Exhibit 10.4
 
KAYNE ANDERSON ENERGY DEVELOPMENT COMPANY
Automatic Dividend Reinvestment Plan
 
Kayne Anderson Energy Development Company, a Maryland corporation (the
“Company”), hereby adopts the following plan (the “Plan”) with respect to
distributions declared by its Board of Directors (the “Board”) on shares of its
Common Stock:
 
1. Unless a stockholder specifically elects to receive cash as set forth below,
all distributions hereafter declared by the Board shall be payable in shares of
the Common Stock of the Company, and no action shall be required on such
stockholder’s part to receive a distribution in stock.
 
2. Such distributions shall be payable on such date or dates as may be fixed
from time to time by the Board to stockholders of record at the close of
business on the record date(s) established by the Board for the distribution
involved.
 
3. The Company may use newly-issued shares of its Common Stock or purchase
shares in the open market in connection with the implementation of the plan. The
number of shares to be issued to a stockholder shall be based on share price
equal to 95% of the closing price of the Company’s Common Stock one day prior to
the dividend payment date.
 
4. The Board may, in its sole discretion, instruct the Company to purchase
shares of its Common Stock in the open market in connection with the
implementation of the Plan as follows: If the Company’s Common Stock is trading
below net asset value at the time of valuation, upon notice from the Company,
the Plan Administrator (as defined below) will receive the dividend or
distribution in cash and will purchase Common Stock in the open market, on the
New York Stock Exchange or elsewhere, for the Participants’ accounts, except
that the Plan Administrator will endeavor to terminate purchases in the open
market and cause the Company to issue the remaining shares if, following the
commencement of the purchases, the market value of the shares, including
brokerage commissions, exceeds the net asset value at the time of valuation.
These remaining shares will be issued by the Company at a price equal to the
greater of (i) the net asset value at the time of valuation or (ii) 95% of the
then current market price. Solely for purposes of determining the net asset
value of the Company’s Common Stock under the provisions of this Dividend
Reinvestment Plan of the Company, the “time of valuation” shall be any date up
to five (5) business days (or such shorter period as is reasonably practical)
before the date of payment of the dividend or distribution.
 
5. In a case where the Plan Administrator has terminated open market purchases
and caused the issuance of remaining shares by the Company, the number of shares
received by the participant in respect of the cash dividend or distribution will
be based on the weighted average of prices paid for shares purchased in the open
market, including brokerage commissions, and the price at which the Company
issues the remaining shares. To the extent that the Plan Administrator is unable
to terminate purchases in the open market before the Plan Administrator has
completed its purchases, or remaining shares cannot be issued by the Company
because the Company declared a dividend or distribution payable only in cash,
and the market price exceeds the net asset value of the shares at the time of
valuation, the average share purchase price paid by the Plan Administrator may
exceed the net asset value of the shares at the time of valuation, resulting in
the acquisition of fewer shares than if the dividend or distribution had been
paid in shares issued by the Company.
 
6. A stockholder may, however, elect to receive his or its distributions in
cash. To exercise this option, such stockholder shall notify American Stock
Transfer & Trust Company, the plan administrator and the Company’s transfer
agent and registrar (collectively the “Plan Administrator”), in writing so that
such notice is received by the Plan Administrator no later than the record date
fixed by the Board for the distribution involved.
 
7. The Plan Administrator will set up an account for shares acquired pursuant to
the Plan for each stockholder who has not so elected to receive dividends and
distributions in cash (each, a “Participant”). The Plan Administrator may hold
each Participant’s shares, together with the shares of other Participants, in
non-certificated form in the Plan Administrator’s name or that of its nominee.
Upon request by a Participant, received no later than three (3) days prior to
the payable date, the Plan Administrator will, instead of crediting shares to
and/or carrying shares in a Participant’s account, issue, without charge to the
Participant, a certificate registered in the Participant’s name for the number
of whole shares payable to the Participant and a check for any fractional share
less a broker commission

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on the sale of such fractional shares. If a request to terminate a Participant’s
participation in the Plan is received less than three (3) days before the
payable date, dividends and distributions for that payable date will be
reinvested. However, subsequent dividends and distributions will be paid to the
Participant in cash.
 
8. The Plan Administrator will confirm to each Participant each acquisition made
pursuant to the Plan as soon as practicable but not later than ten (10) business
days after the date thereof. Although each Participant may from time to time
have an undivided fractional interest (computed to three decimal places) in a
share of Common Stock of the Company, no certificates for a fractional share
will be issued. However, dividends and distributions on fractional shares will
be credited to each Participant’s account. In the event of termination of a
Participant’s account under the Plan, the Plan Administrator will adjust for any
such undivided fractional interest in cash at the market value of the Company’s
shares at the time of termination.
 
9. The Plan Administrator will forward to each Participant any Company related
proxy solicitation materials and each Corporation report or other communication
to stockholders, and will vote any shares held by it under the Plan in
accordance with the instructions set forth on proxies returned by Participants
to the Company.
 
10. In the event that the Company makes available to its stockholders rights to
purchase additional shares or other securities, the shares held by the Plan
Administrator for each Participant under the Plan will be added to any other
shares held by the Participant in certificated form in calculating the number of
rights to be issued to the Participant.
 
11. The Plan Administrator’s service fee, if any, and expenses for administering
the Plan will be paid for by the Company.
 
12. Each Participant may terminate his or its account under the Plan by so
notifying the Plan Administrator via the Plan Administrator’s website at
www.amstock.com, by filling out the transaction request form located at the
bottom of the Participant’s Statement and sending it to American Stock Transfer
and Trust Company, P.O. Box 922, Wall Street Station, New York, NY 10269-0560 or
by calling the Plan Administrator at (888) 888-0317. Such termination will be
effective immediately. The Plan may be terminated by the Company upon notice in
writing mailed to each Participant at least 30 days prior to any record date for
the payment of any dividend or distribution by the Company. Upon any
termination, the Plan Administrator will cause a certificate or certificates to
be issued for the full shares held for the Participant under the Plan and a cash
adjustment for any fractional share to be delivered to the Participant without
charge to the Participant. If a Participant elects by his or its written notice
to the Plan Administrator in advance of termination to have the Plan
Administrator sell part or all of his or its shares and remit the proceeds to
the Participant, the Plan Administrator is authorized to deduct a $15.00
transaction fee plus a $0.10 per share brokerage commission from the proceeds.
 
13. These terms and conditions may be amended or supplemented by the Company at
any time but, except when necessary or appropriate to comply with applicable law
or the rules or policies of the Securities and Exchange Commission or any other
regulatory authority, only by mailing to each Participant appropriate written
notice at least 30 days prior to the effective date thereof. The amendment or
supplement shall be deemed to be accepted by each Participant unless, prior to
the effective date thereof, the Plan Administrator receives written notice of
the termination of his or its account under the Plan. Any such amendment may
include an appointment by the Plan Administrator in its place and stead of a
successor agent under these terms and conditions, with full power and authority
to perform all or any of the acts to be performed by the Plan Administrator
under these terms and conditions. Upon any such appointment of any agent for the
purpose of receiving dividends and distributions, the Company will be authorized
to pay to such successor agent, for each Participant’s account, all dividends
and distributions payable on shares of the Company held in the Participant’s
name or under the Plan for retention or application by such successor agent as
provided in these terms and conditions.
 
14. The Plan Administrator will at all times act in good faith and use its best
efforts within reasonable limits to ensure its full and timely performance of
all services to be performed by it under this Plan and to comply with applicable
law, but assumes no responsibility and shall not be liable for loss or damage
due to errors unless such error is caused by the Plan Administrator’s
negligence, bad faith, or willful misconduct or that of its employees or agents.
 
15. These terms and conditions shall be governed by the laws of the State of
Maryland.
 
Adopted: September 5, 2006
Amended: July 9, 2007
Amended: April 2, 2009