have assumed: (i) the due authorization, execution and delivery of the Transaction Documents and all agreements, instruments and other documents referred to above by all the parties thereto (including the Company); (ii) the genuineness of all signatures on all documents submitted to us; (iii) the authenticity and completeness of all documents, corporate records, certificates and other instruments submitted to us; (iv) that photocopy, electronic, certified, conformed, facsimile and other copies submitted to us of original documents, certificates and other instruments conform to the original documents, corporate records, certificates and other instruments, and that all such original documents, certificates and other instruments were authentic and complete; (v) the legal capacity and competency of all individuals executing documents; (vi) that the Transaction Documents and all other documents executed in connection with the transactions contemplated thereby are the valid and binding obligations of each of the parties thereto (other than the Company under New York law), enforceable against such parties (other than the Company under New York law) in accordance with their respective terms and that no such documents have been amended, modified, supplemented or terminated orally or in writing; (vii) that there are no agreements or understandings between or among any of the parties to the Transaction Documents or third parties that would expand or modify or otherwise affect the terms of the Transaction Documents or the respective rights or obligations of the parties thereunder; (viii) that the statements contained in the certificates and comparable documents of public officials, officers and representatives of the Company and other persons on which we have relied for the purposes of this opinion letter are true and correct and that there has not been any change in the good standing status of the Company from that reported in the Good Standing Certificates; (ix) the due formation and valid existence of the Company, and the good standing of the Company in each applicable jurisdiction (other than the States of Texas and California); (x) the due power and authority of the Company to execute and deliver, and to perform its respective obligations under, the Transaction Documents; (xi) that the Purchasers satisfied all regulatory and legal requirements applicable to their respective activities; (xii) that the rights and remedies set forth in the Transaction Documents will be exercised reasonably and in good faith and were granted without fraud or duress and for good, valuable and adequate consideration and without intent to hinder, delay or defeat any rights of any creditors or stockholders of the Company; (xiii) that the officers, directors and stockholders of the Company have properly discharged their fiduciary duties; (xiv) that each Purpose Statement has been delivered to the Purchaser indicated in the heading thereof; and (xv) that each Purpose Statement has been signed and accepted in good faith by a duly authorized officer of each Purchaser to whom such Purpose Statement was delivered, and such Purchaser has completed the appropriate portions of such Purpose Statement. As to all questions of fact material to this opinion letter and as to the materiality of any fact or other matter referred to herein, we have relied (without independent investigation) upon certificates or comparable documents of officers and representatives of the Company and of public officials and upon the representations, warranties and covenants contained in the Purchase Agreement.

Statements in this opinion letter which are qualified by the expression “to our knowledge”, “of which we have knowledge,” or “known to us” or “we have no reason to believe” or other expressions of like import are limited solely to the current actual knowledge of David Hearth and Lindsay Sparks, who are the individual attorneys in this Firm who have devoted substantive attention to the representation of the Company in connection with the preparation, negotiation, execution and delivery of the Transaction Documents (and expressly exclude the knowledge of any other person in this Firm or any constructive or imputed knowledge of any information, whether by reason of our representation of the Company or otherwise). David Hearth and Lindsay Sparks are the only attorneys in this Firm who devoted substantial time to the transactions contemplated in the Transaction Documents. We have not undertaken any independent investigation to determine the accuracy of any such statement, and any limited inquiry undertaken by us during the preparation of this opinion letter should not be regarded as such an investigation. In rendering the opinion set forth in opinion paragraph 4 below, we have not made any investigation of any court, governmental, regulatory or arbitral records to determine whether any litigation, investigation or proceeding has been filed or is pending.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 3

Based upon the foregoing, and in reliance thereon, and subject to the assumptions, limitations, qualifications and exceptions set forth herein, we are of the following opinions:

1. Based solely on a review of the Good Standing Certificates, we confirm that the Company is in good standing as a foreign corporation in the States of California and Texas.

2. Each of the Purchase Agreement and the Notes of even date herewith constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

3. The execution and delivery of each of the Transaction Documents by the Company and the issuance and repayment of the Notes by the Issuer thereunder do not (a) constitute a breach by the Company of, or constitute a default by the Company under, any agreement listed on Schedule A hereto (collectively, the “Reviewed Agreements”), or (b) cause the Company to violate any federal or New York statute, rule or regulation applicable to the Company that is generally applicable to transactions of the type contemplated in the Transaction Documents.

4. The execution and delivery of each of the Transaction Documents by the Company and the issuance and repayment of the Notes by the Issuer thereunder do not cause the Company to violate any order, judgment or decree of any federal or New York State court or governmental body or authority which by its terms names and is applicable to the Company and which is known to us.

5. No registration of the Notes under the Securities Act is required in connection with the sale of the Notes to the Purchasers under the circumstances contemplated by the Purchase Agreement, and an indenture does not need to be qualified under the Trust Indenture Act of 1939, as amended, assuming (a) the accuracy of the Purchasers’ representations and warranties made in the Purchase Agreement, (b) the accuracy of the Company’s representations and warranties made in the Purchase Agreement regarding the absence of a general solicitation in connection with the offer and sale of such Notes to the Purchasers, and (c) the due performance by the Purchasers of their obligations set forth in the Purchase Agreement.

6. On the date hereof, the sale of the Notes to the Purchasers does not violate Regulation T, U or X of the Board of Governors of the Federal Reserve System. For purposes of our opinion on Regulation T of the Board of Governors of the Federal Reserve System, we have assumed, with your permission, that none of the Purchasers is a “creditor,” as defined in Regulation T of the Board of Governors of the Federal Reserve System, and therefore Regulation T of the Board of Governors of the Federal Reserve System is not applicable to the issuance and sale of the Notes to the Purchasers.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 4

7. The Company is duly registered as a closed-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”).

The foregoing opinions are subject to the following assumptions, exceptions, qualifications and limitations:

A. We express no opinion with respect to any of the following (collectively, the “Excluded Laws”):( i) anti-fraud laws or state securities laws or, except as set forth in opinion paragraphs 5 and 7, other federal securities laws; (ii) except as set forth in opinion paragraph 6, Federal Reserve Board margin regulations; (iii) pension or employee benefit laws, e.g., ERISA; (iv) federal or state antitrust and unfair competition laws, including, without limitation, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and Section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment Risk Review Modernization Act of 2018; (v) the statutes, ordinances, administrative decisions or rules and regulations of counties, towns, municipalities and other political subdivisions (whether created or enabled through legislative action at the federal, state or regional level); (vi) federal or state environmental laws; (vii) federal or state land use, building codes or subdivision laws or other laws, rules or regulations relating to the construction installation or operation of any property or assets; (viii) federal or state tax laws; (ix) federal or state laws relating to communications (including, without limitation, the Communications Act of 1934, as amended, and the Telecommunications Act of 1996, as amended); (x) federal patent, copyright or trademark, state trademark or other federal and state intellectual property laws; (xi) federal or state racketeering laws, e.g., RICO; (xii) federal or state health and safety laws, e.g., OSHA; (xiii) federal or state laws concerning aviation, vessels, railways or other means of transportation; (xiv) federal or state laws concerning public utilities; (xv) federal or state labor or employment laws; (xvi) federal or state laws or policies concerning (A) national and local emergencies (including, without limitation, COVID-19), (B) possible judicial deference to acts of sovereign states, including judicial acts, and (C) criminal and civil forfeiture laws; (xvii) except as set forth in opinion paragraph 6, federal or state banking or insurance laws; (xviii) export, import or customs laws; (xix) anti-terrorism orders, as the same may be renewed, extended, amended or replaced, or any federal, state or local laws, statutes, ordinances, orders, governmental rules, regulations, licensing requirements or policies relating to the same (including, without limitation, Executive Order 13224, effective September 24, 2001); (xx) the USA Patriot Improvement and Reauthorization Act of 2005, its successor statutes or similar statutes in effect from time to time, or the policies promulgated thereunder or any foreign assets control regulations of the United States Treasury Department or any enabling legislation or order relating thereto; (xxi) federal or state laws concerning bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, including, without limitation, fraudulent transfer or fraudulent conveyance laws; (xxii) other federal or state statutes of general application to the extent they provide for criminal prosecution (e.g., mail fraud and wire fraud statutes); or (xxiii) usury or other laws limiting or regulating the maximum amount of interest that may be charged, collected, received or contracted for other than the internal laws of the State of New York, and without limiting the foregoing, we expressly disclaim any opinion as to the usury or other such laws of any other jurisdiction (including laws of other states made applicable through principles of federal preemption or otherwise) which may be applicable to the transactions contemplated by the Transaction Documents; or in the case of each of the foregoing, all rules and regulations promulgated thereunder or administrative or judicial decisions with respect thereto.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 5

B. We express no opinion with respect to (i) the truth of the factual representations and warranties contained in any of the Transaction Documents, or (ii) any document, instrument or agreement other than the Transaction Documents, regardless of whether such document, instrument or agreement is referred to in the Transaction Documents.

C. We express no opinion with respect to the effect that the introduction of extrinsic evidence as to the meaning of any Transaction Document may have on the opinions expressed herein.

D. Our opinions are subject to (i) the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally, including, without limitation, fraudulent transfer or fraudulent conveyance laws; (ii) the effect of public policy considerations, statutes or court decisions which may limit rights to obtain exculpation, indemnification or contribution (including, without limitation, provisions indemnifying a party against liability for its own wrongful or negligent acts, indemnification regarding violations of the securities laws and indemnification for losses resulting from a judgment for the payment of any amount other than in United States dollars); and (iii) the effect of general principles of equity (including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing) and the availability of equitable remedies (including, without limitation, specific performance and equitable relief), regardless of whether considered in a proceeding in equity or at law.

E. No opinion is expressed herein with respect to the validity, binding effect or enforceability of( i) any provision contained in the Transaction Documents allowing any party to exercise any remedial rights without notice to the Company, (ii) any waiver of demand or notice by the Company, or any waiver of any rights or any defense which as a matter of law or public policy cannot be waived, (iii) any provisions contained in the Transaction Documents purporting to establish evidentiary standards, (iv) any provision of the Transaction Documents which purports to establish the subject matter jurisdiction of the United States District Court to adjudicate any controversy related to any of the Transaction Documents, (v) any provision of the Transaction Documents which purports to entitle any person or entity to specific performance of any provision thereof, (vi) any provision of the Transaction Documents which requires a person or entity to cause another person or entity to take or to refrain from taking action under circumstances in which such person or entity does not control such other person or entity, or (vii) any provision of the Transaction Documents providing for the effectiveness of service of process by mail in any suit, action or proceeding of any nature arising in connection with or in any way relating to any Transaction Document or any provision of the Transaction Documents which purports to, or has the effect of, waiving or extending any statute of limitation; (ix) any provision of the Transaction Documents requiring waivers or amendments to be in writing insofar as such provision suggests that oral or other modifications, amendments or waivers could not be effectively agreed upon by the parties or that the doctrine of promissory estoppel might not apply; (x) any provision of the Transaction Documents stating that rights or remedies are not exclusive, that every right or remedy is cumulative and may be exercised in addition to any other right or remedy, that the election of some particular remedy does not preclude recourse to one or more others or that failure to exercise or delay in exercising rights or remedies will not operate as a waiver of any such right or remedy; (xi) any liquidated damage or other provision of the Transaction Documents that imposes (or is deemed or construed to impose) a penalty or forfeiture; (xii) any provision of the Transaction Documents appointing one party as an attorney-in-fact for an adverse party; (xiii) any provision of the Loan Documents purporting to prohibit, restrict or condition the assignment of any agreement or instrument to the extent the same is rendered ineffective by Sections 9-406 through 9-409 of the Uniform Commercial Code as in effect in a relevant jurisdiction; (xiv) any provision of the Transaction Documents purporting to limit the liability of any party thereto to third parties; (xv) any provision of the Transaction Documents stating that time is of the essence; (xvi) any provision of the Transaction Documents that constitutes (or is construed to constitute) an agreement to agree; (xvii) any provision of the Transaction Documents insofar as it purports to provide for a right of reinstatement or characterize the transactions thereunder as not constituting a novation or payment of debt or other obligations; or (xviii) any provision of the Transaction Documents that would require payment of (A) any unamortized original issue discount (including any original issue discount effectively created by payment of a fee), or (B) the closing or arrangement fees, to the extent they are considered to be fees for the “brokerage, soliciting, driving or procuring of a loan” and exceed 0.50% of the amount thereof in violation of New York General Obligations Law Section 5-531.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 6

F. No opinion is expressed herein with respect to the validity, binding effect or enforceability of any provision of the Transaction Documents insofar as it purports to effect a choice of governing law or choice of forum for the adjudication of disputes or with respect to the acceptance by a federal court located in the State of New York of jurisdiction of a dispute arising under the Transaction Documents, other than (i) the enforceability by a New York State court under New York General Obligations Law Section 5-1401 of the choice of New York State law as the governing law of the Transaction Documents (subject, however, to the extent limited by the Constitution of the United States and by Section 1-301 of the New York Uniform Commercial Code), and (ii) the enforceability by a New York State court under New York General Obligations Law Section 5-1402 of New York State courts as a non-exclusive forum for the adjudication of disputes with respect to the Transaction Documents.

G. With respect to our opinion set forth in opinion paragraph 1, with your permission, we are relying solely and without independent investigation on our review and examination of the Good Standing Certificates.

H. For purposes of our opinion set forth in opinion paragraph 2, we have assumed, with your permission, that the term “Additional Covenant” (as used in Section 9.9 of the Purchase Agreement) is limited to a financial covenant in respect of the financial condition of the Company that can be ascertained through the application of a specified numerical financial test or other specified numerical financial criteria.

I. For purposes of our opinion expressed in opinion paragraph 6, we have assumed, with your permission, that the information contained in each Purpose Statement is true, correct, accurate and complete on the date hereof. In rendering the opinion expressed in opinion paragraph 6, we have relied solely, and without any further investigation, on a certificate of the Chief Financial Officer of the Company, dated the date hereof, as to certain certifications or representations regarding, among other things, the current market value of “margin stock” (within the meaning of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System and as used herein, “margin stock”) that serves as direct or indirect security for the Company’s obligations under the Notes and other “credit” (within the meaning of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System and as used herein, “credit”) extended to the Company, and the loan value of all assets of the Company not consisting of margin stock that serve as direct or indirect security for the Company’s obligations under the Notes and other credit extended to the Company.

J. We express no opinion as to the effect on our opinion expressed in opinion paragraph 6 to the extent that any Note may be deemed to constitute margin stock in the hands of any Purchaser. We further express no opinion in opinion paragraph 6 on the effect of Regulation T of the Board of Governors of the Federal Reserve System on any person other than a Purchaser.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 7

K. Without limiting the generality of any limitation, qualification or condition expressed elsewhere herein, we express no opinion on the matters set forth in opinion paragraphs 5 and 6 at any time after the initial issuance and sale of the Notes to the Purchasers on the date hereof, and we expressly disclaim any obligation to update such opinions after the date hereof.

L. We call to your attention that (i) that the Company has elected to be registered as a “closed- end management investment company” under the 1940 Act and (ii) the Company is subject to regulation under the 1940 Act as a “closed-end management investment company.” We understand that the Company is engaged primarily in the business of investing in equity and debt securities, including margin stock. We note that the Purchase Agreement contemplates the Company’s execution and delivery to the Purchasers of completed and executed Federal Reserve Forms G-3.

M. Our opinions contained herein are limited solely to laws and regulations (other than the Excluded Laws) which in our experience are customarily applicable to transactions in the nature of those contemplated by the Transaction Documents and exclude statutes, rules and regulations that are part of a regulatory scheme applicable to any party or any of their affiliates due to the specific assets or business of such party or such affiliates. We express no opinion as to the effect on our opinions regarding the Transaction Documents arising out of the status or activities of, or laws applicable to, any party to the Purchase Agreement (other than the Company to the extent covered by this opinion letter), and, without limiting the foregoing, we are not expressing any opinion as to the effect of compliance or non-compliance by such parties with any state or federal laws or regulations applicable to the transactions contemplated by the Transaction Documents because of the nature of any of their businesses.

N. With respect to our opinions set forth in opinion paragraph 3 with respect to the Reviewed Agreements, we have not reviewed, and express no opinion on, (i) financial covenants or similar provisions requiring financial calculations or determinations to ascertain whether there is any breach of or default under such provisions or (ii) provisions relating to the occurrence of a “material adverse effect,” “material adverse change” or words of similar import. In addition, our opinions relating to the Reviewed Agreements are subject to the effect on the Reviewed Agreements of (x) the introduction of extrinsic evidence to interpret the terms thereof and (y) any non-written modifications thereof. Moreover, our opinions relating to the Reviewed Agreements are based solely upon the plain meaning of their language without regard to interpretation or construction that might be indicated by the laws governing the Reviewed Agreements.

O. We express no opinion with respect to (i) the right, title or interest of the Company in or to any property, or (ii) the creation, perfection or priority of any security interests or liens.

Without limiting any of the other limitations, exceptions and qualifications stated elsewhere herein (including, without limitation, qualification paragraph A with respect to Excluded Laws), we express no opinion with regard to the applicability or effect of the law of any jurisdiction other than, as in effect on the date of this opinion letter, (i) the internal laws of the State of New York, and (ii) the federal laws of the United States.

Each of the Purchasers Party to the Purchase Agreement

May 18, 2022

Page 8

The opinions expressed herein are to be governed by the laws of the State of New York and shall be construed in accordance with the customary practice in New York of lawyers who regularly give, and lawyers who regularly advise opinion recipients regarding, opinions of the kinds contained herein.

This opinion letter is rendered solely to you in connection with the issuance and delivery of the Notes. At your request, we hereby consent to reliance hereon solely in connection with the Transaction Documents by any transferee of the Notes that is an institutional accredited investor pursuant to a transfer that is made in accordance with the express provisions of the Purchase Agreement, on the condition and understanding that any such reliance shall be subject to the terms and conditions of this opinion letter, and further, without limitation of any of the foregoing, that (i) this opinion letter speaks only as of the date hereof and our consent to such reliance shall not constitute a reissuance of this opinion letter or otherwise extend any statute of limitations period applicable hereto on the date of this opinion letter, (ii) we have no responsibility or obligation to update this opinion letter, (iii) we have no responsibility or obligation to consider the applicability or correctness of this opinion letter to any person or entity other than its original addressees and in no event shall any such transferee have any greater rights with respect hereto than the original addresses of this opinion letter, and (iv) any such reliance by such transferee must be actual and reasonable under the circumstances existing at the time of transfer, including any changes in the law, facts or any other developments known to or reasonably knowable by such transferee at such time. This opinion letter may not be relied upon by you for any other purpose or delivered to or relied upon by any other person (except as permitted in the immediately preceding sentence) without our express prior written consent; except that you may furnish a copy of this opinion letter for information (but not reliance): (i) to your independent auditors and your attorneys on the basis that they make no further disclosure, (ii) pursuant to an order or legal process of any court or governmental agency, (iii) in connection with any legal action to which you are a party arising out of the issuance and delivery of the Notes, (iv) to any governmental or regulatory authority having jurisdiction over you, including, without limitation, the National Association of Insurance Commissioners, and (v) your potential successors and assigns. This opinion letter is rendered to you as of the date hereof and shall not be deemed to have been reissued by any subsequent delivery of a copy hereof, and we assume no obligation to advise you or any other person hereafter with regard to any change after the date hereof in the circumstances or the law that may bear on the matters set forth herein even though the change may affect the legal analysis or a legal conclusion or other matters in this opinion letter.

Very truly yours,

Schedule A

Reviewed Agreements

Custody Agreement, dated June 27, 2005, by and between the Company and Custodial Trust Company.

Administration Agreement, dated February 28, 2009, between the Company and Ultimus Fund Solutions, LLC.

Investment Management Agreement, dated June 27, 2005, by and between the Company and Kayne Anderson Capital Advisors, L.P.

Note Purchase Agreement, dated April 16, 2013, among the Borrower and each of the Purchasers listed therein.

Note Purchase Agreement, dated April 30, 2014, among the Borrower and each of the Purchasers listed therein.

Note Purchase Agreement, dated October 29, 2014, among the Borrower and each of the Purchasers listed therein.

Note Purchase Agreement, dated November 5, 2020, among the Borrower and each of the Purchasers listed therein.

Securities Purchase Agreement dated May 18, 2022 among the Company and the purchasers listed therein related to the issuance of Series T Mandatory Redeemable Preferred Shares.

Fourth Amended and Restated Credit Agreement dated as of February 25, 2022, among the Company, the several banks from time to time thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the financial institutions thereto, as amended, modified, supplemented, replaced or refinanced from time to time.

10.

Loan Agreement, dated as of August 6, 2021, by and between and Sumitomo Mitsui Banking Corporation.

Exhibit 4.4(a)

(to Note Purchase Agreement)

[LETTERHEAD OF VENABLE LLP]

DRAFT

May 18, 2022

The Purchasers party to the

Purchase Agreement referred to below

Re:

Kayne Anderson Energy Infrastructure Fund, Inc.

Ladies and Gentlemen:

We have served as Maryland counsel for Kayne Anderson Energy Infrastructure Fund, Inc., a Maryland corporation registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a closed-end management investment company (the “Company”), in connection with certain matters of Maryland law arising out of the sale and issuance by the Company of the following series of its notes (collectively, the “Senior Notes”): (a) $45,000,000 aggregate principal amount of 4.57% Series RR Senior Unsecured Notes due May 18, 2032 (the “Series R Notes”); and (b) $45,000,000 aggregate principal amount of 4.67% Series SS Senior Unsecured Notes due August 2, 2034 pursuant to a Note Purchase Agreement, dated May 18, 2022 (the “Purchase Agreement”), by and between the Company and each of the Purchasers listed on Schedule A thereto (the “Purchasers”). This opinion is being delivered to you at the request of the Company in connection with Section 4.4 of the Purchase Agreement. This firm did not participate in the negotiation or drafting of the Purchase Agreement or the Notes (as defined below).

In connection with our representation of the Company, and as a basis for the opinion hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents (hereinafter collectively referred to as the “Documents”):

1. The charter of the Company (the “Charter”), certified by the State Department of Assessments and Taxation of Maryland (the “SDAT”);

2. The Amended and Restated Bylaws of the Company (the “Bylaws”), certified as of the date hereof by an officer of the Company;

3. A certificate as of May 11, 2022, of the SDAT as to the good standing of the Company;

4. Resolutions adopted by the Board of Directors of the Company, relating to (a) the sale and issuance of the Senior Notes and (b) the authorization of the execution and delivery by the Company of the Purchase Agreement and the Notes, certified as of the date hereof by an officer of the Company;

The Purchasers

May 18, 2022

Page 2

5. The Purchase Agreement;

6. The Notes, each dated as of the date hereof (the “Notes”), made by the Company to the order of the Purchasers, representing the aggregate principal amount of the Series R Notes;

7. A certificate executed by an officer of the Company, dated as of the date hereof; and

8. Such other documents and matters as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.

In expressing the opinion set forth below, we have assumed the following:

1. Each individual executing any of the Documents, whether on behalf of such individual or another person, is legally competent to do so.

2. Each individual executing any of the Documents on behalf of a party (other than the Company) is duly authorized to do so.

3. Each of the parties (other than the Company) executing any of the Documents has duly and validly executed and delivered each of the Documents to which such party is a signatory, and such party’s obligations set forth therein are legal, valid and binding and are enforceable in accordance with all stated terms.

4. All Documents submitted to us as originals are authentic. The form and content of all Documents submitted to us as unexecuted drafts do not differ in any respect relevant to this opinion from the form and content of such Documents as executed and delivered. All Documents submitted to us as certified or photostatic copies conform to the original documents. All signatures on all Documents are genuine. All public records reviewed or relied upon by us or on our behalf are true and complete. All representations, warranties, statements and information (other than facts constituting conclusions of law on matters on which we opine herein) contained in the Documents are true and complete. There has been no oral or written modification of or amendment to any of the Documents, and there has been no waiver of any provision of any of the Documents, by action or omission of the parties or otherwise.

The phrase “known to us” is limited to the actual knowledge, without independent inquiry, of the lawyers at our firm who have performed legal services in connection with the issuance of this opinion.

The Purchasers

May 18, 2022

Page 3

Based upon the foregoing, and subject to the assumptions, limitations and qualifications stated herein, it is our opinion that:

1. The Company is a corporation duly incorporated and existing under and by virtue of the laws of the State of Maryland and is in good standing with the SDAT.

2. The Company has the corporate power to issue and sell the Senior Notes and to execute and deliver the Purchase Agreement and the Notes.

3. The execution and delivery of the Purchase Agreement and the Notes have been duly authorized by all necessary corporate action of the Company. Each of the Purchase Agreement and the Notes has been duly executed and, so far as is known to us, delivered by the Company.

4. The execution, delivery and performance by the Company of its obligations under the Purchase Agreement, and the consummation of the transactions contemplated in the Purchase Agreement, will not conflict with or constitute a breach of the Charter or the Bylaws, or any Maryland law or regulation, or, so far as is known to us, any order of any Maryland governmental authority (other than any law, regulation or order in connection with the securities laws of the State of Maryland, as to which no opinion is hereby expressed).

5. No consent of any Maryland governmental authority is required to be made or obtained by the Company in connection with the sale and issuance of the Senior Notes or the execution and delivery by the Company of the Purchase Agreement and the Notes, except such consents as may have been waived or obtained, if any (except that no opinion is expressed herein with respect to the applicability or effect of the securities laws of the State of Maryland).

The foregoing opinion is limited to Maryland law and we do not express any opinion herein concerning any other law. We express no opinion as to the applicability or effect of the 1940 Act or other federal securities laws, or state securities laws, including the securities laws of the State of Maryland, or as to federal or state laws regarding fraudulent transfers or the laws, codes or regulations of any municipality or other local jurisdiction. We note that the Purchase Agreement provides that it shall be governed by the laws of a state other than the State of Maryland. To the extent that any matter as to which our opinion is expressed herein would be governed by the laws of any jurisdiction other than the State of Maryland, we do not express any opinion on such matter. Our opinion expressed in paragraph 4 above is based upon our consideration of only those Maryland laws or regulations and orders of Maryland governmental authorities, if any, which, in our experience, are normally applicable to transactions of the type referred to in such paragraph. Our opinion expressed in paragraph 5 above is based upon our consideration of only those consents of Maryland governmental authorities, if any, which, in our experience, are normally applicable to transactions of the type referred to in such paragraph. The opinion expressed herein is subject to the effect of any judicial decision which may permit the introduction of parol evidence to modify the terms or the interpretation of agreements.

The opinion expressed herein is limited to the matters specifically set forth herein and no other opinion shall be inferred beyond the matters expressly stated. We assume no obligation to supplement this opinion if any applicable law changes after the date hereof or if we become aware of any fact that might change the opinion expressed herein after the date hereof.

The Purchasers

May 18, 2022

Page 4

This opinion is being furnished to you solely for your benefit. Accordingly, subject to the following sentences, this opinion may not be relied upon by, quoted in any manner to, or delivered to any other person or entity (other than Paul Hastings LLP, counsel to the Company, in connection with the opinion to be issued by it of even date herewith relating to the sale and issuance of the Senior Notes) without, in each instance, our prior written consent. This opinion may also be relied upon by your successors and assigns who are Institutional Investors (as defined in the Purchase Agreement) as if this opinion were addressed to them on the date hereof; provided however that any such reliance by such Institutional Investors must be actual and reasonable under the circumstances existing at the time, including any changes in law or facts or other developments known to or reasonably knowable by such Institutional Investor at such time. This opinion may be delivered (but may not be relied upon by any recipient pursuant to this sentence) (i) to potential successors and assigns, (ii) in connection with any judicial or arbitration process, and (iii) to any governmental or regulatory authority having jurisdiction over you, including, without limitation, the National Association of Insurance Commissioners, in each case, without our prior written consent.

Very truly yours,

Form of Opinion of Special Counsel

to the Purchasers

[To be provided on a case by case basis]

Exhibit 4.4(b)

(to Note Purchase Agreement)

Form of Legend

This Note has not been registered under the Securities Act of 1933, as amended (the “SECURITIES ACT”) OR UNDER THE SECURITIES LAWS OF ANY STATE OR FOREIGN JURISDICTION AND MAY NOT BE TRANSFERRED OR RESOLD UNLESS REGISTERED UNDER THE SECURITIES ACT AND ALL APPLICABLE STATE OR FOREIGN SECURITIES LAWS OR UNLESS AN EXEMPTION FROM THE REQUIREMENT FOR SUCH REGISTRATION IS AVAILABLE.

Exhibit 13.1

(to Note Purchase Agreement)

Form of Agency Agreement

[See Attached}

EX-99.13(11) 6 ea151744_ex13-11.htm EXHIBIT 13.11

Exhibit 13.11

Execution Version

Kayne Anderson Energy Infrastructure Fund, Inc.

Series T Mandatory Redeemable Preferred Shares

Securities Purchase Agreement

Dated as of May 18, 2022

Table of Contents

Section	Heading	Page

Section 1.	Authorization of MRP Shares	1

Section 1.1.	Authorization of Mandatory Redeemable Preferred Shares	1

Section 2.	Purchase and Sale of MRP Shares	2

Section 3.	Closing	2

Section 4.	Conditions to Closing	2

Section 4.1.	Representations and Warranties	2
Section 4.2.	Performance; No Default; Compliance with Articles Supplementary	2
Section 4.3.	Compliance Certificates	3
Section 4.4.	Opinions of Counsel	3
Section 4.5.	Purchase Permitted By Applicable Law, Etc	3
Section 4.6.	Sale of Other MRP Shares	3
Section 4.7.	Payment of Special Counsel Fees	4
Section 4.8.	Private Placement Number	4
Section 4.9.	Changes in Corporate Structure	4
Section 4.10.	Funding Instructions	4
Section 4.11.	Rating of MRP Shares	4
Section 4.12.	Articles Supplementary	4
Section 4.13.	Proceedings and Documents	4
Section 4.14.	Consent of Holders of Other Securities	5

Section 5.	Representations and Warranties of the Company	5

Section 5.1.	Organization; Power and Authority	5
Section 5.2.	Authorization, Etc	5
Section 5.3.	Disclosure	5
Section 5.4.	No Subsidiaries	6
Section 5.5.	Financial Statements; Material Liabilities	6
Section 5.6.	Compliance with Laws, Other Instruments, Etc	6
Section 5.7.	Governmental Authorizations, Etc	6
Section 5.8.	Litigation; Observance of Statutes and Orders	6
Section 5.9.	Taxes	7
Section 5.10.	Title to Property; Leases	7
Section 5.11.	Licenses, Permits, Etc	7
Section 5.12.	Compliance with ERISA	7
Section 5.13.	Private Offering by the Company	7
Section 5.14.	Use of Proceeds; Margin Regulations	8
Section 5.15.	Existing Indebtedness	8
Section 5.16.	Foreign Assets Control Regulations, Etc	8
Section 5.17.	Status under Certain Statutes	9
Section 5.18.	Ranking of Obligations	9
Section 5.19.	Capital Stock	9
Section 5.20.	Restrictions on Creation of MRP Shares and Distributions	10

-i-

Section 6.	Representations of the Purchasers	10

Section 6.1.	Purchase for Investment	10
Section 6.2.	Source of Funds	11

Section 7.	Information as to the Company	13

Section 7.1.	Financial and Business Information	13
Section 7.2.	Officer’s Certificate	16
Section 7.3.	Visitation	17

Section 8.	Redemption of the MRP Shares	17

Section 9.	Affirmative Covenants	17

Section 9.1.	Compliance with Law	17
Section 9.2.	Insurance	17
Section 9.3.	Maintenance of Properties	18
Section 9.4.	Payment of Taxes	18
Section 9.5.	Corporate Existence, Etc	18
Section 9.6	Books and Records	18
Section 9.7.	[Intentionally Omitted.]	18
Section 9.8.	Current Rating on the MRPS Shares	18
Section 9.9.	[Intentionally Omitted.]	19
Section 9.10.	[Intentionally Omitted.]	19
Section 9.11.	Maintenance of Status	19

Section 10.	Negative Covenants	19

Section 10.1.	Transactions with Affiliates	19
Section 10.2.	Merger, Consolidation, Etc	19
Section 10.3.	Economic Sanctions, Etc	20
Section 10.4.	[Intentionally Omitted]	20
Section 10.5.	No Subsidiaries	20

Section 11.	Default and Remedies	20

Section 12.	Reserved	21

-ii-

Section 13.	Registration; Exchange; Substitution of Certificates Representing MRP Shares	21

Section 13.1.	Registration of MRP Shares	21
Section 13.2.	Transfer and Exchange of MRP Shares	22
Section 13.3.	Replacement of Certificates Representing MRP Shares	22

Section 14.	Payments on MRP Shares	22

Section 14.1.	Place of Payment	22
Section 14.2.	Home Office Payment	23
Section 14.3.	Agency Agreement	23

Section 15.	Expenses, Etc	23

Section 15.1.	Transaction Expenses	23
Section 15.2.	Certain Taxes	24
Section 15.3.	Survival	24

Section 16.	Survival of Representations and Warranties; Entire Agreement	24

Section 17.	Amendment and Waiver	25

Section 17.1.	Requirements	25
Section 17.2.	Solicitation of Holders of MRP Shares	25
Section 17.3.	Binding Effect, Etc	26
Section 17.4.	MRP Shares Held by Company, Etc	26

Section 18.	Notices	26

Section 19.	Reproduction of Documents	27

Section 20.	Confidential Information	27

Section 21.	Substitution of Purchaser	28

Section 22.	Miscellaneous	29

Section 22.1.	Successors and Assigns	29
Section 22.2.	Appointment of Initial MRP Shares Directors	29
Section 22.3.	Accounting Terms	29
Section 22.4.	Severability	29
Section 22.5.	Construction, Etc	29
Section 22.6.	Counterparts; Electronic Contracting	30
Section 22.7.	Governing Law	30
Section 22.8.	Jurisdiction and Process; Waiver of Jury Trial	30

-iii-

SCHEDULE A	—	INFORMATION Relating to Purchasers

SCHEDULE B	—	Defined Terms

SCHEDULE 4.9	—	Merger

SCHEDULE 5.3	—	Disclosure Materials

SCHEDULE 5.5	—	Financial Statements

SCHEDULE 5.15	—	Existing Indebtedness

SCHEDULE 5.19	—	Capital Stock

EXHIBIT 1	—	Form of Articles Supplementary

EXHIBIT 2	—	Form of Certificate Representing Series T MRP Shares

EXHIBIT 4.4(a)	—	Form of Opinion of Special Counsel to the Company

EXHIBIT 4.4(b)	—	Form of Opinion of Special Counsel to the Purchasers

Exhibit 13.1	—	Form of Legend

EXHIBIT 14.3	—	Form of Agency Agreement

-iv-

Kayne Anderson Energy Infrastructure Fund, Inc.

811 Main Street, 14th Floor
Houston, Texas 77002

Series T Mandatory Redeemable Preferred Shares

as of May 18, 2022

To Each of The Purchasers Listed in

Schedule A Hereto:

Ladies and Gentlemen:

Section 1. Authorization of MRP Shares.

Section 1.1. Authorization of Mandatory Redeemable Preferred Shares. The Company will authorize the creation, issuance and sale of new common stock as shares of one new series of Preferred Stock (as defined in the Company’s Articles of Amendment and Restatement) classified and designated as “Series T Mandatory Redeemable Preferred Shares” (the “MRP Shares”) liquidation preference $25.00 per share and to consist of 800,000 shares; provided that in no event shall the aggregate purchase price of the MRP Shares exceed $20,000,000. The MRP Shares will have the preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption set forth in the Articles Supplementary (the “Articles Supplementary”) describing the MRP Shares in the form attached hereto as Exhibit 1. A true and correct copy of the Articles of Amendment and Restatement of the Company as currently in effect and prior to the adoption and filing of the Articles Supplementary has heretofore been furnished to you by the Company. The MRP Shares will rank, as to preferences on payment of dividends or distribution of assets upon liquidation, on a parity with shares of any other series of Preferred Stock and prior to any and all of the Common Stock or of any other class of shares of the Company ranking junior to the Preferred Stock.

Certain capitalized and other terms used in this Agreement are defined in Schedule B; and, for purposes of this Agreement, the rules of construction set forth in Section 22.5 shall govern.

Section 2. Purchase and Sale of MRP Shares.

Subject to the terms and conditions of this Agreement, the Company will issue and sell to each Purchaser and each Purchaser will purchase from the Company, at the Closing provided for in Section 3, the number of shares of MRP Shares and of the series specified opposite such Purchaser’s name in Schedule A at a price per share of $25.00. The Purchasers’ obligations hereunder are several and not joint obligations and no Purchaser shall have any liability to any Person for the performance or non-performance of any obligation by any other Purchaser hereunder. The MRP Shares issued hereunder are each herein sometimes referred to as MRP Shares of a “series.”

Section 3. Closing.

The sale and purchase of the MRP Shares to be purchased by each Purchaser shall occur at the offices of Chapman and Cutler LLP, 320 South Canal Street, Chicago, Illinois 60606, at 10:00 a.m., Chicago time, at the closing (the “Closing”), on August 2, 2022 or on such other Business Day thereafter on or prior to August 3, 2022 as may be agreed upon by the Company and the Purchasers. At the Closing, the Company will deliver or cause to be delivered to each Purchaser the MRP Shares to be purchased by such Purchaser at the Closing (as specified opposite such Purchaser’s name or in the name of its nominee), against delivery by such Purchaser to the Company of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to [], for credit to account: Kayne Anderson Energy Infrastructure Fund, Inc. ; Ref: MRP Shares. If at the Closing the Company shall fail to tender such MRP Shares to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure by the Company to tender such MRP Shares or any of the conditions specified in Section 4 not having been fulfilled to such Purchaser’s satisfaction.

Section 4. Conditions to Closing.

Each Purchaser’s obligation to purchase and pay for the MRP Shares to be purchased by such Purchaser at the Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at the Closing, of the following conditions:

Section 4.1. Representations and Warranties. The representations and warranties of the Company in this Agreement shall be correct when made and at the time of the Closing.

Section 4.2. Performance; No Default; Compliance with Articles Supplementary. The Company shall have performed and complied with all agreements and conditions contained in this Agreement and the Articles Supplementary required to be performed or complied with by it, prior to or at the Closing and from the date of this Agreement to the Closing assuming that Sections 9 and 10 are applicable from the date of this Agreement. From the date of this Agreement until the Closing, before and after giving effect to the issue and sale of the MRP Shares (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing.

-2-

Section 4.3. Compliance Certificates.

(a) Officer’s Certificate. The Company shall have delivered to such Purchaser an Officer’s Certificate, dated the date of the Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

(b) Secretary’s Certificate. The Company shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of the Closing, certifying as to

(i) the resolutions attached thereto and other corporate proceedings relating to the authorization, filing and execution of the Articles Supplementary, the authorization, issuance and sale of the MRP Shares and the authorization, execution and delivery of this Agreement and (ii) the Company’s organizational documents as then in effect.

Section 4.4. Opinions of Counsel. Such Purchaser shall have received opinions in form and substance satisfactory to such Purchaser, dated the date of the Closing (a) from Paul Hastings LLP, counsel for the Company, and from Venable LLP, special Maryland counsel to the Company, together covering the matters set forth in Exhibit 4.4(a) and covering such other matters incident to the transactions contemplated hereby as such Purchaser or its counsel may reasonably request (and the Company hereby instructs its counsel to deliver such opinions to the Purchasers) and

Section 4.5. Purchase Permitted By Applicable Law, Etc. On the date of the Closing such Purchaser’s purchase of MRP Shares shall (a) be permitted by the laws and regulations of each jurisdiction to which such Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (b) not violate any applicable law or regulation (including, without limitation, Regulation T, U or X of the Board of Governors of the Federal Reserve System) assuming the required preparation, execution, delivery and filing of the applicable Federal Reserve Board forms (such as Forms U-1 and G-1 through 4) and (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof. If requested by such Purchaser, such Purchaser shall have received an Officer’s Certificate certifying as to such matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase is so permitted.

Section 4.6. Sale of Other MRP Shares. Contemporaneously with the Closing the Company shall sell to each other Purchaser and each other Purchaser shall purchase the MRP Shares to be purchased by it at the Closing as specified in Schedule A.

-3-

Section 4.7. Payment of Special Counsel Fees. Without limiting the provisions of Section 15.1, the Company shall have paid on or before the Closing the reasonable fees, charges and disbursements of the Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to the Closing.

Section 4.8. Private Placement Number. A Private Placement Number issued by PPN CUSIP Unit of CUSIP Global Services (in cooperation with the SVO) shall have been obtained for each Series of the MRP Shares.

Section 4.9. Changes in Corporate Structure. The Company shall not have changed its jurisdiction of incorporation or organization, as applicable, or, except as disclosed in Schedule 4.9 or any mergers, consolidations, or acquisitions consummated after the date hereof that are permitted under Section 10.2, been a party to any merger or consolidation or succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5.

Section 4.10. Funding Instructions. At least five (5) Business Days prior to the date of the Closing, each Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company confirming the information specified in Section 3 including (i) the name and address of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and number into which the purchase price for the MRP Shares is to be deposited. Each Purchaser has the right, but not the obligation, upon written notice (which may be by email) to the Company, to elect to deliver a micro deposit (less than $50.00) to the account identified in the written instructions no later than two (2) Business Days prior to Closing. If a Purchaser delivers a micro deposit, a Responsible Officer must verbally verify the receipt and amount of the micro deposit to such Purchaser on a telephone call initiated by such Purchaser prior to Closing. The Company shall not be obligated to return the amount of the micro deposit, nor will the amount of the micro deposit be netted against the Purchaser’s purchase price of the MRP Shares.

Section 4.11. Rating of MRP Shares. The MRP Shares shall have been given a Rating Letter of not less than “A+” by Kroll on or prior to the date of issuance thereof and evidence of such will have been provided to the Purchasers (which shall include the information described in Section 9.8 and shall include the related Letter Rating Rationale Report with respect to such rating).

Section 4.12. Articles Supplementary. The Board of Directors of the Company shall have duly adopted the Articles Supplementary and the Articles Supplementary shall have been duly filed with the State Department of Assessments and Taxation of Maryland, all in compliance with the applicable provisions of the Maryland General Corporation Law. The Articles Supplementary shall constitute a legal and valid part of the charter of the Company.

Section 4.13. Proceedings and Documents. All corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory to such Purchaser and its special counsel, and such Purchaser and its special counsel shall have received all such counterpart originals or certified or other copies of such documents as such Purchaser or such special counsel may reasonably request and shall receive such information as may be reasonably necessary to complete any Holder Forms.

-4-

Section 4.14. Consent of Holders of Other Securities. On the date of the Closing, any consent or approvals required to be obtained from any holder or holders of any outstanding Securities of the Company which shall be necessary to permit the consummation of the transactions contemplated hereby shall have been obtained and all such consents or amendments shall be reasonably satisfactory in form and substance to the Purchasers and their special counsel.

Section 5. Representations and Warranties of The Company.

The Company represents and warrants to each Purchaser that:

Section 5.1. Organization; Power and Authority. The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has the corporate power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement, to execute and file the Articles Supplementary, to create, issue and sell the MRP Shares and to perform the provisions hereof and thereof. Any approvals by the stockholders of the Company required by law, the Articles of Amendment and Restatement (including the Articles Supplementary) or Bylaws of the Company or otherwise have been duly obtained. The Company is a non-diversified, closed-end management investment company as such term is used in the 1940 Act.

Section 5.2. Authorization, Etc. This Agreement, the Articles Supplementary and the MRP Shares have been duly authorized by all necessary corporate action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each MRP Shares will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by

(i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

Section 5.3. Disclosure. This Agreement and the documents, certificates or other writings delivered to the Purchasers by or on behalf of the Company, including through its agents, BofA Securities, Inc. and Citigroup Global Markets Inc., in connection with the transactions contemplated hereby and identified in Schedule 5.3, and the financial statements listed in Schedule 5.5 (this Agreement and such documents, certificates or other writings and such financial statements delivered to each Purchaser prior to May 3, 2022 being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Except as disclosed in the Disclosure Documents, since November 30, 2021, there has been no change in the financial condition, operations, business or properties of the Company except changes that individually or in the aggregate would not reasonably be expected to have a Material Adverse Effect.

-5-

Section 5.4. No Subsidiaries. The Company has no Subsidiaries as of the date hereof, and as of the Closing, the Company has no Subsidiaries other than any Controlled Portfolio Entities acquired or formed after the date hereof.

Section 5.6. Compliance with Laws, Other Instruments, Etc. The execution, delivery and performance by the Company of this Agreement, the execution and filing of the Articles Supplementary, and the creation, issuance and sale of the MRP Shares will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of the Company under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter, regulations or by-laws, shareholders agreement or any other Material agreement or instrument to which the Company is bound or by which the Company or any of its properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to the Company or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company, including, without limitation, the Securities Act and the 1940 Act.

Section 5.7. Governmental Authorizations, Etc. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Company of this Agreement, the execution and filing of the Articles Supplementary or the creation, issuance and sale of the MRP Shares, except for the filing and recording of the Articles Supplementary as described in Section 4.12 of this Agreement.

-6-

Section 5.9. Taxes. The Company has filed all income tax returns that are required to have been filed in any jurisdiction, and has paid all taxes shown to be due and payable on such returns and all other taxes and assessments payable by them, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which is not individually or in the aggregate Material or (ii) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which the Company has established adequate reserves in accordance with GAAP. The U.S. federal income tax liabilities of the Company have been finally determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up to and including the fiscal year ended November 30, 2017.

Section 5.13. Private Offering by the Company. Neither the Company nor anyone acting on its behalf has offered the MRP Shares or any similar Securities for sale to, or solicited any offer to buy the MRP Shares or any similar Securities from, or otherwise approached or negotiated in respect thereof with, any Person other than the Purchasers and not more than 35 other Institutional Investors, each of which has been offered the MRP Shares at a private sale for investment. Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the MRP Shares to the registration requirements of Section 5 of the Securities Act or to the registration requirements of any Securities or blue sky laws of any applicable jurisdiction.

-7-

Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply the proceeds of the sale of the MRP Shares as permitted under the 1940 Act including for the refinancing of existing Indebtedness, making new portfolio investments and for general corporate purposes. Assuming the required preparation, execution, delivery and filing of the applicable Federal Reserve Board forms by the Purchasers (such as Forms U-1 and G-1 through 4, as applicable), each Purchaser’s purchase of the MRP Shares specified under this Agreement will not cause a violation of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), Regulation X of said Board (12 CFR 224) or Regulation T of said Board (12 CFR 220).

Section 5.15. Existing Indebtedness. (a) Except as described therein, Schedule 5.15 sets forth a complete and correct list of all outstanding Indebtedness of the Company as of April 30, 2022 (including descriptions of the obligors and obligees, principal amounts outstanding, any collateral therefor, and any Guaranty thereof), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Indebtedness of the Company. The Company is not in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Indebtedness of the Company, and no event or condition exists with respect to any Indebtedness of the Company the outstanding principal amount of which exceeds $5,000,000 that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Indebtedness to become due and payable before its stated maturity or before its regularly scheduled dates of payment.

Section 5.16. Foreign Assets Control Regulations, Etc. (a) Neither the Company nor any Controlled Entity (i) is a Blocked Person, (ii) has been notified that its name appears or may in the future appear on a State Sanctions List or (iii) is a target of sanctions that have been imposed by the United Nations or the European Union.

-8-

(ii) will be used, directly or indirectly, in violation of, or cause any Purchaser to be in violation of, any applicable Anti-Money Laundering Laws; or

Section 5.17. Status under Certain Statutes. The Company is subject to regulation under the 1940 Act. The Company is and immediately after giving effect to the issuance of the MRP Shares will be, in compliance with the 1940 Act, including, but not limited to, all leverage provisions specified in the 1940 Act. The Company is not subject to regulation under the Public Utility Holding Company Act of 2005, the ICC Termination Act of 1995, or the Federal Power Act.

Section 5.18. Ranking of Obligations. The Company’s obligations with respect to payment of dividends and distribution of assets upon dissolution, liquidation or winding up of the affairs of the Company in respect of the MRP Shares will, upon issuance thereof, rank senior to all Common Stock of the Company and pari passu with all other Preferred Stock of the Company.

Section 5.19. Capital Stock. The authorized and outstanding capital stock of the Company as of April 30, 2022 is set forth in Schedule 5.19 attached hereto and the authorized and outstanding capital stock of the Company as of the date of the Closing will be set forth in a schedule to the officer’s certificate delivered pursuant to Section 4.3(a). All of the outstanding capital stock of the Company has been validly issued and is fully paid and non-assessable and is subject to no liens and encumbrances, other than as set forth on said Schedule 5.19. The stockholders of the Company are not entitled to any preemptive rights with respect to the Common Stock or other capital stock of the Company. The Company has no outstanding warrants, options, convertible Securities or preemptive or other rights for the purchase, nor is it a party to or is it bound by any agreement or other instrument restricting or affecting the issuance, of capital stock of the Company other than the Company’s charter and under Section 6.6 of the JPMorgan Credit Agreement, under Section 6.6 of the Sumitomo Credit Agreement, under Section 10.4 of the 2013 Note Purchase Agreement, under Section 10.4 of the 2014A Note Purchase Agreement, under Section 10.4 of the 2014B Note Purchase Agreement, under Section 10.4 of the 2021 Note Purchase Agreement, under Section 10.4 of the 2022 Note Purchase Agreement and the Series R/S Articles Supplementary. The MRP Shares which are to be issued and sold on the date of the Closing, when issued and delivered against payment therefor in accordance with this Agreement, will be duly and validly issued, fully paid and non-assessable and will have the preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption as are set forth in the Articles Supplementary and the laws of the State of Maryland.

-9-

Section 5.20. Restrictions on Creation of MRP Shares and Distributions. (a) The Company is not a party to, or otherwise subject to any provision contained in, any instrument evidencing Indebtedness of the Company, any agreement relating thereto or any other agreement (including, but not limited to, its charter or other organizational document) which limits the amount of, or otherwise imposes restrictions on the creation or issuance of MRP Shares of the Company, other than this Agreement and the Articles Supplementary and under Section 6.6 of the JPMorgan Credit Agreement, under Section 6.6 of the Sumitomo Credit Agreement, under Section 10.4 of the 2013 Note Purchase Agreement, under Section 10.4 of the 2014A Note Purchase Agreement, under Section 10.4 of the 2014B Note Purchase Agreement, under Section 10.4 of the 2021 Note Purchase Agreement, under Section 10.4 of the 2022 Note Purchase Agreement and the Series R/S Articles Supplementary.

(b) The Company is not a party to or bound by any contract, indenture, agreement, instrument, order of any court, or governmental agency rule or regulation (other than the 1940 Act), or any note, debenture, bond, or other security, which contains provisions expressly limiting or restricting payments by the Company on or in respect of shares of its capital stock of any class, including, without limitation, the Company’s right and obligation to declare and pay dividends on the MRP Shares and to make mandatory and optional redemption of shares of the MRP Shares pursuant to the provisions of the Articles Supplementary other than this Agreement, under Section 6.6 of the JPMorgan Credit Agreement, under Section 6.6 of the Sumitomo Credit Agreement, under Section 10.4 of the 2013 Note Purchase Agreement, under Section 10.4 of the 2014A Note Purchase Agreement, under Section 10.4 of the 2014B Note Purchase Agreement, under Section 10.4 of the 2021 Note Purchase Agreement, under Section 10.4 of the 2022 Note Purchase Agreement and the Series R/S Articles Supplementary. The Company is subject to the Maryland General Corporation Law and the Articles Supplementary which impose limitations on the declaration and payment of dividends and other distributions and the redemption of the MRP Shares.

Section 6. Representations of the Purchasers.

Section 6.1. Purchase for Investment. (a) Each Purchaser severally represents that it is purchasing the MRP Shares for its own account or for one or more separate accounts maintained by such Purchaser or for the account of one or more pension or trust funds and not with a view to the distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all times be within such Purchaser’s or their control. Each Purchaser understands that the MRP Shares have not been registered under the Securities Act or the securities laws of any state or foreign jurisdiction and may be resold, transferred or otherwise disposed of only if registered pursuant to the provisions of the Securities Act and any applicable state or foreign securities laws or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the MRP Shares.

-10-

(c) Each Purchaser (and any account which is a separate legal entity contemplated in Section 6.1(a)) is an “accredited investor” as defined in Rule 501(a) promulgated under the Securities Act.

(a) the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained by the same employer (or affiliate thereof as defined in PTE 95-60) or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile; or

-11-

(f) the Source is a governmental plan; or

(h) the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA.

-12-

Section 7. Information as to the Company.

Section 7.1. Financial and Business Information. The Company shall deliver or cause to be delivered to each Purchaser until it purchases MRP Shares and then each holder of MRP Shares that is an Institutional Investor:

(i) an unaudited balance sheet of the Company, as at the end of such quarter, and

(ii) unaudited statements of operations and changes in net assets of the Company, for the portion of the fiscal year ending with such quarter, all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year-end adjustments, provided that the Company shall be deemed to have made such delivery of such quarterly financial statements if it shall have timely made such quarterly financial statements available on its home page on the worldwide web (at the date of this Agreement located at http://www.kaynefunds.com) and shall have given to such holder of MRP Shares prior notice of such availability on its home page in connection with each delivery (such availability and notice thereof being referred to as “Electronic Delivery”) provided, further, that the Company agrees also to deliver hard copies of such financial statements within the time period required above to any holder of MRP Shares who has requested such delivery in writing, unless such written request was made within the last 10 days of the end of such time period, in which case, the Company will deliver such financial statements no later than 10 days after the conclusion of the time period required above;

(i) a balance sheet and schedule of investments of the Company, as at the end of such year, and

-13-

(ii) statements of operations and changes in net assets of the Company, for such year, all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion thereon (without a “going concern” or similar qualification or exception and without any qualification or exception as to the scope of the audit on which such opinion is based except for any “going concern” or similar exception resulting from the impending maturity of any indebtedness or any prospective breach of a financial covenant) of independent public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances, provided that the delivery within the time period specified above of the Company’s Form N-CSR for such fiscal year prepared in accordance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.1(b), and provided, further, that the Company shall be deemed to have made such delivery of such Form N-CSR if it shall have timely made Electronic Delivery thereof provided, further, that the Company agrees also to deliver hard copies of such financial statements within the time period required above to any holder of MRP Shares who has requested such delivery in writing within the time period required above, unless such written request was made within the last 10 days of the end of such time period, in which case, the Company will deliver such financial statements no later than 10 days after the conclusion of the time period required above;

(i) one copy of each quarterly or annual financial statement, each regular or periodic report sent to the Company’s stockholders, each notice sent to the Company’s stockholders, each proxy statement and similar document filed with the SEC, each registration statement that shall have become effective (without exhibits except as expressly requested by such Purchaser until it purchases MRP Shares, and then such holder) and each final prospectus and all amendments thereto filed by the Company with the SEC; provided that the Company shall be deemed to have made such delivery of such materials if it shall have made timely Electronic Delivery thereof, and

(ii) if requested by any holder of MRP Shares, each financial statement, report or notice sent by the Company to its principal lending banks as a whole (excluding information sent to such banks in the ordinary course of administration of a bank facility, such as information relating to pricing and borrowing availability) or to any NRSRO.

-14-

(g) NRSRO Rating —upon receipt from any NRSRO currently rating the MRP Shares of evidence of such rating (or change thereto), the Company shall deliver such evidence to the holders of the MRP Shares. The evidence required to be delivered pursuant to this clause (g) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which documents are electronically mailed to the holder of MRP Shares; and

(h) Requested Information — with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or properties of the Company (including, without limitation, actual copies of the quarterly and annual reports of the Company) or relating to the ability of the Company to perform its obligations under this Agreement and under the MRP Shares as from time to time may be reasonably requested by such Purchaser until it purchases MRP Shares, and then such holder of MRP Shares (including any such information as may be reasonably necessary to complete any Holder Forms).

-15-

Section 7.2. Officer’s Certificate. Each set of financial statements delivered to a Purchaser until it purchases MRP Shares, and then a holder of MRP Shares pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a Senior Financial Officer setting forth (which, in the case of Electronic Delivery of any such financial statements, shall be by separate delivery of such certificate to each holder of MRP Shares promptly upon the making of such Electronic Delivery):

(a) Covenant Compliance — the information (including detailed calculations) required in order to establish whether the Company was in compliance with the requirements of Section 3(a)(ii), Section 3(a)(iii) and Section 7 of the Articles Supplementary and any additional provisions added pursuant to Section 3(i) of the Articles Supplementary, during the quarterly or annual period covered by the statements then being furnished (including with respect to each such Section, where applicable, the calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Sections, and the calculation of the amount, ratio or percentage then in existence). In the event that the Company has made an election to measure any financial liability using fair value (which election is being disregarded for purposes of determining compliance with this Agreement pursuant to Section 22.3) as to the period covered by any such financial statement, such Senior Financial Officer’s certificate as to such period shall include a reconciliation from GAAP with respect to such election); and

Documents required to be delivered pursuant to this Section 7.2 may be delivered electronically and, if so delivered shall be deemed to have been delivered on the date on which executed certificates or other documents are electronically mailed to the holder of MRP Shares as applicable.

-16-

Section 7.3. Visitation. The Company shall permit the representatives of each Purchaser until it purchases MRP Shares, and then each holder of MRP Shares that is an Institutional Investor:

(a) No Default — if no Default or Event of Default then exists, at the expense of such Purchaser or such holder of MRP Shares and upon reasonable prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company with the Company’s officers, and, with the consent of the Company (which consent will not be unreasonably withheld) to visit the other offices and properties of the Company, not more than twice each calendar year; and

Section 8. Redemption of the MRP Shares.

The Company will not, directly or indirectly, through any Affiliate or otherwise, purchase, redeem or retire, or make any offer to purchase, redeem or retire, any shares of the MRP Shares other than pursuant to and in accordance with the applicable provisions of the Articles Supplementary.

Section 9. Affirmative Covenants.

From the date of this Agreement until the Closing and thereafter, so long as any of the MRP Shares are outstanding, the Company covenants that:

-17-

Section 9.7. [Intentionally Omitted.]

Section 9.8. Current Rating on the MRPS Shares. To the extent that a NRSRO is currently rating the MRP Shares, evidence of any current rating by a NRSRO currently rating the MRP Shares (which may be in the form of a report, a letter, any combination of the foregoing or similar communication) shall (a) refer to the Private Placement Number issued by PPN CUSIP Unit of CUSIP Global Services in respect of each Series of MRP Shares, (b) not include any prohibition against a holder sharing such evidence with the SVO or any other regulatory authority having jurisdiction over such holder, (c) be delivered by the Company to the holders at least annually (on or before the anniversary of the date of the Closing) and promptly upon any change in the rating an updated Rating Letter evidencing such rating and an updated Rating Rationale Report with respect to such rating along with any other information or details requested by the SVO.

-18-

Section 9.9. [Intentionally Omitted.]

Section 9.10. [Intentionally Omitted.]

Although it will not be a Default or Event of Default if the Company fails to comply with any provision of Section 9 on or after the date of this Agreement and prior to the Closing, if such a failure occurs, then any of the Purchasers may elect not to purchase the MRP Shares on the date of the Closing specified in Section 3.

Section 10. Negative Covenants.

From the date of this Agreement until the Closing and thereafter, so long as any of the MRP Shares are outstanding, the Company covenants that:

(a) the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease all or substantially all of the assets of the Company as an entirety, as the case may be, shall be a solvent corporation or limited liability company organized and existing under the laws of the United States or any State thereof (including the District of Columbia), and, if the Company is not such corporation or limited liability company, (i) such corporation or limited liability company shall have executed and delivered to each holder of any MRP Shares its assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the MRP Shares and (ii) such corporation or limited liability company shall have caused to be delivered to each holder of any MRP Shares an opinion of nationally recognized independent counsel, or other independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; and

-19-

(b) immediately before and immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing.

Section 10.3. Economic Sanctions, Etc. The Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the MRP Shares) with any Person if such investment, dealing or transaction (i) would cause any Purchaser or holder or any affiliate of such Purchaser or holder to be in violation of, or subject to sanctions under, any law or regulation applicable to such Purchaser or holder, or (ii) is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws.

Section 10.4. [Intentionally Omitted.]

Although it will not be a Default or Event of Default if the Company fails to comply with any provision of Section 10 on or after the date of this Agreement and prior to the Closing, if such a failure occurs, then any of the Purchasers may elect not to purchase the MRP Shares on the date of the Closing specified in Section 3.

Section 11. Default and Remedies.

(a) If the Company shall Default, it shall, promptly after any officer of the Company obtains knowledge of such Default, give notice thereof to all holders of outstanding shares of MRP Shares, such notice to be in writing and sent in the manner provided in Section 18.

(b) If any Default has occurred and is continuing and such Default is not remedied within 5 days (for any monetary Default) and within 30 days (for any non-monetary Default) after the earlier of (i) the day on which a Responsible Officer of the Company first obtains knowledge of such Default or (ii) the day on which a written notice thereof is given to the Company by the holder of any MRP Shares (an “Event of Default”), the Required Holders may proceed to protect and enforce any or all of the rights and remedies of the holders of the MRP Shares resulting from such failure, by suit in equity or action at law or by other appropriate proceeding.

-20-

(c) The holders of the MRP Shares shall have the rights and remedies provided in the Articles Supplementary as a result of any failure by the Company to comply with the terms and conditions thereof.

(d) Without limiting the obligations of the Company under Section 15, the Company further agrees, to the extent not prohibited by law, to pay, on the holder’s demand, such amounts as shall be sufficient to cover all costs and expenses of the holder incurred in any enforcement under this Section 11.

(e) No course of dealing and no delay on the part of any holder of any MRP Shares in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies. No right, power or remedy conferred by this Agreement, the Articles Supplementary or any MRP Shares upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise.

Section 12. Reserved.

Section 13. Registration; Exchange; Substitution of Certificates Representing MRP Shares.

Section 13.1. Registration of MRP Shares. Each Purchaser and each subsequent holder of the MRP Shares severally acknowledges and agrees that any MRP Shares received in connection with this Agreement represented by physical certificates will bear the legend set forth on Exhibit 13.1. The Company or its agent on the Company’s behalf shall keep at its principal executive office a register for the registration and registration of transfers of MRP Shares. The name and address of each holder of one or more MRP Shares, each transfer thereof and the name and address of each transferee of one or more MRP Shares shall be registered in such register. If any holder of one or more MRP Shares is a nominee, then (a) the name and address of the beneficial owner of such MRP Share or MRP Share shall also be registered in such register as an owner and holder thereof and (b) at any such beneficial owner’s option, either such beneficial owner or its nominee may execute any amendment, waiver or consent pursuant to this Agreement. Prior to due presentment for registration of transfer, the Person in whose name any MRP Shares shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary. The Company shall give to any holder of an MRP Shares that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of MRP Shares.

-21-

Section 13.2. Transfer and Exchange of MRP Shares. Upon surrender of any certificate representing MRP Shares to the Company or its agent at the address and to the attention of the designated officer (all as specified in Section 18(iii)), for registration of transfer or exchange (and in the case of a surrender for registration of transfer accompanied by a written instrument of transfer duly executed by the registered holder of such MRP Shares or such holder’s attorney duly authorized in writing and accompanied by the relevant name, address and other information for notices of each transferee of such MRP Shares or part thereof), within ten Business Days thereafter, the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new MRP Shares (as requested by the holder thereof) in exchange therefor, in an aggregate MRP Liquidation Preference Amount equal to the unpaid MRP Liquidation Preference Amount of the surrendered MRP Shares. Each such new certificate representing MRP Shares shall be payable to such Person as such holder may request and shall be substantially in the form of Exhibit 2. Each such new certificate representing MRP Shares shall be dated the date of the issuance of such new certificate and the holder thereof shall be entitled to receive cash dividends with respect thereto in accordance with the Articles Supplementary. The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of MRP Shares. Each holder of MRP Shares will be deemed, by its acceptance thereof to have made the representations set forth in Section 6. Notwithstanding anything to the contrary in this Section 13.2, no MRP Shares shall be resold, transferred or otherwise disposed of unless such MRP Shares are registered pursuant to the provisions of the Securities Act and any applicable state or foreign securities laws or if any exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the MRP Shares. Each holder of MRP Shares will be deemed, by its acceptance thereof, (i) to have made the representations set forth in Section 6 of this Agreement and (ii) to have agreed to the confidentiality provisions set forth in Section 20 of this Agreement.

Section 13.3. Replacement of Certificates Representing MRP Shares. Upon receipt by the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any certificates representing MRP Shares (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and

(a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such certificates representing MRP Shares is, or is a nominee for, an original Purchaser or another holder of a MRP Share with a minimum net worth of at least $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or

(b) in the case of mutilation, upon surrender and cancellation thereof,

within ten Business Days thereafter, the Company at its own expense shall execute and deliver, in lieu thereof, new certificates evidencing such MRP Shares, dated and entitled to receive cash dividends from the date to which cash dividends have been paid on the surrendered certificates representing MRP Shares or dated the date of such lost, stolen, destroyed or mutilated certificates representing MRP Shares if no dividends have been paid thereon.

Section 14. Payments on MRP Shares.

Section 14.1. Place of Payment. Subject to Section 14.2, payments of all amounts with respect to any MRP Shares (whether as dividends, upon redemption of shares or otherwise) shall be made in New York, New York at the principal office of The Bank of New York Mellon, located at 240 Greenwich Street, 7E, New York, New York 10286. The Company may at any time, by notice to each holder of MRP Shares, change the place of payment of the MRP Shares so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction.

-22-

Section 14.2. Home Office Payment. Subject to Section 14.3, so long as any Purchaser or its nominee shall be the holder of any MRP Shares, and notwithstanding anything contained in Section 14.1 or in the terms of such MRP Shares to the contrary, the Company will pay all sums becoming due on such MRP Shares (whether as dividends, upon redemption of shares or otherwise) by the method and at the address specified for such purpose below such Purchaser’s name in Schedule A hereto, or by such other method or at such other address as such Purchaser shall have from time to time specified to the Company and the Paying Agent (which notice to the Paying Agent will be in accordance with Section 11(ii) of the Agency Agreement) in writing for such purpose, without the presentation or surrender of any certificate for such MRP Shares or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after full redemption of such MRP Shares, such Purchaser shall surrender any certificate for such MRP Shares for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1. The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any MRP Shares purchased by a Purchaser under this Agreement and that has made the same agreement relating to such MRP Shares as the Purchasers have made in this Section 14.2.

Section 14.3. Agency Agreement. The Company and the holders of the MRP Shares agree that in addition to the other provisions of this Section 14, the Company can make optional redemption of the MRP Shares pursuant to the Articles Supplementary pursuant to the Agency Agreement substantially in the form of Exhibit 14.3 hereto or in such other form as is reasonably acceptable to the Company and the Required Holders. The Company shall deliver to the Paying Agent under the Agency Agreement copies of all notices and certificates related to a redemption of MRP Shares under the Articles Supplementary delivered by the Company to any holder of MRP Shares concurrently with the delivery thereof to such holder.

SECTION 15. EXPENSES, ETC.

Section 15.1. Transaction Expenses. Whether or not the transactions contemplated hereby are consummated, the Company will pay all costs and expenses (including reasonable attorneys’ fees of a special counsel and, if reasonably required by the Required Holders, local or other counsel) incurred by the Purchasers and each other holder of an MRP Share in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement, the Articles Supplementary or the MRP Shares (whether or not such amendment, waiver or consent becomes effective), including, without limitation: (a) the reasonable costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement, the Articles Supplementary or the MRP Shares or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement, the Articles Supplementary or the MRP Shares, or by reason of being a holder of any MRP Shares, (b) the reasonable costs and expenses, including financial advisors’ fees, incurred in connection with the insolvency or bankruptcy of the Company or in connection with any work-out or restructuring of the transactions contemplated hereby, by the Articles Supplementary and by the MRP Shares and (c) the costs and expenses incurred in connection with the initial filing of this Agreement, the Articles Supplementary and all related documents and financial information with the SVO, provided that such costs and expenses under this clause (c) shall not exceed $3,500.00 per series. The Company will pay, and will save each Purchaser and each other holder of an MRP Share harmless from (i) all claims in respect of any fees, costs or expenses if any, of brokers and finders (other than those, if any, retained by a Purchaser or other holder in connection with its purchase of the MRP Shares), (ii) any and all wire transfer fees that any bank or other financial institution deducts from any payment under such MRP Shares to such holder or otherwise charges to a holder of MRP Shares with respect to a payment under such MRP Shares and (iii) any judgment, liability, claim, order, decree, fine, penalty, cost, fee, expense (including reasonable attorneys’ fees and expenses) or obligation resulting from the consummation of the transactions contemplated hereby, including the use of the proceeds of the MRP Shares by the Company.

-23-

Section 15.2. Certain Taxes. The Company agrees to pay all stamp, documentary or similar taxes or fees which may be payable in respect of the execution and delivery or the enforcement of this Agreement or the execution and delivery (but not the transfer) or the enforcement of any of the MRP Shares in the United States or any other jurisdiction where the Company has assets or of any amendment of, or waiver or consent under or with respect to, this Agreement or of any of the MRP Shares, and to pay any value added tax due and payable in respect of reimbursement of costs and expenses by the Company pursuant to this Section 15, and will save each holder of MRP Shares to the extent permitted by applicable law harmless against any loss or liability resulting from nonpayment or delay in payment of any such tax or fee required to be paid by the Company hereunder.

Section 15.3. Survival. The obligations of the Company under this Section 15 will survive the payment or transfer of any MRP Shares, the enforcement, amendment or waiver of any provision of this Agreement, the Articles Supplementary or the MRP Shares, and the termination of this Agreement.

Section 16. Survival of Representations and Warranties; Entire Agreement.

All representations and warranties contained herein shall survive the execution and delivery of this Agreement, the execution and filing of the Articles Supplementary, the issuance and sale of the MRP Shares, the purchase or transfer by any Purchaser of any MRP Shares or portion thereof or interest therein and the redemption of any MRP Shares, and may be relied upon by any subsequent holder of MRP Shares, regardless of any investigation made at any time by or on behalf of such Purchaser or any other holder of MRP Shares. All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement. Subject to the preceding sentence, this Agreement, the Articles Supplementary and the MRP Shares embody the entire agreement and understanding between each Purchaser and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.

-24-

Section 17. Amendment and Waiver.

Section 17.1. Requirements. This Agreement may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders, except that (i) no amendment or waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used in any such Section), will be effective as to any holder of MRP Shares unless consented to by such holder of MRP Shares in writing, and (ii) no such amendment or waiver may, without the written consent of the holder of each MRP Share at the time outstanding affected thereby, (A) change the percentage of the MRP Shares the holders of which are required to consent to any such amendment or waiver, or (B) amend any of Section 11, 17 or 20 of this Agreement.

Section 17.2. Solicitation of Holders of MRP Shares.

(a) Solicitation. The Company will provide each Purchaser and each holder of MRP Shares (irrespective of the amount of MRP Shares then owned by it) with sufficient information, sufficiently far in advance of the date a decision is required, to enable such Purchaser and such holder of MRP Shares to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Articles Supplementary. The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this Section 17 to each Purchaser and each holder of outstanding MRP Shares promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite Purchasers or holders of MRP Shares.

(b) Payment. The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security or provide other credit support, to any Purchaser or holder of MRP Shares as consideration for or as an inducement to the entering into by any Purchaser or holder of MRP Shares of any waiver or amendment of any of the terms and provisions hereof or of the Articles Supplementary, unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each Purchaser, and holder of MRP Shares then outstanding even if such Purchaser or holder of MRP Shares did not consent to such waiver or amendment.

(c) Consent in Contemplation of Transfer. Any consent made pursuant to this Section 17 by the holder of any MRP Shares that has transferred or has agreed to transfer such MRP Shares to (i)the Company or (ii) any Subsidiary or any other Affiliate of the Company or (iii) any other Person in connection with, or in anticipation of, such other Person acquiring, making a tender offer for or merging with the Company and/or any of its Affiliates, in each case in connection with such consent shall be void and has provided or has agreed to provide such written consent as a condition to such transfer shall be void and of no force or effect except solely as to such holder, and any amendments effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of MRP Shares that were acquired under the same or similar conditions) shall be void and of no force or effect except solely as to such transferring holder.

-25-

Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to as provided in this Section 17 applies equally to all Purchasers and holders of MRP Shares and is binding upon them and upon each future holder of any MRP Shares and upon the Company without regard to whether such certificates representing MRP Shares have been marked to indicate such amendment or waiver. No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon. No course of dealing between the Company and the Purchaser or holder of any MRP Shares nor any delay in exercising any rights hereunder shall operate as a waiver of any rights of any Purchaser or holder of such MRP Shares. As used herein, the term “this Agreement” and references thereto shall mean this Agreement as it may from time to time be amended or supplemented.

Section 17.4. MRP Shares Held by Company, Etc. Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate number of MRP Shares then outstanding approved or consented to any amendment, waiver or consent to be given under this Agreement or the Articles Supplementary, or have directed the taking of any action provided herein or therein to be taken upon the direction of the holders of a specified percentage of the aggregate number of MRP Shares then outstanding, MRP Shares (i) directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding or (ii) for which the Company has paid to the Paying Agent the redemption amount therefor in accordance with the Agency Agreement shall be deemed not to be outstanding.

Section 18. Notices.

(ii) if to any other holder of any MRP Shares, to such holder at such address as such other holder shall have specified to the Company in writing; or

Notices under this Section 18 will be deemed given only when actually received.

-26-

Section 19. Reproduction of Documents.

This Agreement and all documents relating thereto, including, without limitation, (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by any Purchaser at the Closing (except the MRP Shares themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to any Purchaser, may be reproduced by such Purchaser by any photographic, photostatic, electronic, digital, or other similar process and such Purchaser may destroy any original document so reproduced. The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such Purchaser in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company or any other holder of MRP Shares from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.

Section 20. Confidential Information.

For the purposes of this Section 20, “Confidential Information” means information delivered to any Purchaser by or on behalf of the Company in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by such Purchaser as being confidential information of the Company, provided that such term does not include information that (a) was publicly known or otherwise known to such Purchaser prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by such Purchaser or any person acting on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by the Company or (d) constitutes financial statements delivered to such Purchaser under Section 7.1 that are otherwise publicly available. Each Purchaser will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by such Purchaser in good faith to protect confidential information of third parties delivered to such Purchaser, provided that such Purchaser may deliver or disclose Confidential Information to (i) its directors, trustees, officers, employees, agents, attorneys and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by its MRP Shares), (ii) its financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with the terms of this Section 20, (iii) any other holder of any MRP Shares, (iv) any Institutional Investor to which it sells or offers to sell such MRP Shares or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (v) any Person from which it offers to purchase any Security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (vi) any federal or state regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or the SVO or, in each case, any similar organization, or any nationally recognized rating agency that requires access to information about such Purchaser’s investment portfolio, or (viii) any other Person to which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to such Purchaser, (x) in response to any subpoena or other legal process, (y) in connection with any litigation to which such Purchaser is a party or (z) if an Event of Default has occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under such Purchaser’s MRP Shares, this Agreement and the Articles Supplementary. Each holder of an MRP Share, by its acceptance of an MRP Share, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement. On reasonable request by the Company in connection with the delivery to any holder of an MRP Share of information required to be delivered to such holder under this Agreement or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying the provisions of this Section 20. A holder of an MRP Share, by receipt of Confidential Information, hereby also acknowledges that trading in the Company’s Securities may be prohibited under applicable laws, rules and regulations and that it has implemented policies to comply with applicable laws, rules and regulations and to prohibit any such prohibited trades.

-27-

In the event that as a condition to receiving access to information relating to the Company or its Subsidiaries in connection with the transactions contemplated by or otherwise pursuant to this Agreement, any Purchaser or holder of a MRP Share is required to agree to a confidentiality undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede any such other confidentiality undertaking.

Section 21. Substitution of Purchaser.

Section 21.1. Each Purchaser shall have the right to substitute any one of its Affiliates as the purchaser of MRP Shares that it has agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both such Purchaser and such Affiliate, shall contain such Affiliate’s agreement to be bound by this Agreement and shall contain a confirmation by such Affiliate of the accuracy with respect to it of the representations set forth in Section 6. Upon receipt of such notice, any reference to such Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such Affiliate in lieu of such original Purchaser. In the event that such Affiliate is so substituted as a Purchaser hereunder and such Affiliate thereafter transfers to such original Purchaser all of the MRP Shares then held by such Affiliate, upon receipt by the Company of notice of such transfer, any reference to such Affiliate as a “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer to such Affiliate, but shall refer to such original Purchaser, and such original Purchaser shall again have all the rights of an original holder of MRP Shares under this Agreement.

Section 21.2. Notwithstanding anything to the contrary herein, no Purchaser shall substitute any Affiliate as the purchaser of the MRP Shares or make any other transfer of the MRP Shares to any other transferee without the prior written consent of the Company which will not be unreasonably withheld or delayed if the source of funds to be used by a proposed Affiliate or transferee to purchase any MRP Shares is a source which qualifies under clause (c) or (g) of Section 6.2 hereof; provided, however, if such Affiliate or other transferee is able to make the representation set forth in Section 6.2(c) without making any disclosure to the Company in writing, the prior written consent of the Company to such substitution or transfer shall not be required.

-28-

Section 22. Miscellaneous.

Section 22.2. Appointment of Initial MRP Shares Directors. The Company and each of the Purchasers acknowledge and agree that, as of the date hereof, each of James C. Baker and Albert L. Richey are currently directors of the Company elected by the holders of the Preferred Stock of the Company and the Board of Directors of the Company intends to nominate a director for election by the holders of the Preferred Stock of the Company (including the MRP Shares) pursuant to Section 4(a) of the Articles Supplementary upon the expiration of such director’s current term.

Section 22.3. Accounting Terms. All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP. For purposes of determining compliance with the financial covenants contained in this Agreement or the Articles Supplementary, any election by the Company to measure an item of Indebtedness using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification Topic No. 825-10-25 – Fair Value Option or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.

-29-

Defined terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein) and, for purposes of the MRP Shares, shall also include any such notes issued in substitution therefor pursuant to Section 13, (b) subject to Section 22.1, any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections and Schedules shall be construed to refer to Sections of, and Schedules to, this Agreement, and (e) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.

For the avoidance of doubt, all Schedules and Exhibits attached to this Agreement shall be deemed to be a part hereof.

Section 22.6. Counterparts; Electronic Contracting. This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. The parties agree to electronic contracting and signatures with respect to this Agreement and the other related documents (other than the MRP Shares). Delivery of an electronic signature to, or a signed copy of, this Agreement and such other related documents (other than the MRP Shares) by facsimile, email or other electronic transmission shall be fully binding on the parties to the same extent as the delivery of the signed originals and shall be admissible into evidence for all purposes.

Section 22.8. Jurisdiction and Process; Waiver of Jury Trial. (a) The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising out of or relating to this Agreement or the MRP Shares. To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

-30-

(c) The Company consents to process being served by or on behalf of any holder of MRP Shares in any suit, action or proceeding of the nature referred to in Section 22.8(a) by mailing a copy thereof by registered, certified priority or express mail (or any substantially similar form of mail), postage prepaid, return receipt or delivery confirmation requested, to it at its address specified in Section 18 or at such other address of which such holder shall then have been notified pursuant to said Section. The Company agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and

(ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.

(c) Nothing in this Section 22.8 shall affect the right of any holder of MRP Shares to serve process in any manner permitted by law, or limit any right that the holders of any MRP Shares may have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

(d) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE MRP SHARES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

* * * * *

-31-

	Very truly yours,

	KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.
SECURITIES PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Massachusetts Mutual Life Insurance Company

	By:	Barings LLC as Investment Adviser

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Metropolitan Life Insurance Company

	By:	MetLife Investment Management, LLC, Its Investment Manager

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Principal Life Insurance Company

	By:	Principal Global Investors, LLC a Delaware limited liability company, its authorized signatory

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	VOYA RETIREMENT [NSURANCE AND ANNUITY COMPANY
	RELIASTAR LIFE INSURANCE COMPANY

	By:	Voya Investment Management LLC, as Agent

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PURCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PuRCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

United of Omaha Life Insurance Company

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PuRCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

RGA GLOBAL REINSURANCE COMPANY, LTD.

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PuRCHASE AGREEMENT

This Agreement is hereby accepted and agreed to as of the date hereof.

	Royal Neighbors of America

	By:	Apollo RN Credit Management LP, its investment adviser
	By:	Apollo Capital Management, L.P., its sole member
	By:	Apollo Capital Management GP, LLC, its General Partner

KAYNE ANDERSON ENERGY INFRASTRUCTURE FUND, INC.

SECURITIES PuRCHASE AGREEMENT

Information Related to Purchasers

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Massachusetts Mutual Life Insurance Company		$3,000,000
c/o Barings LLC		(120,000 Shares)
		SERIES T

Schedule A

(to Securities Purchase Agreement)

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Metropolitan Life Insurance Company		$2,000,000
200 Park Avenue		(80,000 Shares)
New York, New York 10166		Series T

A-2

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Metropolitan Life Insurance Company		$1,000,000
200 Park Avenue		(40,000 Shares)
New York, New York 10166		Series T

A-3

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Principal Life Insurance Company		$2,250,000
		(90,000 Shares)
		Series T

A-4

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Principal Life Insurance Company – Principal		$750,000
PRT Separate Account		(30,000 Shares)
		Series T

A-5

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Voya Retirement Insurance and Annuity Company		$900,000
		(36,000 Shares)
		Series T

A-6

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Reliastar Life Insurance Company		$100,000
		(4,000 Shares)
		Series T

A-7

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Voya Investment Trust Co., as Trustee for the		$2,000,000
Voya Private Credit Trust Fund		(80,000 Shares)
		Series T

A-8

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

The Guardian Life Insurance Company of America		$3,000,000
(PRIF-W)		(120,000 Shares)
		Series T

A-9

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

United of Omaha Life Insurance Company		$2,000,000
		(80,000 Shares)
		Series T

A-10

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

RGA Global Reinsurance Company Ltd.		$2,000,000
		(80,000 Shares)
		Series T

A-11

		Aggregate Liquidation
Name and Address of Purchaser		Preference Amount of MRP
		Shares to be Purchased

Royal Neighbors of America		$1,000,000
c/o Apollo Global Management LLC		(40,000 Shares)
Attn: Private Fixed Income		Series T
7700 Mills Civic Parkway
West Des Moines, IA 50266

A-12

Defined Terms

As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:

“Affiliate” means, at any time, and with respect to any Person, any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

“Agency Agreement” shall mean the Agency Agreement dated as of May 18, 2022, by and among the Company, the Purchasers and the Paying Agent, substantially in the form of Exhibit

14.3 hereto.

“Articles Supplementary” is defined in Section 1.

“Business Day” means a day on which the New York Stock Exchange is open for trading and which is not a Saturday, Sunday or other day on which banks in the City of New York, New York or Houston, Texas is authorized or obligated by law to close, or days on which the Federal Reserve Bank of New York is not open for business.

“Closing” is defined in Section 3.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder from time to time.

Schedule B

(to Securities Purchase Agreement)

“Common Stock” shall mean and include any share of any class or series of capital stock of a corporation, the right of which to share in distributions of either income or realized capital gain of such corporation is without limit as to any amount or percentage as and to the extent no amounts payable on or in respect of such Common Stock and no rights arising in connection therewith have preference over any other Common Stock upon dissolution, liquidation or winding-up of such corporation.

“Company” means Kayne Anderson Energy Infrastructure Fund, Inc., a Maryland corporation or any successor that becomes such in the manner prescribed in Section 10.2.

“Confidential Information” is defined in Section 20.

“Default” means the failure by the Company in its performance or compliance with any covenant or agreement hereunder or under the Articles Supplementary.

“Electronic Delivery” is defined in Section 7.1(a).

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code.

“Event of Default” is defined in Section 11.

“Form N-CSR” is defined in Section 7.1(b).

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America.

B-2

“Governmental Authority” means

(a) the government of

(i) the United States of America or any State or other political subdivision thereof, or

(ii) any other jurisdiction in which the Company conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company, or

(b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

(a) to purchase such indebtedness or obligation or any property constituting security therefor;

(d) otherwise to assure the owner of such indebtedness or obligation against loss in respect thereof.

B-3

“holder” means, with respect to any MRP Shares, the Person in whose name such MRP Shares are registered in the register maintained by the Company pursuant to Section 13.1 provided, however, that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any related definitions in this Schedule A, “holder” shall mean the beneficial owner of such MRP Share whose name and address appears in such register.

“Holder Forms” means any forms required to be filed by a holder of MRP Shares pursuant to (i) the SEC pursuant to the Securities Exchange Act of 1934, as amended, (ii) the 1940 Act or

(iii) as required by the Federal Reserve Board.

“Indebtedness” with respect to any Person means, at any time, without duplication,

(a) its liabilities for borrowed money and its redemption obligations in respect of mandatorily redeemable Preferred Stock;

(d) all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for such liabilities);

(f) the aggregate Swap Termination Value of all Swap Contracts of such Person; and

(g) any Guaranty of such Person with respect to liabilities of a type described in any of clauses (a) through (f) hereof.

B-4

“Institutional Investor” means (a) any Purchaser of MRP Shares, (b) any holder of MRP Shares holding (together with one or more of its affiliates) more than 5% of the aggregate principal amount of the MRP Shares then outstanding, (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form, and (d) any Related Fund of any holder of any MRP Shares.

“Kroll” means Kroll Bond Rating Agency, Inc. and its successors at law.

“Material” means material in relation to the business, operations, affairs, financial condition, assets or properties of the Company.

“Material Adverse Effect” means a material adverse effect on (a) the business, operations, affairs, financial condition, assets or properties of the Company taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the MRP Shares or (c) the validity or enforceability of this Agreement or the MRP Shares.

“MRP Liquidation Preference Amount” means, with respect to the MRP Shares, the liquidation preference of $25.00 per share.

“MRP Shares” is defined in Section 1.1.

“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is defined in section 4001(a)(3) of ERISA).

“NAIC” means the National Association of Insurance Commissioners or any successor thereto.

B-5

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other officer of the Company whose responsibilities extend to the subject matter of such certificate.

“Paying Agent” means The Bank of New York Mellon Trust Company, N.A. and its successors and assigns under the Agency Agreement.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto.

“Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, business entity or Governmental Authority.

“Preferred Stock” means any class of capital stock of a Person that is preferred over any other class of capital stock (or similar equity interests) of such Person to the payment of dividends or the payment of any amount upon liquidation or dissolution of such Person.

“property” or “properties” means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate.

“Purchaser” or “Purchasers” means each of the purchasers that has executed and delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as any such assignment complies with Section 13.2), provided, however, that any Purchaser of MRP Shares that ceases to be the registered holder or a beneficial owner (through a nominee) of such MRP Shares as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the meaning of “Purchaser” of such MRP Shares for the purposes of this Agreement upon such transfer.

B-6

“Qualified Institutional Buyer” means any Person who is a “qualified institutional buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.

“Rating Letter” means a letter issued by a NRSRO in connection with any private long term credit rating for the MRP Shares, which (a) sets forth the long term credit rating for the MRP Shares, (b) refers to the Private Placement Number issued by CUSIP Unit of CUSIP Global Services in respect of the MRP Shares, (c) addresses the likelihood of payment of both aggregate liquidation preference amount and dividends on the MRP Shares (which requirement shall be deemed satisfied if either (x) such letter includes confirmation that the rating reflects the NRSRO’s assessment of the Company’s ability to make timely payment of aggregate liquidation preference amount and dividends on the MRP Shares or a similar statement or (y) such letter is silent as to the NRSRO’s assessment of the likelihood of payment of both aggregate liquidation preference amount and dividends and does not include any indication to the contrary), (d) includes such other information describing the relevant terms of the MRP Shares as may be required from time to time by the SVO or any other Governmental Authority having jurisdiction over any holder of any MRP Shares and (e) shall not be subject to confidentiality provisions or other restrictions which would prevent or limit the letter from being shared with the SVO or any other Governmental Authority having jurisdiction over any holder of any MRP Shares.

“Rating Rationale Report” means, with respect to any Rating Letter, a report issued by the NRSRO in connection with such Rating Letter setting forth an analytical review of the MRP Shares explaining the transaction structure, methodology relied upon, and, as appropriate, analysis of the credit, legal, and operational risks and mitigants supporting the assigned rating for the MRP Shares, in each case, on the letterhead of the NRSRO or its controlled website and generally consistent with the work product that an NRSRO would produce for a similar publicly rated security and otherwise in form and substance generally required by the SVO or any other Governmental Authority having jurisdiction over any holder of any MRP Shares from time to time. Such report shall not be subject to confidentiality provisions or other restrictions which would prevent or limit the report from being shared with the SVO or any other Governmental Authority having jurisdiction over any holder of any MRP Shares.

“Related Fund” means, with respect to any holder of any MRP Shares, any fund or entity that (i) invests in Securities or bank loans, and (ii) is advised or managed by such holder, the same investment advisor as such holder or by an affiliate of such holder or such investment advisor.

“Required Holders” means, at any time, (i) prior to the date of the Closing, the Purchasers and (ii) on or after the Closing, the holders of more than 50% of the number of MRP Shares at the time outstanding (exclusive of MRP Shares then owned by the Company or any of its Affiliates).

“Responsible Officer” means any Senior Financial Officer and any other officer of the Company with responsibility for the administration of the relevant portion of this Agreement.

“SEC” means the Securities and Exchange Commission of the United States, or any successor thereto.

B-7

“Securities” or “Security” shall have the meaning specified in Section 2(1) of the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“Senior Financial Officer” means the chief financial officer, principal accounting officer, treasurer or comptroller of the Company.

“series” means any series of MRP Shares issued pursuant to this Agreement.

“Series R/S Articles Supplementary” means the Articles Supplementary setting forth the preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications, and terms and conditions of redemption of the Series R Mandatory Redeemable Preferred Stock and the Series S Mandatory Redeemable Preferred Stock of the Company, in each case, as in effect on the date hereof.

“SVO” means the Securities Valuation Office of the NAIC or any successor to such Office.

“Swap Contract” means (a) any and all interest rate swap transactions, basis swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward foreign exchange transactions, cap transactions, floor transactions, currency options, spot contracts or any other similar transactions or any of the foregoing (including, but without limitation, any options to enter into any of the foregoing), and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc. or any International Foreign Exchange Master Agreement.

B-8

“Total Assets” shall mean the aggregate amount of all assets of the Company determined in accordance with GAAP applicable to the Company.

“2013 Note Purchase Agreement” means that certain Note Purchase Agreement among the Company and the purchasers set forth in Schedule A thereto dated as of April 16, 2013, as amended prior to the date hereof.

“2014A Note Purchase Agreement” means that certain Note Purchase Agreement among the Company and the purchasers set forth in Schedule A thereto dated as of April 30, 2014, as amended prior to the date hereof.

“2014B Note Purchase Agreement” means that certain Note Purchase Agreement among the Company and the purchasers set forth in Schedule A thereto dated as of October 29, 2014, as amended prior to the date hereof.

“2021 Note Purchase Agreement” means that certain Note Purchase Agreement among the Company and the purchasers set forth in Schedule A thereto dated as of May 11, 2021, as amended prior to the date hereof.

“2022 Note Purchase Agreement” means that certain Note Purchase Agreement among the Company and the purchasers set forth in Schedule A thereto dated as of May 18, 2022, as amended prior to the date hereof.

“USA PATRIOT Act” means United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

B-9

“Valuation Date” means every Friday, or, if such day is not a Business Day, the next preceding Business Day; provided, however, that the first Valuation Date may occur on any other date established by the Company; provided, further, however, that such first Valuation Date shall be not more than one week from the date on which MRP Shares initially are issued.

B-10

Merger

Schedule 4.9

(to Securities Purchase Agreement)

Disclosure Materials

1. Investor Presentation dated April 22, 2022.

2. Offering Letter from BofA Securities, Inc. and Citigroup Global Markets Inc. dated April 22, 2022.

3. KYN Quarterly Commentary & Performance Data Q1 2022, dated April 7, 2022

Schedule 5.3

(to Securities Purchase Agreement)

Financial Statements

1. The Company’s Annual Reports for the fiscal years ended November 30, 2021, November 30, 2020, November 30, 2019, November 30, 2018, and November 30, 2017.

2. The Company’s Quarterly Report for the fiscal quarter ended February 28, 2022.

SChedule 5.5

(to Securities Purchase Agreement)

Existing Indebtedness as of April 30, 2022

Instrument	Obligor	Obligee	Principal Amount Outstanding		Collateral

Revolving Credit Facility	Company	JP Morgan Chase Bank, N.A., as administrative agent along with several banks and financial institutions	$	155,000,000	None

Term Loan	Company	Sumitomo Mitsui Banking Corporation	$	50,000,000	None
Senior Notes:	Company	Holder of Notes			None
Series FF			$	16,570,512
Series GG			$	21,419,150
Series KK			$	32,246,665
Series MM			$	27,322,124
Series NN			$	15,774,041
Series OO			$	14,777,933
Series PP			$	50,000,000
Series QQ			$	20,000,000
Series P Mandatory	Company	Holders of Shares	$	10,066,950	None
Redeemable Preferred Stock
Series R Mandatory	Company	Holders of Shares	$	41,827,975	None
Redeemable Preferred Stock
Series S Mandatory	Company	Holders of Shares	$	49,774,950	None
Redeemable Preferred Stock

In addition to the agreements evidencing or relating to the Indebtedness described above, (i) each of the Articles Supplementary relating to the Series P, Series R, Series S and T Mandatory Redeemable Preferred Stock of the Company impose certain restrictions on the incurring of Indebtedness of the Company and (ii) the Loan Agreement, dated August 6, 2021, by and between the Company and Sumitomo Mitsui Banking Corporation.

SChedule 5.15

(to Securities Purchase Agreement)

Capital Stock

April 30, 2022

Title of Class	Number of Shares Authorized	Number of Shares Outstanding

Common Stock	195,933,205	136,131,530

Preferred Stock	4,066,795	4,066,795

Schedule 5.19

(to Securities Purchase Agreement)

Form of Articles Supplementary

[See attached]

Exhibit 1

(to Securities Purchase Agreement)

Form of Certificate Representing Series T MRP Shares

	SEE REVERSE
	FOR IMPORTANT
	NOTICE ON
	TRANSFER
	RESTRICTIONS
	AND OTHER
	INFORMATION

Number Series T MRP-«Number»	«Shares» Series T
	Mandatory Redeemable Preferred Shares
	$.001 par value per share
	PPN 486606 *32

KAYNE ANDERSON ENERGY INFRASTRUCTURE
FUND, INC.
a Maryland Corporation

[_____] Series T Mandatory Redeemable Preferred Shares

WITNESS the Seal of the Corporation and the signatures of its duly authorized officers this day of , 2022.


President		Treasurer

Exhibit 2

(to Securities Purchase Agreement)

FOR VALUE RECEIVED _____________________________HEREBY SELLS, ASSIGNS, AND TRANSFERS UNTO__________________________________________________________________________________________

(______________) SHARES REPRESENTED BY THE WITHIN CERTIFICATE AND DOES HEREBY IRREVOCABLY CONSTITUTE AND APPOINT ATTORNEY TO TRANSFER THE SAID SHARES ON THE SHARE REGISTER OF THE WITHIN NAMED CORPORATION WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.

DATED________________________________

		________________________________________
______________________________________
		(Stockholder)

		________________________________________
______________________________________
		(Stockholder)

NOTICE: THE SIGNATURE ON THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATSOEVER.

IMPORTANT NOTICE

2-2

Form of Opinion of Special Counsel
to the Company

[See attached]

EXHIBIT 4.4(a)

(to Securities Purchase Agreement)

August 2, 2021

56869.00181

Each of the Purchasers Party to the Purchase Agreement (“Purchasers”)

Re:	Kayne Anderson Energy Infrastructure Fund, Inc. – Private Issuance of Series T Mandatory Redeemable Preferred Shares

Ladies and Gentlemen:

We have acted as counsel to Kayne Anderson Energy Infrastructure Fund, Inc., a Maryland corporation (the “Company”), in connection with the issuance and sale by the Company on the date hereof of new common stock as shares of new series of preferred stock classified and designated as “Series T Mandatory Redeemable Preferred Shares”, liquidation preference $25.00 per share (collectively, the “MRP Shares”) to the Purchasers pursuant to the Securities Purchase Agreement, dated May 18, 2022 (the “Purchase Agreement”), among the Company and the Purchasers. This opinion letter is being furnished pursuant to Section 4.4(a) of the Purchase Agreement. Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Purchase Agreement.

As such counsel and for purposes of our opinions set forth below, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records, certificates of public officials and other instruments as we have deemed necessary or appropriate as a basis for the opinions set forth herein, including, without limitation:

(i)

the Purchase Agreement;

(ii)

the Articles of Amendment and Restatement of the Company, as supplemented by the Articles Supplementary for the Series J Mandatory Redeemable Preferred Shares certified as of [ , 2022], by the Department of Assessments and Taxation of Maryland, and the Bylaws of the Company, each as currently in effect and as certified by the Assistant Secretary of the Company as of the date hereof;

(iii)

a Certificate of Status of Foreign Corporation of the Secretary of State of the State of California with respect to the Company, dated [ , 2022] (the “California Good Standing Certificate”);

(iv)

a Certificate of Fact of the Secretary of State of the State of Texas with respect to the Company, dated [ , 2022] (the “Texas Good Standing Certificate” and, together with the California Good Standing Certificate, the “Good Standing Certificates”);

(v)

the Registration Statement on Form N-8A filed by the Company on September 10, 2010 with the Securities and Exchange Commission under the Investment Company Act of 1940, as amended (the “1940 Act”);

(vi)

stock certificates representing the MRP Shares;

(vii)

the Reviewed Agreements (as defined below); and

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 2

(viii)

certificates of officers and representatives of the Company.

In addition to the foregoing, we have made such investigations of law as we have deemed relevant and necessary as a basis for the opinions expressed below.

The Purchase Agreement is referred to herein as the “Transaction Document.”

In such examination and in rendering the opinions expressed below, we have assumed: (i) the due authorization, execution and delivery of the Transaction Document and all agreements, instruments and other documents referred to above by all the parties thereto; (ii) the genuineness of all signatures on all documents submitted to us; (iii) the authenticity and completeness of all documents, corporate records, certificates and other instruments reviewed by us; (iv) that photocopy, electronic, certified, conformed, facsimile and other copies of original documents, corporate records, certificates and other instruments reviewed by us conform to such original documents, records, certificates and other instruments; (v) the legal capacity and competency of all individuals executing documents; (vi) that the Transaction Document and all other documents executed in connection with the transactions contemplated thereby are the valid and binding obligations of each of the parties thereto (other than the Company under New York law), enforceable against such parties (other than the Company under New York law) in accordance with their respective terms and that no such documents have been amended, modified, supplemented or terminated orally or in writing; (vii) that there are no agreements or understandings between or among any of the parties to the Transaction Document or third parties that would expand, modify or otherwise affect the terms of the Transaction Document or the respective rights or obligations of the parties thereunder; (viii) that the statements contained in the certificates and comparable documents of public officials, officers and representatives of the Company and other persons on which we have relied for the purposes of this opinion letter are true and correct on and as of the date hereof (including, without limitation, the Good Standing Certificates) and that there has not been any change in the good standing status of the Company from that reported in the Good Standing Certificates; (ix) the due formation and valid existence of the Company, and the good standing of the Company in each applicable jurisdiction (other than the good standing of the Company as a foreign corporation in the States of Texas and California); (x) the due power and authority of the Company to execute and deliver, and to perform its respective obligations under, the Transaction Document; (xi) that the Purchasers satisfied all regulatory and legal requirements applicable to their respective activities; (xii) that the rights and remedies set forth in the Transaction Document will be exercised reasonably and in good faith and were granted without fraud or duress and for good, valuable and adequate consideration and without intent to hinder, delay or defeat any rights of any creditors or stockholders of the Company; (xiii) that the officers, directors and stockholders of the Company have properly exercised their fiduciary duties; and (xiv) that the Purchase Agreement has not been amended, restated or otherwise modified and has not been modified. As to all questions of fact material to this opinion letter and as to the materiality of any fact or other matter referred to herein, we have relied (without independent investigation) upon certificates or comparable documents of officers and representatives of the Company and of public officials and upon the representations, warranties and covenants contained in the Purchase Agreement. We have also assumed that the representations and warranties of the Purchasers appearing in Section 6 of the Purchase Agreement are true and correct.

Statements in this opinion letter that are qualified by the expression “to our knowledge”, “of which we have knowledge,” “known to us” or “we have no reason to believe” or other expressions of like import are limited solely to the current actual knowledge of Lindsay Sparks, who is the individual attorney in this Firm who has devoted substantive attention to the representation of the Company in connection with the preparation, negotiation, execution and delivery of the Transaction Document (and expressly exclude the knowledge of any other person in this Firm or any constructive or imputed knowledge of any information, whether by reason of our representation of the Company or otherwise). We have not undertaken any independent investigation to determine the accuracy of any such statement, and any limited inquiry undertaken by us during the preparation of this opinion letter should not be regarded as such an investigation. In rendering the opinion set forth in opinion paragraph 4 below, we have not made any independent investigation of any court, governmental, regulatory or arbitral records to determine whether any litigation, investigation or proceeding has been filed or is pending.

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 3

Based upon the foregoing, and in reliance thereon, and subject to the assumptions, limitations, qualifications and exceptions set forth herein, we are of the following opinion:

1. Based solely on a review of the Good Standing Certificates, we confirm that the Company is in good standing as a foreign corporation in the states of California and Texas, as of the respective dates of the Good Standing Certificates.

2. The Transaction Document constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

3. The execution and delivery by the Company of the Transaction Document and the performance by it of its obligations thereunder do not (a) constitute a breach by the Company of, or constitute a default by the Company under, the express terms of any of the agreements listed on Schedule A hereto (collectively, the “Reviewed Agreements”), or (b) cause the Company to violate any federal or New York State statute, regulation or rule applicable to the Company that is generally applicable to transactions of the type contemplated in the Transaction Document.

4. To our knowledge, there is no litigation, investigation or proceeding at law or in equity, by or before any federal or New York state court, governmental or regulatory body or agency or any federal or New York State arbitration board or panel, pending or overtly threatened in writing against the Company that questions the validity of the Transaction Document.

5. No registration of the MRP Shares under the Securities Act of 1933, as amended, is required in connection with the sale of the MRP Shares to the Purchasers in accordance with and as contemplated by the Purchase Agreement, assuming (a) the accuracy of the Purchasers’ representations and warranties made in the Purchase Agreement, (b) the accuracy of the Company’s representations and warranties made in the Purchase Agreement regarding the absence of a general solicitation in connection with the offer and sale of such MRP Shares to the Purchasers, and (c) the due performance by the Purchasers of their obligations set forth in the Purchase Agreement.

6. The Company is duly registered as a closed-end management investment company under the 1940 Act.

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 4

The foregoing opinions are subject to the following assumptions, exceptions, qualifications and limitations:

A. We express no opinion with respect to any of the following (collectively, the “Excluded Laws”): (i) anti-fraud laws, state securities or blue sky laws or, except with respect to federal securities laws as set forth in opinion paragraphs 5 and 6, other federal securities laws; (ii) Federal Reserve Board margin regulations; (iii) pension or employee benefit laws, e.g., ERISA; (iv) federal or state antitrust and unfair competition laws, including, without limitation, the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and Section 721 of the Defense Production Act of 1950, as amended by the Foreign Investment Risk Review Modernization Act of 2018; (v) the statutes, ordinances, administrative decisions or rules and regulations of counties, towns, municipalities and other political subdivisions (whether created or enabled through legislative action at the federal, state or regional level); (vi) federal or state environmental laws; (vii) federal or state land use, building codes or subdivision laws; (viii) federal or state tax laws; (ix) federal or state laws relating to communications (including, without limitation, the Communications Act of 1934, as amended, and the Telecommunications Act of 1996, as amended); (x) federal patent, copyright or trademark, state trademark or other federal and state intellectual property laws; (xi) federal or state racketeering laws, e.g., RICO; (xii) federal or state health care laws or federal or state safety laws, e.g., OSHA; (xiii) federal or state laws concerning aviation, vessels, railways or other means of transportation; (xiv) federal or state laws concerning public utilities; (xv) federal or state labor or employment laws; (xvi) federal or state laws or policies concerning (A) national or local emergencies (including, without limitation, COVID-19), (B) possible judicial deference to acts of sovereign states, including judicial acts, or (C) criminal or civil forfeiture laws; (xvii) federal or state banking or insurance laws; (xviii) export, import or customs laws; (xix) anti-terrorism orders, as the same may be renewed, extended, amended or replaced, or any federal, state or local laws, statutes, ordinances, orders, governmental rules, regulations, licensing requirements or policies relating to the same (including, without limitation, Executive Order 13224, effective September 24, 2001); (xx) the USA Patriot Improvement and Reauthorization Act of 2005, its successor statutes or similar statutes in effect from time to time, or the policies promulgated thereunder or any foreign assets control regulations of the United States Treasury Department or any enabling legislation or order relating thereto; (xxi) federal or state laws concerning bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, including, without limitation, fraudulent transfer or fraudulent conveyance laws; or (xxii) other federal or state statutes of general application to the extent they provide for criminal prosecution (e.g., mail fraud and wire fraud statutes); or in the case of each of the foregoing, all rules and regulations promulgated thereunder or administrative or judicial decisions with respect thereto.

B. We express no opinion with respect to (i) the truth of the factual representations and warranties contained in the Transaction Document, (ii) the effect of the law of any jurisdiction other than the State of New York which limits the rates of interest legally chargeable or collectible, or (iii) any document, instrument or agreement other than the Transaction Document, regardless of whether such document, instrument or agreement is referred to in the Transaction Document.

C. We express no opinion with respect to the effect that the introduction of extrinsic evidence as to the meaning of the Transaction Document may have on the opinions expressed herein.

D. Our opinions are subject to the effect of (i) any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally, including, without limitation, fraudulent transfer or fraudulent conveyance laws; (ii) public policy considerations, statutes or court decisions which may limit rights to obtain exculpation, indemnification or contribution (including, without limitation, provisions indemnifying a party against liability for its own wrongful or negligent acts, indemnification regarding violations of the securities laws and indemnification for losses resulting from a judgment for the payment of any amount other than in United States dollars); and (iii) general principles of equity (including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing) and the availability of equitable remedies (including, without limitation, specific performance and equitable relief), regardless of whether considered in a proceeding in equity or at law.

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 5

E. No opinion is expressed herein with respect to the validity, binding effect or enforceability of (i) any provision contained in the Transaction Document allowing any party to exercise any remedial rights without notice to the Company, (ii) any waiver of demand or notice by the Company, or any waiver of any rights or any defense which as a matter of law or public policy cannot be waived, (iii) any provisions contained in the Transaction Document purporting to establish evidentiary standards, (iv) any provision of the Transaction Document which purports to establish the subject matter jurisdiction of the United States District Court to adjudicate any controversy related to the Transaction Document, (v) any provision of the Transaction Document which purports to entitle any person or entity to specific performance of any provision thereof, (vi) any provision of the Transaction Document which requires a person or entity to cause another person or entity to take or to refrain from taking action under circumstances in which such person or entity does not control such other person or entity, or (vii) any provision of the Transaction Document providing for the effectiveness of service of process by mail in any suit, action or proceeding of any nature arising in connection with or in any way relating to the Transaction Document or any provision of the Transaction Document which purports to, or has the effect of, waiving or extending any statute of limitations.

F. No opinion is expressed herein with respect to the validity, binding effect or enforceability of any provision of the Transaction Document insofar as it purports to effect a choice of governing law or choice of forum for the adjudication of disputes, other than (i) the enforceability by a New York State court under New York General Obligations Law Section 5-1401 of the choice of New York State law as the governing law of the Transaction Document (subject, however, to the extent limited by the Constitution of the United States and by Section 1-301 of the New York Uniform Commercial Code), and (ii) the enforceability by a New York State court under New York General Obligations Law Section 5-1402 of New York State courts as a non-exclusive forum for the adjudication of disputes with respect to the Transaction Document.

H. Without limiting the generality of any limitation, qualification, assumption or condition expressed elsewhere herein, we express no opinion on the matters set forth in opinion paragraph 5 at any time after the initial issuance and sale of the MRP Shares to the Purchasers on the date hereof, and we expressly disclaim any obligation to update such opinions after the date hereof.

I. No opinion is expressed as to the validity, binding effect or enforceability of any provision of the Transaction Document that (i) requires that waivers or amendments must be in writing in so far as it suggests that oral or other modifications, amendments or waivers could not be effectively agreed upon by the parties or that the doctrine of promissory estoppel might not apply; (ii) waives (a) vague or broadly stated rights, (b) future rights, (c) the benefits of statutory, regulatory or constitutional rights, unless and to the extent that the statute, regulation or constitution expressly allows waiver, (d) unknown future defenses, or (e) rights to damages; (iii) states that rights or remedies are not exclusive, that every right or remedy is cumulative and may be exercised in addition to any other right or remedy, that the election of some particular remedy does not preclude recourse to one or more others or that failure to exercise or delay in exercising rights or remedies will not operate as a waiver of any such right or remedy; (iv) imposes penalties, forfeitures, late payment charges or an increase in interest rate upon delinquency in payment or the occurrence of a default; (v) appoints one party as an attorney-in-fact for an adverse party; (vi) states that time is of the essence; (vii) purports to prohibit, restrict or condition the assignment of any agreement or instrument to the extent the same is rendered ineffective by Sections 9-406 through 9-409 of the Uniform Commercial Code as in effect in a relevant jurisdiction; (viii) purports to limit the liability of any party thereto to third parties; or (ix) constitutes (or is construed to constitute) an agreement to agree.

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 6

J. Our opinions contained herein are limited solely to laws and regulations (other than the Excluded Laws) that, in our experience, are customarily applicable to transactions in the nature of those contemplated by the Transaction Document and exclude statutes, rules and regulations that are part of a regulatory scheme applicable to any party or any of their affiliates (other than the Company) due to the specific assets or business of such party or such affiliates.

K. With respect to our opinion set forth in opinion paragraph 3 with respect to the Reviewed Agreements, we have not reviewed, and express no opinion on, (i) financial covenants or similar provisions requiring financial calculations or determinations to ascertain whether there is any breach of or default under such provisions or (ii) provisions relating to the occurrence of a “material adverse effect,” “material adverse change” or words of similar import. In addition, our opinion relating to the Reviewed Agreements is subject to the effect on the Reviewed Agreements of (x) the introduction of extrinsic evidence to interpret the terms thereof and (y) any non-written modifications thereof. Moreover, our opinion relating to the Reviewed Agreements is based solely upon the plain meaning of their language without regard to interpretation or construction that might be indicated by the laws governing the Reviewed Agreements.

L. We express no opinion as to the effect on our opinions regarding the Transaction Document arising out of the status or activities of, or laws applicable to, the Purchasers or any other party, if any, to the Transaction Document (other than the Company under federal or New York law), and, without limiting the foregoing, we are not expressing any opinion as to the effect of compliance or non-compliance by such parties with any state or federal laws or regulations applicable to the transactions contemplated by the Transaction Document because of the nature of any of their businesses.

Without limiting any of the other limitations, exceptions, assumptions and qualifications stated elsewhere herein (including, without limitation, qualification paragraph A with respect to Excluded Laws), we express no opinion with regard to the applicability or effect of the law of any jurisdiction other than, as in effect on the date of this opinion letter, (i) the internal laws of the State of New York, and (ii) the federal laws of the United States.

This opinion letter deals only with the specified legal issues expressly addressed herein, and you should not infer any opinion that is not explicitly addressed herein from any matter stated in this opinion letter. The opinions expressed herein are to be governed by the laws of the State of New York and shall be construed in accordance with the customary practice in New York of lawyers who regularly give, and lawyers who regularly advise opinion recipients regarding, opinions of the kinds contained herein.

Each of the Purchasers Party to the Purchase Agreement
August 2, 2022

Page 7

This opinion letter is rendered solely to you in connection with the issuance and delivery of the MRP Shares. At your request, we hereby consent to reliance hereon by any transferee of the MRP Shares that is an institutional accredited investor pursuant to a transfer that is made in accordance with the express provisions of the Purchase Agreement, on the condition and understanding that any such reliance shall be subject to the terms and conditions of this opinion letter, and further, without limitation of any of the foregoing, that (i) this opinion letter speaks only as of the date hereof and shall not be deemed to have been reissued as of any date, (ii) we have no responsibility or obligation to update this opinion letter, (iii) we have no responsibility or obligation to consider the applicability or correctness of this opinion letter to any person or entity other than its original addressees, and (iv) any such reliance by such transferee must be actual and reasonable under the circumstances existing at the time of transfer, including any changes in the law, facts or any other developments known to or reasonably knowable by such transferee at such time. This opinion letter may not be relied upon by you for any other purpose or delivered to or relied upon by any other person (except as permitted in the immediately preceding sentence) without our express prior written consent; except that you may furnish a copy of this opinion letter for information (but not reliance):

(i) to your independent auditors and your attorneys, (ii) pursuant to an order or legal process of any court or governmental agency, (iii) in connection with any legal action to which you are a party arising out of the issuance and delivery of the MRP Shares, (iv) to any governmental or regulatory authority having jurisdiction over you, including, without limitation, the National Association of Insurance Commissioners, and (v) your potential successors and assigns. This opinion letter is rendered to you as of the date hereof and shall not be deemed to have been reissued by any subsequent delivery of a copy hereof, as permitted above, and we assume no obligation to advise you or any other person hereafter with regard to any change after the date hereof in the circumstances or the law that may bear on the matters set forth herein even though the change may affect the legal analysis or a legal conclusion or other matters in this opinion letter.

Name and Address of Purchaser

Series of
Notes to be
Purchased

Principal Amount
of Notes to be
Purchased

Brighthouse Life Insurance Company

$1,400,000

$2,000,000