UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrantþ ☒
Filed by a Party other than the Registrant¨ ☐
Check the appropriate box:
¨☐ Preliminary Proxy Statement
¨☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ☒ Definitive Proxy Statement
¨☐ Definitive Additional Materials
¨☐ Soliciting Material Pursuant to §240.14a-12
KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ No fee required.
☐ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
| ||
| ||
| (1) | Title of each class of securities to which transaction applies: | |
| (2) | Aggregate number of securities to which transaction applies: | |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | |
| (4) | Proposed maximum aggregate value of transaction: | |
| (5) | Total fee paid: | |
| ||
☐ Fee paid previously with preliminary materials.
| ☐ |
|
| (1) | Amount Previously Paid: | |
| (2) | Form, Schedule or Registration Statement No.: | |
| (3) | Filing Party: | |
| (4) | Date Filed: | |
Kayne Anderson MLP/Midstream Investment Company (NYSE: KYN)
Kayne Anderson Midstream/Energy Fund, Inc. (NYSE: KMF)
Kayne Anderson Energy Development Company (NYSE: KED)
May 16, 201623, 2019
Dear Fellow Stockholder:
You are cordially invited to attend the combined 20162019 Annual Meeting of Stockholders of Kayne Anderson MLP/Midstream Investment Company and Kayne Anderson Midstream/Energy Fund, Inc. (“KMF”) and Kayne Anderson Energy Development Company (“KED”) (each a “Company” and collectively, the “Companies”) to be held on:
June 23, 201627, 2019
8:00 a.m. Central Time
Kayne Anderson
811 Main Street, 14th Floor
Houston, TX 77002
For each Company, you will be asked to (i) elect twothree directors of the Company, (ii) ratify PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for its fiscal year ending November 30, 2016,2019, and (iii) consider and take action upon such other business as may properly come before the meeting, including the adjournment or postponement thereof.
Enclosed with this letter are (i) answers to questions you may have about the proposals, (ii) the formal notice of the meeting, (iii) the proxy statement, which gives detailed information about the proposals and why the Board of Directors of each Company recommends that you vote to approve them, and (iv) an actual 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 1-877-657-3863.
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.
Sincerely,
Kevin S. McCarthy
Chairman of the Board of Directors,
CEO and President of KMF and KEDChief Executive Officer
| 1 | ||||
| 2 | ||||
| 3 | ||||
| 5 | ||||
NOMINEES FOR DIRECTOR WHO ARE | 6 | |||
| 7 | ||||
REMAINING DIRECTORS WHO ARE | 8 | |||
REMAINING | ||||
INFORMATION ABOUT EACH DIRECTOR’S QUALIFICATIONS, EXPERIENCE, ATTRIBUTES OR SKILLS | ||||
PROPOSAL TWO: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | ||||
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS | ||||
| 27 | ||||
KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY
ANSWERS TO SOME IMPORTANT QUESTIONS
Q. WHAT AM I BEING ASKED TO VOTE “FOR” ON THIS PROXY?
| A. | This proxy contains |
Proposal One — to elect twothree directors to serve until the Company’s 20192022 Annual Meeting of Stockholders and until their successors are duly elected and qualified.
Proposal Two — to ratify PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending November 30, 2016.2019.
Proposal Three — to consider and take action upon such other business as may properly come before the meeting, including the adjournment or postponement thereof.
Q. HOW DOES THE BOARD OF DIRECTORS SUGGEST THAT I VOTE?
| A. | The Board of Directors of each Company unanimously recommends that you vote “FOR” all proposals on the enclosed proxy card. |
Q. HOW CAN I VOTE?
| A. | Voting is quick and easy. You may vote your shares via the internet, by telephone (for internet and telephone voting, please follow the instructions on the proxy ballot), or by simply completing and signing the enclosed proxy ballot, 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. |
This information summarizes information that is included in more
detail in the proxy statement. We urge you to read the proxy statement carefully.
If you have questions, call1-877-657-3863.
Kayne Anderson Midstream/Energy Fund, Inc.KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY
Kayne Anderson Energy Development CompanyKAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
NOTICE OF 20162019 ANNUAL MEETING OF STOCKHOLDERS
| To the Stockholders of: | Kayne Anderson MLP/Midstream Investment Company Kayne Anderson Midstream/Energy Fund, Inc.
|
NOTICE IS HEREBY GIVEN that the combined 20162019 Annual Meeting of Stockholders of Kayne Anderson MLP/Midstream Investment Company and Kayne Anderson Midstream/Energy Fund, Inc. (“KMF”) and Kayne Anderson Energy Development Company (“KED”), each a Maryland corporation (each a “Company” and collectively, the “Companies”), will be held on June 23, 201627, 2019 at 8:00 a.m. Central Time at Kayne Anderson, 811 Main Street, 14th Floor, Houston, TX 77002 for the following purposes:
| 1. | For both Companies: To elect |
| 2. | For both Companies: To ratify the selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending November 30, |
| 3. | For both Companies: To consider and take action upon such other business |
The foregoing items of business are more fully described in the Proxy Statementproxy statement accompanying this Notice.
Stockholders of record as of the close of business on May 6, 201615, 2019 are entitled to notice of and to vote at the meeting (or any adjournment or postponement of the meeting thereof).
By Order of the Boards of Directors of the Companies,
David J. Shladovsky
Secretary
May 16, 201623, 2019
Houston, Texas
Kayne Anderson Midstream/Energy Fund, Inc.KAYNE ANDERSON MLP/MIDSTREAM INVESTMENT COMPANY
Kayne Anderson Energy Development CompanyKAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
811 Main Street, 14th Floor
Houston, TX 77002
1-877-657-3863
20162019 ANNUAL MEETING OF STOCKHOLDERS
JUNE 23, 201627, 2019
This combined proxy statement is being sent to you by the Boards of Directors of Kayne Anderson MLP/Midstream Investment Company (“KYN”) and Kayne Anderson Midstream/Energy Fund, Inc. (“KMF”) and Kayne Anderson Energy Development Company (“KED”), each a Maryland corporation (each a “Company” and collectively, the “Companies”). The Board of Directors of each Company is asking you to complete and return the enclosed proxy card, permitting your votes to be cast at the Annual Meeting of Stockholders (the “Annual Meeting”) to be held on:
June 23, 201627, 2019
8:00 a.m. Central Time
Kayne Anderson
811 Main Street, 14th Floor
Houston, TX 77002
Stockholders of record of each Company at the close of business on May 6, 201615, 2019 (the “Record Date”) are entitled to vote at the Annual Meeting. As a stockholder of a Company, for each proposal, you are entitled to one vote for each share of Common Stock of that Company and one vote for each share of Preferred Stock of that Company you hold.hold on each matter on which holders of such shares are entitled to vote. This combined proxy statement and the enclosed proxy are first being mailed to stockholders on or about May 24, 2016.29, 2019.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 20162019 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 23, 2016:27, 2019: You should have received a copy of the Annual Report for the fiscal year ended November 30, 20152018 for each Company in which you own either Common or Preferred Stock. If you would like another copy of the Annual Report, please write us at the address shown at the top of this page or call us at1-877-657-3863. The Annual Report will be sent to you without charge. This proxy statement and our Annual Reports can be accessed on our website at www.kaynefunds.com/kmf/sec-filings for KMF and at www.kaynefunds.com/ked/sec-filings for KEDwww.kaynefunds.com or on the website of the Securities and Exchange Commission (the “SEC”) at www.sec.gov.
KA Fund Advisors, LLC (“KAFA”), a subsidiary of Kayne Anderson Capital Advisors, L.P. (“KACALP” and together with KAFA, “Kayne Anderson”), externally manages and advises each Company pursuant to an investment management agreement. KAFA is registered as an investment adviser under the Investment Advisers Act of 1940, as amended. Kayne Anderson is a leading investor in both public and private energy companies. At March 31, 2016,2019, Kayne Anderson managed approximately $19$30 billion, including over $14$16 billion in the energy sector. Kayne Anderson may be contacted at the address listed above.
3
This combined proxy statement sets forth the information that each Company’s stockholders should know in order to evaluate each of the following proposals. The following table presents a summary of the proposals for each Company and the classes of stockholders of the Company being solicited with respect to each proposal. Please refer to the discussion of each proposal in this proxy statement for information regarding votes required for the approval of each proposal.
Proposals for each Company | Who votes on the | |
1. To elect the following individuals as directors for terms of three years and until their successors are duly elected and qualified: | ||
• | ||
| ||
• Albert L. Richey |
| |
• James C. Baker | The holders of the Company’s Preferred Stock, voting as a separate class | |
2. To ratify the selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending November 30, | ||
3. To consider and take action upon such other business as may properly come before the meeting or any adjournment or postponement thereof. | ||
4
ELECTION OF DIRECTORS
The KMFEach Company’s Board of Directors unanimously nominated William R. Cordes andAnne K. Costin, Albert L. Richey for re-election as directors at the Annual Meeting, and the KED Board of Directors unanimously nominated James C. Baker and Albert L. Richey forre-election as directors at the Annual Meeting. All are nominated to serve for terms of three years (until the 20192022 Annual Meeting of Stockholders) and until their successors have been duly elected and qualified.
Each of the nominees has consented to be named in this proxy statement and has agreed to serve if elected. The Companies have no reason to believe that any of the nominees will be unavailable to serve. The persons named on the accompanying proxy card intend to vote at the meeting (unless otherwise directed) “FOR” the election of the nominees. If any of the nominees are unable to serve because of an event not now anticipated, the persons named as proxies may vote for another person designated by each Company’s Board.
In accordance with each Company’s charter, its Board of Directors is divided into three classes of approximately equal size. Currently, KMFeach Company has five directors, and KED has seveneight directors as follows:
|
| |||||||||||
Directors | Common Stockholders | Preferred Stockholders | ||||||||||
I | Until 2020 | William R. Cordes
|
| |||||||||
Barry R. Pearl |
| X X | X X | |||||||||
| Until 2021 |
William H. Shea, Jr. William L. Thacker | X | |||||||||||
X X | ||||||||||||||
III | ||||||||||||||
Anne K. Costin Albert L. Richey James C. Baker |
| |||||||||||||
| X
X |
| ||||||||||||
| X X X |
| ||||||||||||
| * | Each director serves a three-year term until the Annual Meeting of Stockholders for the designated year and until his or her successor has been duly elected and qualified. |
Pursuant to the terms of each Company’s mandatory redeemable preferred stock (the “Preferred Stock”), the holders of Preferred Stock are entitled as a class, to the exclusion of the holders of the Company’s common stock (the “Common Stock”), to elect two directors of the Company (the “Preferred Directors”). The KMF BoardEach Company has designated William L. ThackerH. Shea, Jr. and Albert L. Richey as the Preferred Directors, and the KED Board has designated James C. Baker and Terry A. Hart as the Preferred Directors. The terms of the Preferred Stock for each Company further provide that the remaining nominees shall be elected by holders of Common Stock and Preferred Stock voting together as a single class.
The following tables set forth the nominees’ and each remaining director’s name and year of birth; position(s) with each Company and length of time served; principal occupations during the past five years; and other directorships held during the past five years. The address for the nominees and directors is 811 Main Street, 14th14th Floor, Houston, TX 77002.
The term “Independent Director” is used to refer to a director who is not an “interested person,” as defined in the Investment Company Act of 1940, as amended (the “1940 Act”), of the Company, of Kayne Anderson or of the Company’s underwriters in offerings of its 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. Each of Kevin S. McCarthy and James C. Baker and Terry A. Hart areis an “interested persons”person” or “Interested Directors”Director” by virtue of theirhis employment relationshipsrelationship with Kayne Anderson.
5
The Board of Directors of each Company has adopted a mandatory retirement policy. No director may be nominated or stand forre-election if that director would have his or her 72nd75th birthday before the stockholders’ meeting at which that director would be elected. Once elected, a director may complete his or her term even if that director turns 7275 during such term.
For information regarding each Company’s executive officers and their compensation, please refer to “Information About Executive Officers” and “Compensation Discussion and Analysis”.
In addition to serving on the Boards of Directors of KMF and KED, Mr. McCarthy also serves on the Board of Directors of Kayne Anderson MLP Investment Company (“KYN”) and Kayne Anderson Energy Total Return Fund, Inc. (“KYE”). KYN, KYE, KMF and KED are closed-end investment companies registered under the 1940 Act that are advised by KAFA.INFORMATION REGARDING DIRECTOR NOMINEES AND DIRECTORS
NOMINEES FOR DIRECTOR WHO ARE NOT INTERESTED PERSONSINDEPENDENT
Name (Year Born) |
| Position(s) Held with
Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Overseen by Director | Other Directorships Held by Director During Past Five Years | |||||
Anne K. Costin (born 1950) | KYN — Director.3-year term (until the 2019 Annual Meeting of Stockholders). Served since inception. KMF — New director until the 2019 Annual Meeting of Stockholders. Served since August 2018. | 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 a28-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. | 2 | Prior: • Kayne Anderson Energy Total Return Fund, Inc. (“KYE”) | ||||||
Albert L. Richey (born 1949) | KYN — Director. New director until the 2019 Annual Meeting of Stockholders. Served since August 2018. KMF — Director.3-year term (until the 2019 Annual Meeting of Stockholders). Served since inception. | 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. | 2 | Prior: • Kayne Anderson Energy Development Company (“KED”) • Boys & Girls Clubs of Houston • Boy Scouts of America (not-for-profit organization) | ||||||
| (1) | The 1940 Act requires the term “Fund Complex” to be defined to include registered investment companies advised by KAFA, the Companies’ investment adviser, and the Fund Complex includes KYN and KMF. |
6
NOMINEE FOR DIRECTOR WHO IS AN INTERESTED PERSON
Name (Year Born) | Position(s) Held with Each Company, Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Complex(1) Overseen by Director | Other Directorships Held by Director During Past Five Years | ||||
James C. Baker(2)(3) (born 1972) | KYN — New director to serve until the 2019 Annual Meeting of Stockholders. President since June 2016. Executive Vice President from June 2008 to June 2016. Elected annually as an officer, served since June 2005. KMF — New director to serve until the 2019 Annual Meeting of Stockholders. President since June 2016. Executive Vice President from inception to June 2016. Elected annually as an officer, served since inception. | Senior Managing Director of KACALP and KAFA since February 2008. President of KMF since June 2016 and of KYE and KED from June 2016 through merger (August 2018). Executive Vice President of KYE and KED from June 2008 to June 2016 and of KMF from August 2010 to June 2016. Vice President of KYN and KYE from June 2005 to June 2008 and of KED from June 2006 to June 2008. | 2 | Prior: • KED • K-Sea Transportation Partners L.P. • Petris Technology, Inc. (data management for energy companies) • ProPetro Services, Inc. (oilfield services) | ||||
| (1) | The 1940 Act requires the term “Fund Complex” to be defined to include registered investment companies advised by KAFA, the Companies’ investment adviser, and the Fund Complex includes KYN and KMF. |
| (2) | Mr. Baker is an “interested person” of the Companies as defined in the 1940 Act by virtue of his employment relationship with KAFA. |
| (3) | On January 11, 2019, KAFA announced that Kevin S. McCarthy plans to step down as Chief Executive Officer of the Companies in June 2019 and as Chairman of the Board in June 2020. The Board of Directors intends to elect James C. Baker as Chief Executive Officer of the Companies effective July 1, 2019. |
7
REMAINING DIRECTORS WHO ARE INDEPENDENT
Name (Year Born) | Position(s) Held with Each Company, Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Complex(1) Overseen by Director | Other Directorships Held by Director During Past Five Years | ||||||
William R. Cordes (born 1948) | KYN — New director until the 2020 Annual Meeting of Stockholders. Served since August 2018. KMF | — Director.
Stockholders. Served since inception. | 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. | 2 |
• KED
• Boardwalk Pipeline Partners, LP
• Northern Border Partners, L.P. | |||||
|
|
|
|
|
| |||||||||
|
|
| ||||||||||||
NOMINEE FOR DIRECTOR WHO IS AN INTERESTED PERSON
|
|
|
|
|
| |||||
|
|
REMAINING DIRECTORS WHO ARE NOT INTERESTED PERSONS
|
|
|
|
| ||||
Barry R. Pearl (born 1949) | KYN — New director until the 2020 Annual Meeting of Stockholders. Served since August 2018. KMF — Director.
Stockholders. Served since inception. | Management consultant to Northstar Midstream, a private developer and operator of petroleum infrastructure assets | 2 | Current:
• Magellan Midstream Partners, L.P.
Prior:
• KED • Peregrine Midstream Partners LLC
• Seaspan Corporation
• Targa Resources Partners LP
• TEPPCO Partners, L.P. |
8
Name (Year Born) | Position(s) Held with Each Company, Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Complex(1) Overseen by Director | Other Directorships Held by Director During Past Five Years | ||||
William H. Shea, Jr. (born 1954) | KYN — Director.3-year term (until the 2021 Annual Meeting of Stockholders). Served since March 2008. KMF — New director until the 2021 Annual Meeting of Stockholders. Served since August 2018. | Chief Executive Officer of Mainline Energy Partners, LLC since July 2016. 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. | 2 | Current: • Mainline Energy Partners, LLC Prior: • KYE • BGH • BPL • Gibson Energy ULC • Niska Gas Storage Partners LLC • PVG • PVR • Penn Virginia Corporation • USA Compression Partners, LP | ||||
William L. Thacker (born 1945) |
KMF — Director.3-year term (until the
2021 Annual Meeting of Stockholders). Served since inception. | Chairman of the Board of Directors of Copano Energy, L.L.C. from 2009 to 2013. Retired from the Board of TEPPCO in May 2002 after serving as Chairman from March 1997 to May 2002; Chief Executive Officer from January 1994 to May 2002; and President, Chief Operating Officer and Director from September 1992 to January 1994. | 2 |
•
• Copano Energy, L.L.C.
• GenOn Energy, Inc. (electricity generation and sales)
• Pacific Energy Partners, L.P. • QEP Resources Inc. • TEPPCO Partners, L.P. (midstream MLP) | ||||
| (1) | The 1940 Act requires the term “Fund Complex” to be defined to include |
9
REMAINING DIRECTORSDIRECTOR WHO AREIS AN INTERESTED PERSONSPERSON
Name (Year Born) | Position(s) Held with
Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Overseen by Director | Other Directorships Held by Director During Past Five Years | ||||
Kevin S. (born 1959) | KYN/KMF — Chairman of the Board of Directors
Stockholders). Elected annually as an | Current:
• Prior:
• KYE
•
• Clearwater Natural Resources, L.P. (coal mining)
• Direct Fuels Partners, L.P. (transmix refining and fuels distribution)
• Emerge Energy Services LP (frac sand MLP)
• International Resource Partners LP
• K-Sea Transportation Partners • ONEOK, Inc.
• ProPetro Services, Inc. (oilfield services) | ||||||
|
• | |||||||
| (1) | The 1940 Act requires the term “Fund Complex” to be defined to include |
| (2) | Mr. McCarthy |
| (3) | On January 11, 2019, KAFA announced that Kevin S. McCarthy plans to step down as Chief Executive Officer of the Companies in June 2019 and as Chairman of the Board in June 2020. The Board of Directors intends to elect James C. Baker as Chief Executive Officer of the Companies effective July 1, 2019. |
10
For each Company, directors and officers who are “interested persons” by virtue of their employment by Kayne Anderson, including all executive officers, serve without any compensation from the Company. For each Company, for the fiscal year ended November 30, 2015, directors were compensated as follows:2018:
Each Independent Director who serves on the Board of Directors of both KMF and KED received an annual retainer of $105,000 for his or her service on both boards. KMF and KED will each pay a pro rata portion of this retainer quarterly based on their total assets for the quarter. As of February 29, 2016, 59% and 41% of the quarterly retainer was allocated to KMF and KED, respectively.
| • | Each Independent Director who served on the Board of Directors 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 apro rata portion of this retainer quarterly based on their total assets for the quarter. As of February 28, 2019, 79% and 21% of the quarterly retainer was allocated to KYN and KMF, respectively. |
For each Company, the chairperson of the Audit Committee will receivereceived additional compensation of $7,500 annually.
In addition,For each Company, each Independent Director received fees for attending meetings of the Board and its Committees on which such Independent Directors served, as follows:
$2,500$2,500 per regular Board meeting attended in person, or $2,000 per regular Board meeting attended via telephone;
$1,500 for eachtelephone and $1,500 per special Board meeting attended via telephone;telephone.
$1,500For each Company, each Audit Committee member received $1,500 per Audit Committee meeting (in person or via telephone) that iswas more than fifteen minutes in length;length, and
$500 each member of any other Board committee received $500 per other committee meeting (in person or via telephone) that iswas more than fifteen minutes in length.
The Independent Directors were reimbursed for expenses incurred as a result of attendance at meetings of the Board of Directors and its committees.
The following table sets forth the compensation paid by each Company during the fiscal year ended November 30, 20152018 to the Independent Directors. No compensation is paid to directors who are “interested persons.” Neither Company has a retirement or pension plan or any compensation planplans under which the Company’s equity securities were authorized for issuance.
Director Compensation Table
Name | KMF | KED | Subtotal | Due Diligence for Special Transaction(1) | Total Compensation from the Fund Complex | |||||||||||||||
Independent Directors | ||||||||||||||||||||
William R. Cordes | $ | 96,205 | $ | 51,795 | $ | 148,000 | $ | 12,000 | $ | 160,000 | ||||||||||
Barry R. Pearl | 90,705 | 43,795 | 134,500 | 12,000 | 146,500 | |||||||||||||||
Albert L. Richey | 90,705 | 45,795 | 136,500 | 12,000 | 148,500 | |||||||||||||||
William L. Thacker | 91,205 | 46,295 | 137,500 | 19,500 | 157,000 | |||||||||||||||
Interested Directors | ||||||||||||||||||||
Kevin S. McCarthy | None | None | None | None | None | |||||||||||||||
James C. Baker(2) | na | None | None | None | None | |||||||||||||||
Terry A. Hart(2) | na | None | None | None | None | |||||||||||||||
Name | KYN | KMF | Total Compensation from the Fund Complex(1) | |||||||||
Independent Directors | ||||||||||||
William R. Cordes | $ | 61,359 | $ | 74,736 | $ | 176,000 | ||||||
Anne K. Costin | 128,700 | 21,891 | 175,000 | |||||||||
Steven C. Good(2) | 73,841 | — | 129,708 | |||||||||
Barry R. Pearl | 58,109 | 68,736 | 164,000 | |||||||||
Albert L. Richey | 58,609 | 69,236 | 165,000 | |||||||||
William H. Shea, Jr. | 126,700 | 19,891 | 171,000 | |||||||||
William L. Thacker | 57,609 | 68,236 | 163,000 | |||||||||
Interested Directors | ||||||||||||
Kevin S. McCarthy | None | None | None | |||||||||
James C. Baker | None | None | None | |||||||||
| (1) | Includes compensation paid to |
| (2) | Retired at the June 2018 Annual Meeting. |
11
COMMITTEES OF THE BOARD OF DIRECTORS
Each Company’s BoardThe KYN and KMF Boards of Directors each currently has three standing committees: the Audit Committee, the Valuation Committee and the Nominating, Corporate Governance and Compensation Committee (the “Nominating Committee”). The table below shows the directors currently serving on the committees and the following committee descriptions apply to both Companies.of each Company:
Director | Audit Committee | Valuation Committee | Nominating Committee | ||||||||||||||||||||||||||||||
Independent Directors | |||||||||||||||||||||||||||||||||
William R. | X | — | — | ||||||||||||||||||||||||||||||
Anne K. Costin(2) | X | X | — | ||||||||||||||||||||||||||||||
Barry R. Pearl(2) | X | — | X | ||||||||||||||||||||||||||||||
| X | X | |||||||||||||||||||||||||||||||
William H. Shea, Jr. | — | X | |||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||
William L. Thacker | X | X | |||||||||||||||||||||||||||||||
Interested Directors | |||||||||||||||||||||||||||||||||
Kevin S. McCarthy | — | X | — | ||||||||||||||||||||||||||||||
James C. Baker | — | X | — | ||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||
| (1) | Chairman of the Audit |
| (2) | Audit Committee financial expert. |
| • | Audit Committee. 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 |
| • | Valuation Committee. The Valuation Committee is responsible for the oversight of the Company’s valuation procedures and the valuation of the Company’s securities in accordance with such procedures. The Valuation Committee operates under a written charter adopted and approved by the Board, a copy of which is available on the Companies’ website |
| • | Nominating |
12
Company’s management, investment adviser and counsel, |
stockholders, and may also engage a search firm to identify or evaluate or assist in identifying or evaluating candidates. As set forth in the Nominating Committee Charter, in evaluating candidates for a position on the Board, the Committee considers a variety of factors, including, as appropriate: |
the candidate’s knowledge in matters relating to the investment company or to the energy industry;
any experience possessed by the candidate as a director or senior officer of public companies;
the candidate’s educational background;
the candidate’s reputation for high ethical standards and personal and professional integrity;
any specific financial, technical or other expertise possessed by the candidate, and the extent to which such expertise would complement the Board’s existing mix of skills and qualifications;
the candidate’s perceived ability to contribute to the ongoing functions of the Board, including the candidate’s ability and commitment to attend meetings regularly and work collaboratively with other members of the Board;
the candidate’s ability to qualify as an independent director for purposes of the 1940 Act, the candidate’s independence from the Company’s service providers and the existence of any other relationships that might give rise to a conflict of interest or the appearance of a conflict of interest; and
such other factors as the Nominating Committee determines to be relevant in light of the existing composition of the Board and any anticipated vacancies or other transitions (e.g., whether or not a candidate is an “audit committee financial expert” under the federal securities laws).
The Nominating Committee also considers diversity, including gender, race and national origin, education, professional experience, skills and viewpoints in identifying nominees for director. The Nominating Committee does not have a formal policy with respect to diversity; however, the Board and the Nominating Committee believe that it is important that the Board members represent diverse skills, backgrounds, experiences and perspectives.
Prior to making a final recommendation to the Board, the Nominating Committee of each Company may conduct personal interviews with the candidates it believes to be the most qualified.
If there is no vacancy on the Board, the Board will not actively seek recommendations from other parties, including stockholders. When a vacancy on the Board 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 the Company’s stockholders.
The Nominating Committee considers nominees properly recommended by stockholders. To submit a recommendation for nomination as a candidate for a position on the Board of either Company, stockholders of such Company shall mail the recommendation to the Secretary of the Company at 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; (b) a full description of the proposed candidate’s background, including his or her 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 the Company, 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.
Any such recommendation must contain sufficient background information concerning the candidate to enable the Company’s Nominating Committee to make a proper judgment as to the candidate’s
13
qualifications. If a recommendation is received with satisfactorily completed information regarding a candidate
during a time when a vacancy exists on the Board or during such other time as the Nominating Committee is accepting recommendations, the recommendation will be forwarded to the Chair of the Nominating Committee and will be evaluated in the same manner as other candidates for nomination. 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.
Board of Director and Committee Meetings Held
The following table shows the number of meetings held for each Company forduring the fiscal year ended November 30, 2015:2018:
| KMF | KED | Due Diligence for Special Transaction(1) | ||||||||||
Board of Directors | 5 | 4 | 6 | |||||||||
Audit Committee | 3 | 3 | na | |||||||||
Valuation Committee | 4 | 4 | na | |||||||||
Nominating Committee | 3 | 3 | na | |||||||||
| KYN | KMF | |||||||
Board of Directors | 5 | 5 | ||||||
Board of Directors - Special | 4 | 4 | ||||||
Audit Committee | 3 | 3 | ||||||
Valuation Committee | 4 | 4 | ||||||
Nominating Committee | 1 | 1 | ||||||
During the 2018 fiscal year, ended November 30, 2015, all of the directors of each Company attended at least 75% of the aggregate of (1) the total number of meetings of the Board and (2) the total number of meetings held by all committees of the Board on which they served. The Fund doesCompanies do not currently have a policy with respect to Boardboard member attendance at annual meetings.
PleaseFor each Company, please refer to “Corporate Governance” on page 28 for a review of the Board’s leadership structure, role in risk oversight and other matters.
14
INFORMATION ABOUT EACH DIRECTOR’S QUALIFICATIONS,
EXPERIENCE, ATTRIBUTES OR SKILLS
The Board of each Company 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 in light of the Company’s business and structure. 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 NomineeDirector Nominees and Directors.” Each of the directors has servedexperience serving on the Boards of boththe Companies (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. They thereforeTherefore, they have substantial boardroom experience and, in their service to both Companies (and/or KED and KYE), have gained substantial insight as to the operation of the Companies 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 notall-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 each Company annually conducts a self-assessment wherein the effectiveness of the Board and individual directors is reviewed. In conducting its annual self-assessment, each Board has determined that the directors have the appropriate attributes and experience to continue to serve effectively as directors of the Company.
Kevin S. McCarthy. Mr. McCarthy is Chairman President and Chief Executive Officer of both Companies. In this position,KYN and KMF. Mr. McCarthy has extensive knowledge of each Company, its operations, personnel, and financial resources. He has also been Vice Chairman of KACALP since January 2019, Managing Partner of KACALP since June 2004 and Co-Managing Partner of KAFA since 2006. Prior to joining Kayne Anderson in 2004, Mr. McCarthy was most recently global head of energy at UBS Securities LLC. In this role, he had senior responsibility for all of UBS’ energy investment banking activities, including direct responsibilities for securities underwriting and mergers and acquisitions in the MLP industry. From 1995 to 2000, Mr. McCarthy led the energy investment banking activities of Dean Witter Reynolds and then PaineWebber Incorporated. He began his investment banking career in 1984. In addition to his directorships at KYN KYE,and KMF, and KED, heMr. McCarthy is also on the board of directors of Altus Midstream Company. Mr. McCarthy has previously served on the boards of directors of several publicly traded energy companies, including Range Resources Corporation, and ONEOK, Inc., Emerge Energy Services LP and K-Sea Transportation Partners L.P. Mr. McCarthy earned a B.A. in Economics and Geology from Amherst College in 1981 and an M.B.A. in Finance from the Wharton School at the University of Pennsylvania in 1984. Mr. McCarthy’s position of influence and responsibilityexperience at each Company and at KAFA,Kayne Anderson, combined with his experience advising energy companies as an investment banker, make him a valued member of the Board of each Company.
On January 11, 2019, KAFA announced that Mr. McCarthy plans to step down as Chief Executive Officer of the Companies in June 2019 and as Chairman of the Board in June 2020. The Board of Directors intends to elect James C. Baker as Chief Executive Officer of the Companies effective July 1, 2019.
James C. Baker. Mr. Baker serves on the Board of Directors and is President of KYN and KMF. He has been a Senior Managing Director of KACALP and KAFA since February 2008. He previously served as Executive Vice President of KYN, KYE, and KED from June 2008 to June 2016 and of KMF from August 2010 to June 2016; and as Vice President of KYN and KYE from June 2005 to June 2008 and of KED from
15
June 2006 to June 2008. 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 MLP industry. Mr. Baker previously served on the boards of directors ofK-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 position of responsibility at the Company and Kayne Anderson make him a valued member of the Board of each Company.
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. (now ONEOK Partners, L.P.) and President of each 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. In addition to his KMF and KED directorships, Mr. Cordes currently servespreviously served on the Boardboards of Directorsdirectors of KED, Boardwalk Pipeline Partners, LP, where he serves as a member of the Audit and Conflicts Committee. He has served on the board of 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 of each Company 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 a28-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 previously served on the board of directors of KYE. 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 isserves 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 sincefrom March 2016. In addition2016 to his KMF and KED directorships, Mr. Pearl is also a member of the Board of Directors of Magellan Midstream Partners, L.P., where he serves as Presiding Director and a member of the Audit Committee. Prior directorships included Targa Resources Partners LP (midstream MLP), Peregrine Midstream Partners LLC (natural gas storage) and Seaspan Corporation (containership chartering).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 in February 2001 and(“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 of TEPPCO Partners, L.P. (“TEPPCO”) in May 2002, where he served until December 31, 2005. Mr. Pearl was previously Chief Operating Officer of TEPPCO from February 2001 until May 2002.director. Prior to joining TEPPCO, Mr. Pearl wasPearl’s experience included such positions as Vice President —– Finance and Administration, Treasurer, Secretary and Chief Financial Officer of Maverick Tube Corporation, from June 1998. Mr. Pearl wasand Senior Vice President, Business Development, Senior Vice President and Chief Financial Officer of Santa Fe Pacific Pipeline Partners, L.P. from 1995 until 1998,In addition to his directorships at KYN and Senior Vice President, Business Development from 1992 to 1995.KMF, Mr. Pearl isalso serves on the board of directors of Magellan Midstream Partners, L.P., as Presiding Director and a member of the Audit Committee. Prior directorships include KED, 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
16
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 MLP 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 of each Company many years of experience as the chairman of the audit committees of several public companies.
Albert L. Richey.Mr. Richey isserves 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 of Anadarko Petroleum Corporation, serving sincefrom January 2013. From January 20092013 to December 2012, he served as Vice President, Special Projects. From December 2005 through December 2008 he served as Vice President, Corporate Development.August 2016. Mr. Richey joined Anadarko in 1987 as Manager of Treasury Operations. He was named Treasurer later that yearOperations and was namedheld the positions of Vice President, in 1995.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 KED, 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 KMF and KED directorships, he serves as a member of the Board of Directors the Boys & Girls Clubs of Houston and Boy Scouts of America. 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.
William H. Shea, Jr. Mr. Shea serves as an independent director of KYN and KMF. He has served as the Chief Executive Officer of Mainline Energy Partners, LLC since July 2016. He previously served as the 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 the general partner of 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 July 2007 and President and Chief Operating Officer from July 1998 to September 2000. He was also Chairman of the general partner 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 July 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 is also on the board of directors of Mainline Energy Partners, LLC. Mr. Shea formerly served on the boards of directors of KYE, 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 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 of each Company.with insight into the specific industries in which we invest.
William L. Thacker. In addition to his KMF and KED directorships, Mr. Thacker is on the boardserves as an independent director of QEP Resources, Inc., an oilKYN and gas exploration and production company. Prior directorships included GenOn Energy, Inc. (electricity generation and sales) and Chairman of the Board of Directors of Copano Energy, L.L.C. (midstream MLP). From April 2004 until November 2006, he was also a member of the Board of Directors of Pacific Energy Management, LLC, the general partner of Pacific Energy GP, LP, which was in turn the general partner of Pacific Energy Partners, L.P.KMF. He served as Chairman of the Nominating and Governance Committee of Pacific Energy Management, LLC. Mr. Thacker joinedretired from Texas Eastern Products Pipeline Company, LLC (the(“TEPPCO,” the general partner of TEPPCO)TEPPCO Partners, L.P.) in September2002, after serving as Chief Executive Officer and Chairman of the Board. He joined TEPPCO in 1992 as President, Chief Operating Officer, and Director. He was elected Chief Executive Officer in January 1994. In March 1997, he was named to the additional position of Chairman of the Board, which he held until his retirement in May 2002. Prior to joining Texas Eastern Products Pipeline Company, LLC,TEPPCO, Mr. Thacker was President of Unocal Pipeline Company from 1986 until 1992. Mr. Thacker ispreviously served on the boards of directors of KED, QEP Resources, Inc., GenOn Energy, Inc., Copano Energy, L.L.C., and Pacific Energy Management, LLC. Additionally, Mr. Thacker served as past Chairman of the Executive Committee of the Association of Oil Pipelines and has served as a member of the Boardboard of Directorsdirectors of the
17
American Petroleum Institute. Mr. Thacker holds a Bachelor of Mechanical Engineering degree from the Georgia
Institute of Technology and a Master of Business Administration degree from Lamar University. Mr. Thacker has extensive experience in the MLP sector and the energy industry. In addition, Mr. Thacker brings to the Board of each Company many years of experience as a board member of several publicly-tradedpublicly traded energy companies.
James C. Baker. Mr. Baker is Executive Vice President of both Companies, Director of KED and a Senior Managing Director of Kayne Anderson since February 2008, and Managing Director of Kayne Anderson from December 2004 and 2006, respectively, to February 2008. He was Vice President of KYN and KYE from 2005 to 2008 and of KED from 2006 to 2008, and Executive Vice President of KYN, KYE and KED since June 2008 and of KMF since August 2010. 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 MLP industry. Prior to joining UBS in 2000, Mr. Baker was an associate in the energy investment banking group at PaineWebber Incorporated. Mr. Baker previously served on the boards of K-Sea Transportation Partners LP (shipping MLP), Petris Technology, Inc. (data management for energy companies), and ProPetro Services, Inc. (oilfield services company). 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 position of responsibility at each Company and at Kayne Anderson make him a valued member of the KED Board.
Terry A. Hart. Mr. Hart is Chief Financial Officer and Treasurer of KYN and KYE since December 2005, of KED since June 2006, and of KMF since August 2010. He is a Managing Director for Kayne Anderson since December 2005. From 2000 to 2005, Mr. Hart served in roles of increasing responsibility at Dynegy, Inc. as Director of Structured Finance, Assistant Treasurer and Senior Vice President and Controller. He began his finance and accounting career in 1992 with Illinova Corporation, which was acquired by Dynegy, Inc. in 2000. Mr. Hart earned a Bachelor of Science in Accounting from Southern Illinois University in 1991 and a Master of Business Administration from the University of Illinois in 1999. He serves on the board of The Source for Women, a not-for-profit organization. Mr. Hart’s position of responsibility at each Company and at Kayne Anderson make him a valued member of the KED Board.
Required Vote
For KMF:
TheWith respect to each Company, the election of Ms. Costin and Mr. Richey under this proposal requires the affirmative vote of the holders ofas a majority of the Company’s Preferred Stock outstanding as of the Record Date. For purposes of this proposal, each share of Preferred Stock is entitled to one vote.
The election of Mr. Cordesdirector under this proposal requires the affirmative vote of the holders of a majority of the Company’s Common Stock and Preferred Stock outstanding as of the Record Date, voting together as a single class. For purposes of this proposal, each share of Common Stock, and each share of Preferred Stock, is entitled to one vote.
Abstentions, if any, will haveWith respect to each Company, the same effect as votes against the elections of Messrs. Richey and Cordes, although they will be considered present for purposes of determining the presence of a quorum at the Annual Meeting.
For KED:
The election of Mr. Baker as a director under this proposal requires the affirmative vote of the holders of a majority of the Company’s Preferred Stock outstanding as of the Record Date. For purposes of this proposal, each share of Preferred Stock is entitled to one vote.
The election of Mr. Richey under this proposal requires the affirmative vote of the holders of a majority of the Company’s Common Stock and Preferred Stock outstanding as of the Record Date, voting together as a single class. For purposes of this proposal, each share of Common Stock, and each share of Preferred Stock, is entitled to one vote.
Abstentions, if any, will have the same effect as votes against the electionselection of Messrs. Baker and Richey,the nominees, although they will be considered present for purposes of determining the presence of a quorum at the Annual Meeting.
For both Companies:
In uncontested elections of directors, brokers are permitted by applicable regulations to vote shares as to which instructions have not been received from the beneficial owners or the persons entitled to vote. For this reason, it is anticipated that there will be few, if any, broker “non-votes”“non-votes” in connection with this proposal. However, brokernon-votes, if any, will have the same effect as a vote against the nominee, although they would be considered present for purposes of determining a quorum.
BOARD RECOMMENDATION
THE BOARD OF DIRECTORS OF EACH COMPANY, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ELECTIONELECTIONS OF THE NOMINEES TO THE BOARD.
18
RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The Audit Committee and the Board of Directors of each Company, including all of the Company’s Independent Directors, have selected PricewaterhouseCoopers LLP as the independent registered public accounting firm for the Company for the year ending November 30, 20162019 and are submitting the selection of PricewaterhouseCoopers LLP to the stockholders for ratification.
PricewaterhouseCoopers LLP has audited the financial statements of each Company since inception and has informed each Company that it has no direct or indirect material financial interest in the Company or in Kayne Anderson.
A representative of PricewaterhouseCoopers LLP will not be present at the Annual Meeting butand will be available by telephone and have the opportunity to make a statement, if such representative so desires, and to respond to stockholders’ questions.
The Audit Committee of each Company normally meets two times each year with representatives of PricewaterhouseCoopers LLP to discuss the scope of their engagement, review the financial statements of the Company and the results of their examination.
INDEPENDENT ACCOUNTING FEES AND POLICIES
Audit and RelatedOther Fees
The following table sets forth the approximate amounts of the aggregate fees billed to each Company for the fiscal years ended November 30, 20152018 and 2014,2017, respectively, by PricewaterhouseCoopers LLP.LLP:
| KMF | KED | KYN | KMF | |||||||||||||||||||||||||||||
| 2015 | 2014 | 2015 | 2014 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||
Audit Fees(1) | $ | 188,000 | $ | 186,640 | $ | 168,200 | $ | 200,620 | ||||||||||||||||||||||||
Audit-Related Fees(2) | — | — | — | — | ||||||||||||||||||||||||||||
Tax Fees(3) | 88,300 | 162,500 | 143,700 | 187,000 | ||||||||||||||||||||||||||||
Audit Fees(1) | $ | 223,000 | $ | 190,000 | $ | 231,000 | $ | 197,000 | ||||||||||||||||||||||||
Audit-Related Fees(2) | 17,000 | 42,000 | 21,000 | — | ||||||||||||||||||||||||||||
Tax Fees(3) | 160,000 | 214,000 | 134,000 | 138,000 | ||||||||||||||||||||||||||||
All Other Fees | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
| (1) | For professional services rendered with respect to the audit of each Company’s annual financial statements and the quarterly review of each Company’s financial statements. |
| (2) | For professional services rendered with respect to assurance and related services reasonably related to the performance of the audits of each Company’s annual financial statements not included in “Audit Fees” above. |
| (3) | For professional services for tax compliance, tax advice and tax planning. |
The aggregatenon-audit fees billed by PricewaterhouseCoopers LLP for services rendered, for the fiscal years ended November 30, 20152018 and 2014,2017, were (i) $88,300$160,000 and $162,500,$214,000, respectively, to KMF;KYN; and (ii) $143,700$134,000 and $187,000,$138,000, respectively, to KED,KMF, and all of suchnon-audit fees related to tax services provided by PricewaterhouseCoopers LLP. The aggregatenon-audit fees billed by PricewaterhouseCoopers LLP totaled $3,497,000$3,666,000 and $894,000$4,893,000 for services rendered to KAFA and any entity controlling, controlled by, or under common control with KAFA that provides ongoing services to the Companies for the fiscal years ended November 30, 20152018 and 2014,2017, respectively. Each Company’sThe Audit Committee of each Company has considered the provision ofnon-audit services that were rendered to KAFA and any entity controlling, controlled by, or under common control with KAFA that provides ongoing services to the Company that were notpre-approved by the Audit Committee and has determined that the provision of suchnon-audit services is compatible with maintaining PricewaterhouseCoopers LLP’s independence.
19
Audit CommitteePre-Approval Policies and Procedures
Before the auditor for each Company is engaged by the Company to render audit, audit-related or permissiblenon-audit services to the Company, either: (a) the Audit Committee shallpre-approve such engagement; or (b) such engagement shall be entered into pursuant topre-approval policies and procedures established by the Audit Committee. Before anynon-audit services may be provided by the auditor to Kayne Anderson or any entity in the investment company complex (i.e.(i.e., the Company, Kayne Anderson and any entity controlled by, controlling or under common control with Kayne Anderson if such entity is an investment adviser or is engaged in the business of providing administrative, custodian, underwriting or transfer agent services to the Company or Kayne Anderson), if the nature of the services to be provided relate directly to the Company’s operations or financial reporting, suchnon-audit services must be preapprovedpre-approved by the Audit Committee. Anypre-approval policies and procedures established by the Audit Committee must be detailed as to the particular service and not involve any delegation of the Audit Committee’s responsibilities to Kayne Anderson. The Audit Committee may delegate to one or more of its members the authority to grantpre-approvals. Thepre-approval policies and procedures shall include the requirement that the decisions of any member to whom authority is delegated under this provision shall be presented to the full Audit Committee at its next scheduled meeting. Under certain limited circumstances,pre-approvals are not required if certainde minimisthresholds are not exceeded, as such thresholds are set forth by the Audit Committee and in accordance with applicable SEC rules and regulations.
For engagements with PricewaterhouseCoopers LLP, the Audit Committee of each Company approved in advance all audit services andnon-audit services, if any, that PricewaterhouseCoopers LLP provided to the Company and to Kayne Anderson (with respect to the Company’s operations and financial reporting). None of the services rendered by PricewaterhouseCoopers LLP to the Company or Kayne Anderson werepre-approved by the Audit Committee pursuant to thepre-approval exception under Rule 2.01(c)(7)(i)(C) or Rule 2.01(c)(7)(ii) ofRegulation S-X. The Audit Committee has considered and concluded that the provision ofnon-audit services rendered by PricewaterhouseCoopers LLP to Kayne Anderson and any entity controlling, controlled by, or under common control with Kayne Anderson that were not required to be preapprovedpre-approved by the Audit Committee is compatible with maintaining PricewaterhouseCoopers LLP’s independence.
The Audit Committee of the Board of Directors (the “Board”) of each of Kayne Anderson MLP/Midstream Investment Company and Kayne Anderson Midstream/Energy Fund, Inc. and Kayne Anderson Energy Development Company (each, a “Company”) is responsible for assisting the Board in monitoring (1) the accounting and reporting policies and procedures of the Company, (2) the quality and integrity of the Company’s financial statements, (3) the Company’s compliance with regulatory requirements, and (4) the independence and performance of the Company’s independent auditors and any internal auditors. Among other responsibilities, the Audit Committee of each Company reviews, in its oversight capacity, the Company’s annual financial statements with both management and the independent auditors, and the Audit Committee of each Company meets periodically with the independent auditors and any internal auditors to consider their evaluation of the Company’s financial and internal controls. The Audit Committee of each Company also selects, retains and evaluates and may replace the Company’s independent auditors and determines their compensation, subject to ratification of the Board, if required. The Audit Committee of each Company is currently composed of four directors. The Audit Committee of each Company operates under a written charter (the “Audit Committee Charter”) adopted and approved by the Board, a copy of which is available on the Companies’ website (www.kaynefunds.com)(www.kaynefunds.com). Each Audit Committee member is “independent” as defined by New York Stock Exchange listing standards.
20
The Audit Committee of each Company, in discharging its duties, has met with and held discussions with management and the Company’s independent auditors and any internal auditors. The Audit Committee
of each Company has reviewed and discussed the Company’s audited financial statements with management. Management has represented to the independent auditors that the Company’s financial statements were prepared in accordance with accounting principles generally accepted in the U.S. The Audit Committee of each Company has also discussed with the independent auditors the matters required to be discussed by Auditing Standard No. 16,1301, Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board. The Audit Committee of each Company has received the written disclosures and the letter from the Company’s independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditors’ communications with the Audit Committee of each Company concerning independence, and has discussed with the independent auditors the independent auditors’ independence. As provided in the Audit Committee Charter of each Company, it is not the Audit Committee’s responsibility to determine, and the considerations and discussions referenced above do not ensure, that the Company’s financial statements are complete and accurate and presented in accordance with accounting principles generally accepted in the U.S.
Based on each Company’s Audit Committee’s review and discussions with management and the independent auditors, the representations of management and the report of the independent auditors to each Company’s Audit Committee, the Audit Committee of each Company has recommended that its Board include the audited financial statements in the Company’s Annual Report on FormN-CSR for the fiscal year ended November 30, 20152018 filed with the Securities and Exchange Commission.
Submitted by the Audit Committee of each Company:
William R. Cordes
Anne K. Costin
Barry R. Pearl
Albert L. Richey
William L. Thacker
Required Vote
With respect to each Company, the approval of this proposal requires the affirmative vote of a majority of the votes cast by the holders of the Company’s Common Stock and Preferred Stock outstanding as of the Record Date, voting together as a single class. For purposes of this proposal, each share of Common Stock, and each share of Preferred Stock is entitled to one vote.
For purposes of the vote on this proposal, abstentions and brokernon-votes will not be counted as votes cast and will have no effect on the result of the vote.
BOARD RECOMMENDATION
THE BOARD OF DIRECTORS OF EACH COMPANY, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.
21
INFORMATION ABOUT EXECUTIVE OFFICERS
The following table sets forth each executive officer’s name and year of birth; position(s) with each Company, term of office, and length of time served; principal occupations during the past five years; and directorships. The address for the Companies’Company’s offices is 811 Main Street, 14th Floor, Houston, TX 77002. All executive officers currently serve in identical offices with KYN KYE, KMF and KED.KMF.
| Officers | ||||||||
Name (Year Born) | Position(s) Held with
Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Complex(1) Overseen by Officer | Other Directorships Held by Officer | ||||
| Kevin S. McCarthy(2) (born 1959) |
| |||||||
| James C. Baker(2)
| See information on page 7. | |||||||
| ||||||||
| J.C. Frey (born 1968) | Executive Vice President since June 2008 (KYN) and since inception (KMF). Elected annually as an officer, served since 2008 (KYN) and since inception (KMF). | Managing Partner of KACALP since 2004 andCo-Managing Partner of KAFA since 2006. Executive Vice President of KYE and KED from June 2008 through merger (August 2018) and of KMF since August 2010. Vice President of KYN and KYE from June 2005 to June 2008 and of KED from June 2006 to 2008. Assistant Secretary and Assistant Treasurer of KYN from 2004 to January 2019; of KMF from August 2010 to January 2019; of KYE from 2005 through merger (August 2018); and of KED from 2006 through merger (August 2018). | 2 | None | ||||
| Terry A. Hart (born 1969) | Chief Financial Officer, Treasurer and Assistant Secretary. Elected | Managing Director of KACALP since December 2005 and Chief Financial Officer of KAFA since 2006. Chief Financial Officer and Treasurer of KYN since December 2005; of KMF since August 2010; of KYE from December 2005 through merger (August 2018); and of KED from September 2006 through merger (August 2018). Assistant Secretary of KYN and KMF since January 2019. Chief Financial Officer of Kayne Anderson Acquisition Corp. from December 2016 to November 2018. | 2 | Current: • The Source for Women(not-for-profit organization) Prior: • KED | ||||
| Ron M. Logan, Jr. (born 1960) | Senior Vice President. Elected annually as an officer, served since September 2012 (KYN) and June 2012 (KMF). | Senior Managing Director of KACALP |
• VantaCore Partners LP (aggregates MLP) | |||||
22
Name (Year Born) | Position(s) Held with
Term of Office/ Time of Service | Principal Occupations During Past Five Years | Number of Portfolios in Fund Complex(1) Overseen by Officer | Other Directorships Held by Officer | ||||
(born | Senior Managing Director of KACALP and KAFA since February |
| ||||||
|
| |||||||
|
| |||||||
| None | |||||||
| A. Colby Parker
( |
| Assistant Treasurer of
| 2 |
| ||||||||
| ||||||||||||
| Michael J. O’Neil (born 1983) | Chief Compliance Officer. Elected | Chief Compliance Officer of KACALP and KAFA since March 2012, | None | |||||||||
| David J. Shladovsky(3) (born 1960) | Secretary. Elected | None | ||||||||||
| (1) | The 1940 Act requires the term “Fund Complex” to be defined to include registered investment companies advised by KAFA, the Companies’ investment adviser, and the Fund Complex includes KYN and KMF. |
| (2) | On January 11, 2019, KAFA announced that Kevin S. McCarthy plans to step down as Chief Executive Officer of the Companies in June 2019 and as Chairman of the Board in June 2020. The Board of Directors intends to elect James C. Baker as Chief Executive Officer of the Companies effective July 1, 2019. |
| (3) | Mr. Shladovsky will retire as Secretary of each Company at the Annual Meeting. |
COMPENSATION DISCUSSION AND ANALYSIS
Pursuant to an investment management agreement between each Company and KAFA (the Companies’ external manager), KAFA is responsible for supervising the investments and reinvestments of each Company’s assets. KAFA, at its own expense, maintains staff and employs personnel as it determines is
23
necessary to perform its obligations under the investment management agreement. Each Company pays various management fees to KAFA for the advisory and other services performed by KAFA under the investment management agreement.
The executive officers who manage each Company’s regular business are employees of KAFA or its affiliates. Accordingly, neither Company pays salaries, bonuses or other compensation to its executive officers. Neither Company has employment agreements with its executive officers. Neither Company provides pension or retirement benefits, perquisites, or other personal benefits to its executive officers. Neither Company maintains compensation plans under which its equity securities are authorized for issuance. Neither Company has arrangements to make payments to its executive officers upon their termination or in the event of a change in control of the Company.
The investment management agreement for each Company does not require KAFA to dedicate specific personnel to fulfilling its obligation to the Company under the investment management agreement, or require KAFA personnel to dedicate a specific amount of time to the management of the Company. In their capacities as executive officers or employees of KAFA or its affiliates, they devote such portion of their time to the Company’s affairs as required for the performance of KAFA’s duties under the investment management agreement.
The executive officers for both Companies are compensated by KAFA. The Companies understand that KAFA takes into account the performance of each Company as a factor in determining the compensation of certain of its senior managers, and such compensation may be increased depending on the Company’s performance. In addition to compensation for services performed for each Company, certain of the executive officers receive compensation for services performed for KAFA’s various investment funds. However, KAFA cannot segregate and identify that portion of the compensation awarded to, earned by or paid to each Company’s executive officers that relates exclusively to their services to each Company.
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following tables set forth the number of shares of each Company’s Common Stock and Preferred Stock (as of March 31, 2016)2019) beneficially owned by each Company’s current directors and executive officers as a group, and certain other beneficial owners, according to information furnished to each Company by such persons. Based on statements publicly filed with the SEC and other information obtained from such persons, as of March 31, 2016,2019, no persons beneficially owned more than 5% of KYN’s outstanding Common Stock and one person beneficially owned more than 5% of KMF’s outstanding Common Stock and two persons beneficially owned more than 5% of KED’s outstanding Common Stock. As of March 31, 2016,2019, KYN and KMF isare aware of twofour and three persons, who beneficially own more than 5%respectively, each of its outstanding Preferred Stock, and KED is aware of one person whowhom beneficially owns more than 5% of itsKYN’s or KMF’s outstanding Preferred Stock.Stock, respectively. Beneficial ownership is determined in accordance with Rule13d-3 under the 1934 Act and, unless indicated otherwise, includes voting or investment power with respect to the securities.
Common Stock
| KMF | KED | |||||||||||||||
Name of Beneficial Owner of Common Stock | Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | ||||||||||||
Independent Directors | ||||||||||||||||
William R. Cordes | 1,000 | * | 2,000 | * | ||||||||||||
Barry R. Pearl | 4,000 | * | 6,377 | * | ||||||||||||
Albert L. Richey | 5,000 | * | 12,561 | * | ||||||||||||
William L. Thacker | 2,500 | * | 2,598 | * | ||||||||||||
Interested Directors(3) | ||||||||||||||||
Kevin S. McCarthy | 171,635 | * | 54,326 | * | ||||||||||||
James C. Baker | na | na | 54,301 | * | ||||||||||||
Terry A. Hart | na | na | 9,574 | * | ||||||||||||
Executive Officers(3) | ||||||||||||||||
James C. Baker | 58,430 | * | na | na | ||||||||||||
J.C. Frey | 51,506 | * | 23,914 | * | ||||||||||||
Terry A. Hart | 12,053 | * | na | na | ||||||||||||
Ron M. Logan | 5,610 | * | 864 | * | ||||||||||||
Jody C. Meraz | 7,965 | * | 2,993 | * | ||||||||||||
Michael J. O’Neil | — | * | — | * | ||||||||||||
David J. Shladvosky | — | * | 1,957 | * | ||||||||||||
All Directors and Executive Officers as a Group (12 persons) | 319,699 | 1.5 | % | 171,465 | 1.6 | % | ||||||||||
First Trust Advisors L.P. | — | — | 1,269,437 | 11.9 | % | |||||||||||
Burgundy Asset Management Ltd. | — | — | 972,249 | 9.1 | % | |||||||||||
Name of Owner of Common Stock | KYN | KMF | ||||||||||||||
| Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | |||||||||||||
Independent Directors | ||||||||||||||||
William R. Cordes | 6,700 | * | 4,900 | * | ||||||||||||
Anne K. Costin | 2,020 | * | 1,457 | * | ||||||||||||
Barry R. Pearl | 11,711 | * | 4,000 | * | ||||||||||||
Albert L. Richey | 12,068 | * | 5,000 | * | ||||||||||||
24
Name of Owner of Common Stock | KYN | KMF | ||||||||||||||
| Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | |||||||||||||
William H. Shea, Jr. | 10,558 | * | 6,076 | * | ||||||||||||
William L. Thacker . | 12,496 | * | 2,000 | * | ||||||||||||
Interested Directors | ||||||||||||||||
Kevin S. McCarthy | 655,830 | * | 322,221 | * | ||||||||||||
James C. Baker | 238,312 | * | 122,603 | * | ||||||||||||
Executive Officers | ||||||||||||||||
J.C. Frey | 249,512 | * | 132,265 | * | ||||||||||||
Terry A. Hart | 19,682 | * | 17,969 | * | ||||||||||||
Ron M. Logan, Jr. | 36,102 | * | 14,624 | * | ||||||||||||
Jody C. Meraz | 27,484 | * | 16,627 | * | ||||||||||||
A. Colby Parker | 322 | * | 378 | * | ||||||||||||
Michael J. O’Neil | — | — | — | — | ||||||||||||
David J. Shladovsky | 36,721 | * | 7,242 | * | ||||||||||||
All Directors and Executive Officers as a Group (15 persons) | 1,319,518 | (3) | 1.0 | % | 657,362 | (4) | 1.3 | % | ||||||||
| Name of Beneficial Owner of Common Stock | ||||||||||||||||
First Trust Advisors L.P. | — | — | 3,048,849 | 6.2 | % | |||||||||||
120 East Liberty Drive, Suite 400 | ||||||||||||||||
| * | Less than 1% of |
| (1) | Based on |
| (2) | Based on |
| (3) | Does not include |
| (4) | Does not include 4,000 shares of common stock held by KAFA, a subsidiary of KACALP, in which certain executive officers have ownership interests, because they may not exercise voting or investment power with respect to such shares. |
Preferred Stock
| KMF | KED | |||||||||||||||
Name of Beneficial Owner of Preferred Stock | Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | ||||||||||||
All Directors and Executive Officers as a Group (12 persons) | — | — | — | — | ||||||||||||
AIG Asset Management | 1,050,000 | 75.0 | % | — | — | |||||||||||
Prudential Capital Group | — | — | 1,000,000 | 100.0 | % | |||||||||||
Voya Investment Management LLC | 350,000 | 25.0 | % | — | — | |||||||||||
Name of Owner of Preferred Stock | KYN | KMF | ||||||||||||||
| Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | |||||||||||||
All Directors and Executive Officers as a Group (15 persons) | — | — | — | — | ||||||||||||
Voya Investment Management LLC | 2,520,000 | 19.9 | % | 1,150,000 | 38.3 | % | ||||||||||
AIG Asset Management | 1,040,000 | 8.2 | 1,050,000 | 35.0 | ||||||||||||
25
Name of Owner of Preferred Stock | KYN | KMF | ||||||||||||||
| Number of Shares | Percent of Class(1) | Number of Shares | Percent of Class(2) | |||||||||||||
Prudential Capital Group | 1,000,000 | 7.9 | % | — | — | |||||||||||
Provident Investment Management, LLC | 760,000 | 6.0 | — | — | ||||||||||||
Mutual of Omaha | 160,000 | 1.3 | 800,000 | 26.7 | % | |||||||||||
| (1) | Based on |
| (2) | Based on |
The following table sets forth the dollar range of each Company’s equity securities and the aggregate dollar range of equity securities in all of theclosed-end funds overseen by each director in the same Fund Complex beneficially owned by the directors of each Company as of March 31, 20162019 (beneficial ownership being determined in accordance withRule 16a-1(a)(2) of the 1934 Act):
Common Stock Ownership
Director | Dollar Equity Securities | Aggregate Dollar Securities in All Funds Overseen by Director in Fund | ||||||||||
| KMF | ||||||||||||
Independent Directors | ||||||||||||
William R. Cordes | Over $100,000 | $50,001-$100,000 | Over $100,000 | |||||||||
Anne K. Costin | $10,001-$50,000 | $10,001-$50,000 | $10,001-$50,000 | |||||||||
Barry R. Pearl | Over $100,000 | $10,001-$50,000 | Over $100,000 | |||||||||
Albert L. Richey | Over $100,000 | |||||||||||
| $50,001-$100,000 | Over $100,000 | ||||||||||
William H. Shea, Jr. | Over $100,000 | $50,001-$100,000 | Over $100,000 | |||||||||
William L. Thacker . | $10,001-$50,000 | |||||||||||
Interested Directors | ||||||||||||
Kevin S. McCarthy | Over $100,000 | Over $100,000 | Over $100,000 | |||||||||
James C. | Over $100,000 | |||||||||||
| Over $100,000 | Over $100,000 | ||||||||||
| (1) | Dollar ranges are as follows: none; |
For each Company as of March 31, 2016,2019, the Independent Directors of both Companies (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 March 31, 2016,2019, the Independent Directors of both Companies did not own beneficially or of record any class of securities of the underwriters of the offerings of either Company’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.
26
The table below sets forth information about securities owned by the directors of both Companies and their respective immediate family members, as of March 31, 2019, 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 | Title of Class | Value of Securities | Percent of Class | |||||||||||
Anne K. Costin | Self | Kayne Anderson Real Estate Partners II LP(1) | Partnership Units | $ | 1,656 | * | ||||||||||
| Kayne Partners Fund III (QP), L.P.(1) | Partnership Units | $ | 58,626 | * | ||||||||||||
| Kayne Anderson Capital Income Partners (QP), L.P.(1) | Partnership Units | $ | 84,371 | * | ||||||||||||
| Kayne AndersonNon-Traditional Investments, L.P.(1) | Partnership Units | $ | 82,600 | * | ||||||||||||
Barry R. Pearl | Self | Kayne Anderson Real Estate Partners V, L.P.(1) | Partnership Units | $ | 209,110 | * | ||||||||||
| * | Less than 1% of class. |
| (1) | KACALP may be deemed to “control” this fund by virtue of its role as the fund’s general partner. |
As of March 31, 2016,2019, certain officers and certain employees of Kayne Anderson, including all the executive officers of each Company, own, in the aggregate, approximately $4.6$21.2 million of KMF’sKYN’s Common Stock and approximately $3.6$7.8 million of KED’sKMF’s Common Stock.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
For each Company, Section 30(h) of the 1940 Act and Section 16(a) of the 1934 Act require the Company’s directors and executive officers, investment adviser, affiliated persons of the investment adviser and persons who own more than 10% of a registered class of the Company’s equity securities to file Section 16(a) forms with the SEC and NYSE reporting their affiliation with the Company, their ownership and changes in their ownership of the Company’s shares. Those persons and entities are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file. Based solely on a review of those Section 16(a) forms furnished to it, each Company believes that its directors and executive officers, KAFA, affiliated persons of KAFA, and any persons holding more than 10% of the Company’s Preferred Stock have complied with all applicable Section 16(a) filing requirements during the last fiscal year.year except with respect to the events described below. To the knowledge of each Company’s management, no person owned beneficially more than 10% of the KMF’s Common Stock and one person owned beneficially more than 10% of KED’seither Companies’ Common Stock during the fiscal year ended November 30, 2015.2018.
On June 28, 2018, KMF’s stockholders added two directors to its board who were then also directors of Kayne Anderson Energy Total Return Fund, Inc. (“KYE”), Anne Costin and William Shea, Jr. KYE later merged with KMF, effective as of August 6, 2018. The Form 3 filings for Ms. Costin and Mr. Shea were filed late on August 15, 2018. Kayne Anderson Capital Advisors, L.P. (“KACALP”), which is the parent company of Kayne Anderson Fund Advisors, LLC (“KAFA”), the investment adviser to each Company, assists in those filings.
On August 15, 17 and 21, 2018, KACALP, KAFA and various officers and directors of KMF voluntarily filed Forms 4 with respect to the shares of KMF received by them in exchange for shares previously held in KYE as a result of the merger of KYE with KMF. Those Forms 4 were filed in lieu of later reporting of those transactions and updated holdings of KMF’s stock in subsequent required Form 4 or Form 5 filings after the end of KMF’s fiscal year.
On August 17 and 21, 2018, and on September 11, 2018, KACALP, KAFA and various officers and directors of KYN voluntarily filed Forms 4 with respect to the shares of KYN received by them in exchange
27
for shares previously held in Kayne Anderson Energy Development Company (“KED”) as a result of the merger of KED with KYN, effective as of August 6, 2018. Those Forms 4 were filed in lieu of later reporting of those transactions and updated holdings of KYN’s stock in subsequent required Form 4 or Form 5 filings after the end of KYN’s fiscal year.
On October 22, 2018, KACALP distributed its holdings of KYN’s shares on a pro rata basis to its limited partners. Certain of those limited partners are required to file Forms 4 with respect to their transactions in KYN’s shares. KACALP assists in those filings, which were filed one day late with respect to that distribution transaction for KACALP as well as for each of Richard Kayne, Kevin McCarthy, James Baker, J.C. Frey, Terry Hart and David Shladovsky.
28
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 theday-to-day affairs of the Company.
The Board of KMFeach Company currently consists of fiveeight directors, four of whom are Independent Directors. The Board of KED currently consists of seven directors, foursix of whom are Independent Directors. 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. McCarthy serves as Chairman of the Board of each Company. Mr. McCarthy 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. McCarthy’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. Each Board believes that its Board leadership structure — having the Chief Executive Officer serve as Chairman of the Board and Audit and Nominating Committees comprised solely of Independent Directors — is the optimal structure for the Company at this time. Because the Chief Executive Officer has the most extensive knowledge of the various aspects of each Company’s business and is directly involved in managing both the day-to-day operations and long-term strategy of each Company, each Board has determined that Mr. McCarthy is the most qualified individual to lead the Board and serve in the key position as Chairman. Each Board has also concluded that this structure allows for efficient and effective communication with the Board.
Currently, neither Company’s Board has a designated lead Independent Director. Instead, all of the Independent Directors play an active role 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 an equal stake in the Board’s actions and oversight role and equal 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
29
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 acase-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.
Diversity in Nominees for Director
The Nominating Committee of each Company evaluates candidates’ qualifications for Board membership. The Nominating Committee of each Company takes into account the diversity of a particular candidate and the overall diversity of the Board when considering and evaluating candidates for Director. While the Nominating Committee of each Company has not adopted a particular definition of diversity or a particular policy with regard to the consideration of diversity in identifying candidates, when considering a candidate’s and the Board’s diversity, the Nominating Committee generally considers the manner in which each candidate’s leadership, independence, interpersonal skills, financial acumen, integrity and professional ethics, educational and professional background, prior director or executive experience, industry knowledge, business judgment and specific experiences or expertise would compliment or benefit the Board and, as a whole, contribute to the ability of the Board to oversee the Company. The Nominating Committee of each Company may also consider other factors or attributes as it may determine appropriate in its judgment. The Nominating Committee of each Company believes that the significance of each candidate’s background, experience, qualifications, attributes or skills must be considered in the context of the Board as a whole. As a result, the Nominating Committee of each Company has not established any litmus test or quota relating to diversity that must be satisfied before an individual may serve as a director. Each Board believes that Board effectiveness is best evaluated at a group level, through its annual self-assessment process. Through this process, each Board considers whether the Board as a whole has an appropriate level of sophistication, skill and business acumen and the appropriate range of experience and background.
Communications Between Stockholders and the Board of Directors
Stockholders of either Company may send communications to the Company’s Board. Communications should be addressed to the Secretary of eachthe Company at 811 Main Street, 14th Floor, Houston, TX 77002. The Secretary of each Company will forward any communications received directly to that Company’s Board.
Code of Ethics and Policies Regarding Transactions with Related Parties
Each Company has adopted a code of ethics, as required by federal securities laws, which applies to, among others, its directors and officers. Text-only versions of the code of ethics of each Company are available on the EDGAR Database on the SEC’s internet web site at www.sec.gov. In addition, copiesCopies of the code of ethics of each Company may be obtained from the Company free of charge atby calling (877) 657-3863.
Transactions with Related Parties
On December 17, 2015, KAFA agreed to purchase newly issued shares of each Company funded in part with657-3863, or visiting the after-tax management fees received during the fourth quarter of fiscal 2015. The new shares were purchasedCompany’s website at the net asset value as of the close of business on December 18, 2015. For KMF, 136,202 shares were issued in connection with this purchase at $10.56 per share, which represented a 2.9% premium to the closing market price on that date. For KED, 43,309 shares were issued in connection with this purchase at $15.46 per share, which represented a 14.2% premium to the closing market price on the same date. The shares issued in connection with these purchases were distributed among the principals of KAFA, including KACALP, the managing member of KAFA. Each purchase was made pursuant to a stock purchase agreement approved by each Company’s Board of Directors after determination that such purchases were in the best interests of each Company and its respective stockholders.www.kaynefunds.com.
The Companies have each adopted policies with respect to affiliated and related party transactions to the extent required by the 1940 Act and related regulatory guidance.
30
Each Company’s Board knows of no other matters that are intended to be brought before the meeting. If other matters are properly presented at the Annual Meeting, the proxies named in the enclosed form of proxy will vote on those matters in their sole discretion.
MORE INFORMATION ABOUT THE MEETING
Outstanding Stock
At the Record Date, each Company had the following numbers of shares of stock issued and outstanding:
Class of Stock | Shares Outstanding | Shares Outstanding | ||||||||||||||
| KMF | KED | KYN | KMF | |||||||||||||
Common Stock | 22,034,170 | 10,668,505 | 126,337,114 | 47,816,453 | ||||||||||||
Preferred Stock | 1,400,000 | 1,000,000 | 12,680,000 | 3,000,000 | ||||||||||||
To the knowledge of the Companies’ management:
As of March 31, 2016,2019, no persons beneficially owned more than 5% of KMF’sKYN’s outstanding Common Stock and two personsone person beneficially owned more than 5% of KED’sKMF’s outstanding Common Stock.
As of March 31, 2016, two2019, four persons beneficially owned more than 5% of KYN’s outstanding Preferred Stock, and three persons beneficially owned more than 5% of KMF’s outstanding Preferred Stock, and one person beneficially owned more than 5% of KED’s outstanding Preferred Stock.
As of March 31, 2016,2019, no directors owned 1% or more of either Company’s outstanding Common Stock.
As of March 31, 2016,2019, no directors owned 1% or more of either Company’s outstanding Preferred Stock.
As of March 31, 2016,2019, directors and officers and directors of each Company owned, as a group, 1.5%approximately 1% of KMF’s outstanding Common Stock and 1.6% of KED’sboth Companies’ outstanding Common Stock.
As of March 31, 2016,2019, directors and officers of each Company owned, as a group, less than 1%did not own any amount of either Company’s outstanding Preferred Stock.
How Proxies Will Be Voted
For each Company, all proxies solicited by the Board of Directors that are properly executed and received at or prior to the Annual Meeting, and that are not revoked, will be voted at the Annual 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. The Companies know of no other matters to be presented at the Annual Meeting. However, if other proposals are properly presented at the Annual Meeting, the votes entitled to be cast by the persons named as proxies on the enclosed proxy card will cast such votes in their sole discretion.
How to Vote
If your shares in either Company 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 of either Company, you may authorize the persons named as proxies on the enclosed proxy card to
31
cast the votes you are entitled to cast at the meeting by completing, signing, dating and returning the enclosed proxy card. For either Company, stockholders of record or their duly authorized proxies may vote in person at the Annual Meeting. However, even if you plan to attend the Annual Meeting, you should still return your proxy card, which will ensure that your vote is cast should your plans change.
Expenses and Solicitation of Proxies
For each Company, the expenses of preparing, printing and mailing the enclosed proxy card, the accompanying notice and this proxy statement, tabulation expenses and all other costs in connection with the solicitation of proxies will be borne by the Company. Each Company 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 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. If a proxy solicitor is retained by either Company, the costs associated with all proxy solicitation are expected to be approximately $5,000 for each Company. The Company will not pay any of its representatives or Kayne Anderson any additional compensation for their efforts to supplement proxy solicitation.
Dissenters’ or Appraisal Rights
Stockholders of either Company do not have dissenters’ or appraisal rights.
Revoking a Proxy
At any time before it has been voted, you may revoke your proxy for either Company by: (1) sending a letter revoking your proxy to the Secretary of the Company at 811 Main Street, 14th Floor, Houston, TX 77002; (2) properly executing and sending a later-dated proxy to the Secretary of the Company at the same address; or (3) attending the Annual Meeting, requesting return of any previously delivered proxy, and voting in person.
BrokerNon-Votes
Broker Non-Votesnon-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.“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”“non-routine” matters. Under the rules and interpretations of the NYSE, “non-routine”“non-routine” matters are generally matters that may substantially affect the rights or privileges of stockholders. The ratification of the selection of the independent registered public accounting firm is generally considered to be “routine,” and brokers generally have discretionary voting power with respect to such proposal.
Quorum and Adjournment
For each Company, 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 the purposes of the Annual Meeting. Abstentions and brokernon-votes will be counted for purposes of determining whether a quorum is present at the Annual Meeting. For each Company, if a quorum is not present in person or by proxy at the Annual Meeting, the chairman of the Annual Meeting may adjourn the meeting to a date not more than 120 days after the original Record Date without notice other than announcement at the Annual Meeting.
32
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.
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, for each Company, 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 of each Company sharing an address who currently receive multiple copies of proxy materials and annual report of either Company at the same addresses and would like to request “householding” of their communications should contact their brokers.
33
The Amended and Restated Bylaws currently in effect for each Company 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,howeverthat 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 (and in the case of the first annual meeting of stockholders), 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 20172020 Annual Meeting must be received by the Secretary of the Company on or after December 27, 201628, 2019 and prior to 5:00 p.m. Central Time on January 24, 2017.28, 2020. However, under the rules of the SEC, if a stockholder wishes to submit a proposal for possible inclusion in the 20172020 proxy statement pursuant toRule14a-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 underRule 14a-8(e) must be received by the Company on or before January 24, 201728, 2020 in order to be included in the proxy statement and proxy card for the 20172020 Annual Meeting. All nominations and proposals must be in writing.
By Order of the Board of Directors of KYN and KMF
David J. Shladovsky
Secretary
May 16, 201623, 2019
34
APPENDIX ACommon
PROXY486606106
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.MLP/MIDSTREAM INVESTMENT COMPANY
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
THE 20162019 ANNUAL MEETING OF STOCKHOLDERS — JUNE 23, 201627, 2019
The undersigned stockholder of Kayne Anderson Midstream/Energy Fund, Inc.MLP/Midstream Investment Company (“KYN”), a Maryland corporation, (the “Company”), hereby appoints David J. Shladovsky and Jody C. Meraz, or either of them, as proxies for the undersigned, with full power of substitution in each of them, to attend the 20162019 Annual Meeting of Stockholders of the CompanyKYN (the “Annual Meeting”) to be held on June 23, 2016,27, 2019 at 8:00 a.m. Central Time at Kayne Anderson, 811 Main Street, 14th Floor, Houston, TX 77002 and any adjournment or postponement thereof, to cast on behalf of the undersigned all votes that the undersigned is entitled to cast at such Annual Meeting and otherwise to represent the undersigned at the Annual Meeting with all powers possessed by the undersigned if personally present at the Annual Meeting. The undersigned hereby acknowledges receipt of the Notice of the Annual Meeting and the accompanying Proxy Statement, the terms of each of which are incorporated by reference, and revokes any proxy heretofore given with respect to such Annual Meeting.
If this Proxyproxy is properly executed, the votes entitled to be cast by the undersigned will be cast as instructed below, or if no instruction is given, the votes entitled to be cast by the undersigned will be cast “for” each of the proposals. Additionally, the votes entitled to be cast by the undersigned will be cast in the discretion of the Proxyproxy holder on any other matter that may properly come before the Annual Meeting or any adjournment or postponement thereof.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED POSTMARKED ENVELOPE.
▼ PLEASE DETACH AT PERFORATION BEFORE MAILING▼
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.MLP/MIDSTREAM INVESTMENT COMPANY
ANNUAL MEETING PROXY CARD
AUTHORIZED SIGNATURES — THIS SECTION MUST BE COMPLETED | ||||
| Please sign exactly as your name appears. If the shares are held jointly, each holder should sign. When signing as an attorney, executor, administrator, trustee, guardian, officer of a corporation or other entity or in another representative capacity, please indicate your full title under signature(s). | ||||
| Signature | Date | |||
Signature(s)(if held jointly): | Date | |||
(continued from reverse side)
PROXYCommon
486606106
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.MLP/MIDSTREAM INVESTMENT COMPANY
ANNUAL MEETING PROXY CARD
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED BELOW OR, IF NO CHOICE IS INDICATED, WILL
BE VOTED “FOR” EACH PROPOSAL.
| 1. | THE ELECTION OF TWO DIRECTORS |
| NOMINEE | FOR | AGAINST | ABSTAIN | |||||||
| ANNE K. COSTIN | ||||||||||
| ALBERT L. RICHEY | ☐ | ☐ | ☐ | |||||||
| 2. | THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS |
| 3. | TO VOTE AND OTHERWISE REPRESENT THE UNDERSIGNED ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF IN THE DISCRETION OF THE PROXY HOLDER. |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The combined proxy statement and the Company’sKYN’s most recent Annual Report are available
on the internet at www.kaynefunds.com/kmf/sec-filings.www.kaynefunds.com
APPENDIX BPreferred
PROXY4866064#0 (privately held)
4866065#9 (privately held)
4866066#8 (privately held)
4866067#7 (privately held)
4866068#6 (privately held)
486606601 (publicly held)
KAYNE ANDERSON ENERGY DEVELOPMENTMLP/MIDSTREAM INVESTMENT COMPANY
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
THE 20162019 ANNUAL MEETING OF STOCKHOLDERS — JUNE 23, 201627, 2019
The undersigned stockholder of Kayne Anderson Energy DevelopmentMLP/Midstream Investment Company (“KYN”), a Maryland corporation, (the “Company”), hereby appoints David J. Shladovsky and Jody C. Meraz, or either of them, as proxies for the undersigned, with full power of substitution in each of them, to attend the 20162019 Annual Meeting of Stockholders of the CompanyKYN (the “Annual Meeting”) to be held on June 23, 2016,27, 2019 at 8:00 a.m. Central Time at Kayne Anderson, 811 Main Street, 14th Floor, Houston, TX 77002 and any adjournment or postponement thereof, to cast on behalf of the undersigned all votes that the undersigned is entitled to cast at such Annual Meeting and otherwise to represent the undersigned at the Annual Meeting with all powers possessed by the undersigned if personally present at the Annual Meeting. The undersigned hereby acknowledges receipt of the Notice of the Annual Meeting and the accompanying Proxy Statement, the terms of each of which are incorporated by reference, and revokes any proxy heretofore given with respect to such Annual Meeting.
If this Proxyproxy is properly executed, the votes entitled to be cast by the undersigned will be cast as instructed below, or if no instruction is given, the votes entitled to be cast by the undersigned will be cast “for” each of the proposals. Additionally, the votes entitled to be cast by the undersigned will be cast in the discretion of the Proxyproxy holder on any other matter that may properly come before the Annual Meeting or any adjournment or postponement thereof.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED POSTMARKED ENVELOPE.
▼ PLEASE DETACH AT PERFORATION BEFORE MAILING▼
KAYNE ANDERSON ENERGY DEVELOPMENTMLP/MIDSTREAM INVESTMENT COMPANY
ANNUAL MEETING PROXY CARD
AUTHORIZED SIGNATURES — THIS SECTION MUST BE COMPLETED | ||||
| Please sign exactly as your name appears. If the shares are held jointly, each holder should sign. When signing as an attorney, executor, administrator, trustee, guardian, officer of a corporation or other entity or in another representative capacity, please indicate your full title under signature(s). | ||||
| Signature | Date | |||
Signature(s)(if held jointly): | Date | |||
(continued from reverse side)
PROXYPreferred
4866064#0 (privately held)
4866065#9 (privately held)
4866066#8 (privately held)
4866067#7 (privately held)
4866068#6 (privately held)
486606601 (publicly held)
KAYNE ANDERSON ENERGY DEVELOPMENTMLP/MIDSTREAM INVESTMENT COMPANY
ANNUAL MEETING PROXY CARD
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED BELOW OR, IF NO CHOICE IS INDICATED, WILL
BE VOTED “FOR” EACH PROPOSAL.
| 1. | THE ELECTION OF |
| NOMINEE | FOR | AGAINST | ABSTAIN | ||||||
| ANNE K. COSTIN | ☐ | ☐ | |||||||
| ALBERT L. RICHEY | ☐ | ☐ | ☐ | ||||||
| JAMES C. BAKER | |||||||||
| ☐ | |||||||||
| 2. | THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS |
| 3. | TO VOTE AND OTHERWISE REPRESENT THE UNDERSIGNED ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF IN THE DISCRETION OF THE PROXY HOLDER. |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The combined proxy statement and the Company’sKYN’s most recent Annual Report are available
on the internet at www.kaynefunds.com/ked/sec-filingswww.kaynefunds.com
Common
48661E108
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
THE 2019 ANNUAL MEETING OF STOCKHOLDERS — JUNE 27, 2019
The undersigned stockholder of Kayne Anderson Midstream/Energy Fund, Inc. (“KMF”), a Maryland corporation, hereby appoints David J. Shladovsky and Jody C. Meraz, or either of them, as proxies for the undersigned, with full power of substitution in each of them, to attend the 2019 Annual Meeting of Stockholders of KMF (the “Annual Meeting”) to be held on June 27, 2019 at 8:00 a.m. Central Time at Kayne Anderson, 811 Main Street, 14th Floor, Houston, TX 77002 and any adjournment or postponement thereof, to cast on behalf of the undersigned all votes that the undersigned is entitled to cast at such Annual Meeting and otherwise to represent the undersigned at the Annual Meeting with all powers possessed by the undersigned if personally present at the Annual Meeting. The undersigned hereby acknowledges receipt of the Notice of the Annual Meeting and the accompanying Proxy Statement, the terms of each of which are incorporated by reference, and revokes any proxy heretofore given with respect to such Annual Meeting.
If this proxy is properly executed, the votes entitled to be cast by the undersigned will be cast as instructed below, or if no instruction is given, the votes entitled to be cast by the undersigned will be cast “for” each of the proposals. Additionally, the votes entitled to be cast by the undersigned will be cast in the discretion of the proxy holder on any other matter that may properly come before the Annual Meeting or any adjournment or postponement thereof.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED POSTMARKED ENVELOPE.
▼ PLEASE DETACH AT PERFORATION BEFORE MAILING▼
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
ANNUAL MEETING PROXY CARD
AUTHORIZED SIGNATURES — THIS SECTION MUST BE COMPLETED | ||||
| Please sign exactly as your name appears. If the shares are held jointly, each holder should sign. When signing as an attorney, executor, administrator, trustee, guardian, officer of a corporation or other entity or in another representative capacity, please indicate your full title under signature(s). | ||||
| Signature | Date | |||
Signature(s)(if held jointly) | Date | |||
(continued from reverse side)
Common
48661E108
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
ANNUAL MEETING PROXY CARD
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED BELOW OR, IF NO CHOICE IS INDICATED, WILL
BE VOTED “FOR” EACH PROPOSAL.
| 1. | THE ELECTION OF ANNE K. COSTIN AS DIRECTOR FOR A TERM OF THREE YEARS AND UNTIL HER SUCCESSOR IS ELECTED AND QUALIFIED. |
| NOMINEE | FOR | AGAINST | ABSTAIN | |||||||
| ANNE K. COSTIN | ☐ | ☐ | ☐ | |||||||
| ALBERT L. RICHEY | ☐ | ☐ | ☐ | |||||||
| 2. | THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS KMF’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING NOVEMBER 30, 2019. |
| ☐ FOR | ☐ AGAINST | ☐ ABSTAIN |
| 3. | TO VOTE AND OTHERWISE REPRESENT THE UNDERSIGNED ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF IN THE DISCRETION OF THE PROXY HOLDER. |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The combined proxy statement and KMF’s most recent Annual Report are available
on the internet at www.kaynefunds.com
Preferred
48661E4*6 (privately held)
48661E5*5 (privately held)
48661E6*4 (privately held)
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR
THE 2019 ANNUAL MEETING OF STOCKHOLDERS — JUNE 27, 2019
The undersigned stockholder of Kayne Anderson Midstream/Energy Fund, Inc. (“KMF”), a Maryland corporation, hereby appoints David J. Shladovsky and Jody C. Meraz, or either of them, as proxies for the undersigned, with full power of substitution in each of them, to attend the 2019 Annual Meeting of Stockholders of KMF (the “Annual Meeting”) to be held on June 27, 2019 at 8:00 a.m. Central Time at Kayne Anderson, 811 Main Street, 14th Floor, Houston, TX 77002 and any adjournment or postponement thereof, to cast on behalf of the undersigned all votes that the undersigned is entitled to cast at such Annual Meeting and otherwise to represent the undersigned at the Annual Meeting with all powers possessed by the undersigned if personally present at the Annual Meeting. The undersigned hereby acknowledges receipt of the Notice of the Annual Meeting and the accompanying Proxy Statement, the terms of each of which are incorporated by reference, and revokes any proxy heretofore given with respect to such Annual Meeting.
If this proxy is properly executed, the votes entitled to be cast by the undersigned will be cast as instructed below, or if no instruction is given, the votes entitled to be cast by the undersigned will be cast “for” each of the proposals. Additionally, the votes entitled to be cast by the undersigned will be cast in the discretion of the proxy holder on any other matter that may properly come before the Annual Meeting or any adjournment or postponement thereof.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED POSTMARKED ENVELOPE.
▼ PLEASE DETACH AT PERFORATION BEFORE MAILING▼
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
ANNUAL MEETING PROXY CARD
AUTHORIZED SIGNATURES — THIS SECTION MUST BE COMPLETED | ||||
| Please sign exactly as your name appears. If the shares are held jointly, each holder should sign. When signing as an attorney, executor, administrator, trustee, guardian, officer of a corporation or other entity or in another representative capacity, please indicate your full title under signature(s). | ||||
| Signature | Date | |||
Signature(s)(if held jointly): | Date | |||
(continued from reverse side)
Preferred
48661E4*6 (privately held)
48661E5*5 (privately held)
48661E6*4 (privately held)
KAYNE ANDERSON MIDSTREAM/ENERGY FUND, INC.
ANNUAL MEETING PROXY CARD
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED BELOW OR, IF NO CHOICE IS INDICATED, WILL
BE VOTED “FOR” EACH PROPOSAL.
| 1. | THE ELECTION OF ANNE K. COSTIN AS DIRECTOR FOR A TERM OF THREE YEARS AND UNTIL HER SUCCESSOR IS ELECTED AND QUALIFIED. |
| NOMINEE | FOR | AGAINST | ABSTAIN | |||||
| ANNE K. COSTIN | ☐ | ☐ | ☐ | |||||
| ALBERT L. RICHEY | ☐ | ☐ | ☐ | |||||
| JAMES C. BAKER | ☐ | ☐ | ☐ | |||||
| 2. | THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS KMF’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING NOVEMBER 30, 2019. |
| ☐ FOR | ☐ AGAINST | ☐ ABSTAIN |
| 3. | TO VOTE AND OTHERWISE REPRESENT THE UNDERSIGNED ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF IN THE DISCRETION OF THE PROXY HOLDER. |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The combined proxy statement and KMF’s most recent Annual Report are available
on the internet at www.kaynefunds.com