October 30, Dear Fellow Stockholder:

Transcription

1 SM TORTOISE ENERGY INFRASTRUCTURE CORPORATION TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC. TORTOISE MLP FUND, INC. TORTOISE PIPELINE & ENERGY FUND, INC. TORTOISE ENERGY INDEPENDENCE FUND, INC Ash Street, Suite 300 Leawood, Kansas Dear Fellow Stockholder: October 30, 2017 You are cordially invited to attend a combined special meeting (the Meeting ) of stockholders of each of Tortoise Energy Infrastructure Corporation ( TYG ), Tortoise Power and Energy Infrastructure Fund, Inc. ( TPZ ), Tortoise MLP Fund, Inc. ( NTG ), Tortoise Pipeline & Energy Fund, Inc. ( TTP ) and Tortoise Energy Independence Fund, Inc. ( NDP ) (each a Company and collectively, the Companies ) on December 21, 2017 at 10:00 a.m., Central Time, at Ash Street, Suite 300, Leawood, Kansas At the Meeting, stockholders of each Company will be asked to consider and vote on a proposal to approve a new investment advisory agreement between that Company and its current investment adviser, Tortoise Capital Advisors, L.L.C. (the Adviser ). Stockholders of each Company are also being asked to consider and take action upon such other business as may properly come before the Meeting, including the adjournment and postponement thereof. As discussed in more detail in the enclosed combined proxy statement, the current investment advisory agreement for each Company is expected to terminate by the end of the first calendar quarter of 2018 due to a proposed change in ownership of the parent company of the Adviser (the Transaction ). The proposed new investment advisory agreement for each Company is substantially identical to its current investment advisory agreement, except for the effective dates and the termination dates, and would simply continue the relationship between each Company and the Adviser. The Transaction is not expected to result in any change in the day-to-day portfolio management, investment objectives and policies or investment processes of the Companies. Following the closing of the Transaction, the Adviser will continue to operate independently under the Tortoise brand and will continue to emphasize essential asset investing. Each Company s Board of Directors believes that the proposal is in the Company s best interests and recommends a vote FOR the proposals. Enclosed with this letter are the formal notice of the Meeting, answers to questions you may have, the Companies combined proxy statement, which gives detailed information about each of the proposals you will be asked to vote on and why each Company s Board of Directors recommends that you vote to approve each

2 applicable proposal, and the proxy card for you to sign and return. If you have any questions about the enclosed proxy or need any assistance in voting your shares, please call Monday through Friday 9 a.m. to 10 p.m. Eastern time. Your vote is important. Please vote your shares via the internet or by telephone, or complete, sign and date the enclosed proxy card (your ballot) and mail it in the postage-paid envelope included in this package. Sincerely, P. Bradley Adams Chief Executive Officer of each Company

3 TORTOISE ENERGY INFRASTRUCTURE CORPORATION TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC. TORTOISE MLP FUND, INC. TORTOISE PIPELINE & ENERGY FUND, INC. TORTOISE ENERGY INDEPENDENCE FUND, INC Ash Street, Suite 300 Leawood, Kansas NOTICE OF SPECIAL MEETING OF STOCKHOLDERS To the Stockholders of: Tortoise Energy Infrastructure Corporation Tortoise Power and Energy Infrastructure Fund, Inc. Tortoise MLP Fund, Inc. Tortoise Pipeline & Energy Fund, Inc. Tortoise Energy Independence Fund, Inc.: NOTICE IS HEREBY GIVEN that a combined special meeting (the Meeting ) of Stockholders of Tortoise Energy Infrastructure Corporation, Tortoise Power and Energy Infrastructure Fund, Inc., Tortoise MLP Fund, Inc., Tortoise Pipeline & Energy Fund, Inc. and Tortoise Energy Independence Fund, Inc., each a Maryland corporation (each a Company and, collectively, the Companies ), will be held on December 21, 2017 at 10:00 a.m., Central Time, at Ash Street, Suite 300, Leawood, Kansas for the following purposes: 1. For all Companies: To consider and vote on a new investment advisory agreement between the Company and its current investment adviser, Tortoise Capital Advisors, L.L.C. 2. For all Companies: To consider and take action upon such other business as may properly come before the Meeting, including the adjournment and postponement thereof. The foregoing items of business are more fully described in the combined proxy statement accompanying this Notice.

4 Stockholders of record as of the close of business on October 17, 2017 are entitled to notice of and to vote at the Meeting (or any adjournment or postponement of the Meeting). By Order of the Board of Directors of the Company, October 30, 2017 Leawood, Kansas Diane M. Bono Secretary All stockholders are cordially invited to attend the meeting in person. Whether or not you expect to attend the meeting, please vote your shares via the internet, by telephone or by completing, dating, signing and returning the enclosed proxy as promptly as possible in order to ensure your representation at the meeting. If you choose to vote using the enclosed proxy, a return envelope (which postage is prepaid if mailed in the United States) is enclosed for that purpose. Even if you have given your proxy, you may still vote in person if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain from the record holder a proxy issued in your name.

5 TORTOISE ENERGY INFRASTRUCTURE CORPORATION TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC. TORTOISE MLP FUND, INC. TORTOISE PIPELINE & ENERGY FUND, INC. TORTOISE ENERGY INDEPENDENCE FUND, INC. ANSWERS TO SOME IMPORTANT QUESTIONS Q. What am I being asked to vote For on this proxy? A. At the combined special meeting (the Meeting ) of the stockholders of Tortoise Energy Infrastructure Corporation, Tortoise Power and Energy Infrastructure Fund, Inc., Tortoise MLP Fund, Inc., Tortoise Pipeline & Energy Fund, Inc. and Tortoise Energy Independence Fund, Inc. (each a Company and collectively, the Companies ), stockholders of each Company will be asked to consider and vote on a proposal to approve a new investment advisory agreement between that Company and its current investment adviser, Tortoise Capital Advisors, L.L.C. (the Adviser ). Q. Why am I being asked to approve a new investment advisory agreement? A. As required by the Investment Company Act of 1940, as amended (the 1940 Act ), each Company s current investment advisory agreement with the Adviser automatically terminates if the Adviser experiences a direct or indirect change in control. In effect, this provision requires a fund s stockholders to vote on a new investment advisory agreement whenever the ownership of the fund s investment adviser significantly changes. The provision is designed to ensure that stockholders have a say in determining the company or persons that manage their fund. As described in more detail in the combined proxy statement, Tortoise Investments, LLC ( Tortoise Investments ), the parent company of the Adviser, recently announced the signing of a definitive agreement for a buyout transaction (the Transaction ), which will result in a change of control of the Adviser and a termination of each Company s current investment advisory agreement. To ensure continuation of the advisory services provided to each Company, shareholders are being asked to approve a new investment advisory agreement. Q. What ownership changes will result from the Transaction? A. Pursuant to the terms of the Membership Interest Purchase Agreement (the Purchase Agreement ) between a vehicle formed by Lovell Minnick Partners LLC ( Lovell Minnick ) and owned by certain private funds sponsored by Lovell Minnick and a group of institutional co-investors (the Acquirer ) and certain members of Tortoise Investments, and subject to certain customary closing conditions, the Acquirer will acquire the equity interests in Tortoise Investments currently held by Montage Investments, LLC (a subsidiary of Mariner Holdings, LLC) and by certain of the original co-founders of Tortoise Investments. Selling

6 members include Zachary Hamel, Kenneth Malvey and Terry Matlack, who will retire from Tortoise upon the closing of the Transaction, as well as co-founder David Schulte, who left Tortoise in 2015 and is selling his remaining stake. As part of the Transaction, ongoing management and employees are expected to meaningfully increase their ownership of Tortoise Investments. Employees will retain a significant equity interest, with many investing additional capital alongside the Acquirer. Following the closing of the Transaction, it is expected that the Acquirer will own approximately two-thirds of the equity interests in Tortoise Investments and ongoing Tortoise management and employees will own approximately one-third of the equity interests in Tortoise Investments. See Information Regarding the Adviser beginning at page 4 of the Proxy Statement. Lovell Minnick is an independent private equity firm founded in 1999, specializing in financial and business services sectors. Following the closing of the Transaction, the Adviser will continue to operate independently under the Tortoise brand and will continue to emphasize essential asset investing. The Transaction is not expected to result in changes to the Adviser s investment processes or day-to-day portfolio management of the Companies. Q. Will the proposed new advisory agreements affect the portfolio management and strategy of the Companies? A. The day-to-day portfolio management, investment objectives and policies, and investment processes of the Companies will not change as a result of entering into the proposed new investment advisory agreements with the Adviser. The Investment Committee of the Adviser will continue to provide investment strategy oversight to the portfolio management team who implements the strategy for each Company s portfolio. In addition, each Company will retain its current name and ticker symbol. Q. Are there differences between the Companies current investment advisory agreements and the proposed new investment advisory agreements? A. The proposed new investment advisory agreement for each Company is substantially identical to its current investment advisory agreement, except for the effective dates and the termination dates. The advisory fee rate paid to the Adviser by each Company under its current investment advisory agreement will not change under the new investment advisory agreement. The Transaction is not expected to change the level, nature or quality of services provided to the Companies by the Adviser. Approval of the new investment advisory agreements will simply continue the relationship between each Company and the Adviser.

7 Q. Who will pay for the costs and expenses of the Meeting? A. The Companies will not bear any costs and expenses associated with the Transaction, including the costs of holding the Meeting, the costs of this proxy solicitation and the costs of mailing the combined proxy statement to stockholders of record as of the record date. Such costs and expenses will be borne by the parties to the Purchase Agreement. Q. Are any changes anticipated to any Company s Board of Directors? A. As described in more detail in the combined proxy statement, in order to comply with a safe harbor under Section 15(f) of the 1940 Act, during the three-year period following the completion of the Transaction at least 75% of each Company s Board of Directors must not be interested persons (as defined in the 1940 Act) of the Adviser. Accordingly, upon consummation of the Transaction, Terry Matlack, a member of each Company s Board of Directors and a co-founder of the Adviser, is expected to resign from the Board of Directors of each Company. H. Kevin Birzer, a member of the Adviser s Investment Committee and a co-founder of the Adviser, is expected to continue to serve as Chairman of the Board of Directors of each Company and each of the Company s four current independent directors is expected to remain a member of each Company s Board. Q. How does each Company s Board of Directors suggest that I vote? A. The independent directors and the full Board of Directors of each Company unanimously recommends that you vote FOR the proposal on the enclosed proxy or voting instruction card. Q. How can I vote? A. Voting is quick and easy. You may vote your shares via the internet, by telephone (for internet and telephone voting, please follow the instructions on the proxy ballot), or by simply completing and signing the enclosed proxy ballot, and mailing it in the postage-paid envelope included in this package. You may also vote in person if you are able to attend the meeting. However, even if you plan to attend the meeting, we urge you to cast your vote early. That will ensure your vote is counted should your plans change. This information summarizes information that is included in more detail in the combined proxy statement. We urge you to read the entire combined proxy statement carefully. If you have questions, call Monday through Friday 9 a.m. to 10 p.m. Eastern time.

8 OCTOBER 30, 2017 TORTOISE ENERGY INFRASTRUCTURE CORPORATION TORTOISE POWER AND ENERGY INFRASTRUCTURE FUND, INC. TORTOISE MLP FUND, INC. TORTOISE PIPELINE & ENERGY FUND, INC. TORTOISE ENERGY INDEPENDENCE FUND, INC Ash Street, Suite 300 Leawood, Kansas COMBINED PROXY STATEMENT FOR SPECIAL SHAREHOLDER MEETING TO BE HELD ON DECEMBER 21, 2017 This combined proxy statement is being sent to you by the Boards of Directors of each of Tortoise Energy Infrastructure Corporation ( TYG ), Tortoise Power and Energy Infrastructure Fund, Inc. ( TPZ ), Tortoise MLP Fund, Inc. ( NTG ), Tortoise Pipeline & Energy Fund, Inc. ( TTP ) and Tortoise Energy Independence Fund, Inc. ( NDP ) (each a Company and collectively, the Companies ). The Board of Directors of each Company is asking you to complete and return the enclosed proxy, permitting all shares you own in each Company to be voted at a combined special meeting of stockholders (the Meeting ) to be held on December 21, The Board of Directors of each Company has fixed the close of business on October 17, 2017 as the record date (the Record Date ) for the determination of stockholders entitled to notice of and to vote at the Meeting and at any adjournment or postponement thereof as set forth in this combined proxy statement. This combined proxy statement and the enclosed proxy are first being mailed to stockholders on or about November 3, Each Company s reports can be accessed through its link on its investment adviser s website ( or on the Securities and Exchange Commission s ( SEC ) website ( You may also request, and each Company will provide to you without charge, a copy of the Company s most recent annual report and most recent semi-annual report succeeding the annual report, by writing to the Secretary of the Company at the Company s offices located at Ash Street, Suite 300, Leawood, Kansas or by calling the Company at Important Notice Regarding the Availability of Proxy Materials for the Special Meeting of Stockholders to be Held on December 21, 2017: This combined proxy statement is available on the Internet at On this site, you will be able to access the proxy statement for the Meeting and any amendments or supplements to the foregoing material required to be furnished to stockholders.

9 This combined proxy statement sets forth the information that each Company s stockholders should know in order to evaluate each of the following proposals. The following table presents a summary of the proposals for each Company and the class of stockholders of the Company being solicited with respect to each proposal. Proposal for each Company 1. To consider and vote on a new investment advisory agreement between the Company and its investment adviser, Tortoise Capital Advisors, L.L.C. 2. To consider and take action upon such other business as may properly come before the meeting, including the adjournment and postponement thereof. Class of Stockholders of Each Company Entitled to Vote For each of TYG, NTG and TTP Common Stockholders and Preferred Stockholders, voting as a single class For TPZ and NDP Common Stockholders voting as a class For each of TYG, NTG and TTP Common Stockholders and Preferred Stockholders, voting as a single class For TPZ and NDP Common Stockholders voting as a class

10 PROPOSAL ONE APPROVAL OF A NEW INVESTMENT ADVISORY AGREEMENT Background Pursuant to the terms of the separate investment advisory agreement between Tortoise Capital Advisors, L.L.C. (the Adviser ) and each Company (each, a Current Investment Advisory Agreement and collectively, the Current Investment Advisory Agreements ), Tortoise Capital Advisers, L.L.C. currently serves as the investment adviser to each Company and is responsible for the management of the portfolio of each Company. The date of each Company s Current Investment Advisory Agreement and the date on which it was last approved by shareholders and last approved for continuance by the Board of Directors is set forth on Appendix A. On October 18, 2017, Tortoise Investments, LLC ( Tortoise Investments ), the parent company of the Adviser, announced the signing of a definitive agreement for a buy-out of Tortoise Investments. Pursuant to the terms of the Membership Interest Purchase Agreement (the Purchase Agreement ) between a vehicle formed by Lovell Minnick Partners LLC ( Lovell Minnick ) and owned by certain private funds sponsored by Lovell Minnick and a group of institutional co-investors (the Acquirer ) and certain members of Tortoise Investments, and subject to certain customary closing conditions, the Acquirer will acquire the equity interests in Tortoise Investments currently held by Montage Investments, LLC (a subsidiary of Mariner Holdings, LLC) and the equity interests currently held by certain of the original founders of the firm. Selling members include Messrs. Zachary Hamel, Kenneth Malvey and Terry Matlack, each currently a member of the Investment Committee and a Managing Director of the Adviser, who will sell their remaining interests in Tortoise and retire from Tortoise upon the closing of the Transaction. Mr. David Schulte, another co-founder of the firm who left Tortoise in 2015, will also sell his remaining equity interests in Tortoise Investments as part of the Transaction. As part of the Transaction, ongoing management and employees are expected to meaningfully increase their ownership of Tortoise Investments. Employees will retain a significant equity interest, with many investing additional capital alongside the Acquirer. Following the closing of the Transaction, it is expected that the Acquirer will own approximately two-thirds of the equity interests in Tortoise Investments and ongoing Tortoise management and employees will own approximately one-third of the equity interests in Tortoise Investments. Lovell Minnick is an independent private equity firm founded in 1999, specializing in financial and business services sectors. The Board of each Company has been advised that the Transaction has been structured in compliance with the safe harbor provisions of Section 15(f) of the 1940 Act. The closing of the Transaction is subject to the satisfaction or waiver of customary closing conditions, including shareholder approval of new investment advisory agreements for each Company which have been approved by the Board and receipt of the requisite consents from advisory clients representing a significant

11 percentage of the annual revenues of the Adviser. The parties to the Purchase Agreement may terminate the Purchase Agreement if the Transaction is not consummated by April 1, The day-to-day portfolio management, investment objectives and policies, and investment processes of the Companies are not expected to change as a result of the Transaction or entering into the proposed new investment advisory agreements with the Adviser (each a New Investment Advisory Agreement and collectively, the New Investment Advisory Agreements ). The Investment Committee of the Adviser will continue to provide investment strategy oversight to the portfolio management team who implements the strategy for each Company s portfolio and the members of the Investment Committee will remain the same except for the founders who are expected to leave Tortoise upon the closing of the Transaction. P. Bradley Adams, currently Chief Executive Officer, Principal Financial Officer and Treasurer of each of the Companies, will also serve on the Investment Committee for the Companies. Following the closing of the Transaction, the Adviser will continue to operate independently under the Tortoise brand and will remain located at Ash Street, Suite 300, Leawood, Kansas The closing of the Transaction is subject to the receipt of certain regulatory and client approvals and the satisfaction or waiver of certain other customary closing conditions. The Transaction will result in a change in control of the Adviser and will, therefore, constitute an assignment of the Current Investment Advisory Agreements within the meaning of the Investment Company Act of 1940, as amended (the 1940 Act ). An investment advisory agreement automatically terminates upon its assignment under the applicable provisions of the 1940 Act. The terms of each New Investment Advisory Agreement are substantially identical to the terms of its corresponding Current Investment Advisory Agreement, except for the effective and termination dates, and would simply continue the relationship between each Company and the Adviser. The advisory fee rate payable to the Adviser by each Company under its Current Investment Advisory Agreement will not change under its New Investment Advisory Agreement. The form of the New Investment Advisory Agreement with TYG is attached hereto as Appendix B. The form of the New Investment Advisory Agreements with TPZ, NTG, TTP and NDP is attached hereto as Appendix C. Comparison of Current Investment Advisory Agreements and the New Investment Advisory Agreements The terms of each New Investment Advisory Agreement are substantially identical to those of its corresponding Current Investment Advisory Agreement, except for the effective dates and the termination dates. If a New Investment Advisory Agreement is approved by stockholders, it will become effective upon completion of the Transaction and will continue in effect for an initial period ending the earlier of (i) December 31, 2019 or (ii) two years from the effective date of the New Investment Advisory Agreement. Thereafter, each New Investment Advisory 2

12 Agreement will continue annually, provided that its continuance is approved by the Board of Directors, including a majority of the Directors who are not parties to the New Investment Advisory Agreement or interested persons (as defined in the 1940 Act) of any such party (the Independent Directors ), at a meeting called for that purpose, or by vote of a majority of the outstanding shares of the applicable Company. The Board of Directors, including the Independent Directors, last approved the continuance of each Current Investment Advisory Agreement in October Below is a comparison of certain terms of each Current Investment Advisory Agreement to the corresponding New Investment Advisory Agreement. Investment Advisory Services. The investment advisory services to be provided by the Adviser to each Company are the same under the Current Investment Advisory Agreements and the New Investment Advisory Agreements. Each Current Investment Advisory Agreement and its corresponding New Investment Advisory Agreement provide that the Adviser shall furnish an investment program, investment research, advice and supervision to the Company, subject always to the overall investment objectives of the Company, policies and instructions as the Board of Directors may from time to time establish, and provisions of the Company s Articles of Incorporation, Bylaws, and any registration statements filed with the Securities and Exchange Commission (the Commission ), as any of the same may be amended or supplemented from time to time. The Adviser shall determine what securities shall be purchased by the Company, what securities shall be held or sold by the Company, and what portion of the Company s assets shall be held uninvested as cash or in other liquid assets. The Adviser will exercise full discretion and act for the Company with respect to purchases, sales or other transactions, as well as with respect to other things necessary or incidental to the furtherance or conduct of such purchases, sales or other transactions. The Current Investment Advisory Agreement and the New Investment Advisory Agreement for each of TPZ, NTG, TTP and NDP additionally provide that the Adviser may (i) determine the composition of the portfolio of the Company, the nature and timing of the changes therein and the manner of implementing such changes, (ii) identify, evaluate and negotiate the structure of the investments made by the Company, (iii) perform due diligence on prospective portfolio companies, (iv) close and monitor the Company s investments, and (v) provide the Company with such other investment advisory, research and related services as the Company may reasonably require for the investment of its funds. Compensation. The fee structure and advisory fee rate under each Current Investment Advisory Agreement are the same as its corresponding New Investment Advisory Agreement. Under each Current Investment Advisory Agreement and its corresponding New Investment Advisory Agreement, fees are calculated based on a percentage of the Managed Assets of the Company. Managed Assets means a Company s total assets (including any assets attributable to leverage that may be outstanding) minus accrued liabilities (other than liabilities attributable to financial 3

13 leverage). In the case of TYG and NTG, for the purpose of determining Managed Assets, assets exclude net deferred tax assets and liabilities exclude deferred tax liabilities. The advisory fee rate under the terms of each Company s Current Investment Advisory Agreement are identical to its corresponding New Investment Advisory Agreement as follows: Annual Fee Rate TYG TPZ NTG TTP NDP 0.95% of average monthly Managed Assets up to $2.5 billion 0.90% of average monthly Managed Assets between $2.5 billion and $3.5 billion 0.85% of average monthly Managed Assets above $3.5 billion 0.95% of average monthly Managed Assets 0.95% of average monthly Managed Assets 1.10% of average monthly Managed Assets 1.10% of average monthly Managed Assets The advisory fee for TYG is calculated and accrued monthly. The advisory fee for TPZ, NTG, TTP and NDP is calculated and accrued daily. For each Company, the advisory fee is payable quarterly within five (5) days of the end of each calendar quarter. The amount of fees paid to the Adviser during each Company s most recently ended fiscal year is set forth in Appendix D. Payment of Expenses. Under each Current Investment Advisory Agreement and New Investment Advisory Agreement, the Company will pay all expenses other than those expressly stated to be payable by the Adviser. Expenses paid by the Company include, without limitation, expenses of maintaining the Company and continuing its existence, commissions, spreads, fees and other expenses connected with the acquisition, holding and disposition of securities and other investments, legal and accounting expenses, taxes and interest, governmental fees, listing expenses, regulatory expenses including furnishing reports, registration fees and communicating with shareholders, insurance expenses, membership dues, fees related to custodial, transfer, valuation and other administrative expenses, compensation of directors of the Company who are unaffiliated with the Adviser, expenses incurred in leveraging of the Company s assets, Company organization expenses, expenses related to the offering of Company securities and such nonrecurring items as may arise. Other Services. Under each Current Investment Advisory Agreement and New Investment Advisory Agreement, the Adviser agrees to furnish administrative services, other than services provided by the Company s custodian, accounting agent, administrator, dividend and interest paying agent and other services providers, necessary to the operation of the Company. Specifically, the Adviser is authorized to conduct relations with custodians, depositaries, underwriters, 4

14 brokers, dealers, placement agents, banks, insurers, accountants, attorneys, pricing agents and other persons as may be deemed necessary or desirable. The Adviser shall also oversee the performance of, and payment of the fees to, the service providers, make reports and recommendations to the Board of Directors, assist and liaise with service providers in the preparation and filing of regulatory reports, proxy statements, shareholder reports and Board materials, establish and oversee the implementation of borrowing facilities or other forms of leverage authorized by the Board of Directors, and generally supervise any other aspects of the Company s administration as agreed to by the Company and Adviser. The Company shall reimburse the Adviser or its affiliates for any out-of-pocket expenses incurred in providing these administrative duties. The Current Investment Advisory Agreement and New Investment Advisory Agreement of TPZ, NTG, TTP and NDP further provide that to the extent the Adviser expects to provide administrative services that the agreement contemplates would be provided by a third party, the Adviser may propose to the Board of Directors a separate Administrative Agreement that provides for the Adviser to provide such services with separate compensation to the Adviser. Liability of Adviser. Under each Current Investment Advisory Agreement and New Investment Advisory Agreement, the Adviser will not be liable for any default, failure or defect in any of the securities compromising the Company s portfolio if it has satisfied the duties and the standard of care, diligence and skill. The Adviser shall be liable, however, for any loss, damage, claim, cost, charge, expense or liability resulting from the Adviser s willful misconduct, bad faith or gross negligence, or a material breach or default of the Adviser s obligations under the Current Investment Advisory Agreement or New Investment Advisory Agreement. Continuance. The Current Investment Advisory Agreement for each Company continues in effect for successive one-year periods after its initial term, if such continuance is specifically approved at least annually (a) either by the Board of Directors or by the vote of a majority of the outstanding voting securities of the Company (as defined in Section 2(a)(42) of the 1940 Act), and (b) by the affirmative vote of a majority of the directors who are not parties to, or interested persons (as defined in the 1940 Act) of parties to, the Current Investment Advisory Agreements. The New Investment Advisory Agreements shall have an initial term ending the earlier of (i) December 31, 2019 or (ii) two years from the effective date of the New Investment Advisory Agreement, and will continue thereafter for successive oneyear periods if approved annually in the same manner required under the Current Investment Advisory Agreements. Termination. Each Current Investment Advisory Agreement and its corresponding New Investment Advisory Agreement provide that they may be terminated by the Company at any time, without the payment of any penalty, by the Board of Directors of the Company or by the vote of the holders of a majority of the outstanding shares of the Company on 60 days written notice to the Adviser. Each Current Investment Advisory Agreement and its corresponding New Investment Advisory Agreement 5

15 provide that they may be terminated by the Adviser at any time, without the payment of any penalty, upon 60 days written notice to a Company. Each Current Investment Advisory Agreement and its corresponding New Investment Advisory Agreement also provide that they will automatically terminate in the event of an assignment (as defined in the 1940 Act). Information Regarding the Adviser The Adviser is located at Ash Street, Suite 300, Leawood, Kansas The Adviser specializes in essential asset investing. The Adviser was formed in October 2002 to provide portfolio management services to institutional and highnet worth investors seeking professional management of their MLP investments. As of September 30, 2017, the Adviser had approximately $16.0 billion of assets under management. The Adviser is wholly-owned by Tortoise Investments, LLC ( Tortoise Investments ), a holding company. Employees under the Tortoise Investments family, including the members of the Adviser s Investment Committee, hold a minority interest in Tortoise Investments, and Montage Investments, LLC ( Montage Investments ) owns a majority interest in Tortoise Investments. The investment management of the portfolio of each Company is the responsibility of the Adviser s Investment Committee, currently consisting of H. Kevin Birzer, Zachary A. Hamel, Kenneth P. Malvey, Terry C. Matlack, Brian A. Kessens, James R. Mick, Matthew G.P. Sallee and Robert J. Thummel, Jr. The Investment Committee provides investment strategy oversight to the portfolio management team who implements the strategy. While responsibility for monitoring, review, and analysis of individual securities is spread among various individual members of the portfolio management team, all portfolio management decisions and reviews are based on a team approach. Following the closing of the Transaction, the Investment Committee with respect to the Companies will consist of Messrs. Birzer, Sallee, Mick, Kessens, and Thummel (all existing members of the Investment Committee), and P. Bradley Adams. H. Kevin Birzer. Mr. Birzer has been a Managing Director and member of the Investment Committee of the Adviser since Mr. Birzer, Chief Executive Officer of our Adviser, has served as a Director and Chairman of the Board of each Company since its inception. Mr. Birzer, who was a member in Fountain Capital Management, L.L.C. ( Fountain Capital ), a high yield bond management firm, from 1990 to May 2009, began his career in Mr. Birzer graduated with a Bachelor of Business Administration degree from the University of Notre Dame and holds a Master of Business Administration degree from New York University. He earned his CFA designation in Brian A. Kessens. Mr. Kessens joined the Adviser in He has been a portfolio manager of the Adviser since July 2013, a Managing Director of the Adviser since January 2015, and a member of the Investment Committee of the Adviser since June 6

16 30, Mr. Kessens has served as President of TTP and TPZ since June 30, He was a senior investment analyst of the Adviser from June 2012 to July 2013, and an investment analyst from 2008 to June Previously, from 2004 to 2008, he was a vice president in Citigroup s global energy investment banking practice. Prior to Citigroup, he served from 1997 to 2002 as a field artillery officer in the United States Army. Mr. Kessens earned a Master of Business Administration from Columbia Business School in New York and a Bachelor of Science in economics from the United States Military Academy at West Point. He earned his CFA designation in James R. Mick. Mr. Mick joined the Adviser in He has been a portfolio manager of the Adviser since July 2013, a Managing Director of the Adviser since January 2014, and a member of the Investment Committee of the Adviser since June 30, He was a senior investment analyst of the Adviser from June 2012 to July 2013, an investment analyst from 2011 to June 2012, and a research analyst from 2006 to Previously, he was a senior finance specialist at General Electric Insurance Solutions (now Swiss Re) from 2003 to 2006 and a senior auditor at Ernst & Young from 2000 to Mr. Mick earned Bachelor of Science degrees in business administration and accounting and a Master of Accounting and Information Systems degree from the University of Kansas. He earned his CFA designation in Matthew G.P. Sallee. Mr. Sallee joined the Adviser in He has been a portfolio manager of the Adviser since July 2013, a Managing Director of the Adviser since January 2014, and a member of the Investment Committee of the Adviser since June 30, Mr. Sallee has served as President of TYG and NTG since June 30, He was a senior investment analyst of the Adviser from June 2012 to July 2013, an investment analyst from 2009 to June 2012, and a research analyst from 2005 to Previously, he served for five years (from 2000 to 2005) as a senior financial analyst with Aquila, Inc., where he was responsible for analysis of capital allocation at the firm s communications infrastructure subsidiary, Everest Connections. Mr. Sallee graduated magna cum laude from the University of Missouri with a degree in business administration. He earned his CFA designation in Robert J. Thummel, Jr. Mr. Thummel joined the Adviser in He has been a portfolio manager of the Adviser since July 2013, a Managing Director of the Adviser since January 2014, and a member of the Investment Committee of the Adviser since June 30, Mr. Thummel has served as President of NDP since June 30, He was a senior investment analyst of the Adviser from June 2012 to July 2013, and an investment analyst from 2004 to June Mr. Thummel was previously the president of TYN from 2008 until the fund was merged into TYG in June Previously, he was director of finance at KLT Inc., a subsidiary of Great Plains Energy, from 1998 to 2004 and a senior auditor at Ernst & Young from 1995 to Mr. Thummel earned a Bachelor of Science in accounting from Kansas State University and a Master of Business Administration degree from the University of Kansas. 7

17 P. Bradley Adams. Mr. Adams joined the Adviser in 2005 and oversees Tortoise s financial operations. He has been a Managing Director of the Adviser since January 2013 and was Director of Financial Operations of the Adviser from 2005 to January He is also the Chief Executive Officer, Principal Financial Officer and Treasurer of each of the Companies. Previously, he served as a consultant to the financial services industry and was vice president of finance and operations, chief operating officer and director of Jones & Babson, Inc., an investment company distributor and service provider. Mr. Adams earned a Bachelor of Science degree in finance from the University of Wyoming and a Master of Business Administration degree from Rockhurst University in Kansas City, Missouri. Information regarding other registered investment companies or series thereof (other than the Companies) managed by the Adviser, that have similar investment strategies to a Company is set forth in Appendix E to this Proxy Statement. Additional information regarding the officers, directors, beneficial owners and other personnel of the Adviser is set forth in Appendix G to this Proxy Statement. Lovell Minnick Partners LLC, located at 150 N. Radnor Chester Road, Radnor, PA, 19087, is an independent private equity firm found in 1999, which specializes in financial and business services sectors. Matters Considered by the Board of Directors of each Company in approving the New Investment Advisory Agreement The Current Investment Advisory Agreement for each Company was reviewed and, by unanimous vote, renewed by such Company s Board of Directors, including the Independent Directors, at an in-person meeting held on October 16, Such renewal term expires upon the earlier to occur of the closing of the Transaction or December 31, At the same meeting, the Board of Directors, including the Independent Directors, reviewed and unanimously approved the New Investment Advisory Agreements for each Company, subject to requisite stockholder approval and the closing of the Transaction. As the Current Investment Advisory Agreements and the New Investment Advisory Agreements were reviewed and considered by each Company s Board of Directors contemporaneously, and they are substantially identical except for the effective and termination dates, the Board of Director s analysis of them engaged a parallel process and, with respect to the New Investment Advisory Agreements, drew additional focus on the expected effect that the change of control of the Adviser would have on the Adviser and the Company s relationship with the Adviser. In preparation for its review of the Current Investment Advisory Agreement and the New Investment Advisory Agreement, the Independent Directors of each Company consulted with independent legal counsel regarding the factors to be considered in its review and the nature of information to be provided, and through its independent legal counsel the Independent Directors sent a detailed formal request for information to the Adviser. In addition to materials received 8

18 and reviewed by the Board of Directors throughout the year, the Adviser provided extensive information, including information from independent third party sources, and the directors reviewed such information, over the course of several weeks in response to this request. For each Company, the Adviser provided information to assist the Board of Directors in assessing, among other things, the nature, extent and quality of advisory, administrative and other services provided by the Adviser, the investment performance of the Company (including a comparison of advisory fees and total expenses of the Company to other peer funds), the cost of services provided (including a comparison of advisory fees and total expenses of the Company to other peer funds), the profitability of the advisory contract to the Adviser, the potential for economies of scale, if any, and the collateral benefits the Adviser may derive from its relationship with the Company. In August 2017, the Independent Directors consulted with its independent legal counsel regarding the legal issues and items to consider in a potential change of control of the Adviser. Working with its independent legal counsel, the Independent Directors provided to the Adviser a document requesting information from the potential acquirer, to assist the Board of Directors in assessing the potential acquirer and the impact that the change of control would have on the Adviser s relationship with the Companies and the factors considered in reviewing and approving a new investment advisory agreement. The Board of Directors met several times in September 2017 to review and discuss these considerations. After the Adviser s decision to engage in exclusive negotiations with Lovell Minnick, the Board of Directors held an in-person meeting on October 2, 2017 to meet with representatives of the Adviser and Lovell Minnick. At this meeting, Lovell Minnick outlined its background, expertise and experience, described its business, operational and management plans for the Adviser following the closing of the Transaction, summarized the principal terms of the Transaction, and answered such questions as were raised at the meeting. Later that day, Lovell Minnick provided to the Board of Directors, in response to the written request for information submitted by the Independent Directors, detailed information to assist the Board of Directors of each Company in its review and consideration of the New Investment Advisory Agreement and the effect that the Transaction would have on the Adviser and its relationship with the Company ( Transaction Materials ). The Board of Directors of each Company reviewed the Transaction Materials, along with the materials it had received for its general review of the Current Investment Advisory Agreement and the New Investment Advisory Agreement, and held a meeting with the Adviser on October 9, 2017 to discuss and address issues and questions. The Transaction Materials provided to the Board of Directors included, among other things, responsive information regarding (1) the organizational and operational structure of Acquirer and how the Adviser would be integrated into that structure, (2) the background and qualifications of Lovell Minnick and the executives who will be primarily responsible for the Acquirer s relationship with 9

19 the Adviser, (3) the capitalization and financial condition of the Acquirer, (4) the financing arrangements for the Transaction and the implications of leverage upon the Adviser, (5) whether after the Transaction there were plans to change the business, operations or management of the Adviser, (6) Acquirer s availability of capital for future investments in the Adviser, (7) legal, litigation and regulatory matters, including Lovell Minnick s compliance policies, (8) potential conflicts of interest that may arise due to the Acquirer s ownership of the Adviser, (9) the draft definitive purchase agreement and a summary of the terms of the Transaction, including closing conditions, and (10) confirmation that the Transaction is structured to comply with the safe harbor of Section 15(f) of the 1940 Act, and that the Company would not bear any expenses related to the Transaction. At the meeting, the Board of Directors also reviewed and discussed the terms of the Transaction. Based upon its review, at an in-person meeting held on October 16, 2017, the Board of Directors of each Company, including the Independent Directors meeting in executive session with its independent legal counsel, unanimously concluded that it was in the best interest of the Company and its stockholders to approve the New Investment Advisory Agreement for a term expiring upon the earlier of (i) December 31, 2019 or (ii) two years from the effective date of the New Investment Advisory Agreement, subject to stockholder approval and the closing of the Transaction, and resolved to recommend that the stockholders of the Company approve the New Investment Advisory Agreement with respect to such Company. In connection with each Board of Director s consideration of the New Investment Advisory Agreement, the directors considered, among other information and factors, the following factors regarding the Transaction s effect upon the Adviser and the Company s relationship with the Adviser: the statements of Lovell Minnick and the Adviser to the Board of Directors that: o the day-to-day portfolio management, investment objectives and policies, and investment processes of the Company will not change in any material respect as a result of the Transaction; o o o the Transaction does not require or propose any change in the Adviser s day-to-day portfolio management teams or key personnel, except that certain founders of the Adviser are expected to leave Tortoise upon the closing of the Transaction; the services provided by the Adviser to the Company will be of the same or improved quality following the closing of the Transaction as those in effect immediately prior to the closing of the Transaction; there will be no impact on the profitability of the Adviser as a result of the Transaction; 10

20 o the Acquirer and the Adviser intend to comply with the safe harbor provisions of Section 15(f) of the 1940 Act, including having Independent Directors comprise 75% or more of the Company s Board of Directors for three years following the closing of the Transaction and they will use reasonable best efforts not to engage in activities that would impose an unfair burden (within the meaning of Section 15(f)) on the Companies for a period of two years following the closing of the Transaction. except for provisions relating to effectiveness and termination dates, the terms of the New Investment Advisory Agreement are substantially identical to the Current Investment Advisory Agreement, including the fee and expense structure and the advisory fee rate; the investment advisory and administrative services to be provided to the Company by the Adviser are the same under the Current Investment Advisory Agreement and the New Investment Advisory Agreements; the impact of the Transaction on the Adviser s day-to-day operations, including, without limitation, the potential increase in resources available to the Adviser personnel as a result of the Transaction; the anticipated capitalization and level of indebtedness of the Adviser following the closing of the Transaction; the reputation, capabilities, experience, organizational structure and financial resources of Lovell Minnick; the long-term business goals of Lovell Minnick and the Adviser with regard to the business and operations of the Adviser; that stockholders of the Companies will not bear any costs in connection with the Transaction, as the parties to the Purchase Agreement will bear the costs, fees and expenses incurred by the Companies in connection with this Proxy Statement, the solicitation of proxies, and any other costs of the Companies associated with the Transaction; and the terms of the Transaction, including payments made by the Acquirer to the owners of the Adviser in connection with the Transaction, Tortoise ongoing management and employees retaining a significant equity interest in Tortoise with many investing additional capital alongside the Acquirer, and employment relationships of the Adviser s key personnel following closing of the Transaction. The Board of Directors of each Company, including the Independent Directors, considered and evaluated all the information provided to it by the Adviser and Lovell Minnick. The directors did not identify any single factor as being all-important or controlling, and each director may have attributed different levels of important to 11