Document:

Exhibit
10.3

 

EXECUTION VERSION

 

XAI
Octagon Floating Rate & Alternative Income Term Trust

321
North Clark Street, Suite 2430

Chicago,
Illinois 60654

 

June
28, 2022

 

Eagle
Point Credit Management LLC

600
Steamboat Road, Suite 202

Greenwich,
CT 06830

 

Ladies
and Gentlemen:

 

Whereas,
the parties previously entered into a letter agreement, dated as of September 8, 2021 (the “Letter Agreement”) in connection
with the Purchase Agreement, dated as of September 8, 2021 (the “Purchase Agreement”), between XAI Octagon Floating
Rate & Alternative Income Term Trust (the “Trust”) and each purchaser party thereto (each, a “Purchaser”)
relating to the purchase of shares of the Trust’s 6.50% Series 2026 Term Preferred Shares, liquidation preference $25.00 per share
(the “2026 Preferred Shares”). Eagle Point Credit Management LLC (“Eagle Point”) is the investment
manager of each Purchaser.

 

Whereas
the Trust, Eagle Point and the Purchasers desire to amend and restate the Letter Agreement.

 

The
parties do hereby agree:

 

1.             (a)       Each
Purchaser hereby grants to the Trust an irrevocable proxy to vote at any annual or special meeting of shareholders of the Trust all of
the 2026 Preferred Shares which the Purchaser is entitled to vote as of the record date for the applicable annual or special meeting
of shareholders of the Trust in the same proportion as the vote of all other holders of Preferred Shares of the Trust.

 

(b)
      Eagle Point hereby grants to the Trust an irrevocable proxy to vote at any annual or special meeting
of shareholders of the Trust all other 2026 Preferred Shares held by Eagle Point, any person controlled by Eagle Point Holdings LP, Eagle
Point’s immediate parent company (“Eagle Point Parent”), or any other investment vehicles or accounts sponsored or
managed by Eagle Point or any person controlled by Eagle Point Parent, or which Eagle Point or any person controlled by Eagle Point Parent
otherwise has or shares the power to vote, or to direct the voting of, as of the record date for the applicable annual or special meeting
of shareholders of the Trust (together with the 2026 Preferred Shares which any Purchaser is entitled to vote, the “Eagle Point
Shares”), in the same proportion as the vote of all other holders of Preferred Shares of the Trust.

 

2.            Upon
the request of the Trust, Eagle Point shall promptly provide to the Trust a written certification listing the number of Eagle Point Shares
as of the record date of such meeting and identifying the intermediary(s), if any, through which such Eagle Point Shares are held. The
Trust (or its agent) shall cooperate with Eagle Point in connection with Eagle Point’s compliance with its obligations hereunder.

 

     

     

    

 

3.            All
notices shall be in writing and shall be delivered by registered or overnight mail, facsimile, or electronic mail to the address for
each party specified below or to such other person or address as such party may designate for receipt of such notice.

 

If
to the Trust:

 

XAI
Octagon Floating Rate & Alternative Income Term Trust

c/o
XA Investments LLC

321
North Clark Street, Suite 2430

Chicago,
Illinois 60654

Attention:
General Counsel

E-mail:
bmcculloch@xainvestments.com

 

If
to Eagle Point:

 

Eagle
Point Credit Management LLC

600
Steamboat Road, Suite 202

Greenwich,
CT 06830

 

If
to a Purchaser:

 

c/o
Eagle Point Credit Management LLC

600
Steamboat Road, Suite 202

Greenwich,
CT 06830

 

4.
           The execution and delivery by each of the Trust, Eagle Point and each
Purchaser of this Letter Agreement and the performance by each of the Trust, Eagle Point and each Purchaser of its respective obligations
hereunder have been duly authorized by all necessary action of the Trust, Eagle Point and each Purchaser. Eagle Point, in its capacity
as agent and/or investment manager of each Purchaser is duly authorized and empowered to execute this Agreement on behalf of each Purchaser.
Each of the Trust, Eagle Point and each Purchaser hereby represents and warrants that this Letter Agreement is enforceable against it
in accordance with its terms.

 

5.            Each
party hereto hereby acknowledges and agrees that irreparable harm will occur in the event any of the provisions of this Letter Agreement
were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties will
be entitled to seek specific performance hereunder, including, without limitation, an injunction or injunctions to prevent and enjoin
breaches of the provisions of this Letter Agreement and to enforce specifically the terms and provisions hereof, in addition to any other
remedy to which they may be entitled at law or in equity. Any requirements for the securing or posting of any bond with respect to any
such remedy are hereby waived. All rights and remedies under this Letter Agreement are cumulative, not exclusive, and will be in addition
to all rights and remedies available to any party at law or in equity.

 

    2

     

    

 

6.            The
parties hereto hereby irrevocably and unconditionally consent to and submit to the jurisdiction of the state or federal courts in the
State of Delaware for any actions, suits or proceedings arising out of or relating to this Letter Agreement or the transactions contemplated
hereby. The parties irrevocably and unconditionally waive any objection to the laying of venue of any action, suit or proceeding arising
out of this Letter Agreement, or the transactions contemplated hereby, in the state or federal courts in the State of Delaware, and hereby
further irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum. Each party waives all right to trial by jury in any action, proceeding
or counterclaim (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Letter Agreement.

 

7.             This
Letter Agreement represents the entire agreement among the parties with respect to the transactions contemplated herein and supersedes
all prior agreements, written or oral, with respect thereto.

 

8.
            The provisions of this Letter Agreement may be amended or modified
only with the prior written consent of the Trust and Eagle Point. The failure of any party to insist upon strict adherence to any one
or more of the covenants and restrictions in this Letter Agreement, on one or more occasion, shall not be construed as a waiver, nor
deprive such party of the right to require strict compliance thereafter with the same. All waivers must be in writing and signed by the
waiving party.

 

9.             This
Letter Agreement and all of the provisions hereof will be binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that neither this Letter Agreement nor any of the rights, interests or obligations
hereunder may be assigned by any party without the prior written consent of each other party.

 

10.           This
Letter Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to
the choice of law principles thereof.

 

11.          This
Letter Agreement may be executed in counterparts, each of which shall be an original and all of which shall constitute a single agreement.
Delivery of an executed signature page of this Agreement by facsimile or other electronic transmission shall be effective as delivery
of a manually executed counterpart hereof.

 

12.          The
provisions of this Letter Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect
the validity or enforceability of the other provisions hereof. If any provision of this Letter Agreement, or the application thereof
to any person or entity or any circumstance, is invalid or unenforceable, (a) a suitable and equitable provision shall be substituted
therefor in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid or unenforceable provision
and (b) the remainder of this Letter Agreement and the application of such provision to other persons, entities or circumstances shall
not be affected by such invalidity or unenforceability, nor shall such invalidity or unenforceability affect the validity or enforceability
of such provision, or the application thereof, in any other jurisdiction.

 

[Signature
Page Follows]

 

    3

     

    

 

IN
WITNESS WHEREOF, the Parties hereto have executed this Letter Agreement as of the date first above written.

 

	 	XAI OCTAGON FLOATING
    RATE & ALTERNATIVE INCOME TERM TRUST

 

	 	By:	/s/
    Benjamin D. McCulloch
	 		Name: 	Benjamin D. McCulloch
	 		Title:	Secretary
	 	 	 	 
	 	EAGLE POINT CREDIT MANAGEMENT LLC
	 	 
	 	By:	/s/ Taylor Pine
	 		Name:	Taylor Pine
	 		Title:	Director
	 	 	 	 
	 	PURCHASERS:
	 	 	 	 
	 	By:	EAGLE POINT CREDIT MANAGEMENT LLC
	 	 	 	 
	 	 	On behalf of each Purchaser listed on Appendix
    A hereto
	 	 	 	 
	 	 	/s/
    Taylor Pine
	 		Name:	Taylor Pine
	 		Title:	Director

 

    4EXHIBIT 4.4

 

DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED PURSUANT

TO SECTION 12 OF THE SECURITIES EXCHANGE ACT
OF 1934

 

The
following summary of the rights of our common stock, $0.001 par value per share (“Common Stock”), and preferred stock, $0.001
par value per share (“Preferred Stock”), does not purport to be complete. This summary is subject to and qualified by the
provisions of our certificate of incorporation, as amended (“Certificate of Incorporation”), and our amended and restated
bylaws, as amended (“Bylaws”), copies of which are filed as exhibits to our Annual Report on Form 10-K for the fiscal year
ended April 30, 2022, and incorporated herein by reference. In addition, the Delaware General Corporation Law, as amended (“DGCL”)
also affects the terms of our capital stock.

 

Authorized Capital
Stock

 

Our
authorized capital stock consists of 155,000,000 shares, of which:

 

		·	150,000,000 shares have been designated as Common Stock; and
	 	 	 
		·	5,000,000 shares have been designated as Preferred Stock.

 

We are authorized to designate
and issue up to 5,000,000 shares of Preferred Stock in one or more classes or series and, subject to the limitations prescribed by our
Certificate of Incorporation and the DGCL, with such rights, preferences, privileges, and restrictions of each class or series of preferred
stock, including dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences and the number of shares
constituting any class or series as our board of directors may determine, without any vote or action by our stockholders.

 

As
of April 30, 2022, there were 61,807,261 shares of Common Stock issued and outstanding and no shares of Preferred Stock issued or outstanding.

 

All
outstanding shares of our capital stock are fully paid and nonassessable.

 

Common Stock

 

Voting Rights

 

Holders
of Common Stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders, including the
election of directors.

 

The
DGCL could require holders of any of the shares of Common Stock or Preferred Stock to vote separately, as a single class, in the following
circumstances:

 

		·	if we amended our Certificate of Incorporation to increase or decrease the par value of the shares of
a class of stock, then the holders of the shares of that class would be required to vote separately to approve the proposed amendment;
and

 

		·	if we amended our Certificate of Incorporation in a manner that altered or changed the powers, preferences,
or special rights of the shares of a class of stock so as to affect them adversely, then the holders of the shares of that class would
be required to vote separately to approve the proposed amendment.

 

 

 

    	 	1	 

     

    

 

Dividends

 

Subject
to preferences that may be granted to the holders of Preferred Stock, each holder of Common Stock is entitled to share ratably in distributions
to stockholders and to receive ratably such dividends as may be declared by our board of directors out of funds legally available therefor.

 

Liquidation Rights

 

In
the event of our liquidation, dissolution or winding up, the holders of Common Stock will be entitled to receive, after payment of all
of our debts and liabilities and of all sums to which holders of any Preferred Stock may be entitled, the distribution of any of our remaining
assets.

 

Conversion

 

Shares
of Common Stock are not convertible into any other shares of our capital stock.

 

Undesignated Preferred
Stock

 

Our
board of directors is authorized to designate and authorize the issuance of up to 5,000,000 shares of our authorized Preferred Stock in
one or more series of Preferred Stock, and, in connection with the creation of such series, fix by the resolution or resolutions providing
for the issuance of shares the voting powers and designations, preferences and relative, participating, optional or other special rights,
and qualifications, limitations or restrictions of such series, including dividend rates, conversion rights, voting rights, terms of redemption
and liquidation preferences and the number of shares constituting such series.

 

The
particular terms of any additional series of Preferred Stock offered by may include:

 

		·	the maximum number of shares in the series and the designation of the series;

 

		·	the terms of which dividends, if any, will be paid;

 

		·	the terms of which the shares may be redeemed, if at all;

 

		·	the liquidation preference, if any;

 

		·	the terms of any retirement or sinking fund for the purchase or redemption of the shares of the series;

 

		·	the terms and conditions, if any, on which the shares of the series will be convertible into, or exchangeable
for, shares of any other class or classes of securities;

 

		·	the voting rights, if any, of the shares of the series; and

 

		·	any or all other preferences and relative, participating, operational or other special rights or qualifications,
limitations or restrictions of the shares.

 

Our
board of directors may authorize the issuance of series of Preferred Stock with voting or conversion rights that could adversely affect
the voting power or other rights of the holders of Common Stock. In addition, the issuance of Preferred Stock, while providing flexibility
in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring
or preventing a change in control of our company and might harm the market price of our Common Stock.

 

 

 

    	 	2	 

     

    

 

Anti-Takeover Effects of Delaware Law and our
Certificate of Incorporation and Bylaws

 

Delaware Anti-Takeover
Statute

 

We are subject to the provisions
of Section 203 of the DGCL. Subject to certain exceptions, Section 203 prohibits persons deemed “interested stockholders”
from engaging, under certain circumstances, in a “business combination” with a publicly held Delaware corporation for three
years following the date these persons become interested stockholders, unless:

 

		·	prior to the date of the transaction, the board of directors of the corporation approved either the business
combination or the transaction which resulted in the stockholder becoming an interested stockholder;

 

		·	upon completion of the transaction that resulted in the stockholder becoming an interested stockholder,
the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, calculated
in accordance with the provisions of Section 203 of the DGCL; or

 

		·	on or subsequent to the date of the transaction, the business combination is approved by the board of
directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least
662⁄3% of the outstanding voting stock which is not owned by the interested stockholder.

 

Generally, an “interested
stockholder” is a person who, together with affiliates and associates, owns, or within three years prior to the determination of
interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination”
includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. The existence
of this provision may have an anti-takeover effect with respect to transactions not approved in advance by our board of directors. We
also anticipate that Section 203 of the DGCL may also discourage attempts that might result in a premium over the market price for the
shares of capital stock held by stockholders.

 

Filling of Vacancies
on our Board of Directors

 

Our
Bylaws provide that any vacancy or vacancies in our board of directors resulting from the death, resignation or removal of any director,
or an increase in the authorized number of directors, may be filled by a majority of the remaining directors, though less than a quorum.

 

Issuance of Authorized
but Unissued Shares

 

Our
authorized but unissued shares of Common Stock and Preferred Stock are available for future issuance without stockholder approval. We
may use additional shares for a variety of purposes, including future public offerings to raise additional capital, to fund acquisitions
and as employee compensation. The existence of authorized but unissued shares of Common Stock and Preferred Stock could render more difficult
or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.

 

In
addition, the authority possessed by our board of directors to designate and authorize the issuance of shares of our undesignated Preferred
Stock could potentially be used to discourage attempts by third parties to obtain control of our company through a merger, tender offer,
proxy contest, or otherwise by making such attempts more difficult or more costly. Our board of directors may issue our undesignated Preferred
Stock with voting rights or conversion rights that, if exercised, could adversely affect the voting power of the holders of our Common
Stock.

 

Stockholder Meeting
Requirements

 

Our
Bylaws provide that special meetings of our stockholders may only be called at the request of a majority of our board of directors.

 

 

 

    	 	3	 

     

    

 

Elimination of
Stockholder Action by Written Consent

 

Our
Certificate of Incorporation and Bylaws expressly eliminate the right of our stockholders to act by written consent. Stockholder action
must take place at the annual or a special meeting of our stockholders.

 

Advance Notice
Requirements for Stockholder Proposals and Director Nominations

 

Our
Bylaws provide advance notice procedures for stockholders seeking to bring business before our annual meeting of stockholders, or to nominate
candidates for election as directors at any meeting of stockholders. Our Bylaws also specify certain requirements regarding the form and
content of a stockholder’s notice. These provisions may preclude our stockholders from bringing matters before our annual meeting
of stockholders or from making nominations for directors at our meetings of stockholders.

 

Listing

 

Our
Common Stock is listed on The NASDAQ Capital Market and trade under the symbol “CDMO.”

 

The transfer agent and registrar for our Common
Stock is Broadridge Corporate Issuer Solutions, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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