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

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[X] Preliminary Proxy Statement

[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14a-6(e)(2))

[ ] Definitive Proxy Statement

[ ] Definitive Additional Materials

[ ] Soliciting Material Pursuant to Section 240.14a-12

RMK MULTI-SECTOR HIGH INCOME FUND, INC.
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(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:

(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.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

(2) Form, Schedule or Registration Statement No.:

(3) Filing Party:

(4) Date Filed:

RMK ADVANTAGE INCOME FUND, INC.
RMK HIGH INCOME FUND, INC.
RMK MULTI-SECTOR HIGH INCOME FUND, INC.
RMK STRATEGIC INCOME FUND, INC.

50 NORTH FRONT STREET
MEMPHIS, TENNESSEE 38103

May __, 2008

Dear Shareholders:

The enclosed Notice and Proxy Statement relate to separate joint Special
and Annual Meetings of Shareholders (the "Meetings") of RMK Advantage Income
Fund, Inc., RMK High Income Fund, Inc., RMK Multi-Sector High Income Fund, Inc.
and RMK Strategic Income Fund, Inc. (each a "Fund" and collectively, the
"Funds") to be held on July 11, 2008, at the offices of Regions Financial Corp.,
7130 Goodlett Farms Parkway, Cordova, Tennessee 38016, at 11:00 a.m. Central
Time.

At the Special Meeting, the Funds' Boards of Directors are recommending
that shareholders approve new investment advisory agreements (each, a "New
Advisory Agreement" and collectively, the "New Advisory Agreements") between
Hyperion Brookfield Asset Management, Inc. ("HBAM") and each Fund. In addition,
if the New Advisory Agreements are approved by shareholders, the Boards are
recommending that shareholders elect a new Board of Directors of each Fund at
the Annual Meeting. The holding of a Fund's Annual Meeting as currently
scheduled is contingent upon the approval of the New Advisory Agreement by the
shareholders of the Fund. The New Advisory Agreements will not take effect
unless the shareholders of each Fund elect the new directors and the transaction
described in the accompanying Proxy Statement is consummated.

Morgan Asset Management, Inc. ("MAM"), the investment adviser to the Funds,
has entered into an agreement with HBAM under which HBAM, an investment adviser
registered with the U.S. Securities and Exchange Commission, is being proposed
by MAM to become the new investment adviser to the Funds. The agreement
contemplates that HBAM would become the investment adviser to the Funds and MAM
would no longer serve as the Funds' investment adviser. The agreement also
contemplates in connection with the approval of HBAM as the Funds' investment
adviser, shareholders would elect new Boards of Directors of the Funds, which
would consist of individuals proposed by HBAM, and the current members of the
Boards would no longer serve as directors of the Funds. Detailed information
with respect to each of these proposals is included in the accompanying Proxy
Statement for the Meetings.

Each Fund's Board of Directors has unanimously approved the New Advisory
Agreement and has nominated five new individuals for election as directors of
the Fund. The appointment of HBAM as investment adviser to each Fund must be
approved by the shareholders of that Fund, and the new Board of Directors of a
Fund must be elected by the shareholders of that Fund.

YOU WILL BE ASKED (1) TO APPROVE A NEW ADVISORY AGREEMENT FOR YOUR FUND(S)
AT THE JOINT SPECIAL MEETING, AND (2) IF THE NEW ADVISORY AGREEMENT(S) ARE
APPROVED, TO ELECT FIVE NEW DIRECTORS OF YOUR FUND(S) AT THE JOINT ANNUAL
MEETING. THE BOARDS UNANIMOUSLY RECOMMEND THAT YOU VOTE "FOR" THE APPROVAL OF A
NEW ADVISORY AGREEMENT FOR YOUR FUND(S). THE BOARDS ALSO UNANIMOUSLY RECOMMEND

THAT YOU VOTE "FOR" THE ELECTION OF EACH OF THE NOMINEES. ALTHOUGH THE BOARDS
HAVE DETERMINED THAT THE PROPOSALS ARE IN YOUR BEST INTEREST, THE FINAL DECISION
IS YOURS.

YOUR VOTE IS IMPORTANT. The accompanying Proxy Statement includes a
detailed description of the proposals and the reasons for the Boards'
recommendations. The formal Notice of Joint Special and Annual Meetings and
proxy cards also are enclosed. Please read the enclosed materials carefully and
cast your vote. Voting your shares early will help to avoid costly follow-up
mail and telephone solicitation. After reviewing the attached proxy materials,
please complete, sign and date your proxy cards and mail them in the enclosed
postage-paid envelope. Please refer to the enclosed proxy cards for alternative
forms of voting or you may vote in person.

Thank you for your continued support.

Sincerely,

Brian B. Sullivan
President

RMK ADVANTAGE INCOME FUND, INC.
RMK HIGH INCOME FUND, INC.
RMK MULTI-SECTOR HIGH INCOME FUND, INC.
RMK STRATEGIC INCOME FUND, INC.

50 NORTH FRONT STREET
MEMPHIS, TENNESSEE 38103

NOTICE OF JOINT SPECIAL AND ANNUAL MEETINGS OF SHAREHOLDERS

JULY 11, 2008
----------------------

Dear Shareholders:

NOTICE IS HEREBY GIVEN that separate joint Special and Annual Meetings of
Shareholders (the "Meetings") of RMK Advantage Income Fund, Inc., RMK High
Income Fund, Inc., RMK Multi-Sector High Income Fund, Inc. and RMK Strategic
Income Fund, Inc. (each, a "Fund" and collectively, the "Funds") will be held on
July 11, 2008, at 11:00 a.m. Central Time, at the offices of Regions Financial
Corp., 7130 Goodlett Farms Parkway, Cordova, Tennessee 38016, for the following
purposes:

SPECIAL MEETING

(1) To approve a new investment advisory agreement between Hyperion
Brookfield Asset Management, Inc. and each Fund; and

(2) To consider and act upon any other business as may properly come
before the Special Meeting or any adjournment thereof.

ANNUAL MEETING

(1) To elect a Board of five Directors consisting of two Class I
Directors, one Class II Director and two Class III Directors of
each Fund; and

(2) To consider and act upon any other business as may properly come
before the Annual Meeting or any adjournment thereof.

EACH FUND'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
"FOR" EACH PROPOSAL.

Each Fund's Board of Directors has fixed the close of business on May 5,
2008, as the record date for the determination of shareholders entitled to
notice of, and to vote at, the Meetings and any adjournments thereof.

By Order of the Boards of Directors,

Charles D. Maxwell
Secretary

May ___, 2008

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YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
PLEASE RETURN YOUR PROXY CARDS PROMPTLY.

SHAREHOLDERS ARE INVITED TO ATTEND THE MEETINGS IN PERSON. ANY SHAREHOLDER
WHO DOES NOT EXPECT TO ATTEND THE MEETINGS IS URGED TO INDICATE VOTING
INSTRUCTIONS ON THE ENCLOSED PROXY CARDS, DATE AND SIGN THEM, AND RETURN THEM IN
THE ENVELOPE PROVIDED, WHICH NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. IF
YOU OWN SHARES OF MORE THAN ONE FUND, THERE WILL BE TWO PROXY CARDS ENCLOSED FOR
EACH FUND OWNED. PLEASE FILL OUT AND RETURN EACH PROXY CARD. PLEASE REFER TO THE
ENCLOSED PROXY CARDS FOR INSTRUCTIONS ON ALTERNATIVE FORMS OF VOTING. IF YOU
SIGN, DATE AND RETURN THE PROXY CARDS BUT GIVE NO VOTING INSTRUCTIONS, THE
PROXIES WILL VOTE IN FAVOR OF THE APPROVAL OF THE NEW ADVISORY AGREEMENT(S) AND
THE ELECTION OF EACH OF THE NOMINEES.

TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK YOUR
COOPERATION IN MAILING YOUR PROXY CARDS PROMPTLY, NO MATTER HOW LARGE OR SMALL
YOUR HOLDINGS MAY BE.
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RMK ADVANTAGE INCOME FUND, INC.
RMK HIGH INCOME FUND, INC.
RMK MULTI-SECTOR HIGH INCOME FUND, INC.
RMK STRATEGIC INCOME FUND, INC.

50 NORTH FRONT STREET
MEMPHIS, TENNESSEE 38103

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PROXY STATEMENT
------------------

JOINT SPECIAL AND ANNUAL MEETINGS OF SHAREHOLDERS

JULY 11, 2008

This Proxy Statement is furnished to shareholders in connection with the
solicitation of proxies on behalf of the Boards of Directors (each, a "Board"
and collectively, the "Boards") of RMK Advantage Income Fund, Inc., RMK High
Income Fund, Inc., RMK Multi-Sector High Income Fund, Inc. and RMK Strategic
Income Fund, Inc. (each, a "Fund" and collectively, the "Funds") to be voted at
separate joint Special and Annual Meetings of Shareholders of the Funds to be
held on July 11, 2008, at 11:00 a.m. Central Time at the offices of Regions
Financial Corp. ("Regions"), 7130 Goodlett Farms Parkway, Cordova, Tennessee
38016, or any adjournments thereof (the "Meetings"). The approximate mailing
date of this Proxy Statement and the accompanying proxy cards is May __, 2008.

As discussed more fully below, shareholders of the Funds are being asked to
vote:

SPECIAL MEETING

(1) To approve a new investment advisory agreement (each, a "New
Advisory Agreement" and collectively, the "New Advisory
Agreements") between Hyperion Brookfield Asset Management, Inc.
("HBAM") and each Fund; and

(2) To consider and act upon any other business as may properly come
before the Special Meeting or any adjournment thereof.

ANNUAL MEETING

(1) To elect a Board of five Directors consisting of two Class I
Directors, one Class II Director and two Class III Directors of
each Fund; and

(2) To consider and act upon any other business as may properly come
before the Annual Meeting or any adjournment thereof.

The Boards know of no business other than the approval of the New Advisory
Agreements and the election of the new Boards of Directors that will be
presented for consideration at the Meetings. If any other matter is properly
presented, it is the intention of the persons named in the enclosed proxies to
vote in accordance with their best judgment. The New Advisory Agreements will be
considered and voted on at the joint Special Meeting and, if the New Advisory
Agreements are approved by shareholders, the proposal to elect new Boards of
five Directors will be considered and voted on at the joint Annual Meeting. The
New Advisory Agreements will not take effect unless the shareholders also elect
the new directors and the Transaction (defined below) is consummated. The

holding of the joint Annual Meeting as currently scheduled is contingent upon
the approval of the New Advisory Agreements at the joint Special Meeting. In the
event that the New Advisory Agreement between any Fund and HBAM is not approved,
the Funds' joint Annual Meeting will be postponed.

The close of business on May 5, 2008, has been fixed as the record date
(the "Record Date") for determining shareholders entitled to notice of, and to
vote at, the Meetings. Information as to the number of outstanding shares of
common stock of each Fund as of the Record Date is set forth below:

--------------------------------------------------------------------------------
Total Number of Shares
--------------------------------------------------------------------------------
RMK Advantage Income Fund, Inc.
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RMK High Income Fund, Inc.
--------------------------------------------------------------------------------
RMK Multi-Sector High Income Fund, Inc.
--------------------------------------------------------------------------------
RMK Strategic Income Fund, Inc.
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Except as set forth in Appendix A, as of the Record Date, the Funds do not know
of any person who owned beneficially or of record 5% or more of any class of
shares of a Fund. As of the Record Date, current directors and officers of each
Fund as a group own an aggregate of [less than one percent] of each Fund's
outstanding shares. Additional information regarding voting your shares of the
Funds and attending the Meetings is included at the end of this Proxy Statement
in the section entitled "Voting Information."

Each Fund is a Maryland corporation that is registered with the U.S.
Securities and Exchange Commission (the "SEC") under the Investment Company Act
of 1940, as amended (the "1940 Act"), as a diversified, closed-end management
investment company with its own investment objective. Each Fund is authorized to
issue 1,000,000,000 shares of capital stock with a par value of $0.0001 per
share (individually and collectively referred to as "shares," and the holders of
the shares are "shareholders").

Morgan Asset Management, Inc. ("MAM"), 1901 6th Avenue North, 4th Floor,
Birmingham, Alabama 35203, a registered investment adviser under the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), is a wholly owned
subsidiary of MK Holding, Inc. and serves as the each Fund's investment adviser
under an investment advisory agreement (collectively, the "Current Advisory
Agreements"). MK Holding, Inc. is a wholly owned subsidiary of Regions. Morgan
Keegan & Company, Inc. ("Morgan Keegan") is also a wholly owned subsidiary of
Regions.

The date of this Proxy Statement is May __, 2008.

TABLE OF CONTENTS

OVERVIEW .....................................................................xx
The Transaction...............................................................xx
Post-Transaction Structure and Operations of the Funds........................xx
HBAM and its Affiliates.......................................................xx
Anticipated Benefits of the Transaction.......................................xx

SPECIAL MEETING-PROPOSAL 1: APPROVAL OF A NEW ADVISORY AGREEMENT BETWEEN EACH
FUND AND HBAM...............................................................xx
Reasons for Board Approval and Recommendation.................................xx
Terms of the New Advisory Agreement...........................................xx
Differences Between the Current Advisory Agreements and New Advisory
Agreements..................................................................xx
Other Agreements Relating to the Funds........................................xx
Section 15(f) of the 1940 Act.................................................xx
Required Vote.................................................................xx

ANNUAL MEETING-PROPOSAL 2: ELECTION OF BOARDS OF DIRECTORS ..................xx
Board Consideration of the Nominees...........................................xx
Information Concerning Nominees...............................................xx
Ownership of Fund Shares......................................................xx
Board and Committee Meetings..................................................xx
Information About the Funds' Current Officers.................................xx
Compensation of Directors.....................................................xx
Procedures for Communications to the Boards ..................................xx
Required Vote.................................................................xx

ADDITIONAL INFORMATION........................................................xx
Investment Adviser and Administrator..........................................xx
Information about the Independent Registered Public Accounting Firm ..........xx
Legal Proceedings.............................................................xx

VOTING INFORMATION ...........................................................xx
Required Vote.................................................................xx

SOLICITATION OF PROXIES ......................................................xx

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE ......................xx

DIRECTOR ATTENDANCE AT MEETINGS AND SHAREHOLDER COMMUNICATIONS ...............xx

SHAREHOLDER PROPOSALS ........................................................xx

SHAREHOLDER REPORTS ..........................................................xx

OTHER BUSINESS ...............................................................xx

APPENDIX A ...................................................................xx

APPENDIX B ...................................................................xx

OVERVIEW

On April 21, 2008, the Boards considered and approved items to effectuate a
proposal by MAM and HBAM, whereby HBAM would become the new investment adviser
to the Funds. To implement the new investment advisory arrangements for the
Funds, the Boards approved the New Advisory Agreements between HBAM and the
Funds. The Boards are submitting the New Advisory Agreements for approval by the
shareholders of the Funds. If the New Advisory Agreements are approved by
shareholders, the Boards are also submitting a slate of five nominees for
election to serve as new Boards of Directors of the Funds following consummation
of the Transaction (defined below).

THE TRANSACTION

MAM and its affiliates have entered into an Adoption Agreement with HBAM
dated as of April 18, 2008 (the "Adoption Agreement"), under which HBAM is being
proposed by MAM to become the new investment adviser to the Funds and three
open-end funds (the "Open-End Funds") currently advised by MAM (the
"Transaction"). The Adoption Agreement contemplates that, following approval of
the New Advisory Agreements by shareholders of the Funds, HBAM would become the
investment adviser to the Funds and MAM would no longer serve as the Funds'
investment adviser. The Adoption Agreement also contemplates that MAM would
support the election of new Boards of five Directors of the Funds (the "New
Boards"), which would consist of individuals proposed by HBAM, would be elected
and qualified, and the current members of the Boards would no longer serve as
directors following consummation of the Transaction. The Adoption Agreement
contemplates that HBAM would also become the new investment adviser to the Open-
End Funds and that the same slate of nominees would be elected and qualified to
serve as a new board of directors of the Open-End Funds.

After careful consideration of the history of each Fund's relationship with
MAM and HBAM, each Board, including a majority of the directors who are not
"interested persons" (as defined in the 1940 Act) of the Funds (the "Independent
Directors"), who were present at a meeting held in-person on April 21, 2008,
unanimously determined that it would be in the best interests of each Fund and
its shareholders to approve the proposals contemplated by the Adoption
Agreement. At the April 21, 2008 meeting, the Boards, including a majority of
the Independent Directors, unanimously approved the New Advisory Agreements with
HBAM and determined to submit them to shareholders for approval. The form of the
New Advisory Agreement is attached hereto as Appendix B.

The Adoption Agreement contemplates that, contingent upon Board and
shareholder approval of the New Advisory Agreements, the New Boards would be
elected and qualified, and that the current directors of the Funds would no
longer serve following consummation of the Transaction. As described more fully
below, at its April 21, 2008 meeting, each Board, based on the recommendation of
its Independent Directors Committee, nominated a slate of five individuals
(each, a "Nominee" and collectively, the "Nominees") for election as directors
of the Funds. At that meeting, the Boards also approved, based on the
recommendation of the Independent Directors Committees, a decrease in the number
of directors of the Funds from six to five, with such decrease to take effect
upon consummation of the Transaction. The Board of each Fund will continue to be
divided into three classes, designated Class I, Class II and Class III, with the
terms of office of Class I, Class II and Class III Directors expiring at the
annual meeting of shareholders held in 2009, 2010 and 2011, respectively, and at
each third annual meeting of shareholders thereafter.

The consummation of the Transaction is subject to certain terms and
conditions, including, among others: (1) each Fund obtaining approval to enter
into the New Advisory Agreement, as set forth in Proposal 1 of this Proxy
Statement, from the shareholders of that Fund; and (2) the election of the New
Board, as set forth in Proposal 2 of this Proxy Statement, by the shareholders

of each Fund. In addition, the consummation of the Transaction is contingent
upon approval by the shareholders of the Open-End Funds of a new advisory
agreement with HBAM and the election of the Nominees as directors of the Open-
End Funds. The Adoption Agreement also includes representations and warranties
and indemnification provisions. Although there is no assurance that the
Transaction will be consummated, if each of the terms and conditions is
satisfied or waived, the parties anticipate that the closing of the Transaction
will take place on or about July 14, 2008.

As stated above, the appointment of HBAM as the Funds' investment adviser
and the election of the New Boards have been approved by each Fund's current
Board and must be approved by the shareholders of the Funds. The Boards are
submitting the New Advisory Agreements for approval by the shareholders of the
Funds at the Special Meeting. If shareholders of each Fund approve the New
Advisory Agreement, the Boards are also submitting the Nominees for election at
the Annual Meeting to serve as directors of the Funds upon consummation of the
Transaction.

Section 15 of the 1940 Act requires that agreements under which persons
serve as investment advisers to a registered investment company must be approved
by a specified majority of the fund's shareholders. Please see the section
entitled "Voting Information" below. Accordingly, shareholders of each Fund are
being asked to approve the New Advisory Agreement with respect to their Fund to
allow HBAM to serve as the Fund's investment adviser. If the shareholders of
each Fund do not approve the New Advisory Agreement at the Special Meeting, the
Funds' Annual Meeting will be postponed and the current Board will continue in
office.

POST-TRANSACTION STRUCTURE AND OPERATIONS OF THE FUNDS

Following shareholder approval of the proposals described in this Proxy
Statement and the consummation of the Transaction, HBAM will become the Funds'
investment adviser and will have primary responsibility for the day-to-day
management of the Funds. It is expected that the Funds' investment objectives,
policies and restrictions (as set forth in the registration statement) will
remain the same after the Transaction. Furthermore, it is expected that because
of the Expense Limitation Agreements (defined below) the maximum net annual
operating expense ratio of the each Fund will be no higher than the maximum
current net annual operating expense ratio of that Fund for a period of at least
two years after the Transaction.

If the joint Annual Meeting is convened as scheduled and the Nominees are
elected by shareholders at the joint Annual Meeting, the Nominees will be
qualified and serve as directors of the Funds upon consummation of the
Transaction. Although their terms of office do not expire at the Annual Meeting,
the current Class I and Class III Directors will resign as directors of the
Funds effective upon consummation of the Transaction. Accordingly, upon
consummation of the Transaction, all the current members of the Boards, J.
Kenneth Alderman, Albert C. Johnson, James Stillman R. McFadden, W. Randall
Pittman, Mary S. Stone and Archie W. Willis, III, will no longer serve as
directors of the Funds. In addition, the New Boards are expected to appoint new
officers of the Funds.

Under the Adoption Agreement, Morgan Keegan has agreed to continue
providing certain administrative and fund accounting services to the Funds until
HBAM effects a transition to one or more other service providers.

The Funds are permitted to borrow up to one-third of the value of their
total assets, including such borrowings, for investment purposes. Such borrowing
is referred to as leveraging and the Funds have utilized collateralized bank
lines of credit for this purpose. As of [April 29], 2008, the Funds' borrowing
arrangements were as follows: Advantage Income Fund's collateralized $160
million bank line of credit matured in March 2008, was extended and is to be
fully repaid in May 2008, and will not be renewed. As of [April 29], 2008, the
outstanding balance on the line of credit was $[1] million. High Income Fund's
collateralized $125 million bank line of credit matured in December 2007, was
extended and fully repaid in April 2008, and has not been renewed. As of [April

29], 2008, the Fund had no available bank line of credit for leverage purposes.
Multi-Sector High Income's collateralized $180 million bank line of credit
matured in March 2008, was extended and is to be fully repaid in May 2008, and
will not be renewed. As of [April 29], 2008, the outstanding balance on the line
of credit was $[4] million. Strategic Income Fund has a collateralized $150
million bank line of credit which matures in July 2008. As of [April 29], 2008,
the outstanding balance on the line of credit was $[20] million. It is expected
that the line of credit will be repaid in full at or prior to maturity and will
not be renewed. It is also expected that HBAM will evaluate whether to establish
new bank lines of credit for leverage purposes consistent with applicable laws
and regulations.

HBAM AND ITS AFFILIATES

HBAM, a wholly-owned subsidiary of Brookfield Asset Management Inc.
("BAM"), is a Delaware corporation organized in February 1989 and a registered
investment adviser under the Advisers Act. The business address of HBAM and its
officers and directors is Three World Financial Center, 200 Vesey Street, 10th
Floor, New York, New York 10281-1010. As of March 31, 2008, HBAM and its
affiliates had approximately $21.4 billion in assets under management. HBAM's
clients include pension plans, foundations and endowments, insurance companies,
real estate investment trusts and closed-end investment companies. HBAM also
provides portfolio evaluation and consultation services. In its investment
process, HBAM focuses on relative value opportunities, particularly in the
mortgage-backed securities and asset-backed securities markets. BAM, an Ontario,
Canada corporation, is located at Brookfield Place, 181 Bay Street Suite 300,
P.O. Box 762, Toronto, Ontario M5J 2T3.

Mr. Clifford E. Lai serves as Director and Chairman of the Board of
Directors and Mr. John J. Feeney, Jr. serves as Director, Chief Executive
Officer and President of HBAM.

Under an existing consultant agreement with the Funds (the "Consulting
Agreement"), HBAM is responsible for furnishing the Funds with advice regarding
asset valuations. In this regard, HBAM is responsible for, among other things,
assisting the Funds, on a daily basis, in their determination of an estimated
"fair value" for certain portfolio securities. If the New Advisory Agreements
are approved by shareholders and the Transaction is consummated, the Consulting
Agreement will terminate, and HBAM will provide substantially similar services
under the New Advisory Agreements.

ANTICIPATED BENEFITS OF THE TRANSACTION

The Boards anticipate that the Transaction will benefit the Funds in a
number of ways, including:

o HBAM's depth of investment experience with asset-backed and
mortgage-backed securities should enhance the service to the
Funds' shareholders. HBAM has substantial experience,
qualifications and capabilities in managing investment companies
with fixed income assets that are comparable to the Funds'
portfolio holdings. HBAM has extensive investment management
experience with sectors of the fixed income market including
mortgage-backed securities, structured products, core fixed
income and corporate high-yield bonds and loans. HBAM's
corporate high-yield team of five investment professionals has
managed portfolios together for more than 12 years, and has
experience managing high yield funds for both retail and
institutional clients. They have experience managing more than
$5 billion at their prior firm, including more than $2 billion
in leveraged closed-end funds. HBAM has developed an in-depth
knowledge of the Funds' portfolio holdings as a result of
providing asset valuation consulting services to the Funds since
August 2007.

o It is expected that each of the Fund's investment objectives,
policies and restrictions (as set forth in the registration
statement) will remain the same after the Transaction.
Nevertheless, HBAM is also expected to review the current
holdings and composition of the Funds' portfolios and may,
consistent with applicable investment policies and restrictions,
make certain changes in any Fund's portfolio investments. In
selecting securities to purchase or sell, HBAM has indicated that
it will seek to improve the overall risk profile of the
portfolios in light of current market conditions, generate
current income, enhance liquidity and improve the Funds' ability
to obtain favorable leverage arrangements. There is no guarantee
that HBAM will achieve these goals. Moreover, restructuring of a
Fund's portfolio will involve transaction costs, which will be
borne by the Fund, and may result in the realization of taxable
capital gains or losses.

o As a result of the Expense Limitation Agreements (defined below)
the maximum net annual operating expense ratio of each Fund will
be no higher than the maximum current net annual operating
expense ratio of the Fund for a period of at least two years
after the Transaction.

SPECIAL MEETING-PROPOSAL 1: APPROVAL OF A NEW ADVISORY AGREEMENT BETWEEN EACH
FUND AND HBAM

At the joint Special Meeting, shareholders of each Fund are being asked to
approve the New Advisory Agreement between their Fund and HBAM. If the
shareholders approve the New Advisory Agreements, MAM is expected to resign as
investment adviser to each Fund, effective upon closing of the Transaction, and
HBAM will serve as the Fund's investment adviser upon termination of the Fund's
Current Advisory Agreement with MAM. The approval of the New Advisory Agreement
by shareholders is contingent upon the election by shareholders of the Nominees
identified in Proposal 2 as directors of the Fund and the consummation of the
Transaction.

REASONS FOR BOARD APPROVAL AND RECOMMENDATION

BACKGROUND. In late 2007, MAM and HBAM began discussions regarding HBAM's
interest in taking over the management of the Funds. MAM requested and received
a proposal from HBAM under which HBAM would serve as investment adviser to the
Funds. The details of the proposal from HBAM (the "Proposal") were discussed
with the Independent Directors during a telephonic meeting on January 16, 2008
and at an in-person meeting held on January 23, 2008. MAM represented to the
Boards that MAM believed that the Proposal was in the best interests of Fund
shareholders. The elements of the Proposal have been incorporated into the
Adoption Agreement.

The Boards or Independent Directors met telephonically several times to
discuss the Proposal. During these meetings, and at an in-person meeting on
April 21, 2008, the Boards evaluated the resources, capabilities and performance
of HBAM in order to make an informed decision as to whether the engagement of
HBAM would be in the best interests of each Fund and its shareholders. The
Boards requested and received information and materials from HBAM and MAM and
familiarized itself with, among other things, HBAM's structure, personnel,
investment philosophy and performance, financial condition, and organizational
and compliance resources. The Boards also met in person with representatives of
HBAM on two occasions, and individual Board members conducted further meetings
at HBAM's offices.

The Boards considered the details of the Proposal. Among other things, the
Boards considered the New Advisory Agreements, the Expense Limitation Agreements
(defined below) and post-transaction services for the Funds. In addition, the
Boards considered that the Proposal contemplates the election of the New Boards,
which would consist of individuals proposed by HBAM, and the current members of
the Boards would no longer serve as directors. The Boards noted that election of
the New Boards' members would be contingent upon shareholder approval of the New

Advisory Agreements. Further, the Boards noted that, under the Adoption
Agreement, HBAM agreed to pay Morgan Keegan a fee of up to $8 million based on
the Funds' annualized advisory fees in two payments over a two year period and,
with respect to the Open-End Funds, to pay Morgan Keegan a fee for distribution
assistance in respect of the Open-End Funds for a period of one year following
the Transaction closing date equal to 0.15% of the Open-End Funds' average daily
net asset value. The Boards also noted that in connection with the Transaction,
MAM and Regions will agree to indemnify each Fund for amounts payable by the
Fund to MAM's or Region's officers, directors or employees, or any corporate
affiliate of MAM or Regions, pursuant to any agreement or indemnification
obligation of the Funds to such persons, and that MAM and Regions also will
waive all rights of indemnification under any agreement or indemnification
obligation of the Funds. As part of the Proposal, MAM and Regions agreed to
provide certain indemnifications to HBAM. HBAM, the Funds, the Closed-End Funds,
MAM and its affiliates have entered into an agreement to permit HBAM and the
Funds to use the names and marks Morgan Keegan, Morgan, Regions, Regions Morgan
Keegan and RMK as a distinctive part of their names for a period 60 days after
the closing of the Transaction.

After careful consideration and review of, and discussion about, all the
materials and information received from all parties, the Boards determined it
was in the best interests of the Funds to approve HBAM as the new investment
adviser. As stated above, the directors who were present at the in-person
meeting held on April 21, 2008, including all of the Independent Directors,
unanimously approved the New Advisory Agreement between HBAM and each Fund and
unanimously recommended that each Fund's shareholders approve the New Advisory
Agreement. A summary of the Boards' consideration is provided below in the
section below entitled "Independent Directors Committees and Board
Considerations of the New Advisory Agreements."

INDEPENDENT DIRECTORS COMMITTEE AND BOARD CONSIDERATIONS OF THE NEW
ADVISORY AGREEMENTS. In approving the New Advisory Agreements and determining to
submit them to shareholders for approval, the directors considered a wide
variety of factors. The Independent Directors were assisted by independent legal
counsel during their deliberations and received a memorandum from such counsel
discussing the legal standards for their consideration of the New Advisory
Agreements and related matters. They also met in person with such counsel
separately from representatives of MAM and HBAM to discuss the Proposal. In
evaluating the New Advisory Agreements, the Boards reviewed information
furnished by HBAM and MAM in response to questions submitted by independent
legal counsel on their behalf.

In approving the New Advisory Agreements, the Boards determined that the
terms of the New Advisory Agreements are fair and reasonable and that approval
of the New Advisory Agreement on behalf of each Fund is in the best interests of
that Fund. In their deliberations, the Boards did not identify any single factor
or information as all-important or controlling, and each director may have
attributed different weights to the various factors. Among other things, the
directors considered:

(1) THE QUALIFICATIONS OF HBAM, INCLUDING THE NATURE, EXTENT AND QUALITY OF
THE SERVICES TO BE PROVIDED. The Boards first considered whether HBAM was
qualified to assume the management of the Funds. The Boards considered the
reputation, financial strength, key services and operations, resources and
expertise of HBAM as a firm, including the structure of its organization, its
relationships, its historical expertise in the asset-backed securities market,
coupled with expanding capabilities in the core fixed income and high yield
sectors, and its ability to attract and maintain highly-qualified, professional
talent. The Boards noted particularly HBAM's research team has designed advanced
proprietary investment technology platforms for the monitoring, analysis and
management of risk/reward attributes across all sectors of the fixed income
market. Further, the Boards noted that HBAM manages in excess of $21 billion for
a client base including, but not limited to, insurance companies, pension funds,
financial institutions, registered investment companies and foundations. The
Boards considered the quality and nature of the proposed investment advisory
services to be provided to the Funds by HBAM as compared to those provided by
MAM.

Next, the Boards considered the qualifications and experience of the
investment advisory personnel at HBAM. In particular, the Boards considered the
background and expertise of Mr. Dana E. Erikson, CFA, Senior Portfolio Manager
and the Head of the High Yield Team (the "High Yield Team"), as the successor
lead portfolio manager of the Funds, with the day-to-day responsibility for the
management of the Funds. The Boards noted that Mr. Erikson is responsible for
HBAM's corporate high yield exposures and the establishment of portfolio
objectives and strategies. The Boards also noted the experience of the other
members of HBAM's High Yield Team and considered that HBAM applies a team-
oriented approach to the fundamental analysis that drives its relative value-
oriented investment decision-making process. The Boards concluded that the High
Yield Team's experience and credentials made them well qualified to manage each
Fund's portfolio in accordance with its investment objectives and strategies,
and that there was potential that shareholders would benefit from the High Yield
Team's management of the Funds.

The Boards further considered HBAM's methodology for compensating the
Funds' portfolio manager and the rest of the portfolio management, trading and
research team. The Boards also considered HBAM's investment philosophy and its
investment outlook for the Funds. The Boards noted that HBAM's commitment to a
relative value investment philosophy has continued throughout its history.
Additionally, the Boards considered whether HBAM would be able to meet the
compliance demands set forth under various regulations. The Boards reviewed
materials regarding HBAM's compliance program and code of ethics and discussed
the compliance program with HBAM's Chief Compliance Officer.

The Boards concluded that the intended scope of such services was
satisfactory and comparable to those currently provided by MAM and that there
would be no diminution of the scope or quality of the advisory services provided
to the Funds under the New Advisory Agreements.

(2) THE INVESTMENT PERFORMANCE OF HBAM. The Boards considered the
investment performance of HBAM's registered investment companies and the
performance record of the High Yield Team. The Boards compared the long-term
performance of the High Yield Team's composite to its benchmark and to the
performance of the Funds. Based on these factors the Boards concluded that the
overall performance results supported the approval of the New Advisory
Agreements.

(3) THE REASONABLENESS OF THE ADVISORY FEES. In evaluating the costs of the
services to be provided by HBAM under the New Advisory Agreements and the
profitability of HBAM with respect to each Fund, the Boards considered, among
other things, whether advisory fees or other expenses would change as a result
of the new arrangements. The Boards noted that the fees payable under the New
Advisory Agreements would be the same as those payable under the Current
Advisory Agreements. As part of their analysis, the Boards examined the fees
payable under the New Advisory Agreements and the total expense ratio of each
Fund in comparison to the fees and total expense ratios for its peer group. The
Boards noted that the advisory fees and the total expense ratios for each Fund
were near the mean of figures provided by an independent data service for other
leveraged high current yield funds while the advisory fees were at, and the
total expense ratios were slightly above, the median of figures for the other
leveraged high current yield funds. The Boards further noted that pursuant to
the Expense Limitation Agreements (defined below), HBAM would agree to waive a
portion of its fees and reimburse certain expenses of the Funds for a period of
two years after each New Advisory Agreement takes effect so that the maximum
total annual operating expense ratio of each Fund does not exceed the maximum
current contractual expense limitation arrangement between MAM and the Fund.

The Boards then considered HBAM's management of other registered investment
companies and similarly managed accounts. The Boards noted that the advisory
fees paid by the other registered investment companies and similarly managed
accounts were comparable to the advisory fees proposed to be paid by each Fund.

The Boards concluded that the level of advisory fee to be charged to each Fund
was reasonable in light of these factors.

(4) THE PROFITABILITY OF HBAM WITH RESPECT TO ITS RELATIONSHIP WITH EACH
FUND. The Boards considered what benefits HBAM would derive from the management
of the Funds and whether it would have a financial interest in the matters that
were being considered. The Boards reviewed information regarding the estimated
profitability to HBAM of its relationship with the Funds and considered whether
the profits would be reasonable. The profitability analysis took into
consideration fall-out benefits from HBAM's relationship with the Funds. The
Boards found that the estimated profits to be realized by HBAM from its
relationship with the Funds were likely to be reasonable.

(5) THE EXTENT TO WHICH ECONOMIES OF SCALE MIGHT BE REALIZED AS EACH FUND
GROWS. The Boards considered whether economies of scale would be realized by the
Funds at higher asset levels. The Boards also assessed whether certain of HBAM's
costs would increase if asset levels rise. The Boards considered each Fund's
current asset size and concluded that under foreseeable conditions, they were
unable to assess at the present time whether economies of scale would be
realized if the Funds were to experience significant asset growth. The Boards
noted that HBAM has represented that it expects to analyze whether economies of
scale can be recognized in the future should the Funds' assets under management
grow and, should economies of scale emerge, would recommend an appropriate
arrangement to share the benefits of such economies with Fund shareholders.

(6) POSSIBLE CONFLICTS OF INTEREST. The Boards also discussed HBAM's
methods of dealing with conflicts of interest. The Boards noted that HBAM has
adopted compliance policies and procedures that are designed to address the
various conflicts of interest that may arise for HBAM and the individuals that
it employs. For example, the Boards noted that HBAM seeks to minimize the
effects of competing interests for the time and attention of portfolio managers
by assigning portfolio managers to manage funds and accounts that share a
similar investment style. The Boards further noted that HBAM also has adopted
trade allocation procedures that are designed to facilitate the fair allocation
of limited investment opportunities among multiple funds and accounts.

BOARD APPROVAL AND RECOMMENDATION OF THE NEW ADVISORY AGREEMENTS. As a
result of the considerations described above, the Boards, including a majority
of the Independent Directors, determined to approve the New Advisory Agreements
with HBAM. Based on these considerations, the Boards were satisfied that: (1)
the Funds were likely to benefit from the nature, quality and extent of HBAM's
services; and (2) HBAM has the resources to provide the services and to carry
out its responsibilities under the New Advisory Agreements. The Boards,
including a majority of the Independent Directors, concluded that the terms of
the New Advisory Agreements are fair and reasonable, that the fees stated
therein, including ancillary benefits, are reasonable in light of the services
to be provided to the Funds, and for these reasons the Boards approved the New
Advisory Agreements and concluded that the New Advisory Agreement should be
recommended to each Fund's shareholders for their approval. Based on the
foregoing, the Boards, including a majority of the Independent Directors, who
were present at the meeting held in person on April 21, 2008, unanimously voted
to approve and to recommend to the shareholders of each Fund that they approve
the New Advisory Agreement.

Under the 1940 Act, a registered investment company cannot enter into a new
investment advisory agreement unless the shareholders of such fund vote to
approve the new agreement. Accordingly, the Special Meeting is being held to
seek shareholder approval of the New Advisory Agreements. If the shareholders of
the Funds approve the New Advisory Agreements, the New Advisory Agreements will
take effect on the closing date of the Transaction.

TERMS OF THE NEW ADVISORY AGREEMENT

The form of the New Advisory Agreement is attached as Appendix B to this
Proxy Statement and the description of its terms in this section is qualified in
its entirety by reference to Appendix B. The terms of the New Advisory Agreement
are substantially similar to those of the Current Advisory Agreements. However,
there are certain differences of which you should be aware. The following is a
description of the New Advisory Agreement. A comparison of the New Advisory
Agreements and the Current Advisory Agreements is set forth below in the section
entitled "Differences Between the Current Advisory Agreements and the New
Advisory Agreements."

INVESTMENT ADVISORY SERVICES. HBAM will serve as the investment adviser to
the Funds pursuant to the New Advisory Agreements. In addition to providing
investment advisory services to a Fund, the New Advisory Agreement provides that
HBAM will (1) act as investment adviser and direct the investment and
reinvestment of the Fund's assets and in connection therewith will have complete
discretion in purchasing and selling securities and other assets for the Fund
and in voting, exercising consents and exercising all other rights pertaining to
such securities and other assets on behalf of the Fund, and (2) arrange for the
purchase and sale of securities and other assets held in the investment
portfolio of the Fund, including the selection of entities through which such
transactions are to be effected. The New Advisory Agreements permit HBAM to
effect securities transactions on behalf of the Funds through affiliated persons
of HBAM. The New Advisory Agreements also permit HBAM to compensate, through
higher commissions, brokers and dealers (other than its affiliates) who provide
investment research and analysis to the Funds and to other advisory accounts
over which it or its affiliates exercise investment discretion in accordance
with Section 28(e) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act").

During the fiscal year ended March 31, 2008, the Funds did not pay any
commissions to affiliated brokers.

ADVISORY FEES AND EXPENSES. Each Fund will pay HBAM an advisory fee based
on its average daily net assets. The advisory fee will be equal to an annual
rate based on the following fee:

--------------------------------------------------------------------------------
Fund % of Fund's daily net assets paid to HBAM
--------------------------------------------------------------------------------
RMK Advantage Income Fund, Inc. 0.65%
--------------------------------------------------------------------------------
RMK High Income Fund, Inc. 0.65%
--------------------------------------------------------------------------------
RMK Multi-Sector High Income Fund, Inc. 0.65%
--------------------------------------------------------------------------------
RMK Strategic Income Fund, Inc. 0.65%
--------------------------------------------------------------------------------

The advisory fees to be paid under the New Advisory Agreements are the same
as those paid under the Current Advisory Agreements. Please see the discussion
below.

The following table sets forth the aggregate amount of advisory fees paid
by the Funds to MAM pursuant to the Current Advisory Agreements during the last
fiscal year ended March 31, 2008, pursuant to the Current Advisory Agreements:

--------------------------------------------------------------------------------
Fund Aggregate Fee Paid During
the Last Fiscal Year
--------------------------------------------------------------------------------
RMK Advantage Income Fund, Inc. $
--------------------------------------------------------------------------------
RMK High Income Fund, Inc. $
--------------------------------------------------------------------------------
RMK Multi-Sector High Income Fund, Inc. $
--------------------------------------------------------------------------------
RMK Strategic Income Fund, Inc. $
--------------------------------------------------------------------------------

Under the New Advisory Agreement, each Fund will bear the expenses of its
operation, except those specifically allocated to HBAM under the New Advisory
Agreement or under any separate agreement between the Fund and HBAM. Subject to
any separate agreement or arrangement between the Fund and HBAM, the expenses
allocated to a Fund include, but are not limited to: (i) organizational
expenses; (ii) legal and audit expenses; (iii) borrowing expenses; (iv)
interest; (v) taxes; (vi) governmental fees; (vii) fees, voluntary assessments
and other expenses incurred in connection with membership in investment company
organizations; (viii) the cost (including brokerage commissions and issue or
transfer taxes or other charges, if any) of securities purchased or sold by the
Fund and any losses incurred in connection therewith; (ix) fees of custodians,
transfer agents, registrars, proxy voting services, pricing or valuation
services or other agents or service providers; (x) expenses of preparing share
certificates; (xi) expenses relating to the redemption or repurchase of shares;
(xii) expenses of registering and qualifying shares for sale under applicable
federal or state law and maintaining such registrations and qualifications;
(xiii) expenses of preparing, setting in print, printing and distributing
prospectuses, proxy statements, reports, notices and dividends to shareholders;
(xiv) cost of stationery; (xv) costs of shareholders and other meetings of the
Fund, including any expenses relating to proxy solicitation and vote tabulation;
(xvi) compensation and expenses of the independent directors of the Fund, and
officers of the Fund who are not officers, directors or employees of HBAM or its
affiliates, if any; (xvii) the Fund's pro rata portion of premiums of any
fidelity bond and other insurance covering the Fund and its officers and
directors; and (xviii) the fees and other expenses of listing and maintaining
the Fund's shares on the New York Stock Exchange or any other national stock
exchange.

SERVICES TO OTHER CLIENTS. The New Advisory Agreements do not limit the
freedom of HBAM or any of its affiliates to render investment management or
administrative services to other investment companies, to act as investment
adviser or investment counselor to other persons, firms or corporations, or to
engage in other business activities. HBAM acts as investment adviser or sub-
adviser to other registered investment companies with similar investment
objectives and policies as the Funds. The following table sets forth the name,
asset size and compensation received by HBAM for providing advisory or sub-
advisory services to these other funds.

ADVISORY FEE RATE
NET ASSETS AS OF (AS A PERCENTAGE OF
NAME OF SIMILAR FUND MARCH 31, 2008 AVERAGE DAILY NET ASSETS)
-------------------- -------------- ------------------------

The Hyperion Brookfield Total Return Fund, Inc. $209 million 0.65%

The Hyperion Brookfield Strategic Mortgage Income Fund, Inc. $ 91 million 0.65%

Hyperion Brookfield Collateralized Securities Fund, Inc. $328 million 0.41%

Hyperion Brookfield Income Fund, Inc. $145 million 0.50%

LIMITATION OF LIABILITY. The New Advisory Agreement provides that neither
HBAM nor any director, officer, employee, agent or controlling person of HBAM
shall be liable for any act or omission or for any loss sustained by a Fund in
connection with matters to which the New Advisory Agreement relates, unless due
to willful misfeasance, bad faith, gross negligence or reckless disregard of
their duties under the New Advisory Agreement.

TERM OF AGREEMENT. If approved by the shareholders of the Funds, the New
Advisory Agreements will take effect on the closing date of the Transaction and
will remain in effect for an initial term of two years. Thereafter, the New
Advisory Agreement will remain in effect with respect to a Fund from year to
year if approved annually (i) by the vote of the holders of a majority of the
outstanding voting securities (as defined in the 1940 Act) of the Fund or by the
Fund's Board of Directors, and (ii) by the vote, cast in person at a meeting
called for such purpose, of a majority of the Independent Directors.

TERMINATION. The New Advisory Agreement may be terminated, without penalty,
at any time by either party upon at least 60 days' prior written notice to the
other party; provided that in the case of termination by a Fund, the termination
has been authorized (i) by a majority of the Fund's directors or (ii) by a vote
of a majority of the outstanding voting securities (as defined in the 1940 Act)
of the Fund. Each New Advisory Agreement terminates automatically in the event
of its assignment (as defined in the 1940 Act).

DIFFERENCES BETWEEN THE CURRENT ADVISORY AGREEMENTS AND NEW ADVISORY AGREEMENTS

The following are the key differences between the New Advisory Agreements
and the Current Advisory Agreements:

o There are four Current Advisory Agreements, one between each
Fund and MAM. These agreements are substantially similar and
only differ with respect to Fund party and the date of the
agreement.

o Under the Current Advisory Agreements, MAM does not have the
specific authority to delegate one or more of its
responsibilities to sub-advisers or administrators. The New
Advisory Agreements give such authority to HBAM, subject to
Board approval and, to the extent required by the 1940 Act,
shareholder approval.

o The New Advisory Agreements provide that HBAM shall not be
liable for delays or errors occurring by reason of circumstances
beyond its control, including, but not limited to, acts of civil
or military authority, national emergencies, work stoppages,
fire, flood, catastrophe, acts of God, insurrection, war, riot,
or failure of communication or power supply. In the event of
equipment breakdowns beyond its control, HBAM is required to
take reasonable steps to minimize service interruptions but will
have no liability with respect thereto.

o The New Advisory Agreements will be governed by the laws of the
State of New York whereas the Current Advisory Agreements are
governed by the laws of the State of Maryland, in each case to
the extent that state law has not been preempted by the
provisions of any law of the United States.

OTHER AGREEMENTS RELATING TO THE FUNDS

NEW EXPENSE LIMITATION AGREEMENTS. In the interest of limiting the expenses
of the Funds following the transition of advisory services from MAM to HBAM, the
Boards have approved, and upon consummation of the Transaction HBAM will enter
into, an expense limitation agreement with respect to each Fund (the "Expense
Limitation Agreements") whereby HBAM will agree to waive its fees and/or
reimburse certain expenses of the Fund for a period of two years after the New
Advisory Agreements take effect so that the total annual operating expenses
(excluding brokerage, interest expenses and taxes, acquired fund fees and
expenses) of each Fund does not exceed 1.30% of average annual net assets of the
Fund.

The terms of the Expense Limitation Agreements are substantially similar
to the terms under the current contractual expense limitation arrangements with
MAM. MAM has contractually agreed to waive fees and reimburse expenses through
October 31, 2008, so that the total annual operating expenses (excluding
brokerage, interest expenses and taxes) of each Fund do not exceed 1.30% of
average annual net assets of the Fund. MAM's current contractual expense
limitation arrangements with respect to each Fund will terminate upon
termination of the Current Advisory Agreements.

FUND ADMINISTRATIVE AND ACCOUNTING SERVICES. The Funds have each entered
into an Accounting and Administrative Services Agreement with Morgan Keegan.
Under the terms of the agreements, Morgan Keegan provides portfolio accounting
services and certain administrative personnel and services to the Funds for an
annual fee of 0.15% based on a percentage of each Fund's average daily total
assets minus the sum of accrued liabilities other than debt entered into for
purposes of leverage. It is expected that administrative and certain other
services will be transitioned to a third party shortly after consummation of the
Transaction.

SECTION 15(f) OF THE 1940 ACT

Section 15(f) of the 1940 Act permits an investment adviser of a registered
investment company (or any affiliated person of the investment adviser) to
receive any amount or benefit in connection with a sale of securities of, or any
other interest in, the investment adviser, provided that two conditions are
satisfied. First, an "unfair burden" may not be imposed on the investment
company as a result of the transaction, or any express or implied terms,
conditions or understandings applicable to the transaction. The term "unfair
burden" (as defined in the 1940 Act) includes any arrangement during the
two-year period after the transaction whereby the investment adviser (or
predecessor or successor adviser), or any "interested person" (as defined in the
1940 Act) of any such adviser, receives or is entitled to receive any
compensation, directly or indirectly, from the investment company or its
security holders (other than fees for bona fide investment advisory or other
services), or from any person in connection with the purchase or sale of
securities or other property to, from or on behalf of the investment company
(other than ordinary fees for bona fide principal underwriting services).
Second, during the three-year period after the transaction, at least 75% of the
members of the investment company's board of directors cannot be "interested
persons" (as defined in the 1940 Act) of the investment adviser or the
predecessor adviser of such investment company.

MAM and HBAM believe that the Transaction will not result in the imposition
of an "unfair burden" on the Funds. In addition, HBAM has agreed that for two
years after the consummation of the Transaction, it will use its commercially
reasonable efforts to take (or refrain from taking, as the case may be) such
actions as are necessary to ensure that: (i) at least 75% of each Fund's
directors are Independent Directors, and (ii) no "unfair burden" (as defined in
the 1940 Act) is imposed on the Funds as a result of the Transaction. At the
present time, more than 75% of the directors are Independent Directors. If
shareholders approve the election of all of the Nominees identified in Proposal
2, it is expected that more than 75% of the Funds' directors after the
Transaction will be Independent Directors.

REQUIRED VOTE

Approval of this Proposal 1 by each Fund requires the affirmative vote of a
majority of the outstanding voting securities (as defined in the 1940 Act) of
the Fund, which means the vote (i) of 67% or more of the shares of the Fund
present at the Special Meeting if the holders of more than 50% of the Fund's
outstanding shares are present or represented by proxy, or (ii) of more than 50%
of the outstanding shares of the Fund, whichever is the less. Notwithstanding
approval of the New Advisory Agreements by shareholders of the Funds, the New
Advisory Agreements will not take effect unless the shareholders of each Fund
also elect the Nominees to serve as new directors and the Transaction is
consummated.

THE BOARDS RECOMMEND THAT SHAREHOLDERS OF THE FUNDS
VOTE "FOR" PROPOSAL 1.

ANNUAL MEETING-PROPOSAL 2: ELECTION OF BOARDS OF DIRECTORS

Each Board, based on the recommendation of its Independent Directors
Committee, has nominated the five Nominees for election as directors of the
Funds. Shareholders of the Funds are being asked to consider the election of the
Nominees. The Nominees are Louis P. Salvatore, Robert F. Birch, Stuart A.
McFarland, Rodman L. Drake and Clifford E. Lai. The Nominees are individuals who
were proposed by HBAM and currently serve as directors of other registered
investment companies that are advised by HBAM or its affiliates.

The Boards, based upon the recommendation of the Independent Directors
Committees, have also approved a decrease in the number of directors of the
Funds from six to five, with such decrease to take effect upon consummation of
the Transaction. Currently, each Board consists of six members including five
Independent Directors. The current Independent Directors are James Stillman R.
McFadden, Albert C. Johnson, W. Randall Pittman, Mary S. Stone and Archie W.
Willis, III. The current director who is an interested person (as defined in the
1940 Act) of the Funds (the "Interested Director") is J. Kenneth Alderman. Mr.
Alderman also serves as Chairman.

It is expected that the current directors will no longer serve as directors
following the election of the Nominees and the consummation of the Transaction.
However, the decrease in the number of directors of the Company is contingent
upon, and the Nominees if elected at the Annual Meeting will not be qualified as
directors until, the consummation of the Transaction. Accordingly, if the
Transaction is not completed for any reason, the current directors will continue
to hold office until their respective successors are elected and qualified, or
until the earlier of a director's death, resignation or removal.

The terms of office of the current Class II Directors, Mr. Pittman and Ms.
Stone, expire at the Annual Meeting. The terms of current Class I Directors, Mr.
McFadden and Mr. Alderman, and the current Class III Directors, Mr. Johnson and
Mr. Willis, expire at the 2009 and 2010 annual meetings, respectively. The
current Class I and Class III Directors will resign effective upon consummation
of the Transaction.

If elected and qualified, each Nominee will hold office as a director until
his successor is elected and qualified, or until the earlier of the director's
death, resignation or removal. Any director may be removed by shareholders, with
or without cause, by the affirmative vote of a majority of all the votes
entitled to be cast generally for the election of directors.

BOARD CONSIDERATION OF THE NOMINEES

At its April 21, 2008 meeting, the Boards considered proposals related to
the Transaction whereby HBAM would become the new investment adviser to the
Funds. The Transaction also contemplates that the New Boards would be elected
and that the current members of the Boards would no longer serve as directors
following consummation of the Transaction.

Each Nominee was proposed to the Independent Directors by HBAM as
contemplated by the Adoption Agreement. In selecting and nominating the
Nominees, the Independent Directors Committees and the Boards took into
consideration the qualifications, experience and background of each Nominee. In
addition, members of the Independent Directors Committees met in person with
each Nominee prior to the April 21, 2008 meeting. In particular, the Independent
Directors Committees and the Boards considered each Nominee's familiarity with
fixed income funds, including mortgage-backed and asset-backed securities, as a
result of his current service as a director of other comparable funds, his
expertise and his knowledge of the investment company industry.

INFORMATION CONCERNING NOMINEES

Each Nominee has consented to being named in this Proxy Statement and has
agreed to serve as a director of the Funds if elected; however, should any
Nominee become unable or unwilling to accept nomination or election, the persons
named in the proxies will exercise their voting power in favor of such other
person or persons as the Boards may recommend. There are no family relationships
among the Nominees.

The following table sets forth information concerning the Nominees:

--------------------------------------------------------------------------------------------------------------------------------
POSITION(S) NUMBER OF OTHER
NAME, HELD WITH PRINCIPAL PORTFOLIOS IN DIRECTORSHIP(S)
ADDRESS (1) FUNDS, OCCUPATION(S) DURING FUND HELD BY
AND AGE TERM OF OFFICE PAST FIVE YEARS COMPLEX DIRECTOR
AND LENGTH OF OVERSEEN BY
TIME SERVED DIRECTOR (2)

--------------------------------------------------------------------------------------------------------------------------------
CLASS I DISINTERESTED DIRECTORS TO SERVE UNTIL 2009 ANNUAL MEETING OF SHAREHOLDERS:
--------------------------------------------------------------------------------------------------------------------------------

Robert F. Birch None President of 11 Director and/or Trustee of several
Age 72 New America investment companies advised by HBAM
High Income or by its affiliates (1998-Present);
Fund (1992- Director of New America High Income
Present). Fund (1992-Present); Director of
Brandywine Funds (3) (2001-Present).
--------------------------------------------------------------------------------------------------------------------------------
Stuart A. McFarland None Managing Partner 11 Director and/or Trustee
Age 60 of Federal City of several investment companies
Capital Advisors advised by HBAM or its
(1997-Present). affiliates (2006-Present);
Director of Brandywine Funds
2003-Present); Director of
Director of New Castle Investment
Corp. (2000-Present); Chairman
and Chief Executive Officer of
Federal City Bancorp, Inc.
(2005-2007.
--------------------------------------------------------------------------------------------------------------------------------
CLASS II DISINTERESTED DIRECTOR TO SERVE UNTIL 2010 ANNUAL MEETING OF SHAREHOLDERS:
--------------------------------------------------------------------------------------------------------------------------------

Rodman L. Drake None General Partner of 11 Chairman (since 2003) and Director
Resource Capital II & of several investment companies
Age 65 III CIP L.P. (1998- advised by HBAM or by its
2006); Co-founder of affiliates (1989-Present);
Baringo Capital LLC Director, and/or Lead Director of
Crystal River Capital, Inc.
(2005-Present); Director of Celgene
Corporation (April 2006-Present);
Director of Student Loan
Corporation (2005-Present);
Director of Apex Silver Corp
(2007-Present); Director of Jackson

-------------------------------------------------------------------------------------------------------------------------------

Hewitt Tax Services Inc.
(2004-Present); Director of Animal
Medical Center (2002-Present);
Director and/or Lead Director of
Parsons Brinckerhoff, Inc.
(1995-2008); Trustee and/or
Chairman of Excelsior Funds
(1994-2008; Trustee of Columbia
Atlantic Funds (2007-Present).
-------------------------------------------------------------------------------------------------------------------------------
CLASS III DISINTERESTED DIRECTOR TO SERVE UNTIL 2011 ANNUAL MEETING OF SHAREHOLDERS:
-------------------------------------------------------------------------------------------------------------------------------
Louis P. Salvatore None Employee of 11 Director of several investment
Age 61 Arthur companies advised by HBAM or by its
Andersen LLP affiliates (2005-Present); Director
(2002- of Crystal River Capital, Inc.
Present); (2005-Present); Director of Turner
Partner of Corp. (2003-Present); Director of
Arthur Jackson Hewitt Tax Services, Inc.
Andersen LLP (2004-Present).
(1977-2002).
-------------------------------------------------------------------------------------------------------------------------------
CLASS III INTERESTED DIRECTOR TO SERVE UNTIL 2011 ANNUAL MEETING OF SHAREHOLDERS:
-------------------------------------------------------------------------------------------------------------------------------
Clifford E. Lai None Managing Partner of 11
Age 54 Brookfield Asset
Management, Inc.
(2006-Present);
Chairman (2005-
Present), Chief
Executive Officer
(1998-2007),
President (1998-2006)
and Chief Investment
Officer (1993-2002)
of the Advisor;
President, Chief
Executive Officer and
Director of Crystal
River Capital, Inc.
(2005-Present);
President and Director
of several investment
companies advised by
the Advisor or by its
affiliates (1995-
Present); and Co-
Chairman (2003-2006)
and Board of Managers
(1995-2006) of Hyperion
GMAC Capital Advisors,
LLC (formerly Lend
Lease Hyperion Capital,
LLC).
-------------------------------------------------------------------------------------------------------------------------------

(1) The address of each Nominee is Three World Financial Center, 200 Vesey
Street, 10th Floor, New York, New York 10281-1010.

(2) The number includes the Funds, the Open-End Funds and four registered
investment companies currently overseen by the Nominees.

OWNERSHIP OF FUND SHARES

The following table sets forth, for each Nominee, the dollar range of
equity shares beneficially owned in the Funds as of May 5, 2008. The information
as to beneficial ownership is based on statements furnished to the Funds by each
Nominee. Beneficial ownership means having directly or indirectly, through any
contract, arrangement, understanding, relationship or otherwise, a direct or
indirect pecuniary interest in shares of a Fund, and includes shares of the
Funds held by members of the person's immediate family sharing the same
household; provided, however, that the presumption of such beneficial ownership
may be rebutted. Unless otherwise noted, each Nominee's individual beneficial
shareholdings of a Fund constitute less than 1% of the outstanding shares of the
Fund.

AGGREGATE DOLLAR RANGE OF
EQUITY SECURITIES IN
INVESTMENT COMPANIES
AGGREGATE DOLLAR RANGE OF OVERSEEN BY DIRECTOR IN
NAME OF NOMINEE EQUITY SECURITIES IN THE FUNDS FUND COMPLEX*

Louis P. Salvatore None

Robert F. Birch None

Stuart A. McFarland None

Rodman L. Drake None

Clifford E. Lai None

* This column reflects information regarding ownership of equity securities
issued by funds in the Regions Morgan Keegan fund complex.

BOARD AND COMMITTEE MEETINGS

The Boards met 17 times during the Funds' fiscal year ended March 31, 2008.
Each director attended at least 75% of the total number of meetings of the
Boards and of any committee of which he or she was a member during that year.
Each Board has an Audit Committee, an Independent Directors Committee and a
Qualified Legal Compliance Committee.

The Audit Committees are composed of all of the Independent Directors. The
members of the Audit Committees are Messrs. Johnson, McFadden, Pittman and
Willis, and Ms. Stone. The principal functions of the Audit Committee are to
select independent accountants to conduct the annual audits of a Fund's
financial statements, review with the independent accountants the outline, scope
and results of the annual audit, and review the performance and approve all fees
charged by the independent accountants for audit, audit-related and other
professional services. In addition, the Audit Committee meets with the
independent accountants and representatives of management to review accounting
activities and areas of financial reporting and control. It is anticipated that
the New Boards will appoint new members of the Audit Committees.

The Audit Committees met six times during the Funds' fiscal year ended
March 31, 2008. As of the date of this Proxy Statement, the audits of the
financial statements for the fiscal year ended March 31, 2008 have not been
completed and the Audit Committees have not yet met to review the Funds' 2008
audited financial statements. The Audit Committees are expected to meet in May
2008 to review the Funds' 2008 audited financial statements and thereafter a
copy of the report of the Audit Committees will be available to shareholders
upon request.

The Independent Directors Committees are composed of all of the Independent
Directors. The members of the Independent Directors Committees are Messrs.
Johnson, McFadden, Pittman and Willis, and Ms. Stone. The Independent Directors
Committees must determine at least annually with respect to the Funds' advisory
agreements and periodically with respect to other arrangements whether these
arrangements should be approved for continuance. The Independent Directors
Committees also are responsible for evaluating and recommending the selection
and nomination of candidates for election as directors of the Funds, including
Independent Directors, assessing whether directors should be added or removed
from the Boards and recommending to the Boards policies concerning Independent
Director compensation and retirement, investment in the Funds, Board and
committee governance procedures and resources for Independent Directors and
periodically reviewing compliance with any such policies adopted. The
Independent Directors Committees also nominate candidates for membership on all
Board committees. Each Board has adopted a written charter for its Independent
Directors Committee.

While there is no formal list of qualifications, the Independent Director
Committees consider, among other things, whether prospective nominees have
distinguished records in their primary careers, high integrity and substantive
knowledge in areas important to the Boards' operations, such as a background or
education in finance, auditing or the workings of the securities markets. For
candidates to serve as Independent Directors, independence from the investment
adviser, its affiliates and other principal service providers is critical, as is
an independent and questioning mindset. The Independent Directors Committees
also consider whether the prospective candidates' workloads would allow them to
attend the vast majority of Board meetings, be available for service on Board
committees, and devote the additional time and effort necessary to remain
apprised of Board matters and the rapidly changing regulatory environment in
which the Funds operate.

The Independent Directors Committees will consider candidates recommended
by shareholders on the basis of the same criteria used to consider and evaluate
candidates recommended by other sources. The Committees will consider candidates
recommended by shareholders if such proposed nominations are submitted in
writing to the attention of Charles D. Maxwell (addressed c/o the Funds, Fifty
North Front Street, 21st Floor, Memphis, Tennessee 38103).

In addition, each Fund has a Qualified Legal Compliance Committee (the
"QLCC") composed of all of the Independent Directors. The QLCCs receive, review
and take appropriate action with respect to any report made or referred to a
QLCC by an attorney of evidence of a material violation of applicable U.S.
federal or state securities law, material breach of fiduciary duty under U.S.
federal or state law or a similar material violation by a Fund or by an officer,
director, employee or agent of a Fund. The QLCCs did not meet during the fiscal
year ended March 31, 2008.

It is anticipated that the New Boards will appoint new members of the
Independent Directors Committees and QLCCs.

INFORMATION ABOUT THE FUNDS' CURRENT OFFICERS

--------------------------------------------------------------------------------------------------------------------------
POSITION(S) HELD
WITH THE FUNDS,
NAME, TERM OF OFFICE
ADDRESS (1) AND LENGTH OF PRINCIPAL OCCUPATION(S) DURING
AND AGE TIME SERVED THE PAST FIVE YEARS

--------------------------------------------------------------------------------------------------------------------------
Brian B. President (Since Mr. Sullivan has served as President and Chief Investment Officer of
Sullivan 2006) Morgan Asset Management, Inc. since 2006. From 1999 to 2002 and from
Age 53 2005 to 2007, Mr. Sullivan served as President of AmSouth Asset
Management, Inc., which merged into Morgan Asset Management, Inc. in
late 2007. From 1996 to 1999 and from 2002 to 2005, Mr. Sullivan
served as Vice President of AmSouth Asset Management, Inc. Since
joining AmSouth Bank in 1982 through 1996, Mr. Sullivan served in
various capacities including Equity Research Analyst and Chief Fixed
Income Officer and was responsible for Employee Benefits Portfolio
Management and Regional Trust Investments. He holds the Chartered
Financial Analyst designation.
--------------------------------------------------------------------------------------------------------------------------
Thomas R. Vice-President Mr. Gamble has been an executive at Regions Financial Corporation
Gamble (Since 2003) since 1981. He was a Corporate IRA Manager from 2000 to 2001 and a
Age 65 Senior Vice President and Manager of Employee Benefits at the
Birmingham Trust Department of Regions Bank from 1981 to 2000.
--------------------------------------------------------------------------------------------------------------------------
J. Thompson Treasurer Mr. Weller has been a Managing Director and Controller of Morgan
Weller (Since 2006) Keegan & Company, Inc. since 2001. He was Senior Vice President and
Age 43 and Assistant Controller of Morgan Keegan & Company, Inc. from 1998 to 2001,
Secretary Controller and First Vice President from 1997 to 1998, Controller and
(Since 2003) Vice President from 1995 to 1997 and Assistant Controller from 1992 to
1995. Mr. Weller also served as a Business Systems Analyst in the
Investment Information Division of Metropolitan Life Insurance Co.
from 1991 to 1992. Mr. Weller was also with Arthur Andersen & Co. in
1988 and Andersen Consulting from 1989 to 1991.
--------------------------------------------------------------------------------------------------------------------------
Charles D. Secretary and Mr. Maxwell has been Executive Managing Director, Chief Financial
Maxwell Assistant Officer, Treasurer and Secretary of Morgan Keegan & Company, Inc.
Age 54 Treasurer since 2006. Mr. Maxwell previously served as Managing Director of
(Since 2003) Morgan Keegan & Company, Inc. from 1998 to 2006 and Assistant
Treasurer and Assistant Secretary of Morgan Keegan & Company, Inc.
from 1994 to 2006. Mr. Maxwell has been Secretary and Treasurer of
Morgan Asset Management, Inc. since 1993. He was Senior Vice President
of Morgan Keegan & Company, Inc. from 1995 to 1997. Mr. Maxwell was
with the accounting firm of Ernst & Young LLP from 1976 to 1986 and
served as a senior manager from 1984 to 1986.
--------------------------------------------------------------------------------------------------------------------------
Michele F. Chief Ms. Wood has been the Chief Compliance Officer of Morgan Asset
Wood Compliance Management, Inc. since 2006 and is also a Senior Vice President of
Age 38 Officer (Since Morgan Keegan & Co., Inc. She was a Senior Attorney and First Vice
2006) President of Morgan Keegan & Company, Inc. from 2002 to 2006. She was
a Staff Attorney with FedEx Corporation from 2001 and 2002
specializing in employment litigation. She was an Associate with Ford
& Harrison LLP from 1997 to 2001.
--------------------------------------------------------------------------------------------------------------------------

(1) The address of Messrs. Weller and Maxwell and Ms. Wood is 50 North Front Street, 21st Floor, Memphis, Tennessee 38103.
The address of Messrs. Sullivan and Gamble is 1901 6th Avenue North, Suite 400, Birmingham, Alabama 35203.

COMPENSATION OF DIRECTORS

Directors of the Funds who are Interested Directors receive no salary or
fees from the Funds. Independent Directors receive from each Fund an annual
retainer of $4,000 and a fee of $1,000 per quarterly meeting with reimbursement
by the Fund for related expenses for each meeting of the Board attended. Each
chairperson of the Independent Directors Committees and Audit Committees
receives annual compensation of $500 from each Fund. An additional $1,500 is
paid to the Independent Directors for attending special meetings in person, and
an additional $500 is paid for attending special meetings by telephone. No
director is entitled to receive pension or retirement benefits from the Funds.

The table below sets forth the compensation paid to the Nominees by the
Funds for the fiscal year ended March 31, 2008. For the calendar year ended
December 31, 2007, the Nominees received the compensation set forth in the last
column of the table below for serving as directors/trustees of all the
registered investment companies in the Regions Morgan Keegan fund complex.

PENSION OR
RETIREMENT
AGGREGATE BENEFITS ACCRUED AS ESTIMATED ANNUAL TOTAL COMPENSATION FROM THE
NAME AND POSITION COMPENSATION PART OF FUND BENEFITS UPON FUNDS AND FUND COMPLEX PAID
WITH THE FUNDS FROM THE FUNDS EXPENSES RETI8REMENT TO NOMINEE
------------------------------------------------------------------------------------------------------------------------

Louis P. Salvatore $0 N/A N/A $
Nominee

Robert F. Birch $0 N/A N/A $
Nominee

Stuart A. McFarland $0 N/A N/A $
Nominee

Rodman L. Drake $0 N/A N/A $
Nominee

Clifford E. Lai $0 N/A N/A $
Nominee

PROCEDURES FOR COMMUNICATIONS TO THE BOARDS

The Board of each Fund has provided for a process by which shareholders may
send communications to the Board. If a shareholder wishes to send a
communication to a Board, or to a specified director, the communication should
be submitted in writing to the Secretary of the Fund, who will forward such
communication to the director. See "Director Attendance at Meetings and
Shareholder Communications" below.

REQUIRED VOTE

In the election of directors each Nominee must receive a plurality of the
votes cast at the Annual Meeting. A "plurality of the votes" means the candidate
must receive more votes than any other candidate for the same position, but not
necessarily a majority of the votes cast. If elected, the Nominees will only
serve as directors if qualified upon the closing of the Transaction.

THE BOARDS RECOMMEND THAT SHAREHOLDERS
OF THE FUNDS VOTE "FOR" PROPOSAL 2.

ADDITIONAL INFORMATION

INVESTMENT ADVISER AND ADMINISTRATOR

MAM serves as investment adviser to each of the Funds. Morgan Keegan serves
as administrator to each of the Funds. The principal offices of MAM are located
at 1901 6th Avenue North, 4th Floor, Birmingham, Alabama 35203. The principal
offices of Morgan Keegan are located at 50 Front Street, Memphis, Tennessee
38103. MAM and Morgan Keegan are wholly owned subsidiaries of Regions.

INFORMATION ABOUT THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PricewaterhouseCoopers LLP ("PwC") served as each Fund's independent
registered public accounting firm to audit and certify the Funds' financial
statements for the fiscal years ended March 31, 2007 and 2008. PwC prepared each
Fund's federal and state income tax returns and provided certain permitted
non-audit services. PwC, in accordance with Independence Standards Board
Standard No. 1, has confirmed to the Audit Committees that they are independent
auditors with respect to each Fund. The Audit Committees considered whether the
provision by PwC to the Funds of non-audit services to the Funds or of
professional services to the Funds' investment adviser and entities that
control, are controlled by or are under common control with the adviser is
compatible with maintaining PwC's independence and has discussed PwC's
independence with them. Representatives of PwC are not expected to be present at
the Meetings but have been given the opportunity to make a statement if they so
desire and will be available should any matter arise requiring their presence.

AUDIT FEES. The aggregate fees billed by PwC for professional services
rendered for the audit of each Fund's annual financial statements, and the
review of the financial statements included in the Funds' reports to
shareholders, for the fiscal years ended March 31, 2007 and 2008 were $[_____]
and $[_____], respectively.

AUDIT RELATED FEES. The aggregate fees billed by PwC for professional
services rendered reasonably related to the performance of the audit or review
of the Funds' financial statements for the fiscal years ended March 31, 2007 and
2008 were $[_____] and $[_____], respectively. Audit related fees include
amounts for attestation services and review of internal controls.

TAX FEES. The aggregate fees billed by PwC for professional services
rendered for tax compliance, tax advice and tax planning for the fiscal years
ended March 31, 2007 and 2008 were $[_____] and $[_____], respectively. Tax fees
include amounts for tax compliance, tax planning and tax advice.

ALL OTHER FEES. The aggregate fees billed by PwC for professional services
rendered for services other than audit, audit related, and tax compliance, tax
advice and tax planning for the fiscal years ended March 31, 2007 and 2008 were
$[_____] and $[_____], respectively. These fees include amounts for research
regarding the booking of certain assets.

The aggregate non-audit fees billed by PwC for professional services
rendered to the Funds, the Funds' investment adviser, and any entity
controlling, controlled by, or under common control with the adviser for the
fiscal years ended March 31, 2007 and 2008 were $[_____] and $[_____],
respectively. All non-audit services discussed above were pre-approved by the
Audit Committee, which considered whether these services were compatible with
maintaining PwC's independence.

LEGAL PROCEEDINGS

Beginning in late 2007, lawsuits were filed in the United States District
Court for the Western District of Tennessee relating to certain fixed income
funds managed by MAM, including the Funds. The complaints were filed as putative
class actions on behalf of investors who purchased shares of the Funds from
December 2004 through February 2008. The complaints name as defendants the Fund,
MAM, Morgan Keegan, Regions, the Funds' independent auditor, PwC, current
directors, certain former directors, certain officers of the Funds and the
Funds' portfolio managers. The complaints allege that the defendants
misrepresented or failed to disclose material facts relating to portfolio
composition, fair valuation, liquidity and risk in fund registration statements
and other documents. The plaintiffs seek unspecified damages, in some cases
damages and reasonable costs and attorneys' fees. No class has been certified
and each of the cases is at a preliminary stage. No estimate of the effect, if
any, of these lawsuits on the Funds can be made at this time.

In addition, on March 12, 2008, a derivative action was filed in the United
States District Court for the Western District of Tennessee seeking damages on
behalf of the RMK Multi-Sector High Income Fund, Inc. The complaint in this
action alleges that defendants breached duties of care and mismanaged the Fund,
among other things. The complaint seeks unspecified damages and reasonable costs
and attorneys' fees. The proceeding is at a preliminary stage.

Similar claims have been made in lawsuits concerning the Open-End Funds
filed in the United States District Court for the Western District of Tennessee.
Defendants are seeking to have the cases involving the Funds and the Open-End
Funds consolidated in a single proceeding.

MAM and Morgan Keegan are named as defendants in one or more actions filed
in the United States District Courts for the Western District of Tennessee and
the Northern District of Alabama under the Employee Retirement Income Security
Act of 1974 ("ERISA"). Plaintiffs in the ERISA cases seek to represent classes
of participants and beneficiaries of savings and retirement plans ("Plans")
sponsored by Regions. The complaints in these actions allege that the defendants
breached fiduciary duties owed to class members and seek recovery of losses
incurred by the Plans by reason of the alleged breaches of duty, restitution and
other equitable relief, as well as costs and attorneys' fees. No class has been
certified and these proceedings are at a preliminary stage.

VOTING INFORMATION

For each Meeting the presence, in person or by proxy, of shareholders
entitled to cast a majority of all the votes entitled to be cast at the Meeting
will constitute a quorum at the Meeting. Each outstanding full share of common
stock of each Fund is entitled to one vote, and each outstanding fractional
share thereof is entitled to a proportionate fractional share of one vote. If a
quorum is not present at a Meeting, the persons named as proxies may propose one
or more adjournments of the Meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the Meeting in person or by proxy. The persons named as
proxies will vote those proxies that they are entitled to vote "FOR" any
proposal in favor of such an adjournment.

All shares represented by properly executed proxies, unless such proxies
previously have been revoked, will be voted at the Meetings in accordance with
the directions indicated in the proxies; if no direction is indicated, the
shares will be voted "FOR" the approval of the New Advisory Agreements as set
forth in Proposal 1 and "FOR" the election of each of the Nominees as set forth
in Proposal 2.

REQUIRED VOTE

To pass, Proposal 1 requires with respect to each Fund the vote (1) of 67%
or more of the shares of the Fund present at the Special Meeting, if more than
50% of the Fund's outstanding shares are present or represented by proxy at the
Special Meeting, or (2) of more than 50% of the outstanding shares of the Fund,
whichever is the less. In the election of directors under Proposal 2, each
Nominee must receive a plurality of the votes cast at the Annual Meeting. A
"plurality of the votes" means the candidate must receive more votes than any
other candidate for the same position, but not necessarily a majority of the
votes cast. The proposals do not require separate voting by class.

For purposes of determining whether shareholders have approved a proposal,
broker non-votes (i.e., shares held by brokers who do not have discretionary
authority to vote on a particular matter and for which the brokers have not
received voting instructions from their customers) and abstentions will be
counted as shares present at the Meetings for quorum purposes but will not be
voted for or against any adjournment or proposal. Accordingly, broker non-votes
and abstentions effectively will be votes "AGAINST" Proposal 1 because Proposal
1 requires the vote of a specified majority of a Fund's shares. However, the
Funds understand that brokers may vote on Proposal 2 on behalf of their
customers.

You may revoke your proxy at any time before the Meetings by providing
another proxy or by letter or telegram revoking the initial proxy. To be
effective, your revocation must be received by the Secretary of the Funds prior
to the Meetings and must include your name and account number. If you attend the
Meetings in person, you may vote by ballot, thereby canceling any proxy you
provided previously. Proxies voted by alternative forms may be revoked in the
same manner that proxies by mail may be revoked.

Shareholders who plan on attending the Meetings will be required to provide
valid identification in order to gain admission.

SOLICITATION OF PROXIES

The cost of preparing, assembling, printing and mailing the proxy
materials, and any additional solicitation expenses, including reimbursement of
brokerage firms and others for their expenses of forwarding proxy materials to
the beneficial owners of shares, will not be borne by the Funds. The principal
solicitation will be by mail, but proxies also may be solicited by telephone,
facsimile or other electronic communications or personal contact by
representatives of Morgan Keegan, the Funds' administrator, none of whom will
receive any compensation from the Funds for these activities. In addition,
[___________] may make solicitations on behalf of the Boards by telephone or
other means at a cost of approximately $[_______] plus the expense of any
solicitation. [If votes are recorded by telephone, Morgan Keegan will use
procedures designed to authenticate shareholders' identities, to allow
shareholders to authorize the voting of their shares in accordance with their
instructions and to confirm that a shareholder's instructions have been properly
recorded.]

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act and Section 30(h) of the 1940 Act as
applied to each Fund require the Fund's directors, certain of the Fund's
officers, persons who beneficially own more than 10 percent of the Fund's common
stock and certain other persons to file reports of ownership of the Fund's
common stock and change in such ownership on Forms 3, 4 and 5 with the SEC and
the New York Stock Exchange. Such persons are required by SEC regulations to
furnish the Fund with copies of all such filings. Based solely upon a review of
the copies of such forms furnished during or with respect to the fiscal year
ended March 31, 2008, each Fund reports that [_________].

DIRECTOR ATTENDANCE AT MEETINGS AND SHAREHOLDER COMMUNICATIONS

The Funds do not have a policy on director attendance at the Special and
Annual Meetings. For each Fund, no directors attended the 2007 annual meeting of
shareholders. Shareholders may send written communications to the Board of a
Fund or to an individual director by mailing such correspondence to the Fund's
Secretary, Charles D. Maxwell (addressed to 50 North Front Street, 21[st] Floor,
Memphis, Tennessee 38103). Such communications must be signed by the shareholder
and identify the number of shares held by the shareholder. Properly submitted
shareholder communications will, as appropriate, be forwarded to the entire

Board or to the individual director. Any shareholder proposal submitted pursuant
to Rule 14a-8 under the Exchange Act must continue to meet all the requirements
of Rule 14a-8. See "Shareholder Proposals" below.

SHAREHOLDER PROPOSALS

The Funds expect to hold their next annual meeting of shareholders in July
2009. The bylaws of each Fund require advance notice be given to the Fund in the
event a shareholder desires to nominate directors or make proposals to be voted
on at the Fund's annual meeting of shareholders. Nominations and proposals of
shareholders intended to be presented at the meeting must be received by the
Fund by January 31, 2009 and must satisfy the other requirements of the federal
securities laws. Timely submission does not guarantee that such nominations or
proposals will be included.

Notice of any such business must be in writing and sent to Charles D.
Maxwell, addressed c/o the applicable Fund, 50 North Front Street, 21[st] Floor,
Memphis, Tennessee 38103.

SHAREHOLDER REPORTS

EACH FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL
AND UNAUDITED SEMI-ANNUAL REPORT TO A SHAREHOLDER UPON REQUEST. TO REQUEST AN
ANNUAL OR SEMI-ANNUAL REPORT, CONTACT MAM AT 50 FRONT STREET, MEMPHIS, TENNESSEE
38103, OR CALL 1-800-564-2188. AS OF THE DATE OF THIS PROXY STATEMENT, THE AUDIT
OF THE MARCH 31, 2008 FINANCIAL STATEMENTS HAS NOT YET BEEN COMPLETED. IT IS
EXPECTED THAT A COPY OF EACH THE 2008 ANNUAL REPORT FOR EACH FUND WILL BE MAILED
TO SHAREHOLDERS ON OR ABOUT MAY 28, 2008.

[Shareholders of the Funds may have family members living in the same home
who also own shares of the Funds. In order to reduce the amount of duplicative
mail that is sent to homes with more than one Fund account, the Funds will,
until notified otherwise, send only one copy of shareholder reports and proxy
statements to each household address. If you would like to receive separate
documents for each account holder, please call 1-800-[0000] or write to the
Funds at [_______]. If you currently share a household with one or more other
shareholders of the Funds and are receiving duplicate copies of shareholder
reports or proxy statements and would prefer to receive a single copy of such
documents, please call or write the Funds at the phone number or address listed
above.]

OTHER BUSINESS

Management knows of no business to be presented at the Meetings other than
the matters set forth in this Proxy Statement, but should any other matter
requiring a vote of shareholders arise, the proxies will vote according to their
best judgment in the interest of the Funds.

May __, 2008
Memphis, Tennessee

APPENDIX A
----------

PRINCIPAL SHAREHOLDERS

The following table sets forth information about persons who, to the
knowledge of the Funds, own beneficially 5% or more of a class of a Fund's
outstanding securities as of May 5, 2008.

------------------------------------------------------------------------------------------------------------------------------------
NAME OF FUND AND NUMBER OF SHARES PERCENT OF CLASS
NAME OF SHAREHOLDER CLASS BENEFICIALLY OWNED BENEFICIALLY OWNED
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

A-1

APPENDIX B
----------

FORM OF NEW ADVISORY AGREEMENT

THIS INVESTMENT ADVISORY AGREEMENT ("AGREEMENT") is made this _____ day of
__________ 2008, by and between RMK MULTI-SECTOR HIGH INCOME FUND, INC. (the
"FUND"), a Maryland corporation, and HYPERION BROOKFIELD ASSET MANAGEMENT, INC.
(the "ADVISER"), a Delaware corporation.

WHEREAS, the Fund, a closed-end, diversified management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
ACT"), wishes to retain the Adviser to provide investment advisory services to
the Fund; and

WHEREAS, the Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended (the "ADVISERS ACT") and is willing
to furnish such services on the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed as follows:

1. APPOINTMENT OF THE ADVISER. The Fund hereby appoints the Adviser as
investment adviser for the Fund for the period, in the manner, and on the terms
set forth in this Agreement. The Adviser hereby accepts such appointment and
agrees during such period to render the services and to assume the obligations
herein set forth. The Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, except as expressly provided or authorized
(whether herein or otherwise), have no authority to act for or represent the
Fund in any way or otherwise be deemed an agent of the Fund. The Adviser may
delegate any or all of its responsibilities to one or more investment sub-
advisers, subject to the approval of (i) the Board of Directors (the "BOARD") of
the Fund, and (ii) the Fund's shareholders, to the extent required by law. Such
delegation shall not relieve the Adviser of its duties and responsibilities
hereunder.

2. INVESTMENT ADVISORY SERVICES. Subject to the supervision of the Fund's
Board, the Adviser shall provide the Fund with investment research, advice,
management and supervision and shall furnish a continuous investment program for
the Fund's portfolio of securities consistent with the Fund's investment
objectives, policies and limitations as set forth in the Fund's initial
registration statement, as amended or supplemented, the Fund's Articles of
Incorporation and Bylaws, the 1940 Act, the applicable rules and regulations of
the Securities and Exchange Commission (the "SEC") and other applicable federal
and state laws, and such other guidelines as the Board may reasonably establish
or approve. Without limiting the generality of the foregoing, the Adviser shall:
(i) obtain and evaluate such information and advice relating to the economy,
securities markets and securities as it deems necessary or useful to discharge
its duties hereunder; (ii) determine the securities to be purchased, retained,
sold, loaned or otherwise disposed by the Fund and what portion of such assets
will be invested or held uninvested as cash; (iii) place orders pursuant to its
investment determinations for the Fund either directly with the issuer or with
any broker or dealer; and (iv) take such other actions and perform such other

functions of management and supervision with respect to the Fund as it deems
necessary or appropriate or as may be directed by the Board of the Fund.

3. PORTFOLIO TRANSACTIONS. In placing orders with brokers and dealers,
the Adviser shall attempt to obtain the best execution of the orders,
considering all the circumstances. For purposes of this Agreement, "best
execution" shall be interpreted in accordance with applicable law as it pertains
to the management of registered investment companies by registered investment
advisers.

(i) Subject to the appropriate policies and procedures approved by
the Board, the Adviser may, to the extent authorized by Section
28(e) of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), use brokers or dealers who provide the Fund or
the Adviser with brokerage, research, analysis, advice and
similar services to execute transactions on behalf of the Fund,
and the Adviser may cause the Fund to pay to those brokers or
dealers in return for brokerage and research services a higher
commission than may be charged by other brokers or dealers,
subject to the Adviser determining in good faith that such
commission is reasonable in terms either of the particular
transaction or of the overall responsibility of the Adviser to
the Fund and its other clients and that the total commissions
paid by the Fund will be reasonable in relation to the benefits
to the Fund over the long term. Subject to seeking best
execution, the Board may cause or direct the Adviser to effect
transactions in securities through brokers or dealers in a
manner that will help generate resources to pay the cost of
certain expenses that the Fund is required to pay or for which
the Fund is required to arrange payment.

(ii) The Adviser may, to the extent permitted by applicable laws and
regulations, aggregate securities to be sold or purchased for
the Fund and for its other clients in order to obtain best
execution. In that event, allocation of the securities purchased
or sold, as well as expenses incurred in the transaction, will
be made by the Adviser in accordance with the 1940 Act and SEC
or SEC staff guidance thereunder and in the manner it considers
to be the most equitable and consistent with its fiduciary
obligations to the Fund and to its other clients.

(iii) The Adviser may use brokers or dealers who are affiliated with
the Adviser, provided that no such broker or dealer will be
utilized in any transaction in which such broker or dealer acts
as principal and the commissions, fees or other remuneration
received by such brokers or dealers is reasonable and fair
compared to the commissions, fees or other remuneration paid to
other brokers or dealers in connection with comparable
transactions involving similar securities being purchased or
sold during a comparable period of time.

(iv) The Adviser will periodically review the Fund's portfolio
transactions to ensure that such transactions are conducted in
accordance with this Section 3. The Adviser shall provide such
reports to the Board of Directors as it may reasonably request
with respect to the Fund's total brokerage and transaction
activities and the manner in which that business was allocated.

The Fund hereby authorizes any entity or person associated with the Adviser
which is a member of a national securities exchange to effect any transaction on
the exchange for the account of the Fund which is permitted by Section 11(a) of
the Exchange Act and Rule 11a2-2(T) thereunder, and the Fund hereby consents to
the retention of compensation by such entity or person for such transaction in
accordance with Rule 11a2-2(T)(a)(2)(iv).

In the performance of its duties under this Agreement, the Adviser shall at
all times use all reasonable efforts to conform to, and act in accordance with,
any requirements imposed by (i) the provisions of the 1940 Act, the Advisers
Act, and of any rules or regulations of each in force thereunder; (ii) any other
applicable provision of law; (iii) the Articles of Incorporation and By-Laws of
the Fund, as such documents are amended from time to time; (iv) the investment
objectives, policies and restrictions applicable to the Fund as set forth in the
Fund's initial registration statement on Form N-2, as amended or supplemented,
and (v) any policies and determinations of the Board of the Fund.

4. CODE OF ETHICS. The Adviser shall adopt a written code of ethics
complying with the requirements of Rule 17j-1 under the 1940 Act and Section
204A of the Investment Advisers Act of 1940 and shall provide the Fund with a
copy of the code of ethics and evidence of its adoption. Within forty-five (45)
days of the end of the last calendar quarter of each year while this Agreement
is in effect, an executive officer of the Adviser shall certify to the Board
that the Adviser has complied with the requirements of Rule 17j-1 and Section
204A during the previous year and that there has been no violation of the
Adviser's code of ethics or, if such a violation has occurred, that appropriate
action was taken in response to such violation. Upon the written request of the
Fund, the Adviser shall permit the Fund to examine the reports required to be
made to the Adviser by Rule 17j-1(c)(1).

5. BOOKS AND RECORDS. The Adviser shall oversee the maintenance of all
books and records with respect to the Fund's securities transactions and the
Fund's books of account in accordance with all applicable federal and state laws
and regulations. In compliance with the requirements of Rule 31a-3 under the
1940 Act, the Adviser hereby agrees that any records which it maintains for the
Fund are the property of the Fund and further agrees to surrender promptly to
the Fund any of such records upon the Fund's request. The Adviser further agrees
to arrange for the preservation of the records required to be maintained by Rule
31a-1 under the 1940 Act for the periods prescribed by Rule 31a-2 under the 1940
Act. The Adviser will be responsible for preserving the confidentiality of
information concerning the holdings, transactions, and business activities of
the Fund in conformity with the requirements of the 1940 Act, other applicable
laws and regulations, and any policies that are approved by the Board.

6. REPORTS. The Adviser shall furnish to or place at the disposal of the
Fund such information, evaluations, analyses and opinions formulated or obtained
by the Adviser in the discharge of its duties as the Fund may, from time to
time, reasonably request. The Fund shall furnish the Adviser with such documents
and information with regard to its affairs as the Adviser may, at any time or
from time to time, reasonably request in order to discharge its obligations
under this Agreement.

7. FUND PERSONNEL. The Adviser agrees to permit individuals who are
directors, officers or employees of the Adviser to serve (if duly appointed or
elected) as directors, officers or employees of the Fund, without remuneration
from or other cost to the Fund.

8. DISQUALIFICATION. The Adviser shall immediately notify the Board of
the occurrence of any event which would disqualify the Adviser from serving as
an investment adviser of an investment company pursuant to Section 9 of the 1940
Act or any other applicable statute or regulation.

9. EXPENSES. The Adviser shall be responsible for expenses incurred in
providing office space, equipment and personnel as may be necessary or
convenient to provide investment advisory services to the Fund, including
payment of all fees, expenses and salaries of the directors, officers or
employees of the Fund who are directors, officers or employees of the Adviser.
The Fund shall bear the expenses of its operation, except those specifically
allocated to the Adviser under this Agreement or under any separate agreement
between the Fund and the Adviser. Subject to any separate agreement or
arrangement between the Fund and the Adviser, the expenses hereby allocated to
the Fund, and not to the Adviser, include, but are not limited to: (i)
organizational expenses; (ii) legal and audit expenses; (iii) borrowing
expenses; (iv) interest; (v) taxes; (vi) governmental fees; (vii) fees,
voluntary assessments and other expenses incurred in connection with membership
in investment company organizations; (viii) the cost (including brokerage
commissions and issue or transfer taxes or other charges, if any) of securities
purchased or sold by the Fund and any losses incurred in connection therewith;
(ix) fees of custodians, transfer agents, registrars, proxy voting services,
pricing or valuation services or other agents or service providers; (x) expenses
of preparing share certificates; (xi) expenses relating to the redemption or
repurchase of shares; (xii) expenses of registering and qualifying shares for
sale under applicable federal or state law and maintaining such registrations
and qualifications; (xiii) expenses of preparing, setting in print, printing and
distributing prospectuses, proxy statements, reports, notices and dividends to
stockholders; (xiv) cost of stationery; (xv) costs of stockholders and other
meetings of the Fund, including any expenses relating to proxy solicitation and
vote tabulation; (xvi) compensation and expenses of the independent directors of
the Fund and officers of the Fund who are not officers, directors or employees
of the Adviser or its affiliates, if any; (xvii) the Fund's portion of premiums
of any fidelity bond and other insurance covering the Fund and its officers and
directors; (xviii) the fees and other expenses of listing and maintaining the
Fund's shares on the New York Stock Exchange or any other national stock
exchange; and (xiv) any extraordinary expenses (including fees and disbursements
of counsel) incurred by the Fund.

10. COMPENSATION. As compensation for the services performed hereunder,
the Adviser shall receive from the Fund an advisory fee at the annual rate of
0.65% of the Fund's average daily total assets minus liabilities (other than the
aggregate indebtedness entered into for purposes of leverage) ("MANAGED
ASSETS"). This advisory fee shall be payable monthly as soon as practicable
after the last day of each month based on the average of the daily values placed
on the Managed Assets of the Fund as determined at the close of business on each
day throughout the month. The Managed Assets of the Fund will be valued as of
the close of regular trading on the New York Stock Exchange (currently 4:00
p.m., Eastern time) on each business day throughout the month or, if the Fund
lawfully determines the value of its Managed Assets as of some other time on
each business day, as of such time. The first payment of such fee shall be made
as promptly as possible at the end of the month next succeeding the effective
date of this Agreement. In the event that the Adviser's right to such fee
commences on a date other than the first day of the month, the fee for such
month shall be prorated based on the average daily Managed Assets of the Fund in
that period from the date of commencement to the last day of the month. In the
event this Agreement terminates before the end of any month, the fee for such
month shall be prorated based on the average daily Managed Assets of the Fund in
that period from the first day of the month to the date of termination. If the

Fund determines the value of its Managed Assets more than once on any business
day, the last such determination on that day shall be deemed to be the sole
determination on that day. The value of the Managed Assets shall be determined
pursuant to the applicable provisions of the Fund's Articles of Incorporation,
its By-Laws and the 1940 Act. If, pursuant to such provisions, the determination
of the net asset value of the Fund is suspended for any particular business day,
then the value of the Managed Assets of the Fund on that day shall be deemed to
be the value of its Managed Assets as determined on the preceding business day.
If the determination of the net asset value of the Fund has been suspended for
more than one month, the Adviser's compensation payable at the end of that month
shall be computed on the basis of the value of the Managed Assets of the Fund as
last determined (whether during or prior to such month).

11. NON-EXCLUSIVE SERVICES. Nothing in this Agreement shall limit or
restrict the right of any director, officer, or employee of the Adviser who may
also be a director, officer, or employee of the Fund, to engage in any other
business or to devote his time and attention in part to the management or other
aspects of any other business, whether of a similar nature or a dissimilar
nature, nor to limit or restrict the right of the Adviser to engage in any other
business or to render services of any kind, including investment advisory and
management services, to any other corporation, firm, individual or association
provided that any such other services and activities do not, during the term of
this Agreement, interfere, in a material manner, with the Adviser's ability to
meet all of its obligations to the Fund hereunder. The Fund acknowledges that
the Adviser or one or more of its "affiliated persons" may have investment
responsibilities or render investment advice to or perform other investment
advisory services for other individuals or entities and that the Adviser, its
"affiliated persons" or any of its or their directors, officers, agents or
employees may buy, sell or trade in securities for its or their respective
accounts ("AFFILIATED ACCOUNTS"). Subject to the provisions of Section 3, the
Fund agrees that the Adviser or its "affiliated persons" may give advice or
exercise investment responsibility and take such other action with respect to
Affiliated Accounts which may differ from the advice given or the timing or
nature of action with respect to the Fund, provided that the Adviser acts in
good faith. The Fund further acknowledges that one or more of the Affiliated
Accounts may at any time hold, acquire, increase, decrease, dispose of or
otherwise deal with positions in investments in which the Fund may have an
interest. The Adviser shall have no obligation to recommend for the Fund a
position in any investment which an Affiliated Account may acquire, and the Fund
shall have no first refusal, co-investment or other rights in respect of any
such investment, either for the Fund or otherwise.

12. LIMITATION OF LIABILITY.

12.1 Neither the Adviser nor any director, officer or employee of the
Adviser performing services for the Fund at the direction or request of the
Adviser in connection with the Adviser's discharge of its obligations hereunder
shall be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with any matter to which this Agreement
relates; provided that nothing herein contained shall be construed (i) to
protect the Adviser against any liability to the Fund or its stockholders to
which the Adviser would otherwise be subject by reason of the Adviser's willful
misfeasance, bad faith, or gross negligence in the performance of the Adviser's

duties, or by reason of the Adviser's reckless disregard of its obligations and
duties under this Agreement ("DISABLING CONDUCT") or (ii) to protect any
director, officer or employee of the Adviser who is or was a director or officer
of the Fund against any liability to the Fund or its stockholders to which such
person would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
such person's office with the Fund.

12.2 The Fund will indemnify the Adviser against, and hold it harmless
from, any and all expenses (including reasonable counsel fees and expenses)
incurred investigating or defending against claims for losses or liabilities
described in Section 12.1 not resulting from negligence, disregard of its
obligations and duties under this Agreement or disabling conduct by the Adviser.
Indemnification shall be made only following: (i) a final decision on the merits
by a court or other body before whom the proceeding was brought that the Adviser
was not liable by reason of negligence, disregard of its obligations and duties
under this Agreement or disabling conduct or (ii) in the absence of such a
decision, a reasonable determination, based upon a review of the facts, that the
Adviser was not liable by reason of negligence, disregard of its obligations and
duties under this Agreement or disabling conduct by (a) the vote of a majority
of a quorum of directors of the Fund who are neither "interested persons" of the
Fund nor parties to the proceeding ("DISINTERESTED NON-PARTY DIRECTORS") or (b)
an independent legal counsel in a written opinion. The Adviser shall be entitled
to advances from the Fund for payment of the reasonable expenses incurred by it
in connection with the matter as to which it is seeking indemnification
hereunder in the manner and to the fullest extent permissible under the Maryland
General Corporation Law. The Adviser shall provide to the Fund a written
affirmation of its good faith belief that the standard of conduct necessary for
indemnification by the Fund has been met and a written undertaking to repay any
such advance if it should ultimately be determined that the standard of conduct
has not been met. In addition, at least one of the following additional
conditions shall be met: (a) the Adviser shall provide security in form and
amount acceptable to the Fund for its undertaking; (b) the Fund is insured
against losses arising by reason of the advance; or (c) a majority of a quorum
of the full Board, the members of which majority are disinterested non-party
directors, or independent legal counsel, in a written opinion, shall have
determined, based on a review of facts readily available to the Fund at the time
the advance is proposed to be made, that there is reason to believe that the
Adviser will ultimately be found to be entitled to indemnification hereunder.

13. TERM OF AGREEMENT. The term of this Agreement shall begin on the date
first above written and, unless sooner terminated as hereinafter provided, this
Agreement shall remain in effect for two years. Thereafter, this Agreement shall
continue in effect from year to year, subject to the termination provisions and
all other terms and conditions hereof, provided such continuance is approved at
least annually by vote of the holders of a majority of the outstanding voting
securities of the Fund or by the directors, provided that in either event such
continuance is also approved annually by the vote, cast in person at a meeting
called for the purpose of voting on such approval, of a majority of the
directors who are not parties to this Agreement or interested persons of either
party hereto ("INDEPENDENT DIRECTORS"); and provided further that the Adviser
shall not have notified the Fund in writing at least sixty (60) days prior to
the first expiration date hereof or at least sixty (60) days prior to any
expiration date hereof of any year thereafter that it does not desire such

continuation. The Adviser shall furnish to the Fund, promptly upon its request,
such information as may reasonably be necessary to evaluate the terms of this
Agreement or any extension, renewal or amendment thereof.

14. AMENDMENT OR ASSIGNMENT OF AGREEMENT. This Agreement may be amended at
any time, but only by written agreement between the Adviser and the Fund, which
amendment has been authorized by the Board, including the vote or written
consent of a majority of the Independent Directors and, where required by the
1940 Act, the shareholders of the Fund in the manner required by the 1940 Act
and the rules thereunder. This Agreement shall terminate automatically and
immediately in the event of its assignment. The Adviser shall notify the Fund in
writing in advance of any proposed change of "control" to enable the Fund to
take the steps necessary to enter into a new advisory agreement, if necessary.

15. TERMINATION OF AGREEMENT. This Agreement may be terminated at any time
by either party hereto, without the payment of any penalty, upon sixty (60)
days' prior written notice to the other party; provided that in the case of
termination by the Fund, such action shall have been authorized (i) by
resolution of the directors, including the vote or written consent of a majority
of the Independent Directors or (ii) by vote of a majority of the outstanding
voting securities of the Fund.

16. INTERPRETATION AND DEFINITION OF TERMS. Any question of interpretation
of any term or provision of this Agreement having a counterpart in or otherwise
derived from a term or provision of the 1940 Act shall be resolved by reference
to such term or provision of the 1940 Act and to interpretation thereof, if any,
by the United States courts or, in the absence of any controlling decision of
any court, by rules, regulations or orders of the SEC validly issued pursuant to
the 1940 Act. Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is altered by a rule, regulation or order of the
SEC, whether of special or general application, such provision shall be deemed
to incorporate the effect of such rule, regulation or order. Specifically, the
terms "AFFILIATED PERSON," "ASSIGNMENT," "CONTROL," "INTERESTED PERSON" and
"MAJORITY OF THE OUTSTANDING VOTING SECURITIES" shall have the meanings given to
them by Section 2(a) of the 1940 Act, subject to such exemptions as may be
granted by the Securities and Exchange Commission by any rule, regulation or
order.

17. GOVERNING LAW. Except insofar as the 1940 Act or other federal laws
and regulations may be controlling, this Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York.

18. NOTICE. Any notice under this Agreement shall be given in writing
addressed and delivered or mailed postage prepaid to the other party to the Fund
(attn: [Secretary]) or the Adviser (attn: [___________]) at their respective
principal places of business (or to such other addresses or contacts as shall be
designated by the Fund or the Adviser in a written notice to the other party).

19. CAPTIONS. The captions in this Agreement are included for convenience
of reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.

20. SEVERABILITY AND SUCCESSORS. If any provision of this Agreement shall
be held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.

21. FORCE MAJEURE. The Adviser shall not be liable for delays or errors
occurring by reason of circumstances beyond its control, including, but not
limited to, acts of civil or military authority, national emergencies, work
stoppages, fire, flood, catastrophe, acts of God, insurrection, war, riot, or
failure of communication or power supply. In the event of equipment breakdowns
beyond its control, the Adviser shall take reasonable steps to minimize service
interruptions but shall have no liability with respect thereto.

22. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior amendments
and understandings relating to the subject matter hereof.

IN WITNESS WHEREOF the parties have caused this instrument to be signed on
their behalf by their respective officers thereunto duly authorized all as of
the date first written above.

RMK MULTI-SECTOR HIGH INCOME FUND, INC.

By: ______________________________________
Name:
Title:

HYPERION BROOKFIELD ASSET MANAGEMENT, INC.

By: ______________________________________
Name:
Title:

MORGAN KEEGAN

RMK MULTI-SECTOR HIGH INCOME FUND, INC.

SPECIAL MEETING OF SHAREHOLDERS
JULY 11, 2008

This proxy is being solicited on behalf of the Board of Directors of RMK
Multi-Sector High Income Fund, Inc. and relates to the proposal described in the
accompanying Proxy Statement. The undersigned hereby appoints as proxies J.
Thompson Weller and Charles D. Maxwell, and each of them (with power of
substitution), to vote for the undersigned all shares of common stock of the
undersigned in the Company at the Special Meeting of Shareholders to be held on
July 11, 2008 at 11:00 a.m., Central Time, at 7130 Goodlett Farms Parkway,
Cordova, Tennessee 38016, and any adjournment thereof, with all the power the
undersigned would have if personally present. The shares represented by this
proxy will be voted as instructed. Unless indicated to the contrary, this proxy
shall be deemed to grant authority to vote FOR the new investment advisory
agreement. To vote by telephone, please call 1-800-[000-0000]. To vote by
facsimile, fax your completed proxy card to 1-800-[000-0000]. To vote through
the Internet, visit our website at http://www.morgankeegan.com/vote.

YOUR VOTE IS IMPORTANT. Please date and sign this proxy below and return it
promptly in the enclosed envelope.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: [ ]

KEEP THIS PORTION FOR YOUR RECORDS
--------------------------------------------------------------------------------
DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

RMK MULTI-SECTOR HIGH INCOME FUND, INC.

VOTE ON THE FOLLOWING PROPOSAL: FOR AGAINST ABSTAIN

1. Approval of a new investment advisory [ ] [ ] [ ]
agreement between Hyperion Brookfield
Asset Management, Inc. and RMK Multi-Sector
High Income Fund, Inc.

Please sign within the box. If shares are held jointly, each Shareholder named
should sign. If only one signs, his or her signature will be binding. If the
Shareholder is a corporation, the President or a Vice President should sign in
his or her own name indicating this. If the Shareholder is a partnership, a
partner should sign in his or her own name, indicating that he or she is a
"Partner."

--------------------------------------------------------- --------------

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Signature Date

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Signature (Joint Owners) Date

MORGAN KEEGAN

RMK MULTI-SECTOR HIGH INCOME FUND, INC.

ANNUAL MEETING OF SHAREHOLDERS
JULY 11, 2008

This proxy is being solicited on behalf of the Board of Directors of RMK
Multi-Sector High Income Fund, Inc. and relates to the proposal described in the
accompanying Proxy Statement. The undersigned hereby appoints as proxies J.
Thompson Weller and Charles D. Maxwell, and each of them (with power of
substitution), to vote for the undersigned all shares of common stock of the
undersigned in the Company at the Annual Meeting of Shareholders to be held on
July 11, 2008 at 11:00 a.m., Central Time, at 7130 Goodlett Farms Parkway,
Cordova, Tennessee 38016, and any adjournment thereof, with all the power the
undersigned would have if personally present. The shares represented by this
proxy will be voted as instructed. Unless indicated to the contrary, this proxy
shall be deemed to grant authority to vote FOR each nominee. To vote by
telephone, please call 1-800-[000-0000]. To vote by facsimile, fax your
completed proxy card to 1-800-[000-0000]. To vote through the Internet, visit
our website at http://www.morgankeegan.com/vote.

YOUR VOTE IS IMPORTANT. Please date and sign this proxy below and return it
promptly in the enclosed envelope.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: [ ]

KEEP THIS PORTION FOR YOUR RECORDS
--------------------------------------------------------------------------------
DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

RMK MULTI-SECTOR HIGH INCOME FUND, INC.

VOTE ON THE FOLLOWING PROPOSAL: FOR AGAINST FOR ALL EXCEPT

1. Election of two Class I Directors [ ] [ ] [ ] To withhold authority to
to serve until the 2009 annual vote for any individual
meeting of shareholders or until nominee(s), mark "For All
their respective successors are Except" and write the
duly elected and qualified: corresponding nominee
number(s) on the line
01) Robert F. Birch below.
02) Stuart A. MacFarland

----------------------------
2. Election of one Class II Director [ ] [ ] [ ] To withhold authority to
to serve a three-year term or vote for any individual
until his successor is duly nominee(s), mark "For All
elected and qualified: Except" and write the
corresponding nominee
01) Rodman L. Drake number(s) on the line
below.

----------------------------

Election of two Class III [ ] [ ] [ ] To withhold authority to
Directors to serve until the 2010 vote for any individual
annual meeting of shareholders or nominee(s), mark "For All
until their respective successors Except" and write the
are duly elected and qualified: corresponding nominee
number(s) on the line
01) Louis P. Salvatore below.
02) Clifford E. Lai

----------------------------

Please sign within the box. If shares are held jointly, each Shareholder named should sign. If only one signs, his or her signature
will be binding. If the Shareholder is a corporation, the President or a Vice President should sign in his or her own name
indicating this. If the Shareholder is a partnership, a partner should sign in his or her own name, indicating that he or she is a
"Partner."

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Signature Date

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Signature (Joint Owners) Date