<DOCUMENT>
<TYPE>N-2/A
<SEQUENCE>1
<FILENAME>c81634a2nv2za.txt
<DESCRIPTION>PRE-EFFECTIVE AMENDMENT TO REGISTRATION STATEMENT
<TEXT>
<PAGE>


     AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FEBRUARY 19, 2004


                                                    1933 ACT FILE NO. 333-110143

                                                     1940 ACT FILE NO. 811-21462
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM N-2


<Table>
<C>    <S>
 [ ]   REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
 [X]   PRE-EFFECTIVE AMENDMENT NO. 2
 [ ]   POST-EFFECTIVE AMENDMENT NO.
                                AND
 [ ]   REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF
       1940
 [X]   AMENDMENT NO. 2
</Table>


                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION
                       10801 MASTIN BOULEVARD, SUITE 222
                          OVERLAND PARK, KANSAS 66210
                                 (913) 981-1020

                               AGENT FOR SERVICE

                                DAVID J. SCHULTE
                       10801 MASTIN BOULEVARD, SUITE 222
                          OVERLAND PARK, KANSAS 66210

                          COPIES OF COMMUNICATIONS TO:

<Table>
<S>                                <C>                                <C>
   DEBORAH BIELICKE EADES, ESQ.           JOHN R. SHORT, ESQ.               RICHARD KRONTHAL, ESQ.
VEDDER, PRICE, KAUFMAN & KAMMHOLZ,  BLACKWELL SANDERS PEPER MARTIN,            KAYE SCHOLER LLP
               P.C.                               LLP                          425 PARK AVENUE
     222 NORTH LASALLE STREET               720 OLIVE STREET               NEW YORK, NEW YORK 10022
     CHICAGO, ILLINOIS 60601           ST. LOUIS, MISSOURI 63101
</Table>

     APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: As soon as practicable after
the effective date of this Registration Statement

     If any of the securities being registered on this form will be offered on a
delayed or continuous basis in reliance on Rule 415 under the Securities Act of
1933, other than securities offered in connection with a dividend reinvestment
plan, check the following box. [ ]

     It is proposed that this filing will become effective (check appropriate
box):

     [ ] when declared effective pursuant to section 8(c).

        CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933


<Table>
<Caption>
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
                                                         PROPOSED MAXIMUM        PROPOSED MAXIMUM
      TITLE OF SECURITIES            AMOUNT BEING         OFFERING PRICE        AGGREGATE OFFERING           AMOUNT OF
        BEING REGISTERED            REGISTERED(1)           PER UNIT(1)              PRICE(1)         REGISTRATION FEE(2)(3)
-----------------------------------------------------------------------------------------------------------------------------
<S>                              <C>                  <C>                     <C>                     <C>
Common Stock....................      11,500,000              $25.00               $287,500,000             $36,426.25
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
</Table>


(1) Estimated solely for the purpose of calculating the registration fee.


(2) $316.75 of which has been previously paid.



(3) Transmitted to the Securities and Exchange Commission's account at Mellon
    Bank, Pittsburgh, Pennsylvania via wire transfer (Fed. Reference
    #040218019385).


     THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT TO DELAY ITS
EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT THAT
SPECIFICALLY STATES THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL
THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATES AS THE
SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY
DETERMINE.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION

                             CROSS REFERENCE SHEET

                              PART A -- PROSPECTUS


<Table>
<Caption>
                ITEMS IN PART A OF FORM N-2                   LOCATION IN PROSPECTUS
                ---------------------------                   ----------------------
<S>       <C>                                        <C>
Item 1.   Outside Front Cover                        Cover Page
Item 2.   Cover pages; Other Offering Information    Cover Page
Item 3.   Fee Table and Synopsis                     Summary of Company Expenses
Item 4.   Financial Highlights                       Not applicable
Item 5.   Plan of Distribution                       Underwriting
Item 6.   Selling Shareholders                       Not applicable
Item 7.   Use of Proceeds                            Use of Proceeds
Item 8.   General Description of the Registrant      The Company; Leverage; Risks
Item 9.   Management                                 Management of the Company
Item 10.  Capital Stock, Long-Term Debt and other    Description of Shares
          Securities
Item 11.  Defaults and Arrears on Senior             Not applicable
          Securities
Item 12.  Legal Proceedings                          Not applicable
Item 13.  Table of Contents of the Statement of      Table of Contents of the Statement of
          Additional Information                     Additional Information
</Table>


                 PART B -- STATEMENT OF ADDITIONAL INFORMATION


<Table>
<Caption>
                ITEMS IN PART B OF FORM N-2          LOCATION IN STATEMENT OF ADDITIONAL INFORMATION
                ---------------------------          -----------------------------------------------
<S>       <C>                                        <C>
Item 14.  Cover Page                                 Cover Page
Item 15.  Table of Contents                          Table of Contents
Item 16.  General Information and History            Not applicable
Item 17.  Investment Objective and Policies          Investment Objective and Policies
Item 18.  Management                                 Management of the Company
Item 19.  Control Persons and Principal Holders of   Management of the Company
          Securities
Item 20.  Investment Advisory and Other Services     Management of the Company
Item 21.  Brokerage Allocation and Other Services    Portfolio Transactions
Item 22.  Tax Status                                 U.S. Federal Income Tax Matters
Item 23.  Financial Statements                       Financial Statements
</Table>


                          PART C -- OTHER INFORMATION

Items 24-33 have been answered in Part C of this registration statement.
<PAGE>

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.


<Table>
<S>                                                           <C>

SUBJECT TO COMPLETION                                                 (TORTOISE LOGO)
PRELIMINARY PROSPECTUS
DATED FEBRUARY 19, 2004
              COMMON SHARES
</Table>


                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION
                                $25.00 PER SHARE

     Tortoise Energy Infrastructure Corporation (the "Company") is a newly
organized, nondiversified, closed-end management investment company. The
Company's investment objective is to seek a high level of total return with an
emphasis on current distributions paid to its shareholders. The Company seeks to
provide its shareholders with an efficient vehicle to invest in a portfolio of
publicly traded master limited partnerships in the energy infrastructure sector
("MLPs"). Similar to the tax characterization of distributions made by MLPs to
its unitholders, the Company believes that it will have relatively high levels
of deferred taxable income associated with distributions to its shareholders.
There is no assurance that the Company will achieve its objective.

     Under normal circumstances, the Company will invest at least 90% of total
assets (including assets obtained through leverage) in securities of energy
infrastructure companies, and will invest at least 70% of total assets in equity
securities of MLPs. Energy infrastructure companies engage in the business of
transporting, processing, storing, distributing or marketing natural gas,
natural gas liquids (primarily propane), coal, crude oil or refined petroleum
products, or exploring, developing, managing or producing such commodities. The
Company may also invest up to 25% of total assets in debt securities of energy
infrastructure companies, including securities rated below investment grade
(commonly referred to as "junk bonds"), and up to 30% of total assets in
restricted securities for which no public trading market exists.

     PRIOR TO THIS OFFERING, THERE HAS BEEN NO PUBLIC OR PRIVATE MARKET FOR THE
COMMON SHARES. The Common Shares have been approved for listing on the New York
Stock Exchange, subject to notice of issuance, under the trading or "ticker"
symbol "TYG."
                             ---------------------

     INVESTING IN COMMON SHARES INVOLVES A HIGH DEGREE OF RISK. INVESTORS COULD
LOSE SOME OR ALL OF THEIR INVESTMENT IN THE COMPANY. SEE "RISKS" BEGINNING ON
PAGE 21 OF THIS PROSPECTUS.

                             ---------------------
     SHARES OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES FREQUENTLY TRADE AT
PRICES LOWER THAN THEIR NET ASSET VALUE OR INITIAL OFFERING PRICE. MARKET
DISCOUNT RISK APPLIES TO ALL INVESTORS, BUT IT MAY BE GREATER FOR INITIAL
INVESTORS EXPECTING TO SELL SHARES SHORTLY AFTER THE COMPLETION OF THE OFFERING.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
                             ---------------------

<Table>
<Caption>
                                                              PER SHARE   TOTAL(1)
                                                              ---------   --------
<S>                                                           <C>         <C>
Public offering price.......................................   $25.000    $
Underwriting discounts and commissions......................   $ 1.125    $
Proceeds, before expenses, to the Company(2)................   $23.875    $
</Table>

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

(1) The underwriters named in this prospectus have the option to purchase up to
              additional Common Shares at the public offering price, less the
    underwriting discounts and commissions, within 45 days from the date of this
    prospectus to cover over-allotments.

(2) The aggregate expenses of the offering are estimated to be $     , which
    represents $0.          per Common Share issued.

     The Common Shares will be ready for delivery on or about           , 2004.

<Table>
<S>                        <C>                      <C>
STIFEL, NICOLAUS & COMPANY     LEHMAN BROTHERS        RBC CAPITAL MARKETS
       INCORPORATED
       ADVEST, INC.          BB&T CAPITAL MARKETS         OPPENHEIMER
  SANDERS MORRIS HARRIS                                WR HAMBRECHT + CO
PARKER/HUNTER INCORPORATED                           WUNDERLICH SECURITIES,
                                                              INC.
</Table>

                             ---------------------
                       Prospectus dated           , 2004
<PAGE>

     Unlike most investment companies, the Company will be taxed like a
corporation and will not elect to be treated as a regulated investment company
under the Internal Revenue Code.

     Tortoise Capital Advisors, LLC (the "Adviser") will serve as the investment
adviser to the Company. The Adviser was formed in October 2002 and has limited
independent resources. Accordingly, the Adviser has relied to a significant
degree on the officers, employees, and resources of certain affiliated entities.
Four (of the five) members of the investment committee of the Adviser are
affiliates of, but not employees of, the Adviser, and each has other significant
responsibilities with such affiliated entities. The affiliated entities conduct
businesses and activities of their own in which the Adviser has no economic
interest. If these separate activities are significantly greater than the
Adviser's activities, there could be material competition for the efforts of key
personnel. The Adviser has no prior experience managing a registered investment
company.

     The Company may borrow money, issue preferred shares, or issue other debt
securities to the extent permitted by the Investment Company Act of 1940, as
amended (the "1940 Act"). These practices are known as leverage. Leverage
creates an opportunity for increased income and capital appreciation for common
shareholders, but at the same time, it creates special risks that may adversely
affect common shareholders. Because the Adviser's fee is based on total assets
(including assets obtained through leverage), the Adviser's fee will be higher
if the Company is leveraged. There can be no assurance that a leveraged strategy
will be successful during any period in which it is used. See "Leverage" and
"Risks -- Leverage Risks."

     The prospectus sets forth concisely the information about the Company that
a prospective investor should know before investing. You should read this
prospectus, which contains important information about the Company, before
deciding whether to invest in the Company's Common Shares, and retain it for
future reference. A statement of additional information, dated         , 2004,
containing additional information about the Company, has been filed with the
Securities and Exchange Commission and is incorporated by reference in its
entirety into this prospectus. You may request a free copy of the statement of
additional information, the table of contents of which is on page 43 of this
prospectus, by calling 1-888-728-8784 or by writing to the Company at 10801
Mastin Boulevard, Suite 222, Overland Park, Kansas 66210. You can review and
copy documents the Company has filed at the Securities and Exchange Commission's
Public Reference Room in Washington, D.C. Call 1-202-942-8090 for information.
The Securities and Exchange Commission charges a fee for copies. You can get the
same information free from the Securities and Exchange Commission's website
(http://www.sec.gov). You may also e-mail requests for these documents to
publicinfo@sec.gov or make a request in writing to the Securities and Exchange
Commission's Public Reference Section, Washington, D.C. 20549-0102.

     The Company's Common Shares do not represent a deposit or obligation of,
and are not guaranteed or endorsed by, any bank or other insured depository
institution and are not federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other government agency.
<PAGE>

                               TABLE OF CONTENTS


<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Prospectus Summary..........................................    1
Summary of Company Expenses.................................   11
Use of Proceeds.............................................   12
The Company.................................................   13
Leverage....................................................   19
Risks.......................................................   21
Management of the Company...................................   28
Distributions...............................................   30
Closed-End Company Structure................................   32
Tax Matters.................................................   33
Net Asset Value.............................................   35
Description of Shares.......................................   35
Certain Provisions in the Company's Charter and Bylaws......   38
Underwriting................................................   40
Direct Placement Contracts..................................   42
Administrator, Custodian, Transfer Agent and Dividend Paying
  Agent.....................................................   42
Legal Matters...............................................   42
Table of Contents of the Statement of Additional
  Information...............................................   43
</Table>


     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. THE COMPANY HAS NOT, AND THE UNDERWRITERS HAVE
NOT, AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH DIFFERENT INFORMATION. IF
ANYONE PROVIDES YOU WITH DIFFERENT OR INCONSISTENT INFORMATION, YOU SHOULD NOT
RELY ON IT. THE COMPANY IS NOT, AND THE UNDERWRITERS ARE NOT, MAKING AN OFFER TO
SELL THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT
PERMITTED. YOU SHOULD ASSUME THAT THE INFORMATION APPEARING IN THIS PROSPECTUS
IS ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS. THE COMPANY'S BUSINESS,
FINANCIAL CONDITION AND PROSPECTS MAY HAVE CHANGED SINCE THAT DATE. THE COMPANY
WILL AMEND OR SUPPLEMENT THIS PROSPECTUS TO REFLECT MATERIAL CHANGES TO THE
INFORMATION CONTAINED IN THIS PROSPECTUS TO THE EXTENT REQUIRED BY APPLICABLE
LAW.

                                        ii
<PAGE>

                               PROSPECTUS SUMMARY

     This is only a summary. This summary may not contain all of the information
that you should consider before investing in the Company's shares of common
stock ("Common Shares"). You should review the more detailed information
contained in this prospectus and in the statement of additional information,
especially the information set forth under the heading "Risks" on page 20 of
this prospectus.

THE COMPANY

     Tortoise Energy Infrastructure Corporation (the "Company") is a newly
organized, nondiversified, closed-end management investment company. The
Company's investment objective is to seek a high level of total return with an
emphasis on current distributions paid to shareholders. For purposes of the
Company's investment objective, total return includes capital appreciation of,
and all distributions received from, securities in which the Company will invest
regardless of the tax character of the distributions. The Company seeks to
provide its shareholders with an efficient vehicle to invest in a portfolio of
publicly traded master limited partnerships in the energy infrastructure sector
("MLPs"). Similar to the tax characterization of distributions made by MLPs to
its unit holders, the Company believes that it will have relatively high levels
of deferred taxable income associated with distributions made to its
shareholders. Tortoise Capital Advisors, LLC (the "Adviser") will serve as the
Company's investment adviser.

THE OFFERING

     The Company is offering           Common Shares at an initial offering
price of $25.00 per share through a group of underwriters (the "Underwriters")
led by Stifel, Nicolaus & Company, Incorporated, Lehman Brothers Inc. and RBC
Capital Markets. An investor must purchase at least 100 Common Shares ($2,500)
in order to participate in this offering. The Company has given the Underwriters
an option to purchase up to           additional Common Shares at the public
offering price, less the underwriting discounts and commissions, within 45 days
from the date of this prospectus to cover over-allotments. See "Underwriting."

LISTING

     The Common Shares have been approved for listing on the New York Stock
Exchange ("NYSE"), subject to notice of issuance, under the trading or "ticker"
symbol "TYG."

TAX STATUS OF COMPANY


     Unlike most investment companies, the Company will not be treated as a
regulated investment company under the U.S. Internal Revenue Code of 1986, as
amended (the "Internal Revenue Code"). Therefore, the Company will be obligated
to pay federal and applicable state corporate taxes on its taxable income. On
the other hand, the Company is not subject to the "qualifying income" rules
applicable to regulated investment companies. Under current tax law, the
qualifying income rules substantially limit the ability of regulated investment
companies to invest directly in MLPs. Unlike regulated investment companies, the
Company is not required to distribute substantially all of its income and
capital gains. The Company will invest a substantial portion of its assets in
MLPs. Although the MLPs will generate taxable income to the Company, the Company
expects the MLPs to pay cash distributions in excess of the taxable income
reportable by the Company. Similarly, the Company expects to distribute cash in
excess of its taxable income to its shareholders and intends to distribute
substantially all of its distributable cash flow (generally, cash from
operations less certain operating expenses and reserves). The taxation of
Company distributions is discussed below under "Prospectus
Summary -- Shareholder Tax Features." See also "Tax Matters."


TAXATION OF MLPS AND MLP INVESTORS

     The Company will invest primarily in MLPs, which are treated as
partnerships for federal income tax purposes. Limited partners, such as the
Company, will be required to pay tax on their allocable share of the MLPs'
income, gains, losses and deductions, including accelerated depreciation and
amortization deductions. Such items generally are allocated among the general
partner and limited partners in accordance with their percentage interests in
the MLP. Partners recognize and must report their allocable share of income
regardless

                                        1
<PAGE>

of whether any cash distributions are paid out. MLPs typically are required by
their charter documents to distribute substantially all of their distributable
cash flow. The types of MLPs in which the Company intends to invest have
historically made cash distributions to limited partners that exceed the amount
of taxable income allocable to limited partners. This may be due to a variety of
factors, including that the MLP may have significant non-cash deductions, such
as accelerated depreciation. If the cash distributions exceed the taxable income
reported, the MLP investor's basis in MLP units will decrease. This feature will
reduce current income tax liability, but potentially will increase the
investor's gain upon the sale of its MLP interest.

SHAREHOLDER TAX FEATURES

     Shareholders of the Company hold common stock of a corporation. Shares of
common stock differ substantially from partnership interests for federal income
tax purposes. Unlike holders of MLP common units, shareholders of the Company
will not recognize an allocable share of the Company's income, gains, losses and
deductions. Shareholders recognize income only if the Company pays out
distributions. The tax character of the distributions can vary. If the Company
makes distributions from current or accumulated earnings and profits, such
distributions will be taxable to shareholders in the current period as dividend
income. Dividend income will be treated as "qualified dividends" for federal
income tax purposes, subject to favorable capital gains rates. If distributions
exceed the Company's current or accumulated earnings and profits, such excess
distributions will constitute a tax-free return of capital to the extent of a
shareholder's basis in its Common Shares. To the extent excess distributions
exceed a shareholder's basis, it will be taxed as capital gain. Based on the
historical performance of MLPs, the Company expects that a significant portion
of distributions to holders of Common Shares will constitute a tax-free return
of capital. There is no assurance that the Company will make regular
distributions or that the Company's expectation regarding the tax character of
its distributions will be realized. The special tax treatment for qualified
dividends is scheduled to expire as of December 31, 2008.

     Upon the sale of Common Shares, a shareholder generally will recognize
capital gain or loss measured by the difference between the sale proceeds
received by the shareholder and the shareholder's federal income tax basis in
its Common Shares sold, as adjusted to reflect return(s) of capital. Generally,
such capital gain or loss will be long-term capital gain or loss if Common
Shares were held as a capital asset for more than one year. The tax basis for
Common Shares owned by an individual shareholder will be adjusted to equal their
full market value upon such shareholder's death. See "Tax Matters."

COMPARISON WITH DIRECT INVESTMENTS IN MLPS

     The Company is designed to provide an efficient vehicle for investing in a
portfolio of MLPs. As of the date of this prospectus, the Company believes that
it is the only publicly traded investment company offering access to a portfolio
of energy infrastructure MLPs. The Company further believes that an investor who
invests in the Company will benefit from a number of portfolio and tax features
that would not be available from a direct investment in MLPs, including the
following:

     - An investment in the Company offers diversification among a number of
       MLPs within the energy infrastructure sector through a single investment
       vehicle;

     - The Company intends to invest up to 30% of its total assets in direct
       placements (restricted securities). Direct placements offer the potential
       for increased return, but are typically only available to a limited
       number of institutional investors such as the Company;

     - Each shareholder of the Company will receive a single Form 1099, rather
       than a Form K-1 from each MLP if a shareholder invested directly in the
       MLP;

     - Shareholders of the Company will not be required to file state income tax
       returns in each state in which MLPs owned by the Company operate, whereas
       limited partners of MLPs may be required to make state filings in states
       in which the MLP operates;


     - The passive activity income and loss rules apply to a direct investment
       in MLPs, but not to an investment in the Company (these rules limit the
       ability of an investor to use losses to offset other gains);


                                        2
<PAGE>

     - The Internal Revenue Code generally excludes corporate dividends from
       treatment as unrelated business taxable income ("UBTI") (unless the stock
       is debt-financed). Tax-exempt investors, including employee benefit plans
       and IRAs, will not have UBTI upon receipt of distributions from the
       Company, whereas a tax-exempt limited partner's allocable share of income
       of an MLP is treated as UBTI; and

     - Distributions of the Company will be treated as qualifying income for
       regulated investment companies or mutual funds; the income from MLPs are
       not qualifying income for regulated investment companies.


     Unlike MLPs, the Company will be obligated to pay current and deferred tax
with respect to its income, thereby subjecting the Company's income to a double
layer of tax upon distribution to the Company's shareholders. Like other
investment companies, shareholders of the Company will bear the operating costs
of the Company, including management fees, custody and administration, and the
costs of operating as a public company.


INVESTMENT POLICIES

     Under normal circumstances, the Company will invest at least 90% of its
total assets (including assets obtained through leverage) in securities of
energy infrastructure companies, and will invest at least 70% of its total
assets in equity securities of MLPs. Energy infrastructure companies engage in
the business of transporting, processing, storing, distributing or marketing
natural gas, natural gas liquids (primarily propane), coal, crude oil or refined
petroleum products, or exploring, developing, managing or producing such
commodities. The Company will invest solely in energy infrastructure companies
organized in the United States. It is anticipated that all publicly traded
companies in which the Company will invest will have an equity market
capitalization greater than $100 million.

     The Company intends to invest primarily in equity securities of MLPs, which
currently consist of the following instruments: common units, convertible
subordinated units and I-Shares. As of the date of this prospectus, all MLP
common units in which the Company intends to invest are listed and traded on the
NYSE, American Stock Exchange ("AMEX") or NASDAQ National Market. The Company
also may purchase MLP common units through direct placements. MLP convertible
subordinated units are not listed or publicly traded, and are typically
purchased in directly negotiated transactions with MLP affiliates or
institutional holders of such shares. As of the date of this prospectus,
I-Shares are listed and traded on the NYSE.

     MLP common unit holders have typical limited partner rights, including
limited management and voting rights. MLP common units have priority over
convertible subordinated units upon liquidation. Common unit holders are
entitled to minimum quarterly distributions ("MQD"), including arrearage rights,
prior to any distribution payments to convertible subordinated unit holders or
incentive distribution payments to the general partner. MLP convertible
subordinated units are convertible to common units on a one-to-one basis after
the passage of time and/or achievement of specified financial goals. MLP
convertible subordinated units are entitled to MQD after the payments to holders
of common units and before incentive distributions to the general partner. MLP
convertible subordinated units do not have arrearage rights. I-Shares have
similar features to common units except that distributions are payable in
additional I-Shares rather than cash. The Company will invest in I-Shares only
if it has adequate cash to satisfy its distribution targets.

     Although the Company also may invest in equity and debt securities of
energy infrastructure companies that are organized and/or taxed as corporations,
it is likely that any such investments will be in debt securities because the
equity dividends from such corporations typically do not meet the Company's
investment objective. The Company also may invest in securities of general
partners or other affiliates of MLPs and private companies operating energy
infrastructure assets.

     The Company has adopted the following additional nonfundamental investment
policies:

     - The Company may invest up to 30% of its total assets in direct placements
       (restricted securities). The types of direct placements that the Company
       may purchase consist of MLP convertible subordinated units, MLP common
       units and securities of private energy infrastructure companies (i.e.,
       non-MLPs).

                                        3
<PAGE>

       Investments in private companies that do not have any publicly traded
       shares or units are limited to 5% of total assets.

     - The Company may invest up to 25% of total assets in debt securities of
       energy infrastructure companies, including securities rated below
       investment grade (commonly referred to as "junk bonds"). Below investment
       grade debt securities will be rated at least B3 by Moody's Investors
       Service, Inc. ("Moody's") and at least B- by Standard & Poor's Ratings
       Group ("S&P's") at the time of purchase, or comparably rated by another
       statistical rating organization or if unrated, determined to be of
       comparable quality by the Adviser.

     - The Company will not invest more than 10% of total assets in any single
       issuer.

     - The Company will not engage in short sales.

     The Company may change its nonfundamental investment policies without
shareholder approval and will provide notice to shareholders of material changes
(including notice through shareholder reports); provided, however, that a change
in the policy of investing at least 90% of its total assets in energy
infrastructure companies requires 60 days prior written notice to shareholders.
Unless otherwise stated, all investment restrictions apply at the time of
purchase and the Company will not be required to reduce a position due solely to
market value fluctuations. The term total assets includes assets obtained
through leverage for the purpose of each investment restriction.

USE OF LEVERAGE BY THE COMPANY

     The Company may borrow money, issue preferred shares, or issue other debt
securities to the extent permitted by the 1940 Act. These practices are known as
leverage. The Company may not be leveraged at all times and the amount of
leverage, if any, may vary depending on a variety of factors, including the
costs that the Company would incur as a result of leverage, market conditions
and available investment opportunities, including direct placement potential.
Subject to oversight of the Board of Directors, the Company intends to leverage
only when it believes that leverage will serve the best interests of
shareholders. The principal, although not exclusive, factor used in making the
determination will be whether the potential return is likely to exceed the cost
of leverage.

     Because the Adviser's fee is based upon a percentage of the Company's
Managed Assets (as defined below), the Adviser's fee will be higher if the
Company is leveraged. Therefore, the Adviser will have a financial incentive to
leverage the Company, which may create a conflict of interest between the
Adviser and the holders of the Common Shares. There can be no assurance that a
leveraging strategy will be used or that it will be successful during any period
in which it is used. The use of leverage involves risks, which can be
significant. See "Leverage" and "Risks -- Leverage Risk."

     The Company may, but is not required to, hedge general interest rate
exposure arising from its leverage transactions. Under current market
conditions, hedging would be accomplished principally by entering into interest
rate transactions such as swaps, caps and floors. The use of interest rate
transactions is a highly specialized activity that involves investment
techniques and risks different from those associated with ordinary portfolio
security transactions. See "Risks -- Hedging Strategy Risk."

INVESTMENT ADVISER

     The Adviser was formed in October 2002 to provide portfolio management
services to institutional and high net worth investors seeking professional
management of their MLP investments. The Adviser is controlled equally by
Fountain Capital Management, L.L.C. ("Fountain Capital") and Kansas City Equity
Partners LC ("KCEP"). As of December 31, 2003, the Adviser had approximately $82
million of client assets under management. Affiliates of the Adviser have an
additional $285 million of energy infrastructure investment assets under
management. The Adviser's investment committee is comprised of five seasoned
portfolio managers led by David J. Schulte, CFA. As an investment banker and as
a managing director of KCEP, Mr. Schulte has fourteen years of experience in
providing growth companies with acquisition and capital market financings. While
at KCEP and the Adviser he has overseen the investment in privately placed
common units and convertible subordinated units issued by propane and natural
gas processing MLPs.

                                        4
<PAGE>

     The principal business address of the Adviser is 10801 Mastin Boulevard,
Suite 222, Overland Park, Kansas 66210. The Adviser has no prior experience
managing a registered investment company.

     Fountain Capital was formed in 1990 and is focused primarily on providing
investment advisory services to institutional investors with respect to below
investment grade debt. Fountain Capital had $2.4 billion of client assets under
management as of December 31, 2003. Atlantic Asset Management LLC ("Atlantic")
is a minority owner, and an affiliate, of Fountain Capital. Atlantic was formed
in 1992 and provides, directly or through affiliates, a variety of fixed-income
investment advisory services including investment grade bond and high-yield bond
strategies, investment grade collateralized debt obligations and mortgage hedge
funds. Including Fountain Capital, the Atlantic group had approximately $9.7
billion in assets under management as of December 31, 2003. KCEP was formed in
1993 and is focused solely on managing two private equity funds, which have had
combined committed capital of $110 million. KCEP focuses on private equity
investments in the consumer, telecom/media and natural resource distribution and
services industries.

     The Adviser will be responsible for the investment of the Company's
portfolio in accordance with the Company's investment objective and policies.
The Adviser will make all investment decisions for the Company, subject to
oversight by the Company's Board of Directors. Day-to-day management of the
Company's portfolio will be the responsibility of a team of investment analysts
and portfolio managers led by Mr. Schulte. The other members of the Adviser's
investment committee are affiliates of, but not employees of, the Adviser, and
have significant responsibilities with KCEP, Fountain Capital and their
affiliates. All members of the investment committee have undertaken to provide
such services as are necessary to fulfill the obligations of the Adviser to the
Company. The Company will pay the Adviser a fee for its investment management
services equal to an annual rate of 0.95% of the Company's average monthly total
assets (including any assets attributable to any leverage) minus accrued
liabilities other than (i) deferred taxes, (ii) debt entered into for purposes
of leverage and (iii) the aggregate liquidation preference of any outstanding
preferred shares ("Managed Assets"). This fee is calculated monthly and paid
quarterly.

DISTRIBUTIONS

     The Company intends to pay out substantially all of its Distributable Cash
Flow ("DCF") to holders of Common Shares through quarterly distributions. DCF is
the amount received by the Company as cash or paid-in-kind distributions from
MLPs or their affiliates, and interest payments received on debt securities
owned by the Company, less current or anticipated operating expenses, taxes on
Company taxable income, and leverage costs paid by the Company. The Board of
Directors has established a target for distributions to holders of Common Shares
in an amount of at least 95% of DCF on an annual basis. The Company expects that
it will declare and make a distribution no later than May 31, 2004. Subsequent
distributions will be paid each fiscal quarter out of DCF, if any. There is no
assurance that the Company will continue to make regular distributions. The
Company intends to have a fiscal year ending November 30.

     Unless a shareholder elects to receive distributions in cash, distributions
will be used to purchase additional Common Shares of the Company. See
"Distributions -- Automatic Dividend Reinvestment Plan."

RISKS

     No Operating History.  The Company is a newly organized closed-end
management investment company and has no operating history or history of public
trading of its Common Shares.

     Management Risk.  The Adviser was formed in October 2002 and has limited
independent resources. The Adviser has relied to a significant degree on the
officers, employees, and resources of Fountain Capital, KCEP and their
affiliates. Four (of the five) members of the investment committee are
affiliates of, but not employees of, the Adviser, and each have other
significant responsibilities with such affiliated entities. Fountain Capital,
KCEP and their affiliates conduct businesses and activities of their own in
which the Adviser has no economic interest. If these separate activities are
significantly greater than the Adviser's activities, there could be material
competition for the efforts of key personnel. The Adviser has no previous
experience managing a registered investment company.

                                        5
<PAGE>

     Energy Infrastructure Sector.  The Company intends to concentrate its
investments in the energy infrastructure sector, with an emphasis on securities
issued by MLPs. Certain risks inherent in the energy infrastructure business of
these types of MLPs include the following:

     - Processing and coal MLPs may be directly affected by energy commodity
       prices. The volatility of commodity prices can indirectly affect certain
       other MLPs due to the impact of prices on volume of commodities
       transported, processed, stored or distributed. Pipeline MLPs are not
       subject to direct commodity price exposure because they do not own the
       underlying energy commodity. While propane MLPs do own the underlying
       energy commodity, the Adviser intends to seek high quality MLPs that are
       able to mitigate or manage direct margin exposure to commodity price
       levels. The MLP sector can be hurt by market perception that MLPs'
       performance and distributions are directly tied to commodity prices.

     - The profitability of MLPs, particularly processing and pipeline MLPs, may
       be materially impacted by the volume of natural gas or other energy
       commodities available for transporting, processing, storing or
       distributing. A significant decrease in the production of natural gas,
       oil, coal or other energy commodities, due to the decline of production
       from existing facilities, import supply disruption, depressed commodity
       prices or otherwise, would reduce revenue and operating income of MLPs
       and, therefore, the ability of MLPs to make distributions to partners.

     - A sustained decline in demand for crude oil, natural gas and refined
       petroleum products could adversely affect MLP revenues and cash flows.
       Factors that could lead to a decrease in market demand include a
       recession or other adverse economic conditions, an increase in the market
       price of the underlying commodity, higher taxes or other regulatory
       actions that increase costs, or a shift in consumer demand for such
       products.

     - A portion of any one MLP's assets may be dedicated to natural gas
       reserves and other commodities that naturally deplete over time, which
       could have a material adverse impact on an MLP's ability to make
       distributions. MLPs employ a variety of means of increasing cash flow,
       including increasing utilization of existing facilities, expanding
       operations through new construction, expanding operations through
       acquisitions, or securing additional long-term contracts. Thus, some MLPs
       may be subject to construction risk, acquisition risk or other risk
       factors arising from their specific business strategies. A significant
       slowdown in large energy companies' disposition of energy infrastructure
       assets and other merger and acquisition activity in the energy MLP
       industry could reduce the growth rate of cash flows received by the
       Company from MLPs that grow through acquisitions.

     - The profitability of MLPs could be adversely affected by changes in the
       regulatory environment. The business of MLPs are heavily regulated by
       federal and state governments in diverse matters, such as from the way in
       which certain MLP assets are constructed, maintained and operated and the
       prices MLPs may charge for their services. Such regulation can change
       over time in scope and intensity. For example, a particular byproduct of
       an MLP process may be declared hazardous by a regulatory agency and
       unexpectedly increase production costs. Moreover, many state and federal
       environmental laws provide for civil as well as regulatory remediation,
       thus adding to the potential exposure an MLP may face.

     - A rising interest rate environment could adversely impact the performance
       of MLPs. Rising interest rates could limit the capital appreciation of
       equity units of MLPs because of the increased availability of alternative
       investments at competitive yields with MLPs. Rising interest rates may
       also increase an MLP's cost of capital. A higher cost of capital could
       limit growth from acquisition/expansion projects and limit MLP
       distribution growth rates.

     - Since the September 11th attacks, the U.S. government has issued public
       warnings indicating that energy assets, specifically those related to
       pipeline infrastructure, production facilities and transmission and
       distribution facilities, might be specific targets of terrorist activity.
       The continued threat of terrorism and related military activity will
       likely increase volatility for prices in natural gas and oil and could
       affect the market for products of MLPs.

                                        6
<PAGE>

     - Holders of MLP units are subject to certain risks inherent in the
       partnership structure of MLPs including (i) tax risks (described in more
       detail below), (ii) limited ability to elect or remove management (iii)
       limited voting rights, except with respect to extraordinary transactions,
       and (iv) conflicts of interest of the general partner, including those
       arising from incentive distribution payments.

     Cash Flow Risk.  The Company will derive substantially all of its cash flow
from investments in equity securities of MLPs. The amount of cash that the
Company has available to distribute to shareholders is completely dependent on
the ability of MLPs held by the Company to make distributions to its partners.
The Company has no control over the actions of underlying MLPs. The amount of
cash that each individual MLP can distribute to its partners will depend on the
amount of cash it generates from operations, which will vary from quarter to
quarter depending on factors affecting the energy infrastructure market
generally and on factors affecting the particular business lines of the MLP.
Available cash will also depend on the MLPs' level of operating costs (including
incentive distributions to the general partner), level of capital expenditures,
debt service requirements, acquisition costs (if any), fluctuations in working
capital needs and other factors.

     Tax Risk of MLPs.  The value of the Company's investment in MLPs depends
largely on the MLPs being treated as partnerships for federal income tax
purposes. If an MLP does not meet current law requirements to maintain
partnership status, or if it is unable to do so because of tax law changes, it
would be taxed as a corporation. In that case, the MLP would be obligated to pay
income tax at the entity level and distributions received by the Company would
be taxed entirely as dividend income. As a result, there would be a material
reduction in the Company's cash flow and there would likely be a material
decrease in the value of the Common Shares.

     Items of income, gains, losses and deductions of each MLP flow through to
the Company in its capacity as a partner of the MLP. Historically, a substantial
portion of MLP income has been offset by tax deductions. If the amount of MLP
income tax deductions that may be claimed by the Company is less than
anticipated or the Company turns over its portfolio more rapidly than
anticipated, the Company will incur greater current income taxes. A significant
slowdown in acquisition activity by the MLPs in the Company's portfolio also
could accelerate the Company's obligations to pay income taxes due in part to
less accelerated depreciation generated by new acquisitions. In such a case, the
portion of the Company's distributions that is treated as a return of capital
will be reduced and the portion treated as dividend income would increase,
resulting in lower after tax dividends for the Company's shareholders. See
"Risk -- Tax Risks."

     Delay in Use of Proceeds.  Although the Company currently intends to invest
the proceeds of any sales of Common Shares as soon as practicable following the
closing, such investments may be delayed if suitable investments are unavailable
at the time or for other reasons or if the Company is unable to secure firm
commitments for direct placements. Due to the trading market and volumes for
MLPs, it may take the Company a period of time to accumulate positions in
certain securities. Because the market for MLP securities may at times be less
liquid than the market for many other securities, the Company may be unable to
obtain such securities within the time, and in the amount, currently anticipated
by the Company. As a result, the proceeds may be invested in cash, cash
equivalents, high-quality debt instruments, or other securities pending
investment in MLPs or securities of energy infrastructure companies. A delay in
the anticipated use of proceeds could lower returns and lower the Company's
yield in the first year after the issuance of Common Shares. See "Risks -- Delay
in Use of Proceeds."

     Equity Securities Risk.  MLP common units and other equity securities can
be affected by macro economic and other factors affecting the stock market in
general, expectations of interest rates, investor sentiment towards MLPs or the
energy sector, changes in a particular issuer's financial condition, or
unfavorable or unanticipated poor performance of a particular issuer (in the
case of MLPs, generally measured in terms of distributable cash flow). Prices of
common units of individual MLPs and other equity securities can also be affected
by fundamentals unique to the partnership or company, including earnings power
and coverage ratios.

     Investing in securities of smaller companies may involve greater risk than
is associated with investing in more established companies. Smaller
capitalization companies may have limited product lines, markets or

                                        7
<PAGE>

financial resources; may lack management depth or experience; and may be more
vulnerable to adverse general market or economic developments than larger more
established companies.

     Because MLP convertible subordinated units generally convert to common
units at a one-to-one ratio, the price that the Company can be expected to pay
upon purchase or to realize upon resale is generally tied to the common unit
price less a discount. The size of the discount varies depending on a variety of
factors including the likelihood of conversion, the length of time remaining to
conversion, and the size of the block purchased.

     The price of I-Shares and their volatility tend to be correlated to the
price of common units, although the price correlation is not precise.

     Leverage Risk.  Leverage creates an opportunity for an increased return to
common shareholders, but it is a speculative technique that could adversely
affect common shareholders. Unless the income and capital appreciation, if any,
on securities acquired with borrowed funds or other leverage proceeds exceed the
costs of the leverage, the use of leverage could cause the Company to lose
money. When leverage is used, the net asset value and market value of Common
Shares will be more volatile. There is no assurance that the use of leverage
will be successful during any period in which it is used.

     Common shareholders will bear the costs of any leverage through higher
operating expenses. The issuance of debt securities or preferred shares by the
Company would involve offering expenses and other costs. Fluctuations in
interest rates on borrowings and short-term debt could reduce cash available for
dividends on Common Shares. In addition, borrowings pursuant to credit
agreements or rated preferred shares may result in the Company being subject to
certain covenants, such as those relating to asset coverage and portfolio
composition, which may affect the Company's ability to pay dividends and other
distributions on Common Shares in certain instances. The Company may also be
required to pledge its assets to the lenders in connection with certain types of
borrowing.

     Hedging Strategy Risk.  The Company may use interest rate transactions for
hedging purposes only, in an attempt to reduce the interest rate risk arising
from the Company's leveraged capital structure. The Company does not intend to
hedge interest rate risk of portfolio holdings. Interest rate transactions that
the Company may use for hedging purposes will expose the Company to certain
risks that differ from the risks associated with its portfolio holdings. There
are economic costs of hedging reflected in the price of interest rate swaps,
caps and similar techniques, the costs of which can be significant. In addition,
the Company's success in using hedging instruments is subject to the Adviser's
ability to predict correctly changes in the relationships of such hedging
instruments to the Company's leverage risk, and there can be no assurance that
the Adviser's judgment in this respect will be accurate.

     Depending on the state of interest rates in general, the Company's use of
interest rate transactions such as swaps, caps or floors could enhance or
decrease the net income of the Common Shares. To the extent there is a decline
in interest rates, the value of interest rate transactions could decline, and
could result in a decline in the net asset value of the Common Shares. In
addition, if the counterparty to an interest rate transaction defaults, the
Company would not be able to use the anticipated net receipts under the interest
rate transaction to offset the Company's cost of financial leverage.
Consequently, the use of hedging transactions might result in a poorer overall
performance for the Company, whether or not adjusted for risk, than if the
Company had not engaged in such transactions. See "Risks -- Hedging Strategy
Risk."

     Portfolio Turnover Risk.  The Company's annual portfolio turnover rate may
vary greatly from year to year. Although the Company cannot accurately predict
its annual portfolio turnover rate, it is not expected to exceed 30% under
normal circumstances. However, portfolio turnover rate is not considered a
limiting factor in the execution of investment decisions for the Company. High
portfolio turnover may result in the Company's realization of gains that will be
taxable as ordinary income to the Company. In addition, high portfolio turnover
may increase the Company's current and accumulated earnings and profits,
resulting in a greater portion of the Company's distributions being treated as a
dividend to the Company's shareholders. See "The Company -- Portfolio Turnover"
and "Tax Matters."

     Direct Placements (Restricted Securities).  The Company may invest up to
30% of total assets in direct placements (restricted securities). Restricted
securities are subject to statutory and contractual restrictions on their public
resale, which may make it more difficult to value them, may limit the Company's
ability to dispose

                                        8
<PAGE>

of them and may lower the amount the Company could realize upon their sale. To
enable the Company to sell its holdings of a restricted security not registered
under the 1933 Act, the Company may have to cause those securities to be
registered. If the Company decides to pursue a public sale of restricted
securities, a considerable period may elapse between the time the decision is
made to sell the security and the time the security is registered so that the
Company could sell it. The Company would bear the risks of any downward price
fluctuation during that period.

     Liquidity Risk.  Although common units of MLPs trade on the NYSE, AMEX, and
the NASDAQ National Market, certain MLP securities may trade less frequently
than those of larger companies due to their smaller capitalizations. In the
event certain MLP securities experience limited trading volumes, the prices of
such MLPs may display abrupt or erratic movements at times. Additionally, it may
be more difficult for the Company to buy and sell significant amounts of such
securities without an unfavorable impact on prevailing market prices. As a
result, these securities may be difficult to dispose of at a fair price at the
times when the Company believes it is desirable to do so. These securities are
also more difficult to value, and the Adviser's judgment as to value will often
be given greater weight than market quotations, if any exist. Investment of the
Company's capital in securities that are less actively traded or over time
experience decreased trading volume may restrict the Company's ability to take
advantage of other market opportunities. See "The Company -- Investment
Policies/Restricted Securities."

     Valuation Risk.  Market prices generally will not be available for
convertible subordinated units or securities of private companies, and the value
of such investments will ordinarily be determined based on fair valuations
determined by the Adviser pursuant to procedures adopted by the Board of
Directors. Similarly, direct placements of common units will be based on fair
value determinations because of their restricted nature; however, the Adviser
expects that such values will be based on a discount from publicly available
market prices. Restrictions on resale or the absence of a liquid secondary
market may adversely affect the ability of the Company to determine its net
asset value. The sale price of securities that are restricted or otherwise not
readily marketable may be lower or higher than the Company's most recent fair
valuation. In addition, the Company will rely on information provided by MLPs to
calculate taxable income allocable to MLP units held by the Company and to
calculate associated deferred tax liability. See "Net Asset Value."

     Interest Rate Risk.  Interest rate risk is the risk that debt securities
will decline in value because of changes in market interest rates. Generally,
when market interest rates rise, the values of debt securities decline, and vice
versa. The Company's investment in such securities means that the net asset
value and market price of the Common Shares will tend to decline if market
interest rates rise. During periods of declining interest rates, the issuer of a
security may exercise its option to prepay principal earlier than scheduled,
forcing the Company to reinvest in lower yielding securities. This is known as
call or prepayment risk. Lower grade securities frequently have call features
that allow the issuer to repurchase the security prior to its stated maturity.
An issuer may redeem a lower grade obligation if the issuer can refinance the
debt at a lower cost due to declining interest rates or an improvement in the
credit standing of the issuer.

     Below Investment Grade Securities.  Below investment grade debt securities
are commonly referred to as "junk bonds." Below investment grade quality
securities are considered speculative with respect to an issuer's capacity to
pay interest and repay principal while they are outstanding. Below investment
grade debt securities are susceptible to default or decline in market value due
to adverse economic and business developments. The Company does not intend to
invest in distressed securities (securities issued by a company in a bankruptcy
reorganization, subject to a public or private debt restructuring or otherwise
in default or in significant risk of default in the payment of interest and
principal). However, in the event any below investment grade debt security
becomes distressed while held by the Company, the Company may be required to
incur extraordinary expenses in order to protect and recover its investment, and
there will be significant uncertainty as to when, in what manner and for what
value, if any, the distressed obligations will be satisfied.

     Nondiversification.  The Company is a nondiversified investment company
under the 1940 Act and will not be treated as a regulated investment company
under the Internal Revenue Code. Accordingly, there are no regulatory limits
under the 1940 Act or the Internal Revenue Code on the number or size of
securities held by the Company. There currently are only fifty-five (55)
companies presently organized as MLPs and only a limited amount of those
companies operate energy infrastructure assets. The Company intends to select
MLP

                                        9
<PAGE>

investments from this small pool of issuers. The Company may invest in non-MLP
securities to a lesser degree, consistent with its investment objective and
policies.

     Conflicts of Interest of Adviser.  Conflicts of interest may arise from the
fact that the Adviser and its affiliates generally will be carrying on
substantial investment activities for other clients, in which the Company will
have no interest. The Adviser or its affiliates may have financial incentives to
favor certain of such accounts over the Company. Any of their proprietary
accounts and other customer accounts may compete with the Company for specific
trades. The Adviser or its affiliates may give advice and recommend securities
to, or buy or sell securities for, the Company, which advice or securities
recommended may differ from advice given to, or securities recommended or bought
or sold for, other accounts and customers, even though their investment
objectives may be the same as, or similar to, those of the Company.

     Situations may occur when the Company could be disadvantaged because of the
investment activities conducted by the Adviser and its affiliates for its other
accounts. Such situations may be based on, among other things, the following:
(i) legal or internal restrictions on the combined size of positions that may be
taken for the Company or the other accounts, thereby limiting the size of the
Company's position; or (ii) the difficulty of liquidating an investment for the
Company or the other accounts where the market cannot absorb the sale of the
combined position. The Company's investment opportunities may be limited by
affiliations of the Adviser or its affiliates with energy infrastructure
companies. In particular, a private equity fund managed by KCEP holds a
significant subordinated equity position in one MLP and, as a result of such
ownership, holds a board position that is currently filled by David J. Schulte.
This relationship may limit or preclude the Company's investment in securities
of that MLP. See "The Company -- Conflicts of Interest."

     Effects of Terrorism.  The U.S. securities markets are subject to
disruption as a result of terrorist activities, such as the terrorist attacks on
the World Trade Center on September 11, 2001; war, such as the war in Iraq and
its aftermath; and other geopolitical events. Such events have led, and in the
future may lead, to short-term market volatility and may have long-term effects
on the U.S. economy and markets.

     Anti-Takeover Provisions.  The Company's Charter and Bylaws include
provisions that could delay, defer or prevent other entities or persons from
acquiring control of the Company, causing it to engage in certain transactions
or modifying its structure. These provisions may be regarded as "anti-takeover"
provisions. Such provisions could limit the ability of shareholders to sell
their shares at a premium over the then-current market prices by discouraging a
third party from seeking to obtain control of the Company. See "Certain
Provisions in the Company's Charter and Bylaws."

     Market Discount Risk.  Shares of closed-end management investment companies
frequently trade at prices lower than their net asset value. This is
characteristic of shares of closed-end management investment companies and is a
risk separate and distinct from the risk that the Company's net asset value may
decrease as a result of investment activities. Although this risk applies to all
shareholders, it may be greater for shareholders who sell their shares within a
relatively short period after completion of the public offering. The Company's
net asset value will be reduced immediately following this offering by the
underwriter discounts and commissions, and the offering and organizational costs
of the Company which will be borne entirely by the Company.

     For more information on the risks of investing in the Company, see "Risks."

ADMINISTRATOR, CUSTODIAN, TRANSFER AGENT AND DIVIDEND PAYING AGENT

     The Company will engage U.S. Bancorp Fund Services, LLC to serve as the
Company's administrator. Computershare Investor Services, LLC will serve as the
Company's transfer agent, dividend paying agent, and agent for the dividend
reinvestment plan. U.S. Bank N.A. will serve as the Company's Custodian. See
"Administrator, Custodian, Transfer Agent and Dividend Paying Agent."

                                        10
<PAGE>

                          SUMMARY OF COMPANY EXPENSES

     The following table assumes leverage through borrowing or other
transactions involving indebtedness in an amount equal to thirty three and one
third percent (33 1/3%) of the Company's total assets (including the amount
obtained through leverage) and shows Company expenses as a percentage of net
assets attributable to the Company's Common Shares. Footnote 4 to the table also
shows Company expenses as a percentage of net assets attributable to the
Company's Common Shares, but assumes that the Company does not use any form of
leverage.

SHAREHOLDER TRANSACTION EXPENSE

<Table>
<S>                                                           <C>
Underwriting discounts and commissions (as a percentage of
  offering price)(1)........................................            4.5%
Offering Expenses Borne by the Company (as a percentage of
  offering price)(2)........................................
Dividend Reinvestment Plan Fees(3)..........................            None
</Table>

<Table>
<Caption>
                                                              PERCENTAGE OF NET ASSETS
                                                               ATTRIBUTABLE TO COMMON
                                                                  SHARES (ASSUMES
                                                              LEVERAGE IS OUTSTANDING)
                                                              ------------------------
<S>                                                           <C>
Management Fee..............................................            1.42%
Interest Payments on Borrowed Funds(4)......................            1.50%
Other Expenses(5)...........................................            0.25%
                                                                       -----
Total Annual Expenses.......................................            3.17%
  Less Fee and Expense Reimbursement (Years 1 through
     5)(6)..................................................           (0.34)%
                                                                       -----
Net Annual Expenses.........................................            2.83%
</Table>

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

(1) For a description of the manner in which the underwriting discounts and
    commissions may be reduced and of other compensation paid to the
    underwriters by the Company and others, see "Underwriting."

(2) The total of other expenses and offering costs to be incurred by the Company
    in connection with the offering described in this prospectus is $    .

(3) Shareholders will pay brokerage charges if they direct the plan agent to
    sell their Common Shares held in a dividend reinvestment account. See
    "Distributions -- Automatic Dividend Reinvestment Plan."

(4) The table presented in this footnote estimates what the Company's annual
    expenses would be, stated as percentages of the Company's net assets
    attributable to Common Shares but, unlike the table above, assumes that the
    Company does not use any form of leverage, as would be the case, for
    instance, prior to the Company's expected borrowing. In accordance with
    these assumptions, the Company's expenses would be estimated as follows:

<Table>
<Caption>
                                                              PERCENTAGE OF NET ASSETS
                                                               ATTRIBUTABLE TO COMMON
                                                                 SHARES (ASSUMES NO
                                                              LEVERAGE IS OUTSTANDING)
                                                              ------------------------
<S>                                                           <C>
Management Fee..............................................            0.95%
Other Expenses(5)...........................................            0.25%
                                                                       -----
Total Annual Expenses.......................................            1.20%
  Less Fee and Expense Reimbursement (Years 1 through
     5)(6)..................................................           (0.23)%
                                                                       -----
Net Annual Expenses.........................................            0.97%
</Table>

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

(5) Does not include current income tax expense, which is estimated to be
    insignificant.

(6) For each of the first two years following the commencement of the Company's
    operations, the Adviser has agreed to waive or reimburse the Company for
    fees and expenses in an amount equal to 0.23% of the average monthly Managed
    Assets (as previously defined on page 5) of the Company. For years three
    through five, the Adviser has agreed to waive or reimburse the Company for
    fees and expenses in an amount equal to 0.10% of the average monthly Managed
    Assets of the Company.

     The purpose of the table above and the example below is to help investors
understand the fees and expenses that they, as common shareholders, would bear
directly or indirectly. As of the date of this

                                        11
<PAGE>

prospectus, the Company has not commenced investment operations. The Other
Expenses shown in the table and related footnotes are based on estimated amounts
for the Company's first year of operations unless otherwise indicated and assume
that the Company issues approximately ten million Common Shares. If the Company
issues fewer Common Shares, all other things being equal, these expenses would
increase. For additional information with respect to the Company's expenses, see
"Management of the Company" and "Distributions -- Automatic Dividend
Reinvestment Plan."

EXAMPLE:

     The following example illustrates the expenses (including the underwriting
discounts and commissions of $1.125 and estimated offering costs of this
offering of $.08 per Common Share) that shareholders would pay on a $1,000
investment in Common Shares, assuming (1) total annual expenses of 2.8% of net
assets attributable to Common Shares in years 1 and 2, increasing to 3.0% in
years 3 through 5 and increasing further to 3.2% in years 6 through 10 and (2) a
5% annual return:*

<Table>
<Caption>
                                                           1 YEAR   3 YEARS   5 YEARS   10 YEARS(1)
                                                           ------   -------   -------   -----------
<S>                                                        <C>      <C>       <C>       <C>
Total Expenses Incurred..................................   $75      $134      $196        $371
</Table>

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

(1) Assumes waiver or reimbursement of fees and expense of 0.23% of average
    monthly Managed Assets in years one and two, and 0.10% of average monthly
    Managed Assets in years three through five. The Adviser has not agreed to
    reimburse the Company for any year beyond 2009.

 *  The example assumes that the estimated Other Expenses set forth in the fee
    table are accurate, that all distributions are reinvested at net asset value
    and that the Company is engaged in leverage of 33 1/3% of total assets,
    assuming a 3% annual interest rate cost of leverage. THE EXAMPLE SHOULD NOT
    BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES. ACTUAL EXPENSES MAY BE
    GREATER OR LESS THAN THOSE ASSUMED. MOREOVER, THE COMPANY'S ACTUAL RATE OF
    RETURN MAY BE GREATER OR LESS THAN THE HYPOTHETICAL 5% RETURN SHOWN IN THE
    EXAMPLE.

                                USE OF PROCEEDS

     The net proceeds of this offering will be approximately $     (or
approximately $     assuming the Underwriters exercise the over-allotment option
in full) after payment of offering costs estimated to be approximately $     and
the deduction of the underwriting discounts and commissions. The Company will
pay all of its organizational costs and Common Share offering costs, which are
estimated to be approximately $     per Common Share. The Company will invest
the net proceeds of the offering in accordance with its investment objective and
policies described below. Approximately   % of net proceeds of the offering
(excluding the over-allotment option) is expected to be used to complete the
purchase of certain identified Direct Placements immediately after the closing
of the offering. See "Direct Placement Contracts" for a list of direct placement
contracts the Company is a party to as of the date of this prospectus. The
Company estimates that the remaining net proceeds of this offering will be fully
invested in accordance with the Company's investment objective and policies
within three months of the closing. Pending such investment, those proceeds may
be invested in U.S. Government securities or high quality, short-term money
market instruments. See "Prospectus Summary -- Risks -- Delay in Use of
Proceeds" "The Company -- Investment Objective" and "-- Investment Policies."

                                        12
<PAGE>

                                  THE COMPANY


     The Company is a newly organized, nondiversified, closed-end management
investment company registered under the 1940 Act. The Company was organized as a
Maryland corporation on October 30, 2003. As a newly organized entity, the
Company has no operating history. The Company's principal office is located at
10801 Mastin Boulevard, Suite 222, Overland Park, Kansas.


INVESTMENT OBJECTIVE

     The Company's investment objective is to seek a high level of total return
with an emphasis on current distributions paid to shareholders. For purposes of
the Company's investment objective, total return includes capital appreciation
of, and all distributions received from, securities in which the Company will
invest regardless of the tax character of the distributions. The Company seeks
to provide its shareholders with an efficient vehicle to invest in a portfolio
of MLPs. Similar to the tax characterization of cash distributions made by MLPs
to its unitholders, the Company believes that its shareholders will have
relatively high levels of the deferred taxable income associated with cash
distributions made by the Company to shareholders.

ENERGY INFRASTRUCTURE INDUSTRY

     The Company will concentrate its investments in the energy infrastructure
sector. The Company will pursue its objective by investing principally in a
portfolio of equity securities issued by MLPs. MLP common units historically
have generated higher average total returns than domestic common stock (as
measured by the S&P 500)and fixed income securities. A more detailed description
of investment policies and restrictions and more detailed information about
portfolio investments are contained in the statement of additional information.

     Energy Infrastructure Companies.  For purposes of the Company's policy of
investing 90% of total assets in securities of energy infrastructure companies,
an energy infrastructure company is one that derives at least 50% of its
revenues from "Qualifying Income" under Section 7704 of the Internal Revenue
Code or one that derives at least 50% of its revenues from the provision of
services directly related to the generation of Qualifying Income. Qualifying
Income is defined as any income and/or gains from the exploration, development,
mining or production, processing, refining, transportation (including pipelines
transporting natural gas, oil or products thereof), or the marketing or delivery
of any mineral or natural resource (including fertilizer, geothermal energy, and
timber).

     Energy infrastructure companies (other than most pipeline MLPs) do not
operate as "public utilities" or "local distribution companies," and are
therefore not subject to rate regulation by state or federal utility
commissions. However, energy infrastructure companies may be subject to greater
competitive factors than utility companies, including competitive pricing in the
absence of regulated tariff rates, which could cause a reduction in revenue and
which could adversely affect profitability. Most pipeline MLPs are subjected to
government regulation concerning the construction, pricing and operation of
pipelines. Pipeline MLPs are able to set prices (rates or tariffs) to cover
operating costs, depreciation and taxes, and provide a return on investment.
These rates are monitored by the Federal Energy Regulatory Commission (FERC)
which seeks to ensure that consumers receive adequate and reliable supplies of
energy at the lowest possible price while providing energy suppliers and
transporters a just and reasonable return on capital investment and the
opportunity to adjust to changing market conditions.

     Master Limited Partnerships.  Under normal circumstances, the Company will
invest at least 70% of its total assets in equity securities of MLPs that derive
at least 90% of their income from energy infrastructure operations and are
organized as partnerships, thereby eliminating income tax at the entity level.
The MLP has two classes of partners, the general partner, and the limited
partners. The general partner is usually a major energy company, investment fund
or the direct management of the MLP. The general partner normally controls the
MLP through a 2% equity interest plus units that are subordinated to the common
(publicly traded) units for at least the first five-years of the partnership's
existence and then only converting to common if certain financial test are met.

                                        13
<PAGE>

     As a motivation for the general partner to successfully manage the MLP and
increase cash flows, the terms of most MLPs typically provide that the general
partner receives a larger portion of the net income as distributions reach
higher target levels. As cash flow grows, the general partner receives a greater
interest in the incremental income compared to the interest of limited partners.
The general partner's incentive compensation typically increases up to 50% of
incremental income. Nevertheless, the aggregate amount distributed to limited
partners will increase as MLP distributions reach higher target levels. Given
this incentive structure, the general partner has an incentive to streamline
operations and undertake acquisitions and growth projects in order to increase
distributions to all partners.

     Energy infrastructure MLPs in which the Company will invest can generally
be classified in the following categories:

          Pipeline MLPs are common carrier transporters of natural gas, natural
     gas liquids (primarily propane, ethane, butane and natural gasoline), crude
     oil or refined petroleum products (gasoline, diesel fuel and jet fuel).
     Pipeline MLPs also may operate ancillary businesses such as storage and
     marketing of such products. Revenue is derived from capacity and
     transportation fees. Historically, pipeline output has been less exposed to
     cyclical economic forces due to its low cost structure and
     government-regulated nature. In addition, pipeline MLPs do not have direct
     commodity price exposure because they do not own the product being shipped.

          Processing MLPs are gatherers and processors of natural gas as well as
     providers of transportation, fractionation and storage of natural gas
     liquids ("NGLs"). Revenue is derived from providing services to natural gas
     producers, which require treatment or processing before their natural gas
     commodity can be marketed to utilities and other end user markets. Revenue
     for the processor is fee based, although it is not uncommon to have some
     participation in the prices of the natural gas and NGL commodities for a
     portion of revenue.

          Propane MLPs are distributors of propane to homeowners for space and
     water heating. Revenue is derived from the resale of the commodity on a
     margin over wholesale cost. The ability to maintain margin is a key to
     profitability. Propane serves approximately 3% of the household energy
     needs in the United States, largely for homes beyond the geographic reach
     of natural gas distribution pipelines. Approximately 70% of annual cash
     flow is earned during the winter heating season (October through March).
     Accordingly, volumes are weather dependent, but have utility type functions
     similar to electricity and natural gas.

          Coal MLPs own, lease and manage coal reserves.  Revenue is derived
     from production and sale of coal, or from royalty payments related to
     leases to coal producers. Electricity generation is the primary use of coal
     in the United States. Demand for electricity and supply of alternative
     fuels to generators are the primary drivers of coal demand. Coal MLPs are
     subject to operating and production risks, such as: the MLP or a lessee
     meeting necessary production volumes; federal, state and local laws and
     regulations which may limit the ability to produce coal; the MLP's ability
     to manage production costs and pay mining reclamation costs; and the effect
     on demand that the Clean Air Act standards have on coal-end users.

     Although the Company also may invest in equity and debt securities of
energy infrastructure companies that are organized and/or taxed as corporations,
it is likely that any such investments will be in debt securities because the
equity dividends from such corporations typically do not meet the Company's
investment objective. The Company also may invest in securities of general
partners or other affiliates of MLPs and private companies operating energy
infrastructure assets.

INVESTMENT PROCESS

     Under normal circumstances, the Company intends to invest at least 90% of
its total assets (including assets obtained through leverage) in securities of
energy infrastructure companies. The Adviser intends to seek securities that
offer a combination of quality, growth and yield intended to result in superior
total returns over the long run. The Adviser's securities selection process
include a comparison of quantitative, qualitative, and

                                        14
<PAGE>

relative value factors. Although the Adviser intends to use research provided by
broker-dealers and investment firms, primary emphasis will be placed on
proprietary analysis and valuation models conducted and maintained by the
Adviser's in-house investment analysts. To determine whether a company meets its
criteria, the Adviser generally will look for a strong record of distribution
growth, a solid ratio of debt to equity and coverage ratio with respect to
distributions to unit holders, and a proven track record, incentive structure
and management team. It is anticipated that all of the public energy
infrastructure companies in which the Company will invest will have a market
capitalization greater than $100 million.

INVESTMENT POLICIES

     The Company will seek to achieve its investment objective by investing
primarily in securities of MLPs that the Adviser believes offer attractive
distribution rates and capital appreciation potential. The Company also may
invest in other securities set forth below if the Adviser expects to achieve the
Company's objective with such investments.

     The Company's policy of investing at least 90% of its total assets
(including assets obtained through leverage) in securities of energy
infrastructure companies is nonfundamental and may be changed by the Board of
Directors without shareholder approval, provided that shareholders receive at
least 60 days' prior written notice of any change.

     The Company has adopted the following additional nonfundamental policies:

     - Under normal circumstances, the Company intends to invest at least 70%
       and up to 100% of total assets in equity securities issued by MLPs.
       Equity units currently consist of common units, convertible subordinated
       units, and pay-in-kind units.

     - The Company may invest up to 30% of total assets in direct placements
       (restricted securities). The types of restricted securities that the
       Company may purchase include MLP convertible subordinated units,
       unregistered MLP common units and securities of private companies (i.e.,
       non-MLPs). Investments in private companies that do not have any publicly
       traded shares or units are limited to 5% of total assets.

     - The Company may invest up to 25% of total assets in debt securities of
       energy infrastructure companies, including certain securities rated below
       investment grade ("junk bonds"). Below investment grade debt securities
       will be rated at least B3 by Moody's and at least B- by S&P at the time
       of purchase, or comparably rated by another statistical rating
       organization or if unrated, determined to be of comparable quality by the
       Adviser.

     - The Company will not invest more than 10% of total assets in any single
       issuer.

     - The Company will not engage in short sales.

     Unless otherwise stated, all investment restrictions apply at the time of
purchase and the Company will not be required to reduce a position due solely to
market value fluctuations.

                                        15
<PAGE>

INVESTMENT SECURITIES

     The types of securities in which the Company may invest include, but are
not limited to, the following:

     Equity Securities of MLPs.  Consistent with its investment objective, the
Company may invest up to 100% of its total assets in equity securities issued by
energy infrastructure MLPs, including common units, convertible subordinated
units and I-Shares. The table below summarizes the features of these securities,
and a further discussion of these securities follows:

<Table>
<Caption>
                                                    CONVERTIBLE
                           COMMON UNITS         SUBORDINATED UNITS           I-SHARES
                           ------------         ------------------           --------
<S>                    <C>                     <C>                     <C>
VOTING RIGHTS........  Limited to certain      Same as common units    No direct MLP voting
                       significant                                     rights
                       decisions; no annual
                       election of directors
DIVIDEND PRIORITY....  First right to          Second right to MQD;    Equal in amount and
                       minimum quarterly       no arrearage rights     priority to common
                       distribution ("MQD")                            units but paid in
                       specified in                                    additional
                       Partnership                                     I-Shares at current
                       Agreement; arrearage                            market value of
                       rights                                          I-Shares
DIVIDEND RATE........  Minimum set in          Equal in amount to      Equal in amount to
                       Partnership             common units;           common units
                       Agreement;              participate pro rata
                       participate pro rata    with common units
                       with subordinated       above the MQD
                       after both MQDs are
                       met
TRADING..............  Listed on NYSE, AMEX    Not publicly traded     Listed on NYSE
                       and NASDAQ National
                       Market
TAX TREATMENT........  Ordinary income to      Same as common units    Full distribution
                       the extent of taxable                           treated as return of
                       income allocated to                             capital; since
                       holder; tax-free                                distribution is in
                       return of capital                               shares, total basis
                       thereafter to extent                            is not reduced
                       of holder's basis;
                       remainder as capital
                       gain
TYPE OF INVESTOR.....  Retail; creates UBTI    Same as common units    Institutional; does
                       for tax-exempt                                  not create UBTI;
                       investor; not                                   qualifying income for
                       qualifying income for                           regulated investment
                       regulated investment                            companies
                       companies
LIQUIDITY PRIORITY...  Intended to receive     Second right to         Same as common units
                       return of all capital   return of capital;      (indirect right
                       first                   pro rata with common    through I-share
                                               units thereafter        issuer)
CONVERSION RIGHTS....  Not applicable          One-to-one ratio into   None
                                               common units
</Table>

     MLP Common Units.  MLP common units represent an equity ownership interest
in a partnership, providing limited voting rights and entitling the holder to a
share of the company's success through distributions and/or capital
appreciation. Unlike shareholders of a corporation, common unit holders do not
elect directors annually and generally have the right to vote only on certain
significant events, such as mergers, a sale of substantially all of the assets,
removal of the general partner or material amendments to the partnership
agreement. MLPs are required by their partnership agreements to distribute a
large percentage of their current operating earnings. Common unit holders
generally have first right to a MQD prior to distributions to the convertible
subordinated unit holders or the general partner (including incentive
distributions). Common unit holders typically have arrearage rights if the MQD
is not met. In the event of liquidation, MLP common unit holders have first
rights to the partnership's remaining assets after bondhold-

                                        16
<PAGE>

ers, other debt holders, and preferred unit holders have been paid in full. MLP
common units trade on a national securities exchange or over-the-counter.

     MLP Convertible Subordinated Units.  MLP convertible subordinated units are
typically issued by MLPs to founders, corporate general partners of MLPs,
entities that sell assets to the MLP, and institutional investors. The purpose
of the convertible subordinated units is to increase the likelihood that during
the subordination period there will be available cash to be distributed to
common unit holders. The Company expects to purchase subordinated units in
direct placements from such persons. Convertible subordinated units generally
are not entitled to distributions until holders of common units have received
specified MQD, plus any arrearages, and may receive less in distributions upon
liquidation. Convertible subordinated unit holders generally are entitled to MQD
prior to the payment of incentive distributions to the general partner, but are
not entitled to arrearage rights. Therefore, they generally entail greater risk
than MLP common units. They are generally convertible automatically into the
senior common units of the same issuer at a one-to-one ratio upon the passage of
time or the satisfaction of certain financial tests. These units do not trade on
a national exchange or over-the-counter, and there is no active market for
convertible subordinated units. The value of a convertible security is a
function of its worth if converted into the underlying common units. Convertible
subordinated units generally have similar voting rights to MLP common units.

     MLP I-Shares.  I-Shares represent an indirect investment in MLP I-units.
I-units are equity securities issued to affiliates of MLPs, typically a limited
liability company, that owns an interest in and manages the MLP. The issuer has
management rights but is not entitled to incentive distributions. The I-Share
issuer's assets consist exclusively of MLP I-units. Distributions by MLPs to
I-unit holders are made in the form of additional I-units, generally equal in
amount to the cash received by common unit holders of MLPs. Distributions to
I-Share holders are made in the form of additional I-Shares, generally equal in
amount to the I-units received by the I-Share issuer. The issuer of the I-Share
is taxed as a corporation, however, the MLP does not allocate income or loss to
the I-Share issuer. Accordingly, investors receive a Form 1099, are not
allocated their proportionate share of income of the MLPs and are not subject to
state filing obligations.

     Debt Securities.  The Company may invest up to 25% of its assets in debt
securities of energy infrastructure companies, including securities rated below
investment grade. The Company's debt securities may have fixed or variable
principal payments and all types of interest rate and dividend payment and reset
terms, including fixed rate, adjustable rate, zero coupon, contingent, deferred,
payment in kind and auction rate features. To the extent that the Company
invests in below investment grade debt securities, such securities will be
rated, at the time of investment, at least B- by S&P's or B3 by Moody's or a
comparable rating by at least one other rating agency or, if unrated, determined
by the Adviser to be of comparable quality. If a security satisfies the
Company's minimum rating criteria at the time of purchase and is subsequently
downgraded below such rating, the Company will not be required to dispose of
such security. If a downgrade occurs, the Adviser will consider what action,
including the sale of such security, is in the best interest of the Company and
its shareholders.

     Because the risk of default is higher for below investment grade securities
than investment grade securities, the Adviser's research and credit analysis is
an especially important part of managing securities of this type. The Adviser
will attempt to identify those issuers of below investment grade securities
whose financial condition the Adviser believes are adequate to meet future
obligations or have improved or is expected to improve in the future. The
Adviser's analysis focuses on relative values based on such factors as interest
or dividend coverage, asset coverage, earnings prospects and the experience and
managerial strength of the issuer.

     Direct Placements (Restricted Securities).  The Company may invest up to
30% of total assets in direct placements. An issuer may be willing to offer the
purchaser more attractive features with respect to securities issued in direct
placements because it has avoided the expense and delay involved in a public
offering of securities. Adverse conditions in the public securities markets may
also preclude a public offering of securities. MLP convertible subordinated
units are typically purchased from affiliates of the issuer or other existing
holders of convertible units rather than directly from the issuer.

                                        17
<PAGE>

     Securities obtained by means of direct placements are less liquid than
securities traded in the open market because of statutory and contractual
restrictions on resale. Such securities are, therefore, unlike securities that
are traded in the open market, which can be expected to be sold immediately if
the market is adequate. This lack of liquidity creates special risks for the
Company. However, the Company could sell such securities in privately negotiated
transactions with a limited number of purchasers or in public offerings under
the Securities Act of 1933. MLP convertible subordinated units also convert to
publicly traded common units upon the passage of time and/or satisfaction of
certain financial tests. See "Direct Placement Contracts" for a list of direct
placement contracts the Company is a party to as of the date of this prospectus.

     Defensive and Temporary Investments.  Under adverse market or economic
conditions or pending investment of offering or leverage proceeds, the Company
may invest up to 100% of its total assets in securities issued or guaranteed by
the U.S. Government or its instrumentalities or agencies, short-term debt
securities, certificates of deposit, bankers' acceptances and other bank
obligations, commercial paper rated in the highest category by a rating agency
or other fixed income securities deemed by the Adviser to be consistent with a
defensive posture, or may hold cash. The Adviser also may invest in such
instruments to meet working capital needs including, but not limited to, for
collateral in connection with certain investment techniques, to hold a reserve
pending payment of dividends, and to facilitate the payments of expenses and
settlement of trades. The yield on such securities may be lower than the returns
on MLPs or yields on lower rated fixed income securities. To the extent the
Company uses this strategy, it may not achieve its investment objective.

CONFLICTS OF INTEREST

     Conflicts of interest may arise from the fact that the Adviser and its
affiliates generally will be carrying on substantial investment activities for
other clients, in which the Company will have no interest. The Adviser or its
affiliates may have financial incentives to favor certain of such accounts over
the Company. Any of their proprietary accounts and other customer accounts may
compete with the Company for specific trades. The Adviser or its affiliates may
give advice and recommend securities to, or buy or sell securities for the
Company which advice or securities may differ from advice given to, or
securities recommended or bought or sold for, other accounts and customers, even
though their investment objectives may be the same as, or similar to, those of
the Company.

     The Adviser will evaluate a variety of factors in determining whether a
particular investment opportunity or strategy is appropriate and feasible for
the relevant account at a particular time, including, but not limited to, the
following: (i) the nature of the investment opportunity taken in the context of
the other investments at the time; (ii) the liquidity of the investment relative
to the needs of the particular entity or account; (iii) the availability of the
opportunity (i.e., size of obtainable position); (iv) the transaction costs
involved; and (v) the investment or regulatory limitations applicable to the
particular entity or account. Because these considerations may differ when
applied to the Company and relevant accounts under management in the context of
any particular investment opportunity, the investment activities of the Company,
on the one hand, and other managed accounts, on the other hand, may differ
considerably from time to time. In addition, the fees and expenses of the
Company will differ from those of the other managed accounts. Accordingly,
shareholders should be aware that the future performance of the Company and
other accounts of the Adviser may vary.

     Situations may occur when the Company could be disadvantaged because of the
investment activities conducted by the Adviser and its affiliates for its other
accounts. Such situations may be based on, among other things, the following:
(i) legal or internal restrictions on the combined size of positions that may be
taken for the Company or the other accounts, thereby limiting the size of the
Company's position; or (ii) the difficulty of liquidating an investment for the
Company or the other accounts where the market cannot absorb the sale of the
combined position. The Company's investment opportunities may be limited by
affiliations of the Adviser or its affiliates with energy infrastructure
companies. In particular, a private equity fund managed by KCEP holds a
significant subordinated equity position in one MLP and as a result of such
ownership, holds

                                        18
<PAGE>

a board position that is currently filled by Mr. Schulte, that may limit or
preclude the Company's investment in securities of that MLP.

     The Adviser and its principals, officers, employees, and affiliates may buy
and sell securities or other investments for their own accounts and may have
actual or potential conflicts of interest with respect to investments made on
behalf of the Company. As a result of differing trading and investment
strategies or constraints, positions may be taken by principals, officers,
employees, and affiliates of the Adviser that are the same as, different from,
or made at a different time than positions taken for the Company.

PORTFOLIO TURNOVER

     The Company's annual portfolio turnover rate may vary greatly from year to
year. Although the Company cannot accurately predict its annual portfolio
turnover rate, it is not expected to exceed 30% under normal circumstances.
However, portfolio turnover rate is not considered a limiting factor in the
execution of investment decisions for the Company. A higher turnover rate
results in correspondingly greater brokerage commissions and other transactional
expenses that are borne by the Company. High portfolio turnover may result in
the Company's recognition of gains that will increase the Company's tax
liability and thereby lower the after-tax dividends of the Company. In addition,
high portfolio turnover may increase the Company's current and accumulated
earnings profits, resulting in a greater portion of the Company's distributions
being treated as taxable dividends for federal income tax purposes. See "Tax
Matters."

                                    LEVERAGE

     The Company may borrow money, issue preferred shares, or issue other debt
securities to the extent permitted by the 1940 Act. These practices are known as
leverage. The Company generally will not use leverage unless it believes that
leverage will serve the best interests of shareholders. The principal, although
not exclusive, factor used in making this determination will be whether the
potential return is likely to exceed the cost of leverage. The Company also may
borrow up to an additional 5% of its total assets (not including the amount so
borrowed) for temporary purposes, including the settlement and clearance of
securities transactions, which otherwise might require untimely dispositions of
portfolio holdings.

     Under the 1940 Act, the Company is not permitted to incur indebtedness
constituting senior securities unless immediately thereafter the Company has
total assets (including the proceeds of the indebtedness) at least equal to 300%
of the amount of the indebtedness. Stated another way, the Company may not
borrow for investment purposes more than 33 1/3% of its total assets, including
the amount borrowed. The Company also must maintain this 300% "asset coverage"
for as long as the indebtedness is outstanding. The 1940 Act provides that the
Company may not declare any cash dividend or other distribution on its shares,
or purchase any of its shares of capital stock (through tender offers or
otherwise), unless it would satisfy this 300% asset coverage after deducting the
amount of the dividend, other distribution or share purchase price, as the case
may be. If the asset coverage for indebtedness declines to less than 300% as a
result of market fluctuations or otherwise, the Company may be required to sell
a portion of its investments when it may be disadvantageous to do so.

     The establishment of a borrowing facility by the Company would involve
expenses and other costs, including interest payments, which would be borne by
the Company's common shareholders. In addition, the terms of any borrowing or
other indebtedness issued by the Company may impose asset coverage requirements,
dividend limitations and voting right requirements on the Company that are more
stringent than those imposed under the 1940 Act. Such terms may also impose
special restrictions on the Company's portfolio composition or on its use of
various investment techniques or strategies or its ability to pay dividends on
Common Shares in some instances. The Company also may be required to pledge its
assets to lenders in connection with certain types of borrowings. Due to these
restrictions, the Company may be forced to liquidate investments at times or
prices that are not favorable to the Company, or the Company may be forced to
forgo investments that the Adviser otherwise views as favorable.

                                        19
<PAGE>

     Under the 1940 Act, the Company is not permitted to issue preferred shares
unless immediately after such issuance the net asset value of the Company's
portfolio is at least 200% of the liquidation value of the outstanding preferred
shares. Stated another way, the Company may not issue preferred shares that have
an aggregate liquidation value of more than 50% of its total assets, including
the amount leveraged. In addition, the Company is not permitted to declare any
cash dividend or other distribution on its Common Shares unless, at the time of
such declaration, the net asset value of the Company's portfolio (determined
after deducting the amount of such dividend or distribution) is at least 200% of
such liquidation value. In the event preferred shares are issued, the Company
may, as a result of market conditions or otherwise, be required to purchase or
redeem preferred shares, or sell a portion of its investments when it may be
disadvantageous to do so, in order maintain asset coverage of any preferred
shares of at least 200%. Common shareholders would bear the costs of a preferred
share offering which would include offering expenses and the ongoing payment of
dividends.

     The Company may, but is not required to, hedge general interest rate
exposure arising from its leverage transactions. Under current market
conditions, hedging would be accomplished principally by entering into interest
rate transactions. Interest rate transactions are hedging transactions such as
interest rate swaps and the purchase of interest rate caps and floors. Interest
rate swaps involve the exchange by the Company with another party of their
respective commitments to pay or receive interest (e.g., an exchange of floating
rate payments for fixed payments). The purchase of an interest rate cap entitles
the purchaser, to the extent that a specified index exceeds a predetermined
interest rate, to receive payments of interest on a notional principal amount
from the party selling such interest rate cap. The purchase of an interest rate
floor entitles the purchaser, to the extent that a specified index falls below a
predetermined interest rate, to receive payments of interest on a notional
principal amount from the party selling such interest rate floor. The Company
intends to use interest rate transactions solely for the purpose of hedging its
leveraged capital structure. The use of interest rate transactions is a highly
specialized activity that involves investment techniques and risks different
from those associated with ordinary portfolio security transactions. See
"Risks -- Hedging Strategy Risk."

EFFECTS OF LEVERAGE

     Assuming borrowings in the amount of 33 1/3% of the Company's total assets
(including the amount borrowed), and an average annual interest rate of 3%
payable on such borrowing, the annual return that the Company's portfolio must
experience (net of expenses) in order to cover those interest payments would be
1%.

     The following table is designed to illustrate the effect of the foregoing
level of leverage on the return to a shareholder, assuming hypothetical annual
returns (net of expenses) of the Company's portfolio of -10% to 10%. As the
table shows, the leverage generally increases the return to shareholders when
portfolio return is positive and greater than the cost of leverage and decreases
the return when the portfolio return is negative or less than the cost of
leverage. The figures appearing in the table are hypothetical, and actual
returns may be greater or less than those appearing in the table.

<Table>
<S>                                              <C>      <C>     <C>     <C>    <C>
Assumed Portfolio Return (net of expenses).....     (10)%    (5)%     0%     5%     10%
Corresponding Common Share Return..............  (16.50)% (9.00)% (1.50)% 6.00%  13.50%
</Table>

     During the time in which the Company is utilizing leverage, the amount of
the fees paid to the Adviser for investment advisory and management services
will be higher than if the Company did not utilize leverage because the fees
paid will be calculated based on the Company's Managed Assets, which include
assets purchased with leverage. Therefore, the Adviser will have a financial
incentive to leverage the Company, which may create a conflict of interest
between the Adviser and the common shareholders. Because payments on any
borrowings would be paid by the Company at a specified rate, only the Company's
common shareholders would bear the Company's fees and expenses.

     Until the Company incurs indebtedness, the Company's Common Shares will not
be leveraged, and the risks and special considerations related to leverage
described in this prospectus will not apply. Any benefits of leverage cannot be
fully achieved until the proceeds resulting from the use of leverage have been
invested in accordance with the Company's investment objective and policies. For
further information about leveraging, see "Risks -- Leverage Risk."

                                        20
<PAGE>

                                     RISKS

     General.  The Company is a nondiversified, closed-end management investment
company designed primarily as a long-term investment vehicle and not as a
trading tool. An investment in the Company's Common Shares should not constitute
a complete investment program for any investor and involves a high degree of
risk. Due to the uncertainty in all investments, there can be no assurance that
the Company will achieve its investment objective.

     No Operating History.  The Company is a newly organized closed-end
management investment company and has no operating history or history of public
trading of its Common Shares.

     Management Risk.  The Adviser was formed in October 2002 and has limited
independent resources. The Adviser has relied to a significant degree on the
officers, employees, and resources of Fountain Capital, KCEP and their
affiliates. Four (of the five) members of the investment committee are
affiliates of, but not employees of, the Adviser, and each have other
significant responsibilities with such affiliated entities. Fountain Capital,
KCEP and their affiliates conduct businesses and activities of their own in
which the Adviser has no economic interest. If these separate activities are
significantly greater than the Adviser's activities, there could be material
competition for the efforts of key personnel. The Adviser has no previous
experience managing a registered investment company.

     Energy Infrastructure Sector.  The Company intends to concentrate its
investments in the energy infrastructure sector, with an emphasis on securities
issued by MLPs. Certain risks inherent in the energy infrastructure business of
these types of MLPs include the following:

     - Processing and coal MLPs may be directly affected by energy commodity
       prices. The volatility of commodity prices can indirectly affect certain
       other MLPs due to the impact of prices on volume. Pipeline MLPs are not
       subject to direct commodity price exposure because they do not own the
       underlying energy commodity. While propane MLPs do own the underlying
       energy commodity, the Adviser seeks high quality MLPs that are able to
       mitigate or manage direct margin exposure to commodity price levels. The
       MLP sector can be hurt by market perception that MLPs performance and
       distributions are directly tied to commodity prices.

     - The profitability of MLPs, particularly processing and pipeline MLPs, may
       be materially impacted by the volume of natural gas or other energy
       commodities available for transporting, processing, storing or
       distributing. A significant decrease in the production of natural gas,
       oil, coal or other energy commodities, due to the decline of production
       from existing facilities, import supply disruption, depressed commodity
       prices or otherwise, would reduce revenue and operating income of MLPs
       and, therefore, the ability of MLPs to make distributions to partners.

     - A sustained decline in demand for crude oil, natural gas and refined
       petroleum products could adversely affect MLP revenues and cash flows.
       Factors that could lead to a decrease in market demand include a
       recession or other adverse economic conditions, an increase in the market
       price of the underlying commodity, higher taxes or other regulatory
       actions that increase costs, or a shift in consumer demand for such
       products.

     - A portion of any one MLP's assets may be dedicated to natural gas
       reserves and other commodities that naturally deplete over time. Often
       the MLPs are dependent upon exploration and development activities by
       third parties. MLPs employ a variety of means of increasing cash flow,
       including increasing utilization of existing facilities, expanding
       operations through new construction, expanding operations through
       acquisitions, or securing additional long-term contracts. Thus, some MLPs
       may be subject to construction risk, acquisition risk or other risk
       factors arising from their specific business strategies. A significant
       slowdown in large energy companies' disposition of energy infrastructure
       assets and other merger and acquisition activity in the energy MLP
       industry could reduce the growth rate of cash flows received by the
       Company from MLPs that grow through acquisitions.

     - The profitability of MLPs could be adversely affected by changes in the
       regulatory environment. Most MLPs' assets are heavily regulated by
       federal and state governments in diverse matters such as the way

                                        21
<PAGE>

       in which their assets are constructed and the prices they may charge for
       their services. Such regulation can change over time in scope and
       intensity. For example, a particular byproduct of an MLP process may be
       declared hazardous by a regulatory agency and unexpectedly increase
       production costs. Moreover, many state and federal environmental laws
       provide for civil as well as regulatory remediation, thus adding to the
       potential exposure an MLP may face.

     - A rising interest rate environment could adversely impact the performance
       of MLPs. Rising interest rates could limit the capital appreciation of
       equity units of MLPs as a result of the increased availability of
       alternative investments at competitive yields with MLPs. Rising interest
       rates may also increase an MLP's cost of capital. A higher cost of
       capital could limit growth from acquisition/expansion projects and limit
       MLP distribution growth rates.

     - Since the September 11th attacks, the U.S. government has issued public
       warnings indicating that energy assets, specifically those related to
       pipeline infrastructure, production facilities and transmission and
       distribution facilities, might be specific targets of terrorist activity.
       The continued threat of terrorism and related military activity will
       likely increase volatility for prices in natural gas and oil and could
       affect the market for products of MLPs.

     - Holders of MLP units are subject to certain risks inherent in the
       partnership structure of MLPs including (i) tax risks (described below),
       (ii) limited ability to elect or remove management, (iii) limited voting
       rights, except with respect to extraordinary transactions, and (iv)
       conflicts of interest of the general partner including those arising from
       incentive distribution payments.

     Industry Specific Risk.  Energy infrastructure companies are also subject
to risks that are specific to the industry they serve.

          Pipeline MLPs are subject to demand for crude oil or refined products
     in the markets served by the pipeline, sharp decreases in crude oil or
     natural gas prices that cause producers to curtail production or reduce
     capital spending for exploration activities, and environmental regulation.
     Demand for gasoline, which accounts for a substantial portion of refined
     product transportation, depends on price, prevailing economic conditions in
     the markets served, and demographic and seasonal factors. Pipeline MLP unit
     prices are primarily driven by distribution growth rates and prospects for
     distribution growth.

          Processing MLPs are subject to declines in production of natural gas
     fields, which utilize the processing facilities as a way to market the gas,
     prolonged depression in the price of natural gas or crude oil refining,
     which curtails production due to lack of drilling activity and declines in
     the prices of NGL products and natural gas prices, resulting in lower
     processing margins.

          Propane MLPs are subject to earnings variability based upon weather
     patterns in the locations where the company operates and the wholesale cost
     of propane sold to end customers. Propane MLP unit prices are based on
     safety in distribution coverage ratios, interest rate environment and, to a
     lesser extent, distribution growth.

          Coal MLPs are subject to demand variability based on favorable weather
     conditions, strong or weak domestic economy, the level of coal stockpiles
     in the customer base, and the general level of prices of competing sources
     of fuel for electric generation. They are also subject to supply
     variability based on the geological conditions that reduce productivity of
     mining operations, regulatory permits for mining activities and the
     availability of coal that meets Clean Air Act standards.

     Cash Flow Risk.  The Company will derive substantially all of its cash flow
from investments in equity securities of MLPs. The amount of cash that the
Company has available to distribute to shareholders depends entirely on the
ability of MLPs held by the Company to make distributions to its partners and
the tax character of those distributions. The Company has no control over the
actions of underlying MLPs. The amount of cash that each individual MLP can
distribute to its partners will depend on the amount of cash it generates from
operations, which will vary from quarter to quarter depending on factors
affecting the energy infrastructure market generally and on factors affecting
the particular business lines of the MLP. Available cash will also depend on the
MLPs level of operating costs (including incentive distributions to the general

                                        22
<PAGE>

partner), level of capital expenditures, debt service requirements, acquisition
costs (if any), fluctuations in working capital needs and other factors.

     Equity Securities Risk.  MLP common units and other equity securities can
be affected by macro economic and other factors affecting the stock market in
general, expectations of interest rates, investor sentiment towards MLPs or the
energy sector, changes in a particular issuer's financial condition, or
unfavorable or unanticipated poor performance of a particular issuer (in the
case of MLPs, generally measured in terms of distributable cash flow). Prices of
common units of individual MLPs and other equity securities can also be affected
by fundamentals unique to the partnership or company, including earnings power
and coverage ratios.

     Investing in securities of smaller companies may involve greater risk than
is associated with investing in more established companies. Smaller
capitalization companies may have limited product lines, markets or financial
resources; may lack management depth or experience; and may be more vulnerable
to adverse general market or economic developments than larger more established
companies.

     Because convertible subordinated units generally convert to common units on
a one-to-one ratio, the price that the Company can be expected to pay upon
purchase or to realize upon resale is generally tied to the common unit price
less a discount. The size of the discount varies depending on a variety of
factors including the likelihood of conversion, and the length of time remaining
to conversion, and the size of the block purchased.

     The price of I-Shares and their volatility tend to be correlated to the
price of common units, although the price correlation is not precise.

     Tax Risk.  The ability of the Company to meet its investment objective
depends on the level of taxable income and distributions of the MLPs in which it
invests. The Company has no control over the taxable income of underlying MLPs.

     A significant slowdown in large energy companies' disposition of energy
infrastructure assets and other merger and acquisition activity in the energy
MLP industry could limit the appreciation potential of the Company. In addition,
such a slowdown by the MLPs in the Company's Portfolio could accelerate the
Company's obligations to pay income taxes due in part to less accelerated
depreciation generated by new acquisitions. In such a case, the portion of the
Company's distributions that is treated as a return on capital will be reduced
and the portion treated as dividend income to the Company's shareholders would
increase, resulting in lower after-tax yields for the Company's investors.

     Tax Law Change Risk.  Future changes in tax laws or regulations, or related
interpretations of such laws and regulations, could adversely affect the Company
or MLPs, which could negatively impact the Company's shareholders and dividends
they receive from the Company. These changes could include changes in the
federal income tax rate applicable to qualifying dividends. Historically,
dividend income was taxed as ordinary income. In 2003, legislation reduced the
maximum federal income tax rate on qualifying dividends to fifteen percent. The
reduced rate on qualifying dividends is scheduled to expire for tax years after
2008. In addition, legislative changes have been considered that would make it
easier for MLP interests to be owned by regulated investment companies. If such
legislation is enacted, the NAV of the Company may be enhanced due to additional
demand for MLP units; however, the relative value of the Common Shares may be
adversely affected, since a regulated investment company generally is taxed as a
flow-through entity.

     Deferred Tax Risk.  Historically, a substantial portion of the MLPs' income
has been offset by tax deductions. As a result, MLPs generally have made cash
flow payments that have significantly exceeded taxable income. This aspect of
MLPs, and the Company's anticipated leverage, will likely reduce the Company's
current income taxes and, concomitantly, increase the Company's cash
distributions to its shareholders. The Company will accrue deferred income taxes
for the anticipated potential future income tax liability attributable to the
MLP cash flow distributions in excess of the related MLP taxable income reported
by the Company. In addition, the Company will accrue deferred income tax with
respect to any appreciation of interests in MLPs or other investments. If the
amount of MLP income tax deductions that may be claimed by the Company is
smaller than anticipated or the Company turns over its portfolio more rapidly
than
                                        23
<PAGE>

anticipated, the Company will incur greater current income taxes. This may
reduce the Company's current cash flow distributions and the amount of assets
available to the Company for investment. Moreover, if the Company's taxable
income is greater, it is possible that a larger portion of the cash
distributions that it makes to shareholders will be treated as taxable
dividends, thus reducing the after-tax yield to shareholders.

     Leverage Risk.  Borrowings or other transactions involving Company
indebtedness (other than for temporary or emergency purposes) and any preferred
shares issued by the Company all would be considered "senior securities" for
purposes of the 1940 Act and would constitute leverage. Leverage creates an
opportunity for an increased return to common shareholders, but it is a
speculative technique that may adversely affect common shareholders. If the
return on securities acquired with borrowed funds or other leverage proceeds
does not exceed the cost of the leverage, the use of leverage could cause the
Company to lose money. Successful use of leverage depends on the Adviser's
ability to predict or hedge correctly interest rates and market movements, and
there is no assurance that the use of a leveraging strategy will be successful
during any period in which it is used.

     Capital raised through leverage will be subject to interest costs or
dividend payments, which could exceed the income and appreciation on the
securities purchased with the proceeds of the leverage. The Company may also be
required to pay fees in connection with borrowings (such as loan syndication
fees or commitment and administrative fees in connection with a line of credit),
and it might be required to maintain minimum average balances with a bank
lender, either of which would increase the cost of borrowing over the stated
interest rate. The issuance of debt securities by the Company would involve
offering expenses and other costs, including interest payments, which would be
borne indirectly by the common shareholders. Fluctuations in interest rates on
borrowings and short-term debt could reduce cash available for dividends on
Common Shares. Increased operating costs, including the financing cost
associated with any leverage, may reduce the Company's total return.

     The terms of any borrowing, other indebtedness or preferred shares issued
by the Company may impose asset coverage requirements, dividend limitations and
voting right requirements on the Company that are more stringent than those
imposed under the 1940 Act. Such terms may also impose special restrictions on
the Company's portfolio composition or on its use of various investment
techniques or strategies. The Company may be further limited in any of these
respects by guidelines established by any rating agencies that issue ratings for
debt securities or preferred shares issued by the Company. These requirements
may have an adverse effect on the Company. To the extent necessary, the Company
intends to repay indebtedness to maintain the required asset coverage. Doing so
may require the Company to liquidate portfolio securities at a time when it
would not otherwise be desirable to do so. Nevertheless, it is not anticipated
that the 1940 Act requirements, the terms of any senior securities or the rating
agency guidelines will impede the Adviser in managing the Company's portfolio in
accordance with the Company's investment objective and policies.

     The premise underlying the use of leverage is that the costs of leveraging
generally will be based on short-term rates, which normally will be lower than
the return (including the potential for capital appreciation) that the Company
can earn on the longer-term portfolio investments that it makes with the
proceeds obtained through the leverage. Thus, the shareholders would benefit
from an incremental return. However, if the differential between the return on
the Company's investments and the cost of leverage were to narrow, the
incremental benefit would be reduced and could be eliminated or even become
negative. Accordingly, the costs of leveraging may exceed the return from the
portfolio securities purchased with the leveraged capital, which could reduce
the net asset value of the Common Shares. Furthermore, if long-term rates rise,
the net asset value of the Company's Common Shares will reflect the resulting
decline in the value of a larger aggregate amount of portfolio assets than the
Company would hold if it had not leveraged. Thus, leveraging exaggerates changes
in the value and in the yield on the Company's portfolio. This, in turn, may
result in greater volatility of both the net asset value and the market price of
the Common Shares.

     To the extent the income or capital appreciation derived from securities
purchased with funds received from leverage exceeds the cost of leverage, the
Company's return will be greater than if leverage had not been used. Conversely,
if the income or capital appreciation from the securities purchased with such
funds is not sufficient to cover the cost of leverage, the Company's return will
be less than if leverage had not been used,

                                        24
<PAGE>

and therefore the amount available for distribution to shareholders as dividends
and other distributions will be reduced.

     Hedging Strategy Risk.  The Company may use interest rate transactions for
hedging purposes only, in an attempt to reduce the interest rate risk arising
from the Company's leveraged capital structure. Interest rate transactions that
the Company may use for hedging purposes will expose the Company to certain
risks that differ from the risks associated with its portfolio holdings. There
are economic costs of hedging reflected in the price of interest rate swaps,
caps and similar techniques, the costs of which can be significant, particularly
when long-term interest rates are substantially above short-term rates. In
addition, the Company's success in using hedging instruments is subject to the
Adviser's ability to predict correctly changes in the relationships of such
hedging instruments to the Company's leverage risk, and there can be no
assurance that the Adviser's judgment in this respect will be accurate.
Consequently, the use of hedging transactions might result in a poorer overall
performance for the Company, whether or not adjusted for risk, than if the
Company had not engaged in such transactions.

     Depending on the state of interest rates in general, the Company's use of
interest rate transactions could enhance or decrease the net income of the
Common Shares. To the extent there is a decline in interest rates, the value of
interest rate swaps or caps could decline, and could result in a decline in the
net asset value of the Common Shares. In addition, if the counterparty to an
interest rate swap or cap defaults, the Company would not be able to use the
anticipated net receipts under the interest rate swap or cap to offset the
Company's cost of financial leverage.

     Direct Placements (Restricted Securities).  The Company may invest up to
30% of total assets in direct placements (restricted securities). Securities
obtained by means of direct placements are less liquid than securities traded in
the open market because of statutory and contractual restrictions on resale.
Such securities are, therefore, unlike securities that are traded in the open
market, which can be expected to be sold immediately if the market is adequate.
As discussed further below, this lack of liquidity creates special risks for the
Company. However, the Company could sell such securities in privately negotiated
transactions with a limited number of purchasers or in public offerings under
the Securities Act of 1933. MLP convertible subordinated units also convert to
publicly traded common units upon the passage of time and/or satisfaction of
certain financial tests.

     Restricted securities are subject to statutory and contractual restrictions
on their public resale, which may make it more difficult to value them, may
limit the Company's ability to dispose of them and may lower the amount the
Company could realize upon their sale. To enable the Company to sell its
holdings of a restricted security not registered under the 1933 Act, the Company
may have to cause those securities to be registered. The expenses of registering
restricted securities may be negotiated by the Company with the issuer at the
time the Company buys the securities. When the Company must arrange registration
because the Company wishes to sell the security, a considerable period may
elapse between the time the decision is made to sell the security and the time
the security is registered so that the Company could sell it. The Company would
bear the risks of any downward price fluctuation during that period.

     Liquidity Risk.  Although common units of MLPs trade on the NYSE, AMEX, and
the NASDAQ National Market, certain MLP securities may trade less frequently
than those of larger companies due to their smaller capitalizations. In the
event certain MLP securities experience limited trading volumes, the prices of
such MLPs may display abrupt or erratic movements at times. Additionally, it may
be more difficult for the Company to buy and sell significant amounts of such
securities without an unfavorable impact on prevailing market prices. As a
result, these securities may be difficult to dispose of at a fair price at the
times when the Company believes it is desirable to do so. These securities are
also more difficult to value, and the Adviser's judgment as to value will often
be given greater weight than market quotations, if any exist. Investment of the
Company's capital in securities that are less actively traded or over time
experience decreased trading volume may restrict the Company's ability to take
advantage of other market opportunities. See "The Company -- Investment
Policies/Restricted Securities."

     Valuation Risk.  Market prices generally will not be available for MLP
convertible subordinated units, or securities of private companies, and the
value of such investments will ordinarily be determined based on
                                        25
<PAGE>

fair valuations determined by the Adviser pursuant to procedures adopted by the
Board of Directors. Similarly, direct placements of common units will be based
on fair value determinations because of their restricted nature; however, the
Adviser expects that such values will be based on a discount from publicly
available market prices. Restrictions on resale or the absence of a liquid
secondary market may adversely affect the ability of the Company to determine
its net asset value. The sale price of securities that are not readily
marketable may be lower or higher than the Company's most recent determination
of their fair value. Additionally, the value of these securities typically
requires more reliance on the judgment of the Adviser than that required for
securities for which there is an active trading market. Due to the difficulty in
valuing these securities and the absence of an active trading market for these
investments, the Company may not be able to realize these securities' true
value, or may have to delay their sale in order to do so. In addition, the
Company will rely to some extent on information provided by MLPs to estimate
taxable income allocable to MLP units held by the Company and to estimate
associated deferred tax liability. See "Net Asset Value."

     Effects of Terrorism.  The U.S. securities markets are subject to
disruption as a result of terrorist activities, such as the terrorist attacks on
the World Trade Center on September 11, 2001; war, such as the war in Iraq and
its aftermath; and other geopolitical events. Such events have led, and in the
future may lead, to short-term market volatility and may have long-term effects
on the U.S. economy and markets.

     Interest Rate Risk.  Generally, when market interest rates rise, the values
of debt securities decline, and vice versa. The Company's investment in such
securities means that the net asset value and market price of the Common Shares
will tend to decline if market interest rates rise. During periods of declining
interest rates, the issuer of a security may exercise its option to prepay
principal earlier than scheduled, forcing the Company to reinvest in lower
yielding securities. This is known as call or prepayment risk. Lower grade
securities frequently have call features that allow the issuer to repurchase the
security prior to its stated maturity. An issuer may redeem a lower grade
obligation if the issuer can refinance the debt at a lower cost due to declining
interest rates or an improvement in the credit standing of the issuer.

     Below Investment Grade Securities Risk.  Investing in lower grade debt
instruments involves additional risks than investment grade securities. Adverse
changes in economic conditions are more likely to lead to a weakened capacity of
a below investment grade issuer to make principal payments and interest payments
than an investment grade issuer. An economic downturn could adversely affect the
ability of highly leveraged issuers to service their obligations or to repay
their obligations upon maturity. Similarly, downturns in profitability in the
energy infrastructure industry could adversely affect the ability of below
investment grade issuers in that industry to meet their obligations. The market
values of lower quality securities tend to reflect individual developments of
the issuer to a greater extent than do higher quality securities, which react
primarily to fluctuations in the general level of interest rates.

     The secondary market for below investment grade securities may not be as
liquid as the secondary market for more highly rated securities. There are fewer
dealers in the market for below investment grade securities than investment
grade obligations. The prices quoted by different dealers may vary
significantly, and the spread between the bid and asked price is generally much
larger than for higher quality instruments. Under adverse market or economic
conditions, the secondary market for below investment grade securities could
contract further, independent of any specific adverse change in the condition of
a particular issuer, and these instruments may become illiquid. As a result, the
Company could find it more difficult to sell these securities or may be able to
sell the securities only at prices lower than if such securities were widely
traded. Prices realized upon the sale of such lower-rated or unrated securities,
under these circumstances, may be less than the prices used in calculating the
Company's net asset value.

     Because investors generally perceive that there are greater risks
associated with lower quality securities of the type in which the Company may
invest a portion of its assets, the yields and prices of such securities may
tend to fluctuate more than those for higher rated securities. In the lower
quality segments of the debt securities market, changes in perceptions of
issuers' creditworthiness tend to occur more frequently and in a more pronounced
manner than do changes in higher quality segments of the debt securities market,
resulting in greater yield and price volatility.

                                        26
<PAGE>

     Factors having an adverse impact on the market value of below investment
grade securities may have an adverse effect on the Company's net asset value and
the market value of its Common Shares. In addition, the Company may incur
additional expenses to the extent it is required to seek recovery upon a default
in payment of principal or interest on its portfolio holdings. In certain
circumstances, the Company may be required to foreclose on an issuer's assets
and take possession of its property or operations. In such circumstances, the
Company would incur additional costs in disposing of such assets and potential
liabilities from operating any business acquired.

     Nondiversification.  The Company is a nondiversified, closed-end management
investment company under the 1940 Act and will not be treated as a regulated
investment company under the Internal Revenue Code. Accordingly, there are no
regulatory limits under the 1940 Act or the Internal Revenue Code on the number
or size of securities held by the Company. There currently are only fifty-five
(55) companies presently organized as MLPs and only a limited amount of those
companies operate energy infrastructure assets. The Company intends to select
MLP investments from this small pool of issuers. The Company may invest in non-
MLP securities issued by energy infrastructure companies to a lesser degree,
consistent with its investment objective and policies.


     Anti-Takeover Provisions.  The Company's Charter and Bylaws include
provisions that could delay, defer or prevent other entities or persons from
acquiring control of the Company, causing it to engage in certain transactions
or modifying its structure. These provisions may be regarded as "anti-takeover"
provisions. Such provisions could limit the ability of shareholders to sell
their shares at a premium over the then-current market prices by discouraging a
third party from seeking to obtain control of the Company. See "Certain
Provisions in the Company's Charter and Bylaws."


     Market Discount Risk.  Shares of closed-end management investment companies
frequently trade at prices lower than their net asset value. This is
characteristic of shares of closed-end management investment companies and is a
risk separate and distinct from the risk that the Company's net asset value may
decrease as a result of investment activities. Although this risk applies to all
investors, it may be greater for initial investors who seek to sell their shares
within a relatively short period after completion of the public offering.
Accordingly, the Company is designed primarily for long-term investors and
should not be considered a vehicle for trading purposes.

     Whether shareholders will realize a gain or loss upon the sale of the
Company's Common Shares depends upon whether the market value of the shares at
the time of sale is above or below the price the shareholder paid, taking into
account transaction costs for the shares, and is not directly dependent upon the
Company's net asset value. Because the market value of the Company's Common
Shares will be determined by factors such as the relative demand for and supply
of the shares in the market, general market conditions and other factors beyond
the control of the Company, the Company cannot predict whether its Common Shares
will trade at, below or above net asset value, or below or above the initial
offering price for the Common Shares.

                                        27
<PAGE>

                           MANAGEMENT OF THE COMPANY

DIRECTORS AND OFFICERS


     The business and affairs of the Company are managed under the direction of
the Board of Directors. Accordingly, the Company's Board of Directors provides
broad supervision over the affairs of the Company, including supervision of the
duties performed by the Adviser. The officers of the Company are responsible for
the Company's day-to-day operations. The names and business addresses of the
directors and officers of the Company, together with their principal occupations
and other affiliations during the past five years, are set forth in the
Statement of Additional Information. The Board of Directors of the Company
consists of a majority of directors who are not interested persons (as defined
in the 1940 Act) of the Adviser or its affiliates.


INVESTMENT ADVISER

     Pursuant to an Advisory Agreement dated December 12, 2003, the Adviser will
provide the Company with investment research and advice and furnish the Company
with an investment program consistent with the Company's investment objective
and policies, subject to the supervision of the Board. The Adviser will
determine which portfolio securities will be purchased or sold, arrange for the
placing of orders for the purchase or sale of portfolio securities, select
brokers or dealers to place those orders, maintain books and records with
respect to the Company's securities transactions and report to the Board on the
Company's investments and performance.

     The Adviser is located at 10801 Mastin Boulevard, Suite 222, Overland Park,
Kansas 66210. The Adviser specializes in managing portfolios of MLPs and other
energy infrastructure companies. As of December 31, 2003, the Adviser and its
affiliates (including the Atlantic group) had approximately $367 million in
assets under management in the energy infrastructure industry, and had
approximately $9.7 billion in total assets under management.

     The investment management of the Company's portfolio will be the
responsibility of a team of portfolio managers consisting of David J. Schulte,
H. Kevin Birzer, Zachary A. Hamel, Kenneth P. Malvey, and Terry C. Matlack.

          David J. Schulte.  Mr. Schulte is a Managing Director of KCEP and a
     Manager of the Adviser. Mr. Schulte focuses on acquisition financings
     primarily for natural resource distribution and service companies. Prior to
     joining KCEP in 1993, Mr. Schulte had over five years of experience
     completing acquisition and public equity financings as an investment banker
     at the predecessor of Oppenheimer & Co, Inc. From 1986 to 1989, he was a
     securities law attorney. He serves on the Board of Directors of Inergy,
     L.P. Mr. Schulte holds a Bachelor of Science degree in Business
     Administration from Drake University and a Juris Doctorate degree from the
     University of Iowa. He earned his CFA designation in 1992, and is a member
     of the Financial Accounting Policy Committee of the AIMR.

          H. Kevin Birzer.  Mr. Birzer is a Partner/Senior Analyst with Fountain
     Capital and a Manager of the Adviser. Mr. Birzer, who has 20 years of
     investment experience including 16 in high-yield securities, began his
     career with Peat Marwick. His subsequent experience includes three years
     working as a Vice President for F. Martin Koenig & Co., focusing on equity
     and option investments, and three years at Drexel Burnham Lambert, where he
     was a Vice President in the Corporate Finance Department. Mr. Birzer
     graduated Magna Cum Laude 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 1988.

          Zachary A. Hamel.  Mr. Hamel is a Partner/Senior Analyst with Fountain
     Capital and a Manager of the Adviser. Mr. Hamel joined Fountain in 1997. He
     covers energy, chemicals and utilities. Prior to joining Fountain, Mr.
     Hamel worked for the Federal Deposit Insurance Corporation for eight years
     as a Bank Examiner and a Regional Capital Markets Specialist. Mr. Hamel
     graduated from Kansas State University with a Bachelor of Science in
     Business Administration. He also attained a Master in Business

                                        28
<PAGE>

     Administration from the University of Kansas School of Business. He earned
     his CFA designation in 1998.

          Kenneth P. Malvey.  Mr. Malvey joined Fountain Capital as an
     Investment Analyst in June of 2002 and is a Manager of the Adviser. Prior
     to joining Fountain Capital, Mr. Malvey was one of three members of the
     Global Office of Investments for GE Capital's Employers Reinsurance
     Corporation. Most recently he was the Global Investment Risk Manager for a
     portfolio of approximately $24 billion of fixed-income, public equity and
     alternative investment assets. Prior to joining GE in 1996, Mr. Malvey was
     a Bank Examiner and Regional Capital Markets Specialist with the FDIC for
     nine years. Mr. Malvey graduated Magna Cum Laude with a Bachelor of Science
     degree in Finance from Winona State University, Winona, Minnesota. He
     received his CFA designation in 1996.

          Terry C. Matlack.  Mr. Matlack is a Managing Director of KCEP and
     Manager of the Adviser. Prior to joining KCEP in 2001, Mr. Matlack was
     President of GreenStreet Capital and its affiliates in the
     telecommunications service industry. Prior to 1995, he was Executive Vice
     President and a member of the Board of Directors of W. K. Communications,
     Inc., a cable television acquisition company, and Chief Operating Officer
     of W. K. Cellular, a cellular rural service area operator. He has also
     served as a specialist in corporate finance with George K. Baum & Company,
     and as Executive Vice President of Corporate Finance at B.C. Christopher
     Securities Company. Mr. Matlack graduated with a Bachelor of Science in
     Business Administration from Kansas State University and holds a Masters of
     Business Administration and a Juris Doctorate from the University of
     Kansas. He earned his CFA designation in 1985.

COMPENSATION AND EXPENSES

     Under the Advisory Agreement, the Company will pay to the Adviser
quarterly, as compensation for the services rendered by it, a fee equal on an
annual basis to 0.95% of the Company's average monthly Managed Assets. Because
the fee to be paid to the Adviser is determined on the basis of the Company's
Managed Assets, the Adviser's interest in determining whether to leverage the
Company may conflict with the interests of the Company. The Company's average
monthly Managed Assets are determined for the purpose of calculating the
management fee by taking the average of the monthly determinations of Managed
Assets during a given calendar quarter. The fees are payable for each calendar
quarter within five days after the end of that quarter. The Adviser has
contractually agreed to waive or reimburse the Company for fees and expenses,
including the investment advisory fee and other expenses in the amount of 0.23%
of average monthly Managed Assets for the first two years of the Company's
operations and 0.10% of average monthly Managed Assets in years three through
five. See "Summary of Company Expenses."

     The Company will bear all expenses not specifically assumed by the Adviser
incurred in the Company's operations and the offering of its Common Shares.
Expenses borne by the Company will include, but not be limited to, the
following: (i) expenses of maintaining the Company and continuing its existence,
(ii) registration of the Company under the 1940 Act, (iii) commissions, spreads,
fees and other expenses connected with the acquisition, holding and disposition
of securities and other investments including placement and similar fees in
connection with direct placements entered into on behalf of the Company, (iv)
auditing, accounting and legal expenses, (v) taxes and interest, (vi)
governmental fees, (vii) expenses of listing shares of the Company with a stock
exchange, and expenses of issue, sale, repurchase and redemption (if any) of
interests in the Company, including expenses of conducting tender offers for the
purpose of repurchasing Company interests, (viii) expenses of registering and
qualifying the Company and its shares under federal and state securities laws
and of preparing and filing registration statements and amendments for such
purposes, (ix) expenses of reports and notices to shareholders and of meetings
of shareholders and proxy solicitations therefor, (x) expenses of reports to
governmental officers and commissions, (xi) insurance expenses, (xii)
association membership dues, (xiii) fees, expenses and disbursements of
custodians and subcustodians for all services to the Company (including without
limitation safekeeping of funds, securities and other investments, keeping of
books, accounts and records, and determination of net asset values), (xiv) fees,
expenses and disbursements of transfer agents, dividend paying agents,
shareholder servicing agents and registrars for all services to the Company,
(xv) compensation and expenses of directors of the Company
                                        29
<PAGE>

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.


<Table>
<S>                                                           <C>

SUBJECT TO COMPLETION                                                 (TORTOISE LOGO)
PRELIMINARY PROSPECTUS
DATED FEBRUARY 19, 2004
              COMMON SHARES
</Table>


                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION
                                $25.00 PER SHARE

     Tortoise Energy Infrastructure Corporation (the "Company") is a newly
organized, nondiversified, closed-end management investment company. The
Company's investment objective is to seek a high level of total return with an
emphasis on current distributions paid to its shareholders. The Company seeks to
provide its shareholders with an efficient vehicle to invest in a portfolio of
publicly traded master limited partnerships in the energy infrastructure sector
("MLPs"). Similar to the tax characterization of distributions made by MLPs to
its unitholders, the Company believes that it will have relatively high levels
of deferred taxable income associated with distributions to its shareholders.
There is no assurance that the Company will achieve its objective.

     Under normal circumstances, the Company will invest at least 90% of total
assets (including assets obtained through leverage) in securities of energy
infrastructure companies, and will invest at least 70% of total assets in equity
securities of MLPs. Energy infrastructure companies engage in the business of
transporting, processing, storing, distributing or marketing natural gas,
natural gas liquids (primarily propane), coal, crude oil or refined petroleum
products, or exploring, developing, managing or producing such commodities. The
Company may also invest up to 25% of total assets in debt securities of energy
infrastructure companies, including securities rated below investment grade
(commonly referred to as "junk bonds"), and up to 30% of total assets in
restricted securities for which no public trading market exists.

     PRIOR TO THIS OFFERING, THERE HAS BEEN NO PUBLIC OR PRIVATE MARKET FOR THE
COMMON SHARES. The Common Shares have been approved for listing on the New York
Stock Exchange, subject to notice of issuance, under the trading or "ticker"
symbol "TYG."
                             ---------------------

     INVESTING IN COMMON SHARES INVOLVES A HIGH DEGREE OF RISK. INVESTORS COULD
LOSE SOME OR ALL OF THEIR INVESTMENT IN THE COMPANY. SEE "RISKS" BEGINNING ON
PAGE 21 OF THIS PROSPECTUS.

                             ---------------------
     SHARES OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES FREQUENTLY TRADE AT
PRICES LOWER THAN THEIR NET ASSET VALUE OR INITIAL OFFERING PRICE. MARKET
DISCOUNT RISK APPLIES TO ALL INVESTORS, BUT IT MAY BE GREATER FOR INITIAL
INVESTORS EXPECTING TO SELL SHARES SHORTLY AFTER THE COMPLETION OF THE OFFERING.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
                             ---------------------

<Table>
<Caption>
                                                              PER SHARE   TOTAL(1)
                                                              ---------   --------
<S>                                                           <C>         <C>
Public offering price.......................................   $25.000    $
Underwriting discounts and commissions......................   $ 1.125    $
Proceeds, before expenses, to the Company(2)................   $23.875    $
</Table>

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

(1) The underwriters named in this prospectus have the option to purchase up to
              additional Common Shares at the public offering price, less the
    underwriting discounts and commissions, within 45 days from the date of this
    prospectus to cover over-allotments.

(2) The aggregate expenses of the offering are estimated to be $     , which
    represents $0.          per Common Share issued.

     The Common Shares will be ready for delivery on or about           , 2004.

<Table>
<S>                        <C>                      <C>
STIFEL, NICOLAUS & COMPANY     LEHMAN BROTHERS        RBC CAPITAL MARKETS
       INCORPORATED
       ADVEST, INC.          BB&T CAPITAL MARKETS         OPPENHEIMER
  SANDERS MORRIS HARRIS                                WR HAMBRECHT + CO
PARKER/HUNTER INCORPORATED                           WUNDERLICH SECURITIES,
                                                              INC.
</Table>

                             ---------------------
                       Prospectus dated           , 2004
<PAGE>

of the Common Shares is equal to or less than the market price per Common Share
plus estimated brokerage commissions (such condition being referred to herein as
"market premium"), the Plan Agent will receive Additional Common Shares from the
Company for each participant's account. The number of Additional Common Shares
to be credited to the participant's account will be determined by dividing the
dollar amount of the dividend or distribution by the greater of (i) the net
asset value per Common Share on the payment date, or (ii) 95% of the market
price per Common Share on the payment date.

     If, on the payment date, the net asset value per Common Share exceeds the
market price plus estimated brokerage commissions (such condition being referred
to herein as "market discount"), the Plan Agent has until the last business day
before the next date on which the shares trade on an "ex-dividend" basis or in
no event more than 90 days after the payment date ("last purchase date") to
invest the dividend or distribution amount in shares acquired in open-market
purchases. It is contemplated that the Company will pay quarterly dividends.
Therefore, the period during which open-market purchases can be made will exist
only from the payment date on the dividend through the date before the next
ex-dividend date. The weighted average price (including brokerage commissions)
of all Common Shares purchased by the Plan Agent as Plan Agent will be the price
per Common Share allocable to each participant. If, before the Plan Agent has
completed its open-market purchases, the market price of a Common Share exceeds
the net asset value per share, the average per share purchase price paid by the
Plan Agent may exceed the net asset value of the Company's shares, resulting in
the acquisition of fewer shares than if the dividend had been paid in Additional
Common Shares on the payment date. Because of the foregoing difficulty with
respect to open-market purchases, the Plan provides that if the Plan Agent is
unable to invest the full dividend amount in open-market purchases during the
purchase period or if the market discount shifts to a market premium during the
purchase period, the Plan Agent will cease making open-market purchases and will
invest the uninvested portion of the dividend or distribution amount in
Additional Common Shares at the close of business on the last purchase date.

     The Plan Agent maintains all shareholders' accounts in the Plan and
furnishes written confirmation of each acquisition made for the participant's
account as soon as practicable, but in no event later than 60 days after the
date thereof. Shares in the account of each Plan participant will be held by the
Plan Agent in non-certificated form in the Plan Agent's name or that of its
nominee, and each shareholder's proxy will include those shares purchased or
received pursuant to the Plan. The Plan Agent will forward all proxy
solicitation materials to participants and vote proxies for shares held pursuant
to the Plan first in accordance with the instructions of the participants then
with respect to any proxies not returned by such participant, in the same
proportion as the Plan Agent votes the proxies returned by the participants.

     There will be no brokerage charges with respect to shares issued directly
by the Company as a result of dividends or distributions payable either in
shares or in cash. However, each participant will pay a pro rata share of
brokerage commissions incurred with respect to the Plan Agent's open-market
purchases in connection with the reinvestment of dividends or distributions. If
a participant elects to have the Plan Agent sell part or all of his or her
Common Shares and remit the proceeds, such participant will be charged his or
her pro rata share of brokerage commissions on the shares sold.

     The automatic reinvestment of dividends and distributions will not relieve
participants of any federal, state or local income tax that may be payable (or
required to be withheld) on such dividends. See "Tax Matters."

     Shareholders participating in the Plan may receive benefits not available
to shareholders not participating in the Plan. If the market price plus
commissions of the Company's shares is higher than the net asset value,
participants in the Plan will receive shares of the Company at less than they
could otherwise purchase them and will have shares with a cash value greater
than the value of any cash distribution they would have received on their
shares. If the market price plus commissions is below the net asset value,
participants receive distributions of shares with a net asset value greater than
the value of any cash distribution they would have received on their shares.
However, there may be insufficient shares available in the market to make
distributions in shares at prices below the net asset value. Also, because the
Company does not redeem its shares, the price on resale may be more or less than
the net asset value. See "Tax Matters" for a discussion of tax consequences of
the Plan.

                                        31
<PAGE>

     Experience under the Plan may indicate that changes are desirable.
Accordingly, the Company reserves the right to amend or terminate the Plan if in
the judgment of the Board of Directors such a change is warranted. The Plan may
be terminated by the Plan Agent or the Company upon notice in writing mailed to
each participant at least 60 days prior to the effective date of the
termination. Upon any termination, the Plan Agent will cause a certificate or
certificates to be issued for the full shares held by each participant under the
Plan and cash adjustment for any fraction of a Common Share at the then current
market value of the Common Shares to be delivered to him or her. If preferred, a
participant may request the sale of all of the Common Shares held by the Plan
Agent in his or her Plan account in order to terminate participation in the
Plan. If such participant elects in advance of such termination to have the Plan
Agent sell part or all of his shares, the Plan Agent is authorized to deduct
from the proceeds a $15.00 fee plus the brokerage commissions incurred for the
transaction. If a participant has terminated his or her participation in the
Plan but continues to have Common Shares registered in his or her name, he or
she may re-enroll in the Plan at any time by notifying the Plan Agent in writing
at the address below. The terms and conditions of the Plan may be amended by the
Plan Agent or the Company at any time but, except when necessary or appropriate
to comply with applicable law or the rules or policies of the 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 shall be deemed to be accepted by each participant unless, prior to
the effective date thereof, the Plan Agent receives notice of the termination of
the participant's account under the Plan. Any such amendment may include an
appointment by the Plan Agent of a successor Plan Agent, subject to the prior
written approval of the successor Plan Agent by the Company.

     All correspondence concerning the Plan should be directed to Computershare
at Two North LaSalle Street, Chicago, Illinois 60602.

                          CLOSED-END COMPANY STRUCTURE

     The Company is a newly organized, nondiversified, closed-end management
investment company (commonly referred to as a closed-end fund). Closed-end
companies differ from open-end companies (which are generally referred to as
mutual funds) in that closed-end companies generally list their shares for
trading on a stock exchange and do not redeem their shares at the request of the
shareholder. This means that if a shareholder wishes to sell shares of a
closed-end company, he or she must trade them on the market like any other stock
at the prevailing market price at that time. In a mutual fund, if the
shareholder wishes to sell shares of the company, the mutual fund will redeem or
buy back the shares at net asset value. Also, mutual funds generally offer new
shares on a continuous basis to new investors, and closed-end companies
generally do not. The continuous inflows and outflows of assets in a mutual fund
can make it difficult to manage the company's investments. By comparison,
closed-end companies are generally able to stay more fully invested in
securities that are consistent with their investment objectives and also have
greater flexibility to make certain types of investments and to use certain
investment strategies, such as financial leverage and investments in illiquid
securities.

     Shares of closed-end companies frequently trade at a discount to their net
asset value. This characteristic of shares of closed-end management investment
companies is a risk separate and distinct from the risk that the Company's net
asset value may decrease as a result of investment activities. To the extent the
Common Shares do trade at a discount, the Company's Board of Directors may from
time to time engage in open-market repurchases or tender offers for shares after
balancing the benefit to shareholders of the increase in the net asset value per
share resulting from such purchases against the decrease in the assets of the
Company and potential increase in the expense ratio of expenses to assets of the
Company. The Board of Directors believes that in addition to the beneficial
effects described above, any such purchases or tender offers may result in the
temporary narrowing of any discount but will not have any long-term effect on
the level of any discount. There is no guarantee or assurance that the Company's
Board of Directors will decide to engage in any of these actions. Nor is there
any guarantee or assurance that such actions, if undertaken, would result in the
shares trading at a price equal or close to net asset value per share.
Conversion of the Company to an open-end mutual fund is extremely unlikely and
would require an amendment to the Company's Charter.

                                        32
<PAGE>

     Whether shareholders will realize a gain or loss upon the sale of the
Company's Common Shares will depend upon whether the market value of the shares
at the time of sale is above or below the investor's current basis in the
shares. Because the market value of the Company's Common Shares will be
determined by factors such as the relative demand for and supply of the shares
in the market, general market conditions and other factors beyond the control of
the Company, the Company cannot predict whether its Common Shares will trade at,
below or above net asset value, or below or above the initial offering price for
the Common Shares.

                                  TAX MATTERS

     The following is a general summary of certain federal tax considerations
affecting the Company and its shareholders. This discussion does not purport to
be complete or to deal with all aspects of federal income taxation that may be
relevant to shareholders in light of their particular circumstances or who are
subject to special rules, such as banks, thrift institutions and certain other
financial institutions, real estate investment trusts, regulated investment
companies, insurance companies, brokers and dealers in securities or currencies,
certain securities traders, tax-exempt investors, individual retirement accounts
and certain tax-deferred accounts, and foreign investors. Unless otherwise
noted, this discussion assumes that shareholders are U.S. persons and hold
Common Shares as capital assets. More detailed information regarding the tax
consequences of investing in the Company is in the statement of additional
information.

     Company Federal Income Taxation.  The Company will be treated as a
corporation for federal and state income tax purposes. Thus, the Company will be
obligated to pay federal and state income tax on its taxable income. The Company
intends to invest its assets primarily in MLPs, which generally are treated as
partnerships for federal income tax purposes. As a partner in the MLPs, the
Company will have to report its allocable share of the MLP's taxable income in
computing its taxable income. Based upon the Company's review of the historic
results of the type of MLPs in which the Company intends to invest, the Company
expects that the cash flow received by the Company with respect to its MLP
investments will exceed the taxable income allocated to the Company. There is no
assurance that the Company's expectation regarding the tax character of MLP
distributions will be realized. If this expectation is not realized, there will
be greater tax expense borne by the Company and less cash available to
distribute to shareholders. In addition, the Company will take into account in
its taxable income amounts of gain or loss recognized on the sale of MLP
interests. Currently, the maximum regular federal income tax rate for a
corporation is 35 percent. The Company may be subject to a 20 percent
alternative minimum tax on its alternative minimum taxable income to the extent
that the alternative minimum tax exceeds the Company's regular income tax.

     The Company will not be treated as a regulated investment company under the
Internal Revenue Code. The Internal Revenue Code generally provides that a
regulated investment company does not pay an entity level income tax, provided
that it distributes all or substantially all of its income. The regulated
investment company taxation rules have no application to the Company or to
shareholders of the Company.

     Shareholder Federal Income Taxation.  Unlike a holder of a direct interest
in MLPs, a shareholder will not include its allocable share of the Company's
income, gains, losses or deductions in computing its own taxable income. The
Company expects to distribute to its common shareholders at least 95% of DCF.
The Company's distribution of its DCF will be treated as a taxable dividend to
the shareholder to the extent of the Company's current or accumulated earnings
and profits. If the distribution exceeds the earnings and profits, the
distribution is treated as a return of capital to the shareholder to the extent
of the shareholder's basis in the Common Shares, and then as capital gain.
Shareholders will receive a Form 1099 from the Company (rather than a Form K-1
from each MLP if the shareholder invested directly in the MLPs) and will
recognize dividend income only to the extent of the Company's current or
accumulated earnings and profits.

     Generally, a corporation's earnings and profits are computed based upon
taxable income, with certain specified adjustments. As explained above, based
upon the historic performance of the MLPs, the Company anticipates that the
distributed cash from the MLPs will exceed the Company's share of the MLP income
and the Company's gain on the sale of MLP interests. Thus, the Company
anticipates that only a portion of distributions of DCF will be treated as
dividend income to its shareholders. To the extent that distributions to a
shareholder exceed the Company's earnings and profits, a shareholder's basis in
Common Shares will be
                                        33
<PAGE>

reduced and, if a shareholder has no further basis in its shares, a shareholder
will report any excess as capital gain.

     The Jobs Growth and Tax Relief Reconciliation Act of 2003 amended the
federal income tax law generally to reduce the maximum federal income tax rate
of qualifying dividend income to the rate applicable to long-term capital gains,
which is generally fifteen percent. The portion of the Company's distributions
of DCF treated as a dividend for federal income tax purposes should be treated
as a qualifying dividend for federal income tax purposes. This rate of tax on
dividends is currently scheduled to increase back to ordinary income rates after
December 31, 2008.

     If a shareholder participates in the Company's automatic dividend
reinvestment plan, such shareholder will be taxed upon the amount of
distributions as if such amount had been received by the participating
shareholder and the participating shareholder reinvested such amount in
additional Company Common Shares.

     Investment by Tax-Exempt Investors and Regulated Investment
Companies.  Employee benefit plans, other tax-exempt organizations and regulated
investment companies may want to invest in the Company. Employee benefit plans
and most other organizations exempt from federal income tax, including
individual retirement accounts and other retirement plans, are subject to
federal income tax on UBTI. Because the Company is a corporation for federal
income tax purposes, an owner of shares will not report on its federal income
tax return any of the Company's items of income, gain, loss and deduction.
Therefore, a tax-exempt investor generally will not have UBTI attributable to
its ownership or sale of Common Shares unless its ownership of the shares is
debt-financed. In general, a share would be debt-financed if the tax-exempt
owner of shares incurs debt to acquire a share or otherwise incurs or maintains
a debt that would not have been incurred or maintained if that share had not
been acquired.

     For federal income tax purposes, a regulated investment company, or "mutual
fund," is required to derive 90% or more of its gross income from interest,
dividends and gains from the sale of stocks or securities or foreign currency or
specified related sources. As stated above, an owner of Company shares will not
report on its federal income tax return any of the Company's items of income,
gain, loss and deduction. Instead, the owner will simply report income with
respect to the Company's distributions or gain with respect to the sale of
Common Shares. Thus, ownership of Company shares will not result in income that
is not qualifying income for a mutual fund. Furthermore, any gain from the sale
or other disposition of the Company shares, and the associated purchase and
exchange rights, will constitute gain from the sale of stock or securities and
will qualify for purposes of the 90% test applicable to mutual funds. Finally,
Company shares, and the associated purchase and exchange rights, will constitute
qualifying assets to mutual funds, which also must own at least 50% of
qualifying assets at the end of each quarter.

     Sale of the Common Shares.  Upon sale of Common Shares, a shareholder
generally will recognize capital gain or loss measured by the difference between
the sales proceeds received and the shareholder's federal income tax basis of
Common Shares sold. Generally, such capital gain or loss will be long-term
capital gain or loss if Common Shares were held as a capital asset for more than
twelve months.

     Backup Withholding and Information Reporting.  Backup withholding of U.S.
federal income tax may apply to the distributions of DCF to be made by the
Company if you fail to timely provide taxpayer identification numbers or if the
Company is so instructed by the Internal Revenue Service ("IRS"). Any amounts
withheld from a payment to a U.S. holder under the backup withholding rules are
allowable as a refund or credit against the holder's U.S. federal income tax,
provided that the required information is furnished to the IRS in a timely
manner.

     State and Local Taxes.  Company dividends also may be subject to state and
local taxes.

     Tax matters are very complicated, and the federal tax consequences of an
investment in and holding of the Common Shares will depend on the facts of each
investor's situation. Investors are encouraged to consult their own tax advisers
regarding the specific tax consequences that may affect such investors.

                                        34
<PAGE>

                                NET ASSET VALUE

     The Company will compute its net asset value for its Common Shares as of
the close of trading of the NYSE (normally 4:00 p.m. Eastern time) no less
frequently than the last business day of each calendar month and will make its
net asset value available for publication monthly. For purposes of determining
the net asset value of a Common Share, the net asset value of the Company will
equal the value of the total assets of the Company (the value of the securities
the Company holds plus cash or other assets, including interest accrued but not
yet received) less (i) all of its liabilities (including accrued expenses and
both current and deferred income taxes), (ii) accumulated and unpaid dividends
on any outstanding preferred shares, (iii) the aggregate liquidation value of
any outstanding preferred shares, and (iv) any distributions payable on the
Common Shares. The net asset value per Common Share of the Company will equal
the net asset value of the Company divided by the number of outstanding Common
Shares.

     Pursuant to an agreement with U.S. Bancorp Fund Services, LLC (the
"Accounting Services Provider"), the Accounting Services Provider will value the
assets in the Company's portfolio in accordance with Valuation Procedures
adopted by the Board of Directors. The Accounting Services Provider will obtain
securities market quotations from independent pricing services approved by the
Adviser and ratified by the Board of Directors. Securities for which market
quotations are readily available shall be valued at "market value." Any other
securities shall be valued at "fair value."

     Valuation of certain assets at market value will be as follows. For equity
securities, the Accounting Services Provider will first use readily available
market quotations and will obtain direct written broker-dealer quotations if a
security is not traded on an exchange or quotations are not available from an
approved pricing service. For fixed income securities, the Accounting Services
Provider will use readily available market quotations based upon the last
updated sale price or market value from a pricing service or by obtaining a
direct written broker-dealer quotation from a dealer who has made a market in
the security. For options, futures contracts and options of futures contracts,
the Accounting Services Provider will use readily available market quotations.
If no sales are reported on any exchange or OTC market, the Accounting Services
Provider will use the calculated mean based on bid and asked prices obtained
from the primary exchange or OTC market. Other assets will be valued at market
value pursuant to the Valuation Procedures.

     If the Accounting Services Provider cannot obtain a market value or the
Adviser determines that the value of a security as so obtained does not
represent a fair value as of the valuation time (due to a significant
development subsequent to the time its price is determined or otherwise), fair
value for the security shall be determined pursuant to methodologies established
by the Board of Directors. A report of any prices determined pursuant to such
methodologies will be presented to the Board of Directors or a designated
committee thereof for approval no less frequently than quarterly.

                             DESCRIPTION OF SHARES

     The Company is authorized to issue up to 100,000,000 shares of common
stock, $.001 par value per share ("Common Shares"), and up to 10,000,000 shares
of preferred stock, $.001 par value per share ("Preferred Shares"). Upon
completion of this offering,           Common Shares and no Preferred Shares
will be issued and outstanding. The Company's Board of Directors may, without
any action by the shareholders, amend the Company's charter (the "Charter") from
time to time to increase or decrease the aggregate number of shares of stock or
the number of shares of stock of any class or series that the Company has
authority to issue. Additionally, the Charter authorizes the Board of Directors,
without any action by the shareholders, to classify and reclassify any unissued
Common Shares and Preferred Shares into other classes or series of stock from
time to time by setting or changing the terms, preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends or other
distributions, qualifications and terms or conditions of redemption for each
class or series. Although there is no present intention of doing so, the Company
could issue a class or series of stock that could delay, defer or prevent a
transaction or a change in control of the Company that might otherwise be in the
shareholders' best interests. Under Maryland law, shareholders generally are not
liable for Company debts or obligations.

                                        35
<PAGE>

COMMON SHARES

     All Common Shares offered by this prospectus will be duly authorized, fully
paid and nonassessable. Holders of Common Shares are entitled to receive
dividends when authorized by the Board of Directors and declared out of assets
legally available for the payment of dividends. Shareholders are also entitled
to share ratably in the assets legally available for distribution to
shareholders in the event of liquidation, dissolution or winding up, after
payment of or adequate provision for all known debts and liabilities. These
rights are subject to the preferential rights of any other class or series of
the Company's stock.

     In the event that the Company issues Preferred Shares and so long as any
shares of the Company's Preferred Shares are outstanding, holders of Common
Shares will not be entitled to receive any net income of or other distributions
from the Company unless all accumulated dividends on Preferred Shares have been
paid, and unless asset coverage (as defined in the 1940 Act) with respect to
Preferred Shares would be at least 200% after giving effect to such
distributions. See "Leverage."


     Each outstanding Common Share entitles the holder to one vote on all
matters submitted to a vote of shareholders, including the election of
directors. The presence of the holders of shares of Company stock entitled to
cast a majority of the votes entitled to be cast shall constitute a quorum at a
meeting of shareholders. The Charter provides that, except as otherwise provided
in the Bylaws, directors shall be elected by the affirmative vote of the holders
of a majority of the shares of stock outstanding and entitled to vote thereon.
The Bylaws provide that directors are elected by a plurality of all the votes
cast at a meeting of shareholders duly called and at which a quorum is present.
There is no cumulative voting in the election of directors. Consequently, at
each annual meeting of shareholders, the holders of a majority of the
outstanding shares will be able to elect all of the successors of the class of
directors whose terms expire at that meeting. Pursuant to the Charter and
Bylaws, the Board of Directors may amend the Bylaws to alter the vote required
to elect directors.


     Holders of Common Shares have no preference, conversion, exchange, sinking
fund, redemption or appraisal rights and have no preemptive rights to subscribe
for any of the Company's securities. All Common Shares will have equal dividend,
liquidation and other rights.

     The Charter provides for approval of certain extraordinary transactions by
the shareholders entitled to cast at least a majority of the votes entitled to
be cast on the matter. The Charter also provides that any proposal to convert
the Company from a closed-end investment company to an open-end investment
company or any proposal to liquidate or dissolve the Company requires the
approval of the shareholders entitled to cast at least 80 percent of the votes
entitled to be cast on such matter. However, if such a proposal is approved by
at least two-thirds of the continuing directors (in addition to approval by the
full Board of Directors), such proposal may be approved by a majority of the
votes entitled to be cast on such matter. The "continuing directors" are defined
in the Charter as the current directors as well as those directors whose
nomination for election by the shareholders or whose election by the directors
to fill vacancies is approved by a majority of continuing directors then on the
Board of Directors.

     Under the rules of the NYSE applicable to listed companies, the Company
normally will be required to hold an annual meeting of shareholders in each
fiscal year. If the Company is converted to an open-end company or if for any
other reason the shares are no longer listed on the NYSE (or any other national
securities exchange the rules of which require annual meetings of shareholders),
the Company may decide not to hold annual meetings of shareholders.

     The Company has no present intention of offering additional Common Shares,
except as described herein and under the Dividend Reinvestment Plan, as amended
from time to time. See "Distributions -- Automatic Dividend Reinvestment Plan."
Other offerings of shares, if made, will require approval of the Company's Board
of Directors and will be subject to the requirement of the 1940 Act that shares
may not be sold at a price below the then-current net asset value, exclusive of
underwriting discounts and commissions, except, among other things, in
connection with an offering to existing shareholders.

                                        36
<PAGE>

PREFERRED SHARES

     After the closing of this offering, the Company may, but is not required
to, issue Preferred Shares. The Company reserves the right to issue Preferred
Shares to the extent permitted by the 1940 Act, which currently limits the
aggregate liquidation preference of all outstanding preferred shares to 50% of
the value of the Company's total assets less the Company's liabilities and
indebtedness. Although the terms of any Preferred Shares, including dividend
rate, liquidation preference and redemption provisions, will be determined by
the Board of Directors, subject to applicable law and the Charter, it is likely
that the Preferred Shares will be structured to carry a relatively short-term
dividend rate reflecting interest rates on short-term bonds, by providing for
the periodic redetermination of the dividend rate at relatively short intervals
through an auction, remarketing or other procedure. The Company also believes
that it is likely that the liquidation preference, voting rights and redemption
provisions of the Preferred Shares will be similar to those stated below.

     In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of Preferred Shares would be entitled to
receive a preferential liquidating distribution, which is expected to equal the
original purchase price per Preferred Share plus accumulated and unpaid
dividends, whether or not declared, before any distribution of assets is made to
holders of Common Shares. After payment of the full amount of the liquidating
distribution to which they are entitled, the holders of Preferred Shares will
not be entitled to any further participation in any distribution of assets by
the Company.


     The 1940 Act requires that the holders of any preferred shares, voting
separately as a single class, have the right to elect at least two Directors at
all times. The remaining directors will be elected by holders of common shares
and preferred shares, voting together as a single class. In addition, subject to
the prior rights, if any, of the holders of any other class of senior securities
outstanding, the holders of any preferred shares have the right to elect a
majority of the directors at any time two years' accumulated dividends on any
preferred shares are unpaid. The 1940 Act also requires that, in addition to any
approval by shareholders that might otherwise be required, the approval of the
holders of a majority of any outstanding preferred shares, voting separately as
a class, would be required to (i) adopt any plan of reorganization that would
adversely affect the preferred shares, and (ii) take any action requiring a vote
of security holders under Section 13(a) of the 1940 Act, including, among other
things, changes in the Company's subclassification as a closed-end investment
company or changes in its fundamental investment restrictions. See "Certain
Provisions in the Company's Charter and Bylaws." As a result of these voting
rights, the Company's ability to take any such actions may be impeded to the
extent that there are any of its Preferred Shares outstanding.



     The affirmative vote of the holders of a majority of the outstanding
Preferred Shares, voting as a separate class, will be required to amend, alter
or repeal any of the preferences, rights or powers of holders of Preferred
Shares so as to affect materially and adversely such preferences, rights or
powers. The class vote of holders of Preferred Shares described above will in
each case be in addition to any other vote required to authorize the action in
question.


     The terms of the Preferred Shares, if issued, are expected to provide that
(i) they are redeemable by the Company in whole or in part at the original
purchase price per share plus accrued dividends per share, (ii) the Company may
tender for or purchase Preferred Shares and (iii) the Company may subsequently
resell any shares so tendered for or purchased. Any redemption or purchase of
Preferred Shares by the Company will reduce the leverage applicable to the
Common Shares, while any resale of shares by the Company will increase that
leverage.

     The discussion above describes the possible offering of Preferred Shares by
the Company. If the Board of Directors determines to proceed with such an
offering, the terms of the Preferred Shares may be the same as, or different
from, the terms described above, subject to applicable law and the Charter. The
Board of Directors, without the approval of the holders of Common Shares, may
authorize an offering of Preferred Shares or may determine not to authorize such
an offering, and may fix the terms of the Preferred Shares to be offered.

     The information contained under this heading is subject to the provisions
contained in the Company's Charter and Bylaws and the laws of the State of
Maryland.

                                        37
<PAGE>

             CERTAIN PROVISIONS IN THE COMPANY'S CHARTER AND BYLAWS

     The following description of certain provisions of the Charter and Bylaws
is only a summary. For a complete description, please refer to the Charter and
Bylaws, which have been filed as exhibits to the Company's registration
statement. A more detailed description can also be found in the Company's
statement of additional information.

     The Company's Charter and Bylaws include provisions that could delay, defer
or prevent other entities or persons from acquiring control of the Company,
causing it to engage in certain transactions or modifying its structure. These
provisions may be regarded as "anti-takeover" provisions. Such provisions could
limit the ability of shareholders to sell their shares at a premium over the
then-current market prices by discouraging a third party from seeking to obtain
control of the Company.

CLASSIFICATION OF THE BOARD OF DIRECTORS; ELECTION OF DIRECTORS


     The Charter provides that the number of directors may be established only
by the Board of Directors pursuant to the Bylaws, but may not be less than one.
The Bylaws provide that the number of directors may not be greater than nine.
Subject to any applicable limitations of the 1940 Act, any vacancy may be
filled, at any regular meeting or at any special meeting called for that
purpose, only by a majority of the remaining directors, even if those remaining
directors do not constitute a quorum. Pursuant to the Charter, the Board of
Directors is divided into three classes: Class I, Class II and Class III. The
initial terms of Class I, Class II and Class III directors will expire in 2005,
2006 and 2007, respectively. Beginning in 2005, upon the expiration of their
current terms, directors of each class will be elected to serve for three-year
terms and until their successors are duly elected and qualified. Each year only
one class of directors will be elected by the shareholders. The classification
of the Board of Directors should help to assure the continuity and stability of
the Company's strategies and policies as determined by the Board of Directors.


     The classified Board provision could have the effect of making the
replacement of incumbent directors more time-consuming and difficult. At least
two annual meetings of shareholders, instead of one, will generally be required
to effect a change in a majority of the Board of Directors. Thus, the classified
Board provision could increase the likelihood that incumbent directors will
retain their positions. The staggered terms of directors may delay, defer or
prevent a change in control of the Board, even though a change in control might
be in the best interests of the shareholders.

REMOVAL OF DIRECTORS

     The Charter provides that a director may be removed only for cause and only
by the affirmative vote of at least two-thirds of the votes entitled to be cast
in the election of directors. This provision, when coupled with the provision in
the Bylaws authorizing only the Board of Directors to fill vacant directorships,
precludes shareholders from removing incumbent directors, except for cause and
by a substantial affirmative vote, and filling the vacancies created by the
removal with nominees of shareholders.


AMENDMENT TO THE CHARTER AND BYLAWS



     The Charter provides that amendments to the Charter must be declared
advisable by the Board of Directors and generally approved by the affirmative
vote of shareholders entitled to cast at least a majority of the votes entitled
to be cast on the matter. Certain provisions of the Charter, including its
provisions on classification of the Board of Directors, election and removal of
directors and conversion of the Company to an open-end investment company, may
be amended only by the affirmative vote of the shareholders entitled to cast at
least 80 percent of the votes entitled to be cast on the matter. However, if
such a proposal is approved by at least two-thirds of the continuing directors
(in addition to approval by the full Board of Directors), such proposal may be
approved by a majority of the votes entitled to be cast on such matter. The
Board of Directors has the exclusive power to adopt, alter or repeal any
provision of the Bylaws and to make new Bylaws.


                                        38
<PAGE>

DISSOLUTION OF THE COMPANY

     The Charter provides that any proposal to liquidate or dissolve the Company
requires the approval of the shareholders entitled to cast at least 80 percent
of the votes entitled to be cast on such matter. However, if such a proposal is
approved by at least two-thirds of the continuing directors (in addition to
approval by the full Board), such proposal may be approved by a majority of the
votes entitled to be cast on such matter.

ADVANCE NOTICE OF DIRECTOR NOMINATIONS AND NEW BUSINESS

     The Bylaws provide that with respect to an annual meeting of shareholders,
nominations of persons for election to the Board of Directors and the proposal
of business to be considered by shareholders may be made only (i) pursuant to
notice of the meeting, (ii) by the Board of Directors or (iii) by a shareholder
who is entitled to vote at the meeting and who has complied with the advance
notice procedures of the Bylaws. With respect to special meetings of
shareholders, only the business specified in the Company's notice of the meeting
may be brought before the meeting. Nominations of persons for election to the
Board of Directors at a special meeting may be made only (i) pursuant to notice
of the meeting by the Company, (ii) by the Board of Directors, or (iii) provided
that the Board of Directors has determined that directors will be elected at the
meeting, by a shareholder who is entitled to vote at the meeting and who has
complied with the advance notice provisions of the Bylaws.

                                        39
<PAGE>

                                  UNDERWRITING

     The underwriters named below, acting through Stifel, Nicolaus & Company,
Incorporated, Lehman Brothers Inc. and RBC Dain Rauscher Inc. as their
representatives (the "Representatives"), have severally agreed, subject to the
terms and conditions of an underwriting agreement dated         , 2004, to
purchase from the Company the number of Common Shares set forth opposite their
respective names.

<Table>
<Caption>
                                                              NUMBER OF COMMON
UNDERWRITER                                                        SHARES
-----------                                                   ----------------
<S>                                                           <C>
Stifel, Nicolaus & Company, Incorporated....................
Lehman Brothers Inc.........................................
RBC Dain Rauscher Inc.......................................
Advest, Inc.................................................
BB&T Capital Markets, a division of Scott & Stringfellow....
Oppenheimer and Co. Inc.....................................
Sanders Morris Harris.......................................
WR Hambrecht + Co, LLC......................................
Parker/Hunter Incorporated..................................
Wunderlich Securities, Inc..................................
                                                                  --------
          Total.............................................
                                                                  ========
</Table>

     The underwriting agreement provides that the obligations of the
Underwriters to purchase the shares included in this offering are subject to the
approval of certain legal matters by counsel and to certain other conditions.
The Underwriters are obligated to purchase all the Common Shares listed in the
table above if any of the Common Shares are purchased. In the underwriting
agreement, the Company and Adviser have agreed to indemnify the Underwriters
against certain liabilities, including liabilities arising under the Securities
Act of 1933, or to contribute payments the Underwriters may be required to make
for any of those liabilities.

     The Common Shares have been approved for listing on the NYSE, subject to
notice of issuance, under the symbol "TYG." In order to meet the requirements
for listing the Common Shares on the NYSE, the Underwriters have undertaken to
sell lots of 100 or more Common Shares to a minimum of 2,000 beneficial owners.
The minimum investment requirement is 100 Common Shares ($2,500). Prior to this
offering, there has been no public market for the Common Shares or any other
securities of the Company. Consequently, the offering price for the Common
Shares was determined by negotiation between the Company and the
Representatives. Investors must pay for any shares purchased in the initial
public offering on or before           , 2004.

     The Underwriters propose initially to offer some of the Common Shares
directly to the public at the public offering price set forth on the cover page
of this prospectus and some of the Common Shares to certain dealers at the
public offering price less a concession not in excess of $1.125 per share. The
underwriting discounts and commissions the Company will pay of $1.125 per share
are equal to 4.5% of the initial offering price. The Underwriters may allow, and
the dealers may reallow, a discount not in excess of $     per share on sales to
other dealers. After the initial public offering, the public offering price,
concession and discount may be changed. The Representatives have advised the
Company that the Underwriters do not intend to confirm any sales to any account
over which they exercise discretionary authority.

     The Company has granted the Underwriters an option to purchase up to
          additional Common Shares at the public offering price, less the
underwriting discounts and commissions, within 45 days from the date of this
prospectus, solely to cover any over-allotments. If the Underwriters exercise
this option, each will be obligated, subject to conditions contained in the
underwriting agreement, to purchase a number of additional shares proportionate
to that underwriter's initial amount reflected in the table below.

                                        40
<PAGE>

     The following table shows the public offering price, underwriting discounts
and commissions and proceeds before expenses to the Company. The information
assumes either no exercise or full exercise by the Underwriters of their
over-allotment option.

<Table>
<Caption>
PER SHARE                                                    WITHOUT OPTION   WITH OPTION
---------                                                    --------------   -----------
<S>                                                          <C>              <C>
Public offering price......................................     $              $
Underwriting discounts and commissions.....................     $              $
Proceeds, before expenses to the Company...................     $              $
</Table>

     The expenses of the offering are estimated to be $     . The Company will
pay all of its organizational and offering expenses.

     Until the distribution of the Common Shares is complete, the Securities and
Exchange Commission rules may limit Underwriters and selling group members from
bidding for and purchasing the Company's Common Shares. However, the
Representatives may engage in transactions that stabilize the price of Common
Shares, such as bids or purchases to peg, fix or maintain that price.

     If the Underwriters create a short position in the Company's Common Shares
in connection with the offering (i.e., if they sell more Common Shares than are
listed on the cover of this prospectus), the Representatives may reduce that
short position by purchasing Common Shares in the open market. The
Representatives may also elect to reduce any short position by exercising all or
part of the over-allotment option described above. Purchases of Common Shares to
stabilize its price or to reduce a short position may cause the price of the
Company's Common Shares to be higher than it might be in the absence of such
purchases.

     Neither the Company nor any of the Underwriters make any representation or
prediction as to the direction or magnitude of any effect that the transaction
described above may have on the price of Common Shares. In addition, neither the
Company nor any of the Underwriters make any representation that the
Representatives will engage in these transactions or that these transactions,
once commenced, will not be discontinued without notice.

     In connection with this offering, the Underwriters or selected dealers may
distribute prospectuses electronically.

     The Company has agreed not to offer or sell any additional Common Shares
for a period of 180 days after the date of the underwriting agreement without
the prior written consent of the Underwriters, except for the sale of Common
Shares to the Underwriters pursuant to the underwriting agreement.

     The Company anticipates that the Underwriters may from time to time act as
brokers or dealers in executing the Company's portfolio transactions after they
have ceased to be Underwriters and, subject to certain restrictions may so act
while they are underwriters. The Underwriters are active underwriters of, and
dealers in, securities and act as market makers in a number of such securities,
and therefore can be expected to engage in portfolio transactions with the
Company.

     The Company expects to use a portion of the net proceeds of this offering
to purchase, after the closing of this offering, MLP equity securities. The
Company has agreed that until November 26, 2004, the Company will not make
direct or indirect minority investments in certain MLPs, or enter into any
transaction that results in the acquisition of any equity investment in these
MLPs (other than open market purchases on a national securities exchange) unless
Lehman Brothers Inc. has acted as placement agent to the issuer in connection
with such transaction. Any direct placement fees the issuers of the MLPs in
which the Company invests pay to Lehman Brothers Inc. for acting as placement
agent are separate and distinct from the discounts and commissions that will be
paid by the Company in connection with this offering. It is anticipated that
Lehman Brothers Inc. will pay to Stifel a mutually agreed upon portion of any
such direct placement fees that Lehman Brothers Inc. receives in connection with
the minority investments described above. In addition, the Company has agreed
that until November 26, 2004, Lehman Brothers Inc. shall have a right, but not
the obligation, to act as exclusive underwriter, arranger and/or advisor with
respect to the issuance of any indebtedness by the Company or other security
that ranks senior to the Common Shares, other than bank

                                        41
<PAGE>

loans. Stifel has also provided financial advisory services to the Company in
connection with structuring the offering for which it will receive a financial
advisory fee equal to 0.10% of the gross proceeds of this offering.

     The addresses of the Representatives are: Stifel, Nicolaus & Company,
Incorporated, 501 North Broadway, St. Louis, MO 63102; Lehman Brothers Inc., 745
7th Ave., New York, NY 10019; and RBC Dain Rauscher Inc., 60 South Sixth Street,
Minneapolis, MN 55402.

                           DIRECT PLACEMENT CONTRACTS

     As of the date of this prospectus, the Company has entered into binding
contracts for direct placements with the following companies (the closing of all
of which are contingent upon the closing of the Common Share offering):

<Table>
<Caption>
                                                                      COST PER
                                                                      UNIT TO
NAME OF ISSUER                                     TYPE OF SECURITY   COMPANY    TOTAL COST
--------------                                     ----------------   --------   ----------
<S>                                                <C>                <C>        <C>
</Table>

                    ADMINISTRATOR, CUSTODIAN, TRANSFER AGENT
                           AND DIVIDEND PAYING AGENT

     The Company will engage U.S. Bancorp Fund Services, LLC to serve as the
Company's administrator. The Company will pay the administrator a monthly fee
computed at an annual rate of 0.07% of the first $300 million of the Company's
Managed Assets, 0.06% on the next $500 million of Managed Assets and 0.04% on
the balance of the Company's Managed Assets, subject to a minimum annual fee of
$45,000.

     Computershare Investor Services, LLC will serve as the Company's transfer
agent, dividend paying agent, and agent for the automatic dividend reinvestment
plan.

     U.S. Bank N.A. will serve as the Company's custodian. The Company will pay
the custodian a monthly fee computed at an annual rate of 0.015% on the first
$100 million of the Company's Managed Assets and 0.01% on the balance of the
Company's Managed Assets, subject to a minimum annual fee of $4,800.

                                 LEGAL MATTERS


     Blackwell Sanders Peper Martin, LLP ("Blackwell"), Kansas City, Missouri,
serves as counsel to the Company. Vedder, Price, Kaufman & Kammholz, P.C.,
Chicago, Illinois, is serving as special counsel to the Company in connection
with the offering. Kaye Scholer LLP serves as counsel to the underwriters.
Stroock & Stroock & Lavan LLP is serving as special counsel to the underwriters
in connection with the offering. Certain legal and tax matters in connection
with the Common Shares offered hereby are passed on for the Company by
Blackwell, and for the Underwriters by Kaye Scholer LLP. Blackwell may rely on
the opinion of Venable LLP, Baltimore, Maryland, on certain matters of Maryland
law.


                                        42
<PAGE>

          TABLE OF CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION

<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Investment Limitations......................................    1
Investment Objective and Policies...........................    3
Management of the Company...................................   14
Portfolio Transactions......................................   22
Net Asset Value.............................................   23
Leverage....................................................   24
Description of Preferred Shares.............................   25
U.S. Federal Income Tax Matters.............................   27
Proxy Voting Policies.......................................   30
Independent Accountants.....................................   31
Additional Information......................................   31
Report of Independent Accountants...........................   32
Financial Statements........................................  F-1
Appendix A -- Ratings of Investments........................  A-1
</Table>

                                        43
<PAGE>

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

     Until         , 2004 (25 days after the date of this prospectus) all
dealers that buy, sell or trade the Common Shares, whether or not participating
in this offering, may be required to deliver a prospectus. This is in addition
to the dealer's obligation to deliver a prospectus when acting as an underwriter
and with respect to their unsold allotments or subscriptions.

                                 COMMON SHARES

                                (TORTOISE LOGO)

                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION
                                $25.00 PER SHARE

                           -------------------------
                                   PROSPECTUS
                           -------------------------

                           STIFEL, NICOLAUS & COMPANY
                                  INCORPORATED

                                LEHMAN BROTHERS

                              RBC CAPITAL MARKETS

                                  ADVEST, INC.

                              BB&T CAPITAL MARKETS

                                  OPPENHEIMER

                             SANDERS MORRIS HARRIS

                               WR HAMBRECHT + CO

                           PARKER/HUNTER INCORPORATED

                          WUNDERLICH SECURITIES, INC.

                                          , 2004

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>


                  Subject to Completion, Dated January 29, 2004


         The information in this statement of additional information is not
complete and may be changed. We may not sell these securities until the
registration statement filed with the Securities and Exchange Commission is
effective. This statement of additional information is not an offer to sell
these securities and it is not soliciting an offer to buy these securities in
any state where an offer or sale is not permitted.

                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION

                                __________, 2004

                       STATEMENT OF ADDITIONAL INFORMATION

         Tortoise Energy Infrastructure Corporation (the "Company") is a newly
organized, non-diversified, closed-end management investment company. This
statement of additional information relating to the Company's shares of common
stock ("Common Shares") is not a prospectus, but should be read in conjunction
with the prospectus relating to the Common Shares dated __________, 2004. This
statement of additional information does not include all information that a
prospective investor should consider before purchasing Common Shares of the
Company, and investors should obtain and read the prospectus prior to purchasing
such shares. A copy of the prospectus is available without charge from the
Company by calling 1-888-728-8784. You may also obtain a copy of the prospectus
on the Securities and Exchange Commission's web site (http://www.sec.gov).
Capitalized terms used but not defined in this statement of additional
information have the meanings ascribed to them in the prospectus.

         No person has been authorized to give any information or to make any
representations not contained in the prospectus or in this statement of
additional information in connection with the offering made by the prospectus,
and, if given or made, such information or representations must not be relied
upon as having been authorized by the Company. The prospectus and this statement
of additional information do not constitute an offering by the Company in any
jurisdiction in which such offering may not lawfully be made.

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                  PAGE
<S>                                                                                                               <C>
Investment Limitations.........................................................................................      1
Investment Objective and Policies..............................................................................      3
Management of the Company......................................................................................     14
Portfolio Transactions.........................................................................................     22
Net Asset Value................................................................................................     23
Leverage ......................................................................................................     24
Description of Preferred Shares................................................................................     26
U.S. Federal Income Tax Matters................................................................................     27
Proxy Voting Policy............................................................................................     30
Independent Accountants........................................................................................     31
Additional Information.........................................................................................     31
Report Of Independent Accountants..............................................................................     32
Financial Statements...........................................................................................    F-1
Appendix A--Rating of Investments..............................................................................    A-1
</TABLE>

                                        i

<PAGE>

                             INVESTMENT LIMITATIONS

         This section supplements the disclosure in the prospectus and provides
additional information on the Company's investment limitations. Investment
limitations identified as fundamental may not be changed without the approval of
the holders of a majority of the Company's outstanding voting securities (which
for this purpose and under the Investment Company Act of 1940, as amended (the
"1940 Act") means the lesser of (1) 67% of the Common Shares represented at a
meeting at which more than 50% of the outstanding Common Shares are represented
or (2) more than 50% of the outstanding Common Shares).

         Investment limitations stated as a maximum percentage of the Company's
assets are only applied immediately after, and because of, an investment or a
transaction by the Company to which the limitation is applicable (other than the
limitations on borrowing). Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered in determining whether the investment complies with the Company's
investment limitations.

         THE FOLLOWING ARE THE COMPANY'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE COMPANY MAY NOT:

         issue senior securities, except as permitted by the 1940 Act and the
rules and interpretive positions of the SEC thereunder;

         borrow money, except as permitted by the 1940 Act and the rules and
interpretive positions of the SEC thereunder;

         make loans, except by the purchase of debt obligations, by entering
into repurchase agreements or through the lending of portfolio securities and as
otherwise permitted by the 1940 Act and the rules and interpretive positions of
the SEC thereunder;

         concentrate its investment in any particular industry, except that the
Company will concentrate its assets in the group of industries constituting the
energy infrastructure sector and may concentrate in one or more industries
within that sector.

         underwrite securities issued by others, except to the extent that the
Company may be considered an underwriter within the meaning of the Securities
Act of 1933, as amended (the "1933 Act") in the disposition of restricted
securities held in its portfolio;

         purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments, except that the Company may invest in
securities or other instruments backed by real estate or securities of companies
that invest in real estate or interests therein; and

         purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments, except that the Company may
purchase or sell options and futures contracts or invest in securities or other
instruments backed by physical commodities.

         All other investment policies of the Company are considered
nonfundamental and may be changed by the Board of Directors (the "Board")
without prior approval of the Company's outstanding voting shares.

         The Company has adopted the following nonfundamental policies:

<PAGE>

         -        Under normal circumstances, the Company will invest at least
                  90% of its total assets (including assets obtained through
                  leverage) in securities of energy infrastructure companies.

         -        The Company will invest at least 70% and up to 100% of its
                  total assets in equity securities issued by master limited
                  partnerships ("MLPs").

         -        The Company may invest up to 30% of total assets in direct
                  placements of restricted securities. The types of direct
                  placements that the Company may purchase include MLP
                  convertible subordinated units, MLP common units and
                  securities of private energy infrastructure companies (i.e.,
                  non-MLPs). Investments in private companies that do not have
                  any publicly traded shares or units are limited to 5% of total
                  assets.

         -        The Company may invest up to 25% of total assets in debt
                  securities of energy infrastructure companies, including
                  securities rated below investment grade (commonly referred to
                  as "junk bonds"). Below investment grade debt securities will
                  be rated at least B3 by Moody's Investors Service, Inc.
                  ("Moody's") and at least B- by Standard & Poor's Ratings Group
                  ("S&P's") at the time of purchase, or comparably rated by
                  another statistical rating organization or if unrated,
                  determined to be of comparable quality by the Adviser.

         -        The Company will not invest more than 10% of total assets in
                  any single issuer.

         -        The Company will not engage in short sales.

         Currently under the 1940 Act, the Company is not permitted to incur
indebtedness unless immediately after such borrowing the Company has asset
coverage of at least 300% of the aggregate outstanding principal balance of
indebtedness (i.e., such indebtedness may not exceed 33 1/3% of the value of the
Company's total assets). Additionally, currently under the 1940 Act, the Company
may not declare any dividend or other distribution upon its Common Shares, or
purchase any such shares, unless the aggregate indebtedness of the Company has,
at the time of the declaration of any such dividend or distribution or at the
time of any such purchase, an asset coverage of at least 300% after deducting
the amount of such dividend, distribution, or purchase price, as the case may
be. Currently under the 1940 Act, the Company is not permitted to issue
preferred shares unless immediately after such issuance the net asset value of
the Company's portfolio is at least 200% of the liquidation value of the
outstanding preferred shares (i.e., such liquidation value may not exceed 50% of
the value of the Company's total assets). In addition, currently under the 1940
Act, the Company is not permitted to declare any cash dividend or other
distribution on its Common Shares unless, at the time of such declaration, the
net asset value of the Company's portfolio (determined after deducting the
amount of such dividend or distribution) is at least 200% of such liquidation
value.



         Under the 1940 Act, a "senior security" does not include any promissory
note or evidence of indebtedness where such loan is for temporary purposes only
and in an amount not exceeding 5% of the value of the total assets of the issuer
at the time the loan is made. A loan is presumed to be for temporary purposes if
it is repaid within sixty days and is not extended or renewed. Both transactions
involving indebtedness and any preferred shares issued by the Company would be
considered senior securities under the 1940 Act, and as such, are subject to the
asset coverage requirements discussed above.



         Currently under the 1940 Act, the Company is not permitted to lend
money or property to any person, directly or indirectly, if such person controls
or is under common control with the Company, except for a loan from the Company
to a company which owns all of the outstanding securities of the Company.
Currently, under interpretative positions of the staff of the SEC, the Company
may not have on loan at any given time securities representing more than
one-third of its total assets.

                                       2

<PAGE>

         The Company interprets its policies with respect to borrowing and
lending to permit such activities as may be lawful for the Company, to the full
extent permitted by the 1940 Act or by exemption from the provisions therefrom
pursuant to an exemptive order of the SEC.

         Under the 1940 Act, the Company may, but does not intend to, invest up
to 10% of its total assets in the aggregate in shares of other investment
companies and up to 5% of its total assets in any one investment company,
provided the investment does not represent more than 3% of the voting stock of
the acquired investment company at the time such shares are purchased. As a
shareholder in any investment company, the Company will bear its ratable share
of that investment company's expenses, and would remain subject to payment of
the Company's advisory fees and other expenses with respect to assets so
invested. Holders of Common Shares would therefore be subject to duplicative
expenses to the extent the Company invests in other investment companies. In
addition, the securities of other investment companies may also be leveraged and
will therefore be subject to the same leverage risks described herein and in the
prospectus. As described in the prospectus in the section entitled "Leverage,"
the net asset value and market value of leveraged shares will be more volatile
and the yield to shareholders will tend to fluctuate more than the yield
generated by unleveraged shares.


                        INVESTMENT OBJECTIVE AND POLICIES

         The prospectus presents the investment objective and the principal
investment strategies and risks of the Company. This section supplements the
disclosure in the Company's prospectus and provides additional information on
the Company's investment policies, strategies and risks. Restrictions or
policies stated as a maximum percentage of the Company's assets are only applied
immediately after a portfolio investment to which the policy or restriction is
applicable (other than the limitations on borrowing). Accordingly, any later
increase or decrease resulting from a change in values, net assets or other
circumstances will not be considered in determining whether the investment
complies with the Company's restrictions and policies.

         The Company's investment objective is to seek a high level of total
return with an emphasis on current distributions paid to shareholders. For
purposes of the Company's investment objective, total return includes capital
appreciation of, and all distributions received from, securities in which the
Company will invest regardless of the tax character of the distribution. There
is no assurance that the Company will achieve its objective. The investment
objective and the investment policies discussed below are nonfundamental. The
Board of Directors of the Company may change the investment objective, or any
policy or limitation that is not fundamental, without a shareholder vote.
Shareholders will receive at least 60 days' prior written notice of any change
to the nonfundamental investment policy of investing at least 90% of total
assets in energy infrastructure companies. Unlike most other investment
companies, the Company will not be treated as a regulated investment company
under the U.S. Internal Revenue Code of 1986, as amended (the "Internal Revenue
Code"). Therefore, the Company will be subject to federal and applicable state
corporate income taxes. The Company expects that a substantial portion of its
distributions to shareholders will be characterized for tax purposes as a return
of capital.

         Under normal circumstances, the Company will invest at least 90% of its
total assets (including assets obtained through leverage) in securities of
energy infrastructure companies. Energy infrastructure companies engage in the
business of transporting, processing, storing, distributing or marketing natural
gas, natural gas liquids (primarily propane), coal, crude oil or refined
petroleum products, or exploring, developing, managing or producing such
commodities. Companies that provide energy-related services to the foregoing
businesses are also considered energy infrastructure companies, if they derive
at least 50% of revenues from the provision of energy-related services to such
companies. The Company intends to invest at least 70% of its total assets in a
portfolio of equity securities of energy infrastructure companies that are MLPs
that the Adviser believes offer attractive distribution rates and capital

                                       3

<PAGE>

appreciation potential. MLP equity securities ("units") currently consist of
common units, convertible subordinated units and pay-in-kind units or I-Shares
("I-Shares"). The Company also may invest in other securities, consistent with
its investment objective and fundamental and non-fundamental policies.







         The following pages contain more detailed information about the types
of issuers and instruments in which the Company may invest, strategies the
Adviser may employ in pursuit of the Company's investment objective and a
discussion of related risks. The Adviser may not buy these instruments or use
these techniques unless it believes that doing so will help the Company achieve
its objective.

ENERGY INFRASTRUCTURE COMPANIES

         For purposes of the Company's policy of investing 90% of total assets
in securities of energy infrastructure companies, an energy infrastructure
company is one that derives at least 50% of its revenues from "Qualifying
Income" under Section 7704 of the Internal Revenue Code or one that derives at
least 50% of its revenues from the provision of services directly related to the
generation of Qualifying Income. Qualifying Income is defined as any income
and/or gains from the exploration, development, mining or production,
processing, refining, transportation (including pipelines transporting natural
gas, oil or products thereof), or the marketing of any mineral or natural
resource (including fertilizer, geothermal energy, and timber); or the
transportation, delivery or processing of natural resources or minerals.

         Energy infrastructure MLPs are limited partnerships that derive at
least 90% of their income from energy infrastructure operations. The business of
energy infrastructure MLPs is affected by supply and demand for energy
commodities because most MLPs derive revenue and income based upon the volume of
the underlying commodity transported, processed, distributed, and/or marketed.
Specifically, processing and coal MLPs may be directly affected by energy
commodity prices. Propane MLPs own the underlying energy commodity, and
therefore have direct exposure to energy commodity prices, although the Adviser
intends to seek high quality MLPs that are able to mitigate or manage direct
margin exposure to commodity prices. Pipeline MLPs have indirect commodity
exposure to oil and gas price volatility because although they do not own the
underlying energy commodity, the general level of commodity prices may affect
the volume of the commodity the MLP delivers to its customers and the cost of
providing services such as distributing NGLs. The MLP sector in general could be
hurt by market perception that MLP's performance and valuation are directly tied
to commodity prices.

         Energy infrastructure companies (other than most pipeline MLPs) do not
operate as "public utilities" or "local distribution companies," and are
therefore not subject to rate regulation by state or federal utility
commissions. However, energy infrastructure companies may be subject to greater
competitive factors than utility companies, including competitive pricing in the
absence of regulated tariff rates, which could cause a reduction in revenue and
which could adversely affect profitability. Most pipeline MLPs are subjected to
government regulation concerning the construction, pricing and operation of
pipelines. Pipeline MLPs are able to set prices (rates or tariffs) to cover
operating costs, depreciation and taxes, and provide a return on investment.
These rates are monitored by the Federal Energy Regulatory Commission (FERC)
which seeks to ensure that consumers receive adequate and reliable supplies of
energy at the lowest possible price while providing energy suppliers and
transporters a just and reasonable return on capital investment and the
opportunity to adjust to changing market conditions.

         Energy infrastructure MLPs in which the Company will invest can
generally be classified in the following categories:

         Pipeline MLPs are common carrier transporters of natural gas, natural
gas liquids (primarily propane, ethane, butane and natural gasoline), crude oil
or refined petroleum products (gasoline, diesel fuel and jet fuel). Pipeline
MLPs also may operate ancillary businesses such as storage and marketing of

                                       4

<PAGE>

such products. Revenue is derived from capacity and transportation fees.
Historically, pipeline output has been less exposed to cyclical economic forces
due to its low cost structure and government-regulated nature. In addition, most
pipeline MLPs have limited direct commodity price exposure because they do not
own the product being shipped.

         Processing MLPs are gatherers and processors of natural gas as well as
providers of transportation, fractionation and storage of natural gas liquids
("NGLs"). Revenue is derived from providing services to natural gas producers,
which require treatment or processing before their natural gas commodity can be
marketed to utilities and other end user markets. Revenue for the processor is
fee based, although it is not uncommon to have some participation in the prices
of the natural gas and NGL commodities for a portion of revenue.

         Propane MLPs are distributors of propane to homeowners for space and
water heating. Revenue is derived from the resale of the commodity on a margin
over wholesale cost. The ability to maintain margin is a key to profitability.
Propane serves approximately 3% of the household energy needs in the United
States, largely for homes beyond the geographic reach of natural gas
distribution pipelines. Approximately 70% of annual cash flow is earned during
the winter heating season (October through March). Accordingly, volumes are
weather dependent, but have utility type functions similar to electricity and
natural gas.

         Coal MLPs own, lease and manage coal reserves. Revenue is derived from
production and sale of coal, or from royalty payments related to leases to coal
producers. Electricity generation is the primary use of coal in the United
States. Demand for electricity and supply of alternative fuels to generators are
the primary drivers of coal demand. Coal MLPs are subject to operating and
production risks, such as: the MLP or a lessee meeting necessary production
volumes; federal, state and local laws and regulations which may limit the
ability to produce coal; the MLP's ability to manage production costs and pay
mining reclamation costs; and the effect on demand that the Clean Air Act
standards have on coal-end users.

         MLPs typically achieve distribution growth by internal and external
means. MLPs achieve growth internally by experiencing higher commodity volume
driven by the economy and population, and through the expansion of existing
operations including increasing the use of underutilized capacity, pursuing
projects that can leverage and gain synergies with existing infrastructure and
pursuing so called "greenfield projects." External growth is achieved by making
accretive acquisitions. While opportunities for growth by acquisition appear
abundant based on current market conditions, especially for smaller MLPs, the
Adviser expects MLPs to grow primarily through internal means.

         MLPs are subject to various federal, state and local environmental laws
and health and safety laws as well as laws and regulations specific to their
particular activities. Such laws and regulations address: health and safety
standards for the operation of facilities, transportation systems and the
handling of materials; air and water pollution requirements and standards; solid
waste disposal requirements; land reclamation requirements; and requirements
relating to the handling and disposition of hazardous materials. Energy
infrastructure MLPs are subject to the costs of compliance with such laws
applicable to them, and changes in such laws and regulations may adversely
affect their results of operations.

         MLPs operating interstate pipelines and storage facilities are subject
to substantial regulation by the Federal Energy Regulatory Commission ("FERC"),
which regulates interstate transportation rates, services and other maters
regarding natural gas pipelines including: the establishment of rates for
service; regulation of pipeline storage and liquified natural gas facility
construction; issuing certificates of need for companies intending to provide
energy services or constructing and operating interstate pipeline and storage
facilities; and certain other matters. FERC also regulates the interstate
transportation of crude oil,

                                       5

<PAGE>

including: regulation of rates and practices of oil pipeline companies;
establishing equal service conditions to provide shippers with equal access to
pipeline transportation; and establishment of reasonable rates for transporting
petroleum and petroleum products by pipeline.

         Energy infrastructure MLPs may be subject to liability relating to the
release of substances into the environment, including liability under federal
"SuperFund" and similar state laws for investigation and remediation of releases
and threatened releases of hazardous materials, as well as liability for injury
and property damage for accidental events, such as explosions or discharges of
materials causing personal injury and damage to property. Such potential
liabilities could have a material adverse effect upon the financial condition
and results of operations of energy infrastructure MLPs.

         Energy infrastructure MLPs are subject to numerous business related
risks, including: deterioration of business fundamentals reducing profitability
due to development of alternative energy sources, changing demographics in the
markets served, unexpectedly prolonged and precipitous changes in commodity
prices and increased competition which takes market share; the lack of growth of
markets requiring growth through acquisitions; disruptions in transportation
systems; the dependence of certain MLPs upon the energy exploration and
development activities of unrelated third parties; availability of capital for
expansion and construction of needed facilities; a significant decrease in
natural gas production due to depressed commodity prices or otherwise; the
inability of MLPs to successfully integrate recent or future acquisitions; and
the general level of the economy.

         The energy industry and particular energy infrastructure companies may
be adversely affected by possible terrorist attacks, such as the attacks that
occurred on September 11, 2001. It is possible that facilities of energy
infrastructure companies, due to the critical nature of their energy businesses
to the United States, could be direct targets of terrorist attacks or be
indirectly affected by attacks on others. They may have to incur significant
additional costs in the future to safeguard their assets. In addition, changes
in the insurance markets after September 11, 2001 may make certain types in
insurance more difficult to obtain or obtainable only at significant additional
cost. To the extent terrorism results in a lower level economic activity, energy
consumption could be adversely affected, which would reduce revenues and impede
growth. Terrorist or war related disruption of the capital markets could also
affect the ability of energy infrastructure companies to raise needed capital.

MASTER LIMITED PARTNERSHIPS

         Under normal circumstances the Company will invest at least 70% of its
total assets in equity securities of MLPs. An MLP is a limited partnership the
interests in which (known as units) are traded on securities exchanges or
over-the-counter. Organization as a partnership eliminates tax at the entity
level.

         An MLP has one or more general partners (who may be individuals,
corporations, or other partnerships) which manage the partnership, and limited
partners, which provide capital to the partnership but have no role in its
management. Typically, the general partner is owned by company management or
another publicly traded sponsoring corporation. When an investor buys units in a
MLP, he or she becomes a limited partner.

         MLPs are formed in several ways. A nontraded partnership may decide to
go public. Several nontraded partnerships may roll up into a single MLP. A
corporation may spin-off a group of assets or part of its business into a MLP of
which it is the general partner, to realize the assets' full value on the
marketplace by selling the assets and using the cash proceeds received from the
MLP to address debt obligations or to invest in higher growth opportunities,
while retaining control of the MLP. A corporation may fully convert to a MLP,
although since 1986 the tax consequences have made this an unappealing option
for most corporations. Also, a newly formed company may operate as a MLP from
its inception.

                                       6

<PAGE>

         The sponsor or general partner of an MLP, other energy companies, and
utilities may sell assets to MLPs in order to generate cash to fund expansion
projects or repay debt. The MLP structure essentially transfers cash flows
generated from these acquired assets directly to MLP limited partner unit
holders.



         In the case of an MLP buying assets from its sponsor or general partner
the transaction is intended to be based upon comparable terms in the acquisition
market for similar assets. To help insure that appropriate protections are in
place. The board of the MLP generally creates an independent committee to review
and approve the terms of the transaction. The Committee often obtains a fairness
opinion and can retain counsel or other experts to assist its evaluation. Since
both parties normally have a significant equity stake in the MLP, both parties
are aligned to see that the transaction is accretive and fair to the MLP.

         MLPs tend to pay relatively higher distributions than other types of
companies and the Company intends to use these MLP distributions in an effort to
meet its investment objective.


         As a motivation for the general partner to successfully manage the MLP
and increase cash flows, the terms of MLPs typically provide that the general
partner receives a larger portion of the net income as distributions reach
higher target levels. As cash flow grows, the general partner receives a greater
interest in the incremental income compared to the interest of limited partners.
Although the percentages vary among MLPs, the general partner's marginal
interest in distributions generally increases from 2% to 15% at the first
designated distribution target level moving up to 25% and ultimately 50% as
pre-established distribution per unit thresholds are met. Nevertheless, the
aggregate amount distributed to limited partners will increase as MLP
distributions reach higher target levels. Given this incentive structure, the
general partner has an incentive to streamline operations and undertake
acquisitions and growth projects in order to increase distributions to all
partners.

         Because the MLP itself does not pay tax, its income or loss is
allocated to its investors, irrespective of whether the investors receive any
cash payment from the MLP. An MLP typically makes quarterly cash distributions.
Although they resemble corporate dividends, MLP distributions are treated
differently for tax purposes. The MLP distribution is treated as a return of
capital to the extent of the investor's basis in his MLP interest and, to the
extent the distribution exceeds the investor's basis in the MLP, capital gain.
The investor's original basis is the price paid for the units. The basis is
adjusted downwards with each distribution and allocation of deductions (such as
depreciation) and losses, and upwards with each allocation of taxable income.

         When the units are sold, the difference between the sales price and the
investor's adjusted basis equals taxable gain. The partner will not be taxed on
distributions until (1) he sells his MLP units and pays tax on his gain, which
gain is increased due to the basis decrease due to prior distributions; or (2)
his basis reaches zero.

         For a further discussion and a description of MLP tax matters, see the
section entitled "U.S. Federal Income Tax Matters."

THE COMPANY'S INVESTMENTS


         The types of securities in which the Company may invest include, but
are not limited to the following:


         Equity Securities. Consistent with its investment objective, the
Company may invest up to 100% of its total assets in equity securities issued by
energy infrastructure MLPs, including common units, convertible subordinated
units and I-Shares units (each discussed below). The Company may also invest up
to 30% of total assets in equity securities of non-MLPs.

         The value of equity securities will be affected by changes in the stock
markets, which may be the result of domestic or international political or
economic news, changes in interest rates or changing investor sentiment. At
times, stock markets can be volatile and stock prices can change substantially.
Equity securities risk will affect the Company's net asset value per share,
which will fluctuate as the value of the securities held by the Company change.
Not all stock prices change uniformly or at the same time, and not all stock
markets move in the same direction at the same time. Other factors affect a
particular stock's prices, such as poor earnings reports by an issuer, loss of
major customers, major litigation against an issuer, or changes in governmental
regulations affecting an industry. Adverse news affecting one

                                       7

<PAGE>

company can sometimes depress the stock prices of all companies in the same
industry. Not all factors can be predicted.

         Investing in securities of smaller companies may involve greater risk
than is associated with investing in more established companies. Smaller
capitalization companies may have limited product lines, markets or financial
resources; may lack management depth or experience; and may be more vulnerable
to adverse general market or economic developments than larger more established
companies.

         MLP Common Units. MLP common units represent an equity ownership
interest in a partnership, providing limited voting rights and entitling the
holder to a share of the company's success through distributions and/or capital
appreciation. Unlike shareholders of a corporation, common unit holders do not
elect directors annually and generally have the right to vote only on certain
significant events, such as mergers, a sale of substantially all of the assets,
removal of the general partner or material amendments to the partnership
agreement. MLPs are required by their partnership agreements to distribute a
large percentage of their current operating earnings. Common unit holders
generally have first right to a MQD prior to distributions to the convertible
subordinated unit holders or the general partner (including incentive
distributions). Common unit holders typically have arrearage rights if the MQD
is not met. In the event of liquidation, MLP common unit holders have first
rights to the partnership's remaining assets after bondholders, other debt
holders, and preferred unit holders have been paid in full. MLP common units
trade on a national securities exchange or over-the-counter.




         MLP Convertible Subordinated Units. MLP convertible subordinated units
are typically issued by MLPs to founders, corporate general partners of MLPs,
entities that sell assets to the MLP, and institutional investors. The purpose
of the convertible subordinated units is to increase the likelihood that during
the subordination period there will be available cash to be distributed to
common unit holders. The Company expects to purchase subordinated units in
direct placements from such persons. Convertible subordinated units generally
are not entitled to distributions until holders of common units have received
specified MQD, plus any arrearages, and may receive less in distributions upon
liquidation. Convertible subordinated unit holders generally are entitled to MQD
prior to the payment of incentive distributions to the general partner, but are
not entitled to arrearage rights. Therefore, they generally entail greater risk
than MLP common units. They are generally convertible automatically into the
senior common units of the same issuer at a one-to-one ratio upon the passage of
time or the satisfaction of certain financial tests. These units do not trade on
a national exchange or over-the-counter, and there is no active market for
convertible subordinated units. The value of a convertible security is a
function of its worth if converted into the underlying common units. Convertible
subordinated units generally have similar voting rights to MLP common units.



         MLP I-Shares. I-Shares represent an indirect investment in MLP common
units. I-Shares are equity securities issued by affiliates of MLPs, typically a
limited liability company, that owns an interest in and manages the MLP. The
issuer has management rights but is not entitled to incentive distributions. The
I-Share issuer's assets consist exclusively of MLP common units. Distributions
to I-Share holders are made in the form of additional I-Shares, generally equal
in amount to the cash distribution received by common unit holders of MLP. The
issuer of the I-Share is taxed as a corporation, however, the MLP does not
allocate income or loss to the I-Share issuer. Accordingly, investors receive a
Form 1099, are not allocated their proportionate share of income of the MLP and
are not subject to state filing obligations. Distributions of I-Shares do not
generate UBTI and are qualifying income for mutual fund investors.

         Debt Securities. The Company may invest up to 25% of its assets in debt
securities of energy infrastructure companies, including certain securities
rated below investment grade. The Company's debt securities may have fixed or
variable principal payments and all types of interest rate and dividend

                                       8

<PAGE>

payment and reset terms, including fixed rate, adjustable rate, zero coupon,
contingent, deferred, payment in kind and auction rate features. If a security
satisfies the Company's minimum rating criteria at the time of purchase and is
subsequently downgraded below such rating, the Company will not be required to
dispose of such security. If a downgrade occurs, the Adviser will consider what
action, including the sale of such security, is in the best interest of the
Company and its shareholders.



         Below Investment Grade Debt Securities. The Company may invest up to
25% of the Company's assets in below investment grade securities. The below
investment grade debt securities in which the Company invests are rated from B3
to Ba1 by Moody's, from B- to BB+ by S&P's, are comparably rated by another
nationally recognized rating agency or are unrated but determined by the Adviser
to be of comparable quality.

         Investment in below investment grade securities involves substantial
risk of loss. Below investment grade debt securities or comparable unrated
securities are commonly referred to as "junk bonds" and are considered
predominantly speculative with respect to the issuer's ability to pay interest
and principal and are susceptible to default or decline in market value due to
adverse economic and business developments. The market values for high yield
securities tend to be very volatile, and these securities are less liquid than
investment grade debt securities. For these reasons, your investment in the
Company is subject to the following specific risks:

         -        increased price sensitivity to changing interest rates and to
                  a deteriorating economic environment;

         -        greater risk of loss due to default or declining credit
                  quality;

         -        adverse company specific events are more likely to render the
                  issuer unable to make interest and/or principal payments; and

         -        if a negative perception of the below investment grade debt
                  market develops, the price and liquidity of below investment
                  grade debt securities may be depressed. This negative
                  perception could last for a significant period of time.


         Adverse changes in economic conditions are more likely to lead to a
weakened capacity of a below investment grade debt issuer to make principal
payments and interest payments than an investment grade issuer. The principal
amount of below investment grade securities outstanding has proliferated in the
past decade as an increasing number of issuers have used below investment grade
securities for corporate financing. An economic downturn could severely affect
the ability of highly leveraged issuers to service their debt obligations or to
repay their obligations upon maturity. Similarly, down-turns in profitability in
specific industries, such as the energy infrastructure industry, could adversely
affect the ability of below investment grade debt issuers in that industry to
meet their obligations. The market values of lower quality debt securities tend
to reflect individual developments of the issuer to a greater extent than do
higher quality securities, which react primarily to fluctuations in the general
level of interest rates. Factors having an adverse impact on the market value of
lower quality securities may have an adverse effect on the Company's net asset
value and the market value of its Common Shares. In addition, the Company may
incur additional expenses to the extent it is required to seek recovery upon a
default in payment of principal or interest on its portfolio holdings. In
certain circumstances, the Company may be required to foreclose on an issuer's
assets and take possession of its property or operations. In such circumstances,
the Company would incur additional costs in disposing of such assets and
potential liabilities from operating any business acquired.

         The secondary market for below investment grade securities may not be
as liquid as the secondary market for more highly rated securities, a factor
which may have an adverse effect on the

                                       9

<PAGE>

Company's ability to dispose of a particular security when necessary to meet its
liquidity needs. There are fewer dealers in the market for below investment
grade securities than investment grade obligations. The prices quoted by
different dealers may vary significantly and the spread between the bid and
asked price is generally much larger than higher quality instruments. Under
adverse market or economic conditions, the secondary market for below investment
grade securities could contract further, independent of any specific adverse
changes in the condition of a particular issuer, and these instruments may
become illiquid. As a result, the Company could find it more difficult to sell
these securities or may be able to sell the securities only at prices lower than
if such securities were widely traded. Prices realized upon the sale of such
lower rated or unrated securities, under these circumstances, may be less than
the prices used in calculating the Company's net asset value.

         Because investors generally perceive that there are greater risks
associated with lower quality debt securities of the type in which the Company
may invest a portion of its assets, the yields and prices of such securities may
tend to fluctuate more than those for higher rated securities. In the lower
quality segments of the debt securities market, changes in perceptions of
issuers' creditworthiness tend to occur more frequently and in a more pronounced
manner than do changes in higher quality segments of the debt securities market,
resulting in greater yield and price volatility.

         The Company will not invest in distressed, below investment grade
securities (those that are in default or the issuers of which are in
bankruptcy). If a debt security becomes distressed while held by the Company,
the Company may be required to bear certain extraordinary expenses in order to
protect and recover its investment if it is recoverable at all.

         See Appendix A to this statement of additional information for a
description of Moody's and S&P's ratings.

         Restricted, Illiquid and Thinly-Traded Securities. The Company may
invest up to 30% of total assets in direct placements (restricted securities).
Securities obtained by means of direct placement are less liquid than securities
traded in the open market. The Company may therefore not be able to readily sell
such securities. Investments currently considered by the Adviser to be illiquid
because of such restrictions include subordinated convertible units and direct
placements of common units. Such securities are unlike securities that are
traded in the open market and which can be expected to be sold immediately if
the market is adequate. The sale price of securities that are not readily
marketable may be lower or higher than the Company's most recent determination
of their fair value. Additionally, the value of these securities typically
requires more reliance on the judgment of the Adviser than that required for
securities for which there is an active trading market. Due to the difficulty in
valuing these securities and the absence of an active trading market for these
investments, the Company may not be able to realize these securities' true
value, or may have to delay their sale in order to do so.

         Restricted securities generally can be sold in privately negotiated
transactions, pursuant to an exemption from registration under the 1933 Act, or
in a registered public offering. The Adviser has the ability to deem restricted
securities as liquid. To enable the Company to sell its holdings of a restricted
security not registered under the 1933 Act, the Company may have to cause those
securities to be registered. When the Company must arrange registration because
the Company wishes to sell the security, a considerable period may elapse
between the time the decision is made to sell the security and the time the
security is registered so that the Company could sell it. The Company would bear
the risks of any downward price fluctuation during that period.

         In recent years, a large institutional market has developed for certain
securities that are not registered under the 1933 Act, including private
placements, repurchase agreements, commercial paper, foreign securities and
corporate bonds and notes. These instruments are often restricted securities
because the securities are either themselves exempt from registration or sold in
transactions not requiring

                                       10

<PAGE>

registration, such as Rule 144A transactions. Institutional investors generally
will not seek to sell these instruments to the general public, but instead will
often depend on an efficient institutional market in which such unregistered
securities can be readily resold or on an issuer's ability to honor a demand for
repayment. Therefore, the fact that there are contractual or legal restrictions
on resale to the general public or certain institutions is not dispositive of
the liquidity of such investments.

         Rule 144A under the 1933 Act establishes a "safe harbor" from the
registration requirements of the 1933 Act for resales of certain securities to
qualified institutional buyers. Institutional markets for restricted securities
that exist or may develop as a result of Rule 144A may provide both readily
ascertainable values for restricted securities and the ability to liquidate an
investment. An insufficient number of qualified institutional buyers interested
in purchasing Rule 144A-eligible securities held by the Company, however, could
affect adversely the marketability of such portfolio securities and the Company
might be unable to dispose of such securities promptly or at reasonable prices.

         The Company may also invest in securities that may not be restricted,
but are thinly-traded. Although securities of certain MLPs trade on the NYSE,
the AMEX, the NASDAQ National Market or other securities exchanges or markets,
such securities may trade less than those of larger companies due to their
relatively smaller capitalizations. Such securities may be difficult to dispose
of at a fair price during times when the Company believes it is desirable to do
so. Thinly-traded securities are also more difficult to value and the Adviser's
judgment as to value will often be given greater weight than market quotations,
if any exist. If market quotations are not available, thinly-traded securities
will be valued in accordance with procedures established by the Board.
Investment of the Company's capital in thinly-traded securities may restrict the
Company's ability to take advantage of market opportunities. The risks
associated with thinly-traded securities may be particularly acute in situations
in which the Company's operations require cash and could result in the Company
borrowing to meet its short term needs or incurring losses on the sale of
thinly-traded securities.

         Commercial Paper. The Company may invest in commercial paper.
Commercial paper is a debt obligation usually issued by corporations and may be
unsecured or secured by letters of credit or a surety bond. Commercial paper is
usually repaid at maturity by the issuer from the proceeds of the issuance of
new commercial paper. As a result, investment in commercial paper is subject to
the risk that the issuer cannot issue enough new commercial paper to satisfy its
outstanding commercial paper, also known as rollover risk.

         Asset-backed commercial paper is a debt obligation generally issued by
a corporate-sponsored special purpose entity to which the corporation has
contributed cash-flowing receivables like credit card receivables, auto and
equipment leases, and other receivables. Investment in asset-backed commercial
paper is subject to the risk that insufficient proceeds from the projected cash
flows of the contributed receivables are available to repay the commercial
paper.

         U.S. Government Securities. The Company may invest in U.S. Government
Securities. There are two broad categories of U.S. Government-related debt
instruments: (a) direct obligations of the U.S. Treasury, and (b) securities
issued or guaranteed by U.S. Government agencies.

         Examples of direct obligations of the U.S. Treasury are Treasury Bills,
Notes, Bonds and other debt securities issued by the U.S. Treasury. These
instruments are backed by the "full faith and credit" of the United States. They
differ primarily in interest rates, the length of maturities and the dates of
issuance. Treasury bills have original maturities of one year or less. Treasury
notes have original maturities of one to ten years and Treasury bonds generally
have original maturities of greater than ten years.

                                       11

<PAGE>

         Some agency securities are backed by the full faith and credit of the
United States and others are backed only by the rights of the issuer to borrow
from the U.S. Treasury (such as Federal Home Loan Bank Bonds and Federal
National Mortgage Association Bonds), while still others, such as the securities
of the Federal Farm Credit Bank, are supported only by the credit of the issuer.
With respect to securities supported only by the credit of the issuing agency or
by an additional line of credit with the U.S. Treasury, there is no guarantee
that the U.S. Government will provide support to such agencies and such
securities may involve risk of loss of principal and interest.

         Repurchase Agreements. The Company may enter into "repurchase
agreements" backed by U.S. Government Securities. A repurchase agreement arises
when the Company purchases a security and simultaneously agrees to resell it to
the vendor at an agreed upon future date. The resale price is greater than the
purchase price, reflecting an agreed upon market rate of return that is
effective for the period of time the Company holds the security and that is not
related to the coupon rate on the purchased security. Such agreements generally
have maturities of no more than seven days and could be used to permit the
Company to earn interest on assets awaiting long term investment. The Company
requires continuous maintenance by the custodian for the Company's account in
the Federal Reserve/Treasury Book Entry System of collateral in an amount equal
to, or in excess of, the market value of the securities that are the subject of
a repurchase agreement. Repurchase agreements maturing in more than seven days
are considered illiquid securities. In the event of a bankruptcy or other
default of a seller of a repurchase agreement, the Company could experience both
delays in liquidating the underlying security and losses, including: (a)
possible decline in the value of the underlying security during the period while
the Company seeks to enforce its rights thereto; (b) possible subnormal levels
of income and lack of access to income during this period; and (c) expenses of
enforcing its rights.

         Reverse Repurchase Agreements. The Company may enter into reverse
repurchase agreements for temporary purposes with banks and securities dealers
if the creditworthiness of the bank or securities dealer has been determined by
the Adviser to be satisfactory. A reverse repurchase agreement is a repurchase
agreement in which the Company is the seller of, rather than the investor in,
securities and agrees to repurchase them at an agreed-upon time and price. Use
of a reverse repurchase agreement may be preferable to a regular sale and later
repurchase of securities because it avoids certain market risks and transaction
costs.

         At the time when the Company enters into a reverse repurchase
agreement, liquid assets (cash, U.S. Government Securities or other "high-grade"
debt obligations) of the Company having a value at least as great as the
purchase price of the securities to be purchased will be segregated on the books
of the Company and held by the custodian throughout the period of the
obligation. The use of reverse repurchase agreements by the Company creates
leverage which increases the Company's investment risk. If the income and gains
on securities purchased with the proceeds of these transactions exceed the cost,
the Company's earnings or net asset value will increase faster than otherwise
would be the case; conversely, if the income and gains fail to exceed the cost,
earnings or net asset value would decline faster than otherwise would be the
case. The Company intends to enter into reverse repurchase agreements only if
the income from the investment of the proceeds is greater than the expense of
the transaction, because the proceeds are invested for a period no longer than
the term of the reverse repurchase agreement.

         Margin Borrowing. Although it does not currently intend to, the Company
may in the future use margin borrowing of up to 33 1/3% of total assets for
investment purposes when the Adviser believes it will enhance returns. Margin
borrowings by the Company create certain additional risks. For example, should
the securities that are pledged to brokers to secure margin accounts decline in
value, or should brokers from which the Company has borrowed increase their
maintenance margin requirements (i.e., reduce the percentage of a position that
can be financed), then the Company could be subject to a "margin call," pursuant
to which it must either deposit additional funds with the broker or suffer
mandatory

                                       12

<PAGE>

liquidation of the pledged securities to compensate for the decline in value. In
the event of a precipitous drop in the value of the assets of the Company, it
might not be able to liquidate assets quickly enough to pay off the margin debt
and might suffer mandatory liquidation of positions in a declining market at
relatively low prices, thereby incurring substantial losses. For these reasons,
the use of borrowings for investment purposes is considered a speculative
investment practice.

         Interest Rate Transactions. In an attempt to reduce the interest rate
risk arising from the Company's leveraged capital structure, the Company may
enter into interest rate transactions such as swaps, caps and floors. The use of
interest rate transactions is a highly specialized activity that involves
investment techniques and risks different from those associated with ordinary
portfolio security transactions. In an interest rate swap, the Company would
agree to pay to the other party to the interest rate swap (which is known as the
"counterparty") a fixed rate payment in exchange for the counterparty agreeing
to pay to the Company a variable rate payment that is intended to approximate
the Company's variable rate payment obligation on any variable rate borrowings.
The payment obligations would be based on the notional amount of the swap. In an
interest rate cap, the Company would pay a premium to the counterparty to the
interest rate cap and, to the extent that a specified variable rate index
exceeds a predetermined fixed rate, would receive from the counterparty payments
of the difference based on the notional amount of such cap. In an interest rate
floor, the Company would be entitled to receive, to the extent that a specified
index falls below a predetermined interest rate, payments of interest on a
notional principal amount from the party selling the interest rate floor.
Depending on the state of interest rates in general, the Company's use of
interest rate transactions could enhance or decrease Distributable Cash Flow
available to the Common Shares. To the extent there is a decline in interest
rates, the value of the interest rate transactions could decline, and could
result in a decline in the net asset value of the Common Shares. In addition, if
the counterparty to an interest rate transaction defaults, the Company would not
be able to use the anticipated net receipts under the interest rate transaction
to offset the Company's cost of financial leverage.

         Delayed-Delivery Transactions. Securities may be bought and sold on a
delayed-delivery or when-issued basis. These transactions involve a commitment
to purchase or sell specific securities at a predetermined price or yield, with
payment and delivery taking place after the customary settlement period for that
type of security. Typically, no interest accrues to the purchaser until the
security is delivered. The Company may receive fees or price concessions for
entering into delayed-delivery transactions.

         When purchasing securities on a delayed-delivery basis, the purchaser
assumes the rights and risks of ownership, including the risks of price and
yield fluctuations and the risk that the security will not be issued as
anticipated. Because payment for the securities is not required until the
delivery date, these risks are in addition to the risks associated with the
Company's investments. If the Company remains substantially fully invested at a
time when delayed-delivery purchases are outstanding, the delayed-delivery
purchases may result in a form of leverage. When delayed-delivery purchases are
outstanding, the Company will set aside appropriate liquid assets in a
segregated custodial account to cover the purchase obligations. When the Company
has sold a security on a delayed-delivery basis, the Company does not
participate in further gains or losses with respect to the security. If the
other party to a delayed-delivery transaction fails to deliver or pay for the
securities, the Company could miss a favorable price or yield opportunity or
suffer a loss.

         Securities Lending. The Company may lend securities to parties such as
broker-dealers or institutional investors. Securities lending allows the Company
to retain ownership of the securities loaned and, at the same time, to earn
additional income. Since there may be delays in the recovery of loaned
securities, or even a loss of rights in collateral supplied should the borrower
fail financially, loans will be made only to parties deemed by the Adviser to be
of good credit and legal standing. Furthermore, loans

                                       13
<PAGE>

of securities will only be made if, in the Adviser's judgment, the consideration
to be earned from such loans would justify the risk.

         The Adviser understands that it is the current view of the Commission
staff that the Company may engage in loan transactions only under the following
conditions: (1) the Company must receive 100% collateral in the form of cash or
cash equivalents (e.g., U.S. Treasury bills or notes) from the borrower; (2) the
borrower must increase the collateral whenever the market value of the
securities loaned (determined on a daily basis) rises above the value of the
collateral; (3) after giving notice, the Company must be able to terminate the
loan at any time; (4) the Company must receive reasonable interest on the loan
or a flat fee from the borrower, as well as amounts equivalent to any dividends,
interest, or other distributions on the securities loaned and to any increase in
market value; (5) the Company may pay only reasonable custodian fees in
connection with the loan; and (6) the Board must be able to vote proxies on the
securities loaned, either by terminating the loan or by entering into an
alternative arrangement with the borrower.

         Defensive and Temporary Investments. Under adverse market or economic
conditions or pending investment of offering or leverage proceeds, the Company
may invest up to 100% of its total assets in securities issued or guaranteed by
the U.S. Government or its instrumentalities or agencies, short-term debt
securities, certificates of deposit, bankers' acceptances and other bank
obligations, commercial paper rated in the highest category by a rating agency
or other fixed income securities deemed by the Adviser to be consistent with a
defensive posture, or may hold cash. The Adviser also may invest in such
instruments to meet working capital needs including, but not limited to, the
need for collateral in connection with certain investment techniques, to hold a
reserve pending payment of dividends, and to facilitate the payments of expenses
and settlement of trades. The yield on such securities may be lower than the
returns on MLPs or yields on lower rated fixed income securities. To the extent
the Company uses this strategy, it may not achieve its investment objective.

                            MANAGEMENT OF THE COMPANY

DIRECTORS AND OFFICERS


         The business and affairs of the Company are managed under the direction
of the Board of Directors. Accordingly, the Company's Board of Directors
provides broad supervision over the affairs of the Company, including
supervision of the duties performed by the Adviser. The officers of the Company
are responsible for the Company's day-to-day operations. The directors and
officers of the Company and their principal occupations and other affiliations
during the past five years are set forth below. Each director and officer will
hold office until his successor is duly elected and qualified, or until he
resigns or is removed in the manner provided by law. Unless otherwise indicated,
the address of each director and officer is 10801 Mastin Boulevard, Overland
Park, Kansas 66210.


<TABLE>
<CAPTION>
                               POSITION(s) HELD
                               WITH COMPANY AND                                                           OTHER
                                LENGTH OF TIME             PRINCIPAL OCCUPATION DURING             DIRECTORSHIPS HELD BY
     NAME AND AGE                  SERVED                        PAST FIVE YEARS                          DIRECTOR
------------------------    ----------------------   ---------------------------------------   ------------------------------
<S>                         <C>                      <C>                                       <C>
INDEPENDENT DIRECTORS

Conrad S. Ciccotello, 43    Director since 2003      Associate Professor of Risk Management    None
                                                     and Insurance, Robinson College of
                                                     Business, Georgia State University;
                                                     Director of Graduate Personal Financial
                                                     Planning (PFP) Programs, Editor,
                                                     "Financial Services Review," (an
</TABLE>

                                               14
<PAGE>

<TABLE>
<CAPTION>
                               POSITION(s) HELD
                               WITH COMPANY AND                                                           OTHER
                                LENGTH OF TIME             PRINCIPAL OCCUPATION DURING             DIRECTORSHIPS HELD BY
     NAME AND AGE                  SERVED                        PAST FIVE YEARS                          DIRECTOR
------------------------    ----------------------   ---------------------------------------   ------------------------------
<S>                         <C>                      <C>                                       <C>
                                                     academic journal dedicated to the study
                                                     of individual financial management);
                                                     Formerly, faculty member,
                                                     Pennsylvania State University.

John R. Graham, 58          Director since 2003      Executive-in-Residence and Professor of   Erie Indemnity Company; Erie
                                                     Finance, College of Business              Family Life Insurance Company;
                                                     Administration, Kansas State University   Kansas State Bank
                                                     (has served as a professor or adjunct
                                                     professor since 1970); Chairman of the
                                                     Board, President and CEO, Graham
                                                     Capital Management, Inc. and Owner of
                                                     Graham Ventures; Formerly, CEO, Kansas
                                                     Farm Bureau Financial Services,
                                                     including seven affiliated insurance or
                                                     financial service companies (1979-2000).

Charles E. Heath, 61        Director since 2003      Retired in 1999. Formerly, Chief          None
                                                     Investment Officer, General Electric's
                                                     Employers Reinsurance Corporation
                                                     (1989-1999). CFA since 1974.

INTERESTED DIRECTORS AND OFFICERS

H. Kevin Birzer(1), 44      Director and Chairman    Partner/Senior Analyst, Fountain          None
                            of the Board since       Capital; Manager of the Adviser;
                            2003                     Formerly, President, F. Martin Koenig &
                                                     Co.; Vice President, Corporate Finance
                                                     Department, Drexel Burnham Lambert
                                                     (1986-1989).

Terry C. Matlack(1), 47     Director, Treasurer and  Managing Director, KCEP;                  ACT
Address:                    Chief Financial Officer  Manager of the Adviser; Formerly,         Telecommunication, Inc.; Trendstar
233 West 47th Street,       since 2003               President, GreenStreet Capital.           Investment Trust (open-end small cap
Kansas City, MO 64112                                                                          investment fund)

David J. Schulte, 42        President and Chief      Managing Director, KCEP (1993-present);   Inergy, L.P. and Elecsys Corp.
                            Executive Officer since  Manager of the Adviser. CFA since 1992;
                            2003                     Member, Financial Accounting Policy
                                                     Committee of AIMR.

Zachary A. Hamel, 39        Secretary since 2003     Partner/Senior Analyst with Fountain      None
                                                     Capital (1997-present);
</TABLE>

                                             15
<PAGE>

<TABLE>
<CAPTION>
                               POSITION(s) HELD
                               WITH COMPANY AND                                                           OTHER
                                LENGTH OF TIME             PRINCIPAL OCCUPATION DURING              DIRECTORSHIPS HELD
     NAME AND AGE                  SERVED                        PAST FIVE YEARS                        BY DIRECTOR
------------------------    ----------------------   ---------------------------------------   ------------------------------
<S>                         <C>                      <C>                                       <C>
                                                     Manager of the Adviser.

Kenneth P. Malvey, 38       Assistant Treasurer      Investment Analyst, Fountain Capital      None
                            Since 2003               Management (2002-present). Formerly,
                                                     Investment Risk Manager and member of
                                                     the Global Office of Investments, GE
                                                     Capital's Employers Reinsurance
                                                     Corporation.

Andrew P. Chica, 28         Assistant Secretary      Compliance Officer (2000-present)         None
                            Since 2003               U.S. Bancorp Fund Services, LLC

Scott J. Schuenke, 24       Assistant Secretary      Compliance Officer (2002-present)         None
                            Since 2003               U.S. Bancorp Fund Services, LLC
</TABLE>


-----------------
(1)    As a result of their respective positions held with the Adviser or its
       affiliates, these individuals are considered "interested persons" of the
       Adviser within the meaning of the 1940 Act.

         The Company has an Audit Committee that consists of three directors of
the Company who are not "interested persons" of the Company within the meaning
of the 1940 Act ("Independent Directors"). The Audit Committee members are
Charles E. Heath (Chairman), Conrad S. Ciccotello and John R. Graham. The Audit
Committee's function is to oversee the Company's accounting policies, financial
reporting and internal control system. The Audit Committee makes recommendations
regarding the selection of independent auditors of the Company, reviews the
independence of such firm, reviews the scope of the audit and internal controls,
considers and reports to the Board on matters relating to the Company's
accounting and financial reporting practices, and performs such other tasks as
the full Board deems necessary or appropriate.

         As the Company is a newly-organized closed-end management investment
company, no meetings of the above committees have been held in the current
fiscal year.

         Directors and officers of the Company who are interested persons of the
Company will receive no salary or fees from the Company. Each Independent
Director is expected to receive from the Company an annual retainer of $4,000
($6,000 for the Chairman of the Audit Committee) and a fee of $2,000 (and
reimbursement for related expenses) for each meeting of the Board or committee
meeting he or she attends. Each Independent Director will also receive $500 for
each telephone committee meeting. No director or officer will be entitled to
receive pension or retirement benefits from the Company.

         The table below sets forth the estimated compensation to be paid to the
directors by the Company for the period beginning on the commencement of
operations and ending on [November 30], 2004. As of date of this statement of
additional information, the Company was not operational and did not pay
compensation to the directors.

<TABLE>
<CAPTION>
NAME AND POSITION WITH THE COMPANY                AGGREGATE COMPENSATION FROM THE COMPANY*
----------------------------------                ----------------------------------------
<S>                                               <C>
INDEPENDENT DIRECTORS
Conrad S. Ciccotello                                             $16,000
John R. Graham                                                   $16,000
Charles E. Heath                                                 $18,000

INTERESTED DIRECTORS
H. Kevin Birzer                                                  $     0
Terry C. Matlack                                                 $     0
</TABLE>

                                       16
<PAGE>

-------------------------
*      Because the Company has not completed its first fiscal year, compensation
       is estimated based upon payments to be made by the Company during the
       current fiscal year.

         The following table sets forth the dollar range of equity securities
beneficially owned by each director in the Company as of the date of this
statement of additional information.

<TABLE>
<CAPTION>
                                                       AGGREGATE DOLLAR RANGE OF
   NAME OF DIRECTOR                       COMPANY SECURITIES BENEFICIALLY OWNED BY DIRECTOR
   ----------------                       -------------------------------------------------
<S>                                       <C>
INDEPENDENT DIRECTORS
Conrad S. Ciccotello                                            None
John R. Graham                                                  None
Charles E. Heath                                                None
INTERESTED DIRECTORS
H. Kevin Birzer                                              Over $100,000
Terry C. Matlack                                         $10,001 - $50,000
</TABLE>

CONTROL PERSONS

         Eleven individuals, (the "Subscribers") all of whom are affiliated with
the Adviser, provided the initial capital for the Company by purchasing 23,047
shares of Common Shares of the Company for $550,250. As of the date of this
Statement of Additional Information, the Subscribers owned 100% of the
outstanding Common Shares. The Subscribers may be deemed to control the Company
until such time as they own less than 25% of the outstanding shares of the
Company. One of the subscribers, H. Kevin Birzer, 10801 Mastin Boulevard,
Overland Park, Kansas, individually may also be deemed to control the Company as
he owns 27.2% of the outstanding Common Shares.

         The table below lists each person who owns five percent or more of the
Company's outstanding securities:

<TABLE>
<CAPTION>
      NAME                          ADDRESS                      TYPE OF OWNERSHIP        % OF OWNERSHIP
-----------------    -------------------------------------       -----------------        --------------
<S>                  <C>                                         <C>                      <C>
H. Kevin Birzer*     10801 Mastin Blvd., Overland Park, KS           Beneficial               27.2%

Zachary A. Hamel*    10801 Mastin Blvd., Overland Park, KS           Beneficial                8.2%

Terry C. Matlack*    10801 Mastin Blvd., Overland Park, KS           Beneficial                5.5%

Larry Powell         10801 Mastin Blvd., Overland Park, KS           Beneficial               18.2%

William Reisler      10801 Mastin Blvd., Overland Park, KS           Beneficial               14.5%

Kenneth P. Malvey*   10801 Mastin Blvd., Overland Park, KS           Beneficial                5.5%

David J. Schulte*    10801 Mastin Blvd., Overland Park, KS           Beneficial               11.8%
</TABLE>

-------------------------
*      As of the date of this Statement of Additional Information, the officers
       and directors of the Company, as a group, own 57.2% of the Company's
       outstanding securities.

                                       17
<PAGE>

INDEMNIFICATION OF DIRECTORS AND OFFICERS


         Maryland law permits a Maryland corporation to include in its charter a
provision limiting the liability of its directors and officers to the
corporation and its shareholders for money damages except for liability
resulting from (a) actual receipt of an improper benefit or profit in money,
property or services or (b) active and deliberate dishonesty which is
established by a final judgment as being material to the cause of action. The
Charter contains such a provision which eliminates directors' and officers'
liability to the maximum extent permitted by Maryland law.


         The Charter authorizes the Company, to the maximum extent permitted by
Maryland law and the 1940 Act, to indemnify any present or former director or
officer or any individual who, while a director of the Company and at the
request of the Company, serves or has served another corporation, real estate
investment trust, partnership, joint venture, trust, employee benefit plan or
other enterprise as a director, officer, partner or trustee, from and against
any claim or liability to which that person may become subject or which that
person may incur by reason of his or her status as a present or former director
or officer of the Company and to pay or reimburse his or her reasonable expenses
in advance of final disposition of a proceeding. The Bylaws obligate the
Company, to the maximum extent permitted by Maryland law and the 1940 Act, to
indemnify any present or former director or officer or any individual who, while
a director of the Company and at the request of the Company, serves or has
served another corporation, real estate investment trust, partnership, joint
venture, trust, employee benefit plan or other enterprise as a director,
officer, partner or trustee and who is made a party to the proceeding by reason
of his service in that capacity from and against any claim or liability to which
that person may become subject or which that person may incur by reason of his
or her status as a present or former director or officer of the Company and to
pay or reimburse his or her reasonable expenses in advance of final disposition
of a proceeding. The Charter and Bylaws also permit the Company to indemnify and
advance expenses to any person who served a predecessor of the Company in any of
the capacities described above and any employee or agent of the Company or a
predecessor of the Company.

         Maryland law requires a corporation (unless its charter provides
otherwise, which the Company's Charter does not) to indemnify a director or
officer who has been successful in the defense of any proceeding to which he is
made a party by reason of his service in that capacity. Maryland law permits a
corporation to indemnify its present and former directors and officers, among
others, against judgments, penalties, fines, settlements and reasonable expenses
actually incurred by them in connection with any proceeding to which they may be
made a party by reason of their service in those or other capacities unless it
is established that (a) the act or omission of the director or officer was
material to the matter giving rise to the proceeding and (i) was committed in
bad faith or (ii) was the result of active and deliberate dishonesty, (b) the
director or officer actually received an improper personal benefit in money,
property or services or (c) in the case of any criminal proceeding, the director
or officer had reasonable cause to believe that the act or omission was
unlawful. However, under Maryland law, a Maryland corporation may not indemnify
for an adverse judgment in a suit by or in the right of the corporation or for a
judgment of liability on the basis that personal benefit was improperly
received, unless in either case a court orders indemnification and then only for
expenses. In addition, Maryland law permits a corporation to advance reasonable
expenses to a director or officer upon the corporation's receipt of (a) a
written affirmation by the director or officer of his good faith belief that he
has met the standard of conduct necessary for indemnification by the corporation
and (b) a written undertaking by him or on his behalf to repay the amount paid
or reimbursed by the corporation if it is ultimately determined that the
standard of conduct was not met.

                                       18
<PAGE>

INVESTMENT ADVISER AND ACCOUNTING SERVICES PROVIDER

         Tortoise Capital Advisers, L.L.C. (the "Adviser") will serve as the
Company's investment adviser. The Adviser was formed by Fountain Capital
Management, L.L.C. ("Fountain Capital") and Kansas City Equity Partners, L.C.
("KCEP") in October 2002 to provide portfolio management services exclusively
with respect to energy infrastructure investments. The Adviser is controlled
equally by Fountain Capital and KCEP, each of which own half of all of the
voting shares of the Adviser.

         Fountain Capital was formed in 1990 and is focused primarily on
providing investment advisory services to institutional investors with respect
to below investment grade debt. Atlantic Asset Management LLC ("Atlantic") is a
minority owner, and an affiliate, of Fountain Capital. Fountain Capital had $2.4
billion of client assets under management as of December 31, 2003.

         KCEP was formed in 1993 and is focused solely on managing two private
equity funds, which have had combined committed capital of $110 million. KCEP
focuses on private equity investments in the Consumer, Telecom/Media and Natural
Resource Distribution and Services industries.

         Atlantic was formed in 1992 and provides, directly or through
affiliates, a variety of fixed-income investment advisory services including
investment grade bond and high-yield bond strategies, investment grade
collateralized debt obligations and mortgage hedge funds. Including Fountain
Capital, the Atlantic group had approximately $9.7 billion in assets under
management as of December 31, 2003.

         The Adviser is located at 10801 Mastin Boulevard, Suite 222, Overland
Park, Kansas 66210. The Adviser specializes in managing portfolios of MLPs and
other energy infrastructure companies. As of December 31, 2003, the Adviser and
its affiliates (including the Atlantic group) had approximately $367 million in
assets under management in the energy infrastructure industry.

         Pursuant to an Investment Advisory Agreement dated December 12, 2003,
(the "Advisory Agreement"), the Adviser shall, subject to overall supervision by
the Board, manage the investments of the Company. The Adviser will regularly
provide the Company with investment research advice and supervision and will
furnish continuously an investment program for the Company, consistent with the
investment objective and policies of the Company.

         Day-to-day management of the Company's portfolio will be the
responsibility of a team of investment analysts and portfolio managers led by
David J. Schulte. The Adviser has established a five member Investment
Committee. The members of the Committee are David J. Schulte, H. Kevin Birzer,
Terry C. Matlack, Zachary A. Hamel and Kenneth Malvey. Each member of the
committee, other than Mr. Schulte, has significant responsibilities with respect
to KCEP and/or Fountain Capital. All members of the Investment Committee have
undertaken to provide such services as necessary to fulfill the obligations of
the Advisor to the Company.

         In addition, the Adviser will be obligated to supply the Board and
officers of the Company with certain statistical information and reports, to
oversee the maintenance of various books and records and to arrange for the
preservation of records in accordance with applicable federal law and
regulations. Under the Investment Advisory Agreement, the Company will pay to
the Adviser quarterly, as compensation for the services rendered and expenses
paid by it, a fee equal on an annual basis to 0.95% of the Company's average
monthly Managed Assets. Managed Assets means the total assets of the Company
(including any assets attributable to leverage that may be outstanding) minus
accrued liabilities other than (i) deferred taxes, (ii) debt entered into for
the purpose of leverage and (iii) the aggregate liquidation preference of any
outstanding preferred shares.

                                       19
<PAGE>

         The Adviser has contractually agreed to waive or reimburse the Company
for fees and expenses, including the investment advisory fee and other expenses
in the amount of 0.23% of average monthly Managed Assets for the first two years
of the Company's operations and 0.10% of average monthly Managed Assets in years
three through five.

         Because the management fees paid to the Adviser are based upon a
percentage of the Company's Managed Assets, fees paid to the Adviser will be
higher if the Company is leveraged; thus, the Adviser will have an incentive to
leverage the Company. Because the fee reimbursement agreement is based on
Managed Assets, to the extent the Company is engaged in leverage, the gross
dollar amount of the Adviser's fee reimbursement obligations to the Company will
increase. The Adviser intends to leverage the Company only when it believes it
will serve the best interests of the shareholders. The Company's average monthly
Managed Assets are determined for the purpose of calculating the management fee
by taking the average of the monthly determinations of managed assets during a
given calendar quarter. The fees are payable for each calendar quarter within 5
days of the end of that quarter.

         The Advisory Agreement provides that the Company will pay all expenses
other than those expressly stated to be payable by the Adviser, which expenses
payable by the Company shall include, without implied limitation: (i) expenses
of maintaining the Company and continuing its existence, (ii) registration of
the Company under the 1940 Act, (iii) commissions, spreads, fees and other
expenses connected with the acquisition, holding and disposition of securities
and other investments including placement and similar fees in connection with
direct placements entered into on behalf of the Company, (iv) auditing,
accounting and legal expenses, (v) taxes and interest, (vi) governmental fees,
(vii) expenses of listing shares of the Company with a stock exchange, and
expenses of issue, sale, repurchase and redemption (if any) of interests in the
Company, including expenses of conducting tender offers for the purpose of
repurchasing Company interests, (viii) expenses of registering and qualifying
the Company and its shares under federal and state securities laws and of
preparing and filing registration statements and amendments for such purposes,
(ix) expenses of reports and notices to shareholders and of meetings of
shareholders and proxy solicitations therefor, (x) expenses of reports to
governmental officers and commissions, (xi) insurance expenses, (xii)
association membership dues, (xiii) fees, expenses and disbursements of
custodians and subcustodians for all services to the Company (including without
limitation safekeeping of funds, securities and other investments, keeping of
books, accounts and records, and determination of net asset values), (xiv) fees,
expenses and disbursements of transfer agents, dividend paying agents,
shareholder servicing agents and registrars for all services to the Company,
(xv) compensation and expenses of directors of the Company who are not members
of the Adviser's organization, (xvi) pricing and valuation services employed by
the Company, (xvii) all expenses incurred in connection with leveraging of the
Company's assets through a line of credit, or issuing and maintaining preferred
shares, (xviii) all expenses incurred in connection with the organization of the
Company and the initial public offering of Common Shares, and (xix) such
non-recurring items as may arise, including expenses incurred in connection with
litigation, proceedings and claims and the obligation of the Company to
indemnify its directors, officers and shareholders with respect thereto.

         The Advisory Agreement provides that the Adviser will not be liable in
any way for any default, failure or defect in any of the securities comprising
the Company's portfolio if it has satisfied the duties and the standard of care,
diligence and skill set forth in the Advisory Agreement. However, the Adviser
shall be liable to the Company for any loss, damage, claim, cost, charge,
expense or liability resulting from the Adviser's willful misconduct, bad faith
or gross negligence or disregard by the Adviser of the Adviser's duties or
standard of care, diligence and skill set forth in the Agreement or a material
breach or default of the Adviser's obligations under the Agreement.

         The Advisory Agreement will continue in force until December 31, 2005,
and from year to year thereafter, provided such continuance is approved by a
majority of the Board or by vote of the holders of

                                       20
<PAGE>

a majority of the outstanding voting securities of the Company. Additionally,
the Advisory Agreement must be approved annually by vote of a majority of the
Independent Directors. The Advisory Agreement may be terminated by the Adviser
or the Company, without penalty, on sixty (60) days' written notice to the
other. The Advisory Agreement will terminate automatically in the event of its
assignment.

         The Advisory Agreement was considered and approved by the Board of
Directors, including a majority of the Independent Directors, at the
organizational meeting of the Company held on December 12, 2003. In considering
the Advisory Agreement, the Board, including a majority of the Independent
Directors, determined that the terms of the agreement are fair and reasonable
and that approval of the Advisory Agreement on behalf of the Company is in the
best interests of the Company. In evaluating the Advisory Agreement, the Board
reviewed materials furnished by the Adviser and met with senior advisory
personnel. The Board also specifically considered the following as relevant to
its determination to approve the Advisory Agreement: (1) the history,
reputation, qualification and background of the Adviser and the team of analysts
and portfolio managers responsible for the Company's investment program; (2) the
Adviser's reliance on the personnel and resources of affiliates; (3) the unique
nature of the product and the specialized expertise of the Adviser in a niche
market (MLPs); (4) that the fee and expense ratios of the Company are reasonable
given the quality of services expected to be provided and are comparable to the
fee and expense ratios of similar closed-end funds with similar investment
objectives and policies; (5) that an affiliate of the Adviser, Atlantic Asset
Management LLC ("Atlantic") will receive 20% of the advisory fees paid to the
Adviser that derive from assets invested in the Company by Atlantic's clients;
and (6) other factors deemed relevant by the Board. The Board noted and approved
that the fee rate would be applicable to all assets under management, including
amounts attributable to leverage, and the potential conflict of the Adviser in
determining the amount of leverage.

POTENTIAL CONFLICTS OF INTEREST

         The Adviser and its affiliates manage other accounts and portfolios
with investment strategies similar to those of the Company. Securities
frequently meet the investment objectives of the Company and such other accounts
and the Company may compete against other accounts for the same trade the
Company might otherwise make, including the priority of the trading order.

         It is possible that at times identical securities will be held by the
Company and other accounts. However, positions in the same issuer may vary and
the length of time that the Company or other accounts may choose to hold their
investment in the same issuer may likewise vary. To the extent that one or more
of the accounts managed by the Adviser seeks to acquire the same security at
about the same time, the Company may not be able to acquire as large a position
in such security as it desires or it may have to pay a higher price for the
security. Similarly, the Company may not be able to obtain as large an execution
of an order to sell or as high a price for any particular portfolio security if
the Adviser decides to sell on behalf of another account the same portfolio
security at the same time. On the other hand, if the same securities are bought
or sold at the same time by the Company and other accounts, the resulting
participation in volume transactions could produce better executions for the
Company. In the event more than one account purchases or sells the same security
as the Company on a given date, the purchases and sales will normally be
allocated as nearly as practicable on a pro rata basis in proportion to the
amounts desired to be purchased or sold by each account and the Company. Other
factors considered in the allocation of securities include cash balances, risk
tolerances and other guideline restrictions. Although the other accounts may
have the same or similar investment objectives and policies as the Company,
their portfolios may not necessarily consist of the same investments as the
Company or each other, and their performance results are likely to differ from
those of the Company.

                                       21
<PAGE>

CUSTODIAN AND TRANSFER AGENT

         U.S. Bank National Association, 425 Walnut Street, Cincinnati, OH
45202, will serve as the custodian of the Company's cash and investment
securities. Computershare Investor Services, LLC, Two North LaSalle Street,
Chicago, Illinois, will serve as transfer agent and dividend paying agent for
the Company, as well as the Plan Agent for the Company's Automatic Dividend
Reinvestment Plan.

CODE OF ETHICS

         The Company and the Adviser have adopted a Code of Ethics under Rule
17j-1 of the 1940 Act, which is applicable to officers, directors and designated
employees of the Company and the Adviser. Subject to certain limitations, the
Code permits covered persons to invest in securities, including securities that
may be purchased or held by the Company. The Code contains provisions and
requirements designed to identify and address certain conflicts of interest
between personal investment activities of covered persons and the interests of
investment advisory clients such as the Company. Among other things, the Code
prohibits certain types of transactions absent prior approval, imposes time
periods during which personal transactions may not be made in certain
securities, and requires submission of duplicate broker confirmations and
statements and quarterly reporting of securities transactions. Exceptions to
these and other provisions of the Code may be granted in particular
circumstances after review by appropriate personnel.

         The Code of Ethics of the Company can be reviewed and copied at the
Securities and Exchange Commission's Public Reference Room in Washington, D.C.
Information on the operation of the Public Reference Room may be obtained by
calling the Securities and Exchange Commission at (202) 942-8090. The Code of
the Company is also available on the EDGAR Database on the Securities and
Exchange Commission's Internet site at http://www.sec.gov, and, upon payment of
a duplicating fee, by electronic request at the following e-mail address:
publicinfo@sec.gov or by writing the Securities and Exchange Commission's Public
Reference Section, Washington, D.C. 20549-0102.

                             PORTFOLIO TRANSACTIONS

EXECUTION OF PORTFOLIO TRANSACTIONS

         As of the date of this statement of additional information, the Company
has not commenced operations and therefore has not engaged in any portfolio
transactions or paid any brokerage commissions.

         The Adviser is responsible for decisions to buy and sell securities for
the Company, broker-dealer selection, and negotiation of brokerage commission
rates. The Adviser's primary consideration in effecting a security transaction
will be to obtain the best execution. In selecting a broker-dealer to execute
each particular transaction, the Adviser will take the following into
consideration: the best net price available; the reliability, integrity and
financial condition of the broker-dealer; the size of and the difficulty in
executing the order; and the value of the expected contribution of the
broker-dealer to the investment performance of the Company on a continuing
basis. Accordingly, the price to the Company in any transaction may be less
favorable than that available from another broker-dealer if the difference is
reasonably justified by other aspects of the execution services offered.

         Subject to such policies as the Board may from time to time determine,
the Adviser shall not be deemed to have acted unlawfully or to have breached any
duty solely by reason of its having caused the Company to pay a broker or dealer
that provides brokerage and research services to the Adviser an amount of
commission for effecting a Company investment transaction in excess of the
amount of

                                       22
<PAGE>

commission another broker or dealer would have charged for effecting that
transaction, if the Adviser determines in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
particular transaction or the Adviser's overall responsibilities with respect to
the Company and to other clients of the Adviser as to which the Adviser
exercises investment discretion. The Adviser is further authorized to allocate
the orders placed by it on behalf of the Company to such brokers and dealers who
also provide research or statistical material or other services to the Company,
the Adviser or to any sub-adviser. Such allocation shall be in such amounts and
proportions as the Adviser shall determine and the Adviser will report on said
allocations regularly to the Board indicating the brokers to whom such
allocations have been made and the basis therefor.


PORTFOLIO TURNOVER

         The Company's annual portfolio turnover rate may vary greatly from year
to year. Although the Company cannot accurately predict its annual portfolio
turnover rate, it is not expected to exceed 30% under normal circumstances.
However, portfolio turnover rate is not considered a limiting factor in the
execution of investment decisions for the Company. A higher turnover rate
results in correspondingly greater brokerage commissions and other transactional
expenses that are borne by the Company. High portfolio turnover may result in
the Company's recognition of gains that will increase the Company's current and
accumulated earnings profits resulting in a greater portion of the Company's
distributions being treated as taxable dividends for Federal income tax
purposes. See "U.S. Federal Income Tax Matters."

                                 NET ASSET VALUE

         The Company will compute its net asset value for its Common Shares as
of the close of trading of the NYSE (normally 4:00 p.m. Eastern time) no less
frequently than the last business day of each calendar month. For purposes of
determining the net asset value of a Common Share, the net asset value of the
Company will equal the value of the total assets of the Company (the value of
the securities the Company holds plus cash or other assets, including interest
accrued but not yet received) less (i) all of its liabilities (including accrued
expenses and taxes, including both current and deferred income taxes); (ii)
accumulated and unpaid dividends on any outstanding preferred shares; (iii) the
aggregate liquidation value of any outstanding preferred shares; and (iv) any
distributions payable on the Common Shares. The net asset value per Common Share
of the Company will equal the net asset value of the Company divided by the
number of outstanding Common Shares.

         Pursuant to an agreement with U.S. Bancorp Fund Services, LLC (the
"Accounting Services Provider"), the Accounting Services Provider will value the
assets in the Company's portfolio in accordance with Valuation Procedures
adopted by the Board of Directors. The Accounting Services Provider will obtain
securities market quotations from independent pricing services approved by the
Adviser and ratified by the Board of Directors. Securities for which market
quotations are readily available shall be valued at "market value." Any other
securities shall be valued at "fair value."

         Valuation of certain assets at market value will be as follows. For
equity securities, the Accounting Services Provider will first use readily
available market quotations obtained from an approved pricing service and will
obtain direct written broker-dealer quotations if a security is not traded on an
exchange or quotations are not available from an approved pricing service. For
fixed income securities, the Accounting Services Provider will use readily
available market quotations based upon (a) the last updated sale price or a
service generated by a pricing matrix based upon yield data for securities with
similar characteristics or (b) by obtaining a direct written broker-dealer
quotation from a dealer who has made a market in the security. For options,
futures contracts and options of futures

                                       23
<PAGE>

contracts, the Accounting Services Provider will use readily available market
quotations. If no sales are reported on any exchange or OTC market, the
Accounting Services Provider will use the calculated mean based on bid and asked
prices obtained from the primary exchange or OTC market. Other assets will be
valued at market value pursuant to the Valuation Procedures.

         If the Accounting Services Provider cannot obtain a market value or the
Adviser determines that the value of a security as so obtained does not
represent a fair value as of the valuation time (due to a significant
development subsequent to the time its price is determined or otherwise), fair
value for the security shall be determined pursuant to methodologies established
by the Board of Directors. The Valuation Procedures provide that direct
placements of securities of private companies (i.e., companies with no
outstanding public securities) ordinarily will be valued at cost. The Valuation
Procedures provide that securities that are convertible into publicly traded
securities (i.e., convertible subordinated units) ordinarily will be valued at
the market value of the publicly traded security less a discount equal in amount
to the discount negotiated at the time of purchase. A report of any prices
determined pursuant to such methodologies will be presented to the Board of
Directors or a designated committee thereof for approval no less frequently than
quarterly.

         The Valuation Procedures also provide that the Adviser will review the
valuation of the obligation for income taxes separately for current taxes and
deferred taxes due to the differing impact of each on (i) the anticipated timing
of required tax payments and (ii) the impact of each on the treatment of
distributions by the Company to its shareholders.

         The allocation between current and deferred income taxes is determined
based upon the value of assets reported for book purposes compared to the
respective net tax bases of assets as recognized for federal income tax
purposes. It is anticipated that cash distributions from MLPs in which the
Company invests will not equal the amount of taxable income allocable to the
Company primarily due to depreciation and amortization recorded by MLPs which
generally results in a portion of the cash distribution received to not be
recognizable as income for tax purposes. The relative portion of such
distributions not recognized for tax purposes will vary among the MLPs, and will
also vary year by year for each MLP. The Adviser will be able to directly
confirm the portion of each distribution recognized as taxable income when it
receives annual tax reporting information from each MLP. The allocation between
current and deferred income taxes also impacts the determination of the
Company's earnings and profits, as described in Internal Revenue Code Section
312.

                                    LEVERAGE

         The Company may borrow money, issue preferred shares, or issue other
debt securities to the extent permitted by the 1940 Act. These practices are
known as leverage. The Company generally will not use leverage unless it
believes that leverage will serve the best interests of shareholders. The
principal, although not exclusive, factor used in making this determination will
be whether the potential return is likely to exceed the cost of leverage. The
Company also may borrow up to an additional 5% of its total assets (not
including the amount so borrowed) for temporary purposes, including the
settlement and clearance of securities transactions, which otherwise might
require untimely dispositions of portfolio holdings.

         Under the 1940 Act, the Company is not permitted to incur indebtedness
constituting senior securities unless immediately thereafter the Company has
total assets (including the proceeds of the indebtedness) at least equal to 300%
of the amount of the indebtedness. Stated another way, the Company may not
borrow for investment purposes more than 33 1/3% of its total assets, including
the amount borrowed. The Company also must maintain this 300% "asset coverage"
for as long as the indebtedness is outstanding. The 1940 Act provides that the
Company may not declare any cash dividend

                                       24
<PAGE>
or other distribution on its shares, or purchase any of its shares of capital
stock (through tender offers or otherwise), unless it would satisfy this 300%
asset coverage after deducting the amount of the dividend, other distribution or
share purchase price, as the case may be. If the asset coverage for indebtedness
declines to less than 300% as a result of market fluctuations or otherwise, the
Company may be required to sell a portion of its investments when it may be
disadvantageous to do so.

         The establishment of a borrowing facility by the Company would involve
expenses and other costs, including interest payments, which would be borne by
the Company's common shareholders. In addition, the terms of any borrowing or
other indebtedness issued by the Company may impose asset coverage requirements,
dividend limitations and voting right requirements on the Company that are more
stringent than those imposed under the 1940 Act. Such terms may also impose
special restrictions on the Company's portfolio composition or on its use of
various investment techniques or strategies or its ability to pay dividends on
Common Shares in some instances. The Company also may be required to pledge its
assets to lenders in connection with certain types of borrowings. Due to these
restrictions, the Company may be forced to liquidate investments at times or
prices that are not favorable to the Company, or the Company may be forced to
forgo investments that the Adviser otherwise views as favorable.


         Under the 1940 Act, the Company is not permitted to issue preferred
shares unless immediately after such issuance the net asset value of the
Company's portfolio is at least 200% of the liquidation value of the outstanding
preferred shares. Stated another way, the Company may not issue preferred shares
that have an aggregate liquidation value of more than 50% of its total assets,
including the amount leveraged. In addition, the Company is not permitted to
declare any cash dividend or other distribution on its Common Shares unless, at
the time of such declaration, the net asset value of the Company's portfolio
(determined after deducting the amount of such dividend or distribution) is at
least 200% of such liquidation value. In the event preferred shares are issued,
the Company may, as a result of market conditions or otherwise, be required to
purchase or redeem preferred shares, or sell a portion of its investments when
it may be disadvantageous to do so, in order maintain asset coverage of any
preferred shares of at least 200%. Common shareholders would bear the costs of a
preferred share offering which would include offering expenses and the ongoing
payment of dividends.

         The Company may, but is not required to, hedge general interest rate
exposure arising from its leverage transactions. Under current market
conditions, hedging would be accomplished principally by entering into interest
rate transactions. Interest rate transactions are hedging transactions such as
interest rate swaps and the purchase of interest rate caps and floors. Interest
rate swaps involve the exchange by the Company with another party of their
respective commitments to pay or receive interest (e.g., an exchange of floating
rate payments for fixed payments). The purchase of an interest rate cap entitles
the purchaser, to the extent that a specified index exceeds a predetermined
interest rate, to receive payments of interest on a notional principal amount
from the party selling such interest rate cap. The purchase of an interest rate
floor entitles the purchaser, to the extent that a specified index falls below a
predetermined interest rate, to receive payments of interest on a notional
principal amount from the party selling such interest rate floor. The Company
intends to use interest rate transactions solely for the purpose of hedging its
leveraged capital structure. The use of interest rate transactions is a highly
specialized activity that involves investment techniques and risks different
from those associated with ordinary portfolio security transactions.

EFFECTS OF LEVERAGE

         Assuming borrowings in the amount of 33 1/3% of the Company's total
assets (including the amount borrowed), and an average annual interest rate of
3% payable on such borrowing, the annual return that the Company's portfolio
must experience (net of expenses) in order to cover those interest payments
would be 1%.

                                       25
<PAGE>

                         DESCRIPTION OF PREFERRED SHARES

         The Company's Charter authorizes the Board of Directors to create
additional classes of stock. Preferred shares may be issued in one or more
classes or series, with such rights as determined by action of the Board of
Directors without the approval of the common shareholders.

         Although the terms of any preferred shares, including their dividend
rate, voting rights, liquidation preference and redemption provisions, will be
determined by the Board (subject to applicable law and the Charter) if and when
it authorizes a preferred shares offering, it is likely that any such preferred
shares would pay cumulative dividends for relatively short-term periods and
would provide for the periodic redetermination of the dividend rate through an
auction process or remarketing procedure. The liquidation preference, preference
on distribution, voting rights and redemption provisions of the preferred shares
would likely be as stated below.

         As used in this statement of additional information, unless otherwise
noted, the Company's "net assets" include assets of the Company attributable to
any outstanding Common Shares and preferred shares, with no deduction for the
liquidation preference of the preferred shares. Solely for financial reporting
purposes, however, the Company would be required to exclude the liquidation
preference of preferred shares from "net assets," so long as the preferred
shares have redemption features that are not solely within the control of the
Company. For all regulatory and tax purposes, the Company's preferred shares
will be treated as stock (rather than indebtedness).

         Limited Issuance of Preferred Shares. Under the 1940 Act, the Company
could issue preferred shares with an aggregate liquidation value of up to
one-half of the value of the Company's net assets, measured immediately after
issuance of the preferred shares.

         Distribution Preference. The preferred shares would have complete
priority over the Common Shares as to distribution of assets.

         Liquidation Preference. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the Company, holders of
preferred shares ("preferred shareholders") would be entitled to receive a
preferential liquidating distribution (expected to equal the original purchase
price per share plus accumulated and unpaid dividends thereon, whether or not
earned or declared) before any distribution of assets is made to holders of
Common Shares. After payment of the full amount of the liquidating distribution
to which they are entitled, preferred shareholders would not be entitled to any
further participation in any distribution of assets by the Company. A
consolidation or merger of the Company with or into any business trust or
corporation or a sale of all or substantially all of the assets of the Company
would not be deemed to be a liquidation, dissolution or winding up of the
Company.


         Voting Rights. In connection with any issuance of preferred shares, the
Company must comply with Section 18(i) of the 1940 Act, which requires, among
other things, that preferred shares be voting shares. Except as otherwise
provided in the Charter or the Company's Bylaws or otherwise required by
applicable law, preferred shareholders would vote together with common
shareholders as a single class.


         In connection with the election of the Company's directors, preferred
shareholders, voting as a separate class, would also be entitled to elect two of
the Company's directors, and the remaining directors would be elected by common
shareholders and preferred shareholders, voting together as a single class. In
addition, if at any time dividends on the Company's outstanding preferred shares
would be unpaid in an amount equal to two full years' dividends thereon, the
holders of all outstanding preferred shares, voting as a separate class, would
be entitled to elect a majority of the Company's directors until all dividends
in arrears have been paid or declared and set apart for payment.

                                       26

<PAGE>

         The affirmative vote of the holders of a majority (as such term is
defined in the 1940 Act) of the outstanding preferred shares, voting as a
separate class, would be required to approve any action requiring a vote of
security holders under Section 13(a) of the 1940 Act including, among other
things, changes in the investment limitations described as fundamental policies
under "Investment Limitations." The class or series vote of preferred
shareholders described above would in each case be in addition to any separate
vote of the requisite percentage of Common Shares and preferred shares necessary
to authorize the action in question.


         Holders of preferred shares would not be entitled to vote on matters
placed before shareholders if, at or prior to the time when a vote is required,
such shares shall have been (1) redeemed or (2) called for redemption and
sufficient funds shall have been deposited in trust to effect such redemption.


         The discussion above describes the terms related to a possible offering
of preferred shares. If the Board does determines to authorize an offering of
preferred shares, the terms thereof may be the same as, or different from, the
terms described above, subject to applicable law and the Charter and Bylaws.


                         U.S. FEDERAL INCOME TAX MATTERS

         Set forth below is a discussion of the material federal income tax
aspects concerning the Company and the purchase, ownership and disposition of
Common Shares. This discussion does not purport to be complete or to deal with
all aspects of federal income taxation that may be relevant to shareholders in
light of their particular circumstances or who are subject to special rules,
such as banks, thrift institutions and certain other financial institutions,
real estate investment trusts, regulated investment companies, insurance
companies, brokers and dealers in securities or currencies, certain securities
traders, tax-exempt investors, individual retirement accounts and certain
tax-deferred accounts, and foreign investors. Unless otherwise noted, this
discussion assumes that you are a U.S. person and hold your Common Shares as a
capital asset. This discussion is based on present provisions of the Internal
Revenue Code and the regulations promulgated thereunder and existing judicial
decisions and administrative pronouncements, all of which are subject to change
or differing interpretations (possibly with retroactive effect). Prospective
investors should consult their own tax advisers with regard to the federal
income tax consequences of the purchase, ownership or disposition of Common
Shares, as well as the tax consequences arising under the laws of any state,
locality, foreign country or other taxing jurisdiction.

TAXATION OF THE COMPANY

         The Company will be treated as a regular C corporation for federal and
state income tax purposes. The Company will compute and pay federal and state
income tax on its taxable income. Thus, the Company will be subject to federal
income tax on its taxable income at tax rates up to 35%. Additionally, in
certain instances the Company could be subject to the alternative minimum tax of
20% on its alternative minimum taxable income to the extent that the alternative
minimum tax exceeds its regular federal income tax.

         As indicated above, the Company intends to invest its assets primarily
in MLPs. MLPs generally are treated as partnerships for federal income tax
purposes. Since partnerships are generally not subject to federal income tax,
the partnership's partners must report their proportionate share of partnership
income. Thus, as a partner in MLPs, the Company will report its proportionate
share of the MLPs' income in computing its federal taxable income, irrespective
of whether any cash distributions are made by the MLP to the Company. The
Company will also take into account any other items of Company income, gain,
deduction or loss. The Company anticipates that these may include interest
income earned on the Company's investment in debt securities, deductions for
Company operating expenses and gain or loss recognized by the Company on the
sale of MLP interests or any other security.

                                       27

<PAGE>

         As explained further below, based upon the historic performance of
MLPs, the Company anticipates initially that its proportionate share of the
MLPs' taxable income will be significantly less than the amount of cash
distributions received by the Company from the MLPs. In such case, the Company
anticipates that it will not incur federal income tax on a significant portion
of its cash flow, particularly after taking into account the Company's current
operational expenses. If the MLPs' taxable income is a significantly greater
portion of the MLPs' cash distributions, the Company will incur additional
current federal income tax.

         The Company anticipates that each year it will turn over a certain
portion of its investment assets. The Company will recognize gain or loss on the
disposition of all or a portion of its interest in MLPs in an amount equal to
the difference between the sales price and the Company's basis in the MLP
interests sold. To the extent the Company receives MLP cash distributions in
excess of the taxable income reportable by the Company with respect to each
respective MLP interest, the Company's basis in the MLP interest will be reduced
and the Company's gain on the sale of an MLP interest likewise will be
increased.

         The Company will not be treated as a regulated investment company under
the federal income tax rules. The federal income tax rules generally provide
that a regulated investment company does not pay an entity level income tax,
provided that it distributes all or substantially all of its income. The
regulated investment company taxation rules have no application to the Company
or shareholders of the Company.

TAXATION OF THE SHAREHOLDERS

         Distributions. The Company expects to distribute to its common
shareholders an amount equal to 95% of the distributable cash flow ("DCF") on an
annual basis. The Company's distribution of its DCF will be treated as a
dividend-type distribution. A dividend-type distribution is treated as a taxable
dividend to the shareholder to the extent of the distributing corporation's
current or accumulated earnings and profits. If the distribution exceeds the
distributing corporation's current or accumulated earnings and profits, the
distribution is treated as a return of capital to the shareholder, to the extent
of the shareholder's basis in the Common Shares, and then as capital gain.

         Generally, a corporation's earnings and profits are computed based upon
taxable income, with certain specified adjustments, and reduced for
distributions made by the distributing corporation. As explained above, based
upon the historic performance of the MLPs, the Company annually anticipates that
the distributed cash from the MLPs will exceed the Company's proportionate share
of the MLP income and the Company's gain on its sale of MLP interests. Thus, the
Company anticipates that only a portion of its dividend-type distributions will
be treated as dividend income to its shareholders. To the extent of the excess
distribution, a shareholder's basis in the Common Shares will be reduced and, if
a shareholder has no further basis in its shares, a shareholder will report any
excess as capital gain.

         Thus, the taxable portion of the Company's dividend distributions will
be affected by (1) the proportion of the Company's share of MLP taxable income
to the Company's amount of MLP cash distributions and (2) the Company's annual
portfolio turnover rate. A higher percentage of MLP taxable income to MLP cash
distributions or a higher annual portfolio turnover rate will result in a
greater portion of the Company's dividend-type distributions being treated as
dividend income.

         The Jobs Growth and Tax Relief Reconciliation Act of 2003 (the "2003
Act") amended the federal income tax law generally to reduce the maximum federal
income tax rate on qualifying dividend income to the rate applicable to
long-term capital gains, which is generally fifteen percent. The portion of the
Company's dividend-type distributions treated as a dividend for federal income
tax purposes should be treated as a qualifying dividend for federal income tax
purposes. This rate of tax on dividends is currently scheduled to increase back
to ordinary income rates after December 31, 2008.

                                       28

<PAGE>

         If a shareholder participates in the Company's automatic dividend
reinvestment plan, such shareholder will be taxed upon the amount received as if
such amount is received by the participating shareholder and the participating
shareholder reinvested such amount in additional Company Common Stock.

         The Company will notify shareholders annually as to the federal income
tax status of Company distributions to them.

         Sale of Shares. Upon the sale of Common Shares, a shareholder generally
will recognize capital gain or loss measured by the difference between the sales
proceeds received and the shareholder's federal income tax basis of Common
Shares sold. Generally such capital gain or loss will be long-term capital gain
or loss if Common Shares were held as a capital asset for more than twelve
months.

         Backup Withholding. The Company generally is required to withhold and
remit to the U.S. Treasury 28% (except as noted below) of all distributions
(including Capital Gain Dividends) and redemption or repurchase proceeds
otherwise payable to any individual or certain other non-corporate shareholder
who fails to properly furnish the Company with a correct taxpayer identification
number. Withholding at that rate also is required from all distributions
otherwise payable to such a shareholder who has under-reported dividend or
interest income or who fails to certify to the Company that he or she is not
otherwise subject to that withholding (together with the withholding described
in the preceding sentence, "backup withholding"). The backup withholding rate
will increase to 31% for amounts paid after December 31, 2010, unless Congress
enacts tax legislation providing otherwise. Backup withholding is not an
additional tax, and any amounts withheld with respect to a shareholder may be
credited against the shareholder's federal income tax liability.

TAX CONSEQUENCES OF CERTAIN INVESTMENTS

         Federal Income Taxation of MLPs. MLPs are similar to corporations in
many respects, but differ in others, especially in the way they are taxed for
federal income tax purposes. A corporation is a distinct legal entity, separate
from its shareholders and employees and is treated as a separate entity for
federal income tax purposes as well. Like individual taxpayers, a corporation
must pay a federal income tax on its income. To the extent the corporation
distributes its income to its shareholders in the form of dividends, the
shareholders may pay federal income tax on the dividends they receive. For this
reason, it is said that corporate income is double-taxed, or taxed at two
levels.

         An MLP, as a partnership, is not considered to be a separate entity,
but is rather an aggregate of all the partners. An MLP is treated for federal
income tax purposes as a pass-through entity. No federal income tax is paid at
the partnership level. A partnership's income is considered earned by all the
partners; it is allocated among all the partners in proportion to their
interests in the partnership, and each partner pays tax on his or her share of
the partnership income. All the other items that go into determining taxable
income and tax owed are passed through to the partners as well - capital gains
and losses, deductions, credits, etc. Partnership income is thus said to be
single-taxed or taxed only at one level - that of the individual partner.

         The Internal Revenue Code generally requires all publicly-traded
partnerships to be treated as a corporation for federal income tax purposes.
However, if the publicly-traded partnership satisfies certain requirements, the
publicly-traded partnership will be taxed as partnership for federal income tax
purposes, referred to herein as an MLP. Under these requirements, an MLP must
receive 90 percent of its income from specified sources as qualifying income.

         Qualifying income for MLPs includes interest, dividends, real estate
rents, gain from the sale or disposition of real property, income and gain from
commodities or commodity futures, and income and

                                       29

<PAGE>

gain from mineral or natural resources activities. Mineral or natural resources
activities include exploration, development, production, mining, refining
(including fertilizers), marketing and transportation (including pipelines), of
oil and gas, minerals, geothermal energy, or timber. This means that most MLPs
today are in energy, timber, or real estate related (including mortgage
securities) businesses.

         Because the MLP itself does not pay tax, its income or loss is
allocated to its investors, irrespective of whether the investors receive any
cash payment from the MLP. MLPs generally make quarterly cash distributions.
Although they resemble corporate dividends, MLP distributions are treated
differently. The MLP distribution is treated as a return of capital to the
extent of the investor's basis in his MLP interest and, to the extent the
distribution exceeds the investor's basis in the MLP, capital gain. The
investor's original basis is the price paid for the units. The basis is adjusted
downwards with each distribution and allocation of deductions (such as
depreciation) and losses, and upwards with each allocation of income.

         It is important to note that an MLP investor is taxed on his share of
partnership income whether or not he actually receives any cash from the
partnership. The tax is based not on money he actually receives, but his
proportionate share of what the partnership earns. However, most MLPs make it a
policy to make quarterly distributions to their partners that will comfortably
exceed any tax owed.

         When the units are sold, the difference between the sales price and the
investor's adjusted basis equals taxable gain. The partner will not be taxed on
distributions until (1) he sells his MLP units and pays tax on his gain, which
gain is increased due to the basis decrease due to prior distributions; or (2)
his basis reaches zero.

         At tax filing season an MLP investor will receive a K-1 form showing
his share of each item of partnership income, gain, loss, deductions and
credits. He will use that information to figure his taxable partnership income
(MLPs provide their investors with material that walks them through all the
steps). If the result is net income, the partner pays tax on it at his
individual tax rate. If the result is a net loss, it is considered a "passive
loss" under the tax code and generally may not be used to offset income from
other sources, but must be carried forward.

         Because the Company is a corporation, the Company, and not its
shareholders, will report the income or loss of the MLPs. Thus, the Company's
shareholders will not have to deal with any K-1 reporting by the MLP.
Shareholders, instead, will receive a Form 1099 from the Company. In addition,
due to the Company's anticipated broad public ownership, the Company will not be
subject to the passive activity loss limitation rules mentioned in the preceding
paragraph.

                               PROXY VOTING POLICY

         The Company and the Advisor have adopted Proxy Voting Policies and
Procedures ("Proxy Policy"), which they believe are reasonably designed to
ensure that proxies are voted in the best interests of the Company and its
shareholders. Subject to the oversight of the Board of Directors, the Board has
delegated responsibility for implementing the Proxy Policy to the Adviser.
Because of the unique nature of MLPs in which the Company primarily invests, the
Adviser shall evaluate each proxy on a case-by-case basis. Because proxies of
MLPs are expected to relate only to extraordinary measures, the Company does not
believe it is prudent to adopt pre-established voting guidelines.

         In the event requests for proxies are received with respect to the
voting of equity securities other than MLP equity units, on routine matters,
such as election of directors or approval of auditors, the proxies usually will
be voted with management unless the Adviser determines it has a conflict or the

                                       30

<PAGE>

Adviser determines there are other reasons not to vote with management. On
non-routine matters, such as amendments to governing instruments, proposals
relating to compensation and stock option and equity compensation plans,
corporate governance proposals and shareholder proposals, the Adviser will vote,
or abstain from voting if deemed appropriate, on a case by case basis in a
manner it believes to be in the best economic interest of the Company's
shareholders. In the event requests for proxies are received with respect to
debt securities, the Adviser will vote on a case by case basis in a manner it
believes to be in the best economic interest of the Company's shareholders.


         The Chief Executive Officer is responsible for monitoring Company
actions and ensuring that (i) proxies are received and forwarded to the
appropriate decision makers; and (ii) proxies are voted in a timely manner upon
receipt of voting instructions. The Company is not responsible for voting
proxies it does not receive, but will make reasonable efforts to obtain missing
proxies. The Chief Executive Officer shall implement procedures to identify and
monitor potential conflicts of interest that could affect the proxy voting
process, including (i) significant client relationships; (ii) other potential
material business relationships; and (iii) material personal and family
relationships. All decisions regarding proxy voting shall be determined by the
Investment Committee of the Adviser and shall be executed by the Chief Executive
Officer. Every effort shall be made to consult with the portfolio manager and/or
analyst covering the security. The Company may determine not to vote a
particular proxy, if the costs and burdens exceed the benefits of voting (e.g.,
when securities are subject to loan or to share blocking restrictions).

         If a request for proxy presents a conflict of interest between the
Company's shareholders on one hand, and the Adviser, the principal underwriters,
or any affiliated persons of the Company, Company management may (i) disclose
the potential conflict to the Board of Directors and obtain consent; or (ii)
establish an ethical wall or other informational barrier between the persons
involved in the conflict and the persons making the voting decisions.

                             INDEPENDENT ACCOUNTANTS

         Ernst & Young, LLP will serve as independent public accountants for the
Company. Ernst & Young, LLP will provide audit services, tax return preparation
and assistance and consultation in connection with review of the Company's
filings with the Commission.

                             ADDITIONAL INFORMATION

         A Registration Statement on Form N-2, including amendments thereto,
relating to the Common Shares offered hereby, has been filed by the Company with
the Commission. The prospectus and this statement of additional information do
not contain all of the information set forth in the Registration Statement,
including any exhibits and schedules thereto. For further information with
respect to the Company and the shares offered hereby, reference is made to the
Registration Statement. Statements contained in the prospectus and this
statement of additional information as to the contents of any contract or other
document referred to are not necessarily complete and in each instance reference
is made to the copy of such contract or other document filed as an exhibit to
the Registration Statement, each such statement being qualified in all respects
by such reference. A copy of the Registration Statement may be inspected without
charge at the Commission's principal office in Washington, D.C., and copies of
all or any part thereof may be obtained from the Commission upon the payment of
certain fees prescribed by the Commission.

                                       31

<PAGE>


                         Report of Independent Auditors




The Shareholders and Board of Directors
Tortoise Energy Infrastructure Corporation



We have audited the accompanying statement of assets and liabilities of Tortoise
Energy Infrastructure Corporation (referred to herein as "the Company") as of
February 6, 2004, and the related statement of operations for the period from
October 29, 2003 (date of organization) through February 6, 2004. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.



We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of cash as of February 6, 2004, by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.



In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company at February 6,
2004, and the results of its operations from October 29, 2003 to February 6,
2004 in conformity with accounting principles generally accepted in the United
States.



                                                     /s/ Ernst & Young LLP



Kansas City, Missouri
February 13, 2004




                                       32
<PAGE>


                              FINANCIAL STATEMENTS



                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION

                       STATEMENT OF ASSETS AND LIABILITIES

                                FEBRUARY 6, 2004



<Table>
<S>                                                                <C>
ASSETS:
Cash .........................................................     $ 550,250
Deferred Offering Costs ......................................       386,649
                                                                   ---------
   TOTAL ASSETS ..............................................       936,899

LIABILITIES:
Accrued Offering Costs .......................................       386,649
Payable to Adviser ...........................................        31,967
Payable for Organization Costs ...............................       134,379
Payable to Transfer Agent ....................................           400
                                                                   ---------
   TOTAL LIABILITIES .........................................       553,395
                                                                   ---------

NET ASSETS APPLICABLE TO COMMON SHARES .......................     $ 383,504
                                                                   =========

NET ASSETS APPLICABLE TO COMMON SHARES REPRESENT:
Common Shares, $.001 par value; 100,000,000 shares authorized,
23,047 shares outstanding ....................................     $      23
Additional Paid-In Capital ...................................       550,227
Retained Deficit .............................................      (166,746)
                                                                   ---------
   TOTAL .....................................................     $ 383,504
                                                                   =========

NET ASSET VALUE PER COMMON SHARE OUTSTANDING ($383,504 divided
by 23,047 common shares outstanding) .........................     $   16.64
                                                                   =========
</Table>



    The accompanying notes are an integral part of the financial statements.

                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION

                             STATEMENT OF OPERATIONS

  PERIOD FROM OCTOBER 29, 2003 (DATE OF ORGANIZATION) THROUGH FEBRUARY 6, 2004



<Table>
<S>                                                                <C>
INVESTMENT INCOME ............................................     $      --
                                                                   ---------

EXPENSES:

Organization Costs ...........................................     $ 166,346
Transfer Agent Fees ..........................................           400
                                                                   ---------
TOTAL EXPENSES ...............................................       166,746
                                                                   ---------

NET INVESTMENT LOSS BEFORE TAXES .............................      (166,746)
                                                                   ---------

INCOME TAXES .................................................            --
                                                                   ---------

NET INVESTMENT LOSS ..........................................     $(166,746)
                                                                   =========
</Table>



    The accompanying notes are an integral part of the financial statements.



                                      F-1

<PAGE>



                   TORTOISE ENERGY INFRASTRUCTURE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

                                FEBRUARY 6, 2004



1.       Organization



Tortoise Energy Infrastructure Corporation (the "Company") was organized as a
Maryland corporation on October 29, 2003, and is a non-diversified, closed-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"). The Company has had no operations other than the sale
of 23,047 shares to the aggregate Subscribers for $550,250 on January 22, 2004.
The Company is planning a public offering of its common stock as soon as
practicable after the effective date of its registration statement.



2.       Significant Accounting Policies



The following is a listing of the significant accounting policies that the
Company will implement upon the commencement of its operations:



A. Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amount of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements. Actual results could differ from those
estimates.



B. Investment Valuation - The Company intends to own securities that are listed
on a securities exchange. The Company will value those securities at their last
sale price on that exchange on the valuation date. If the security is listed on
more than one exchange, the Company will use the price of that exchange that it
generally considers to be the principal exchange on which the stock is traded.
Securities listed on the NASDAQ Stock Market, Inc. ("NASDAQ") will be valued at
the NASDAQ Official Closing Price, which may not necessarily represent the last
sale price. If there has been no sale on such exchange or NASDAQ on such day,
the security will be valued at the mean between the bid and ask price on such
day.



The Company may invest up to 30% of its total assets in direct private placement
securities. Direct private placement securities are subject to statutory and
contractual restrictions on their public resale, which may make it more
difficult to obtain a valuation and may limit the Company's ability to dispose
of them. Investments in private placement securities and other securities for
which market quotations are not readily available will be valued in good faith
by using fair value procedures approved by the Board of Directors. Such fair
value procedures consider factors such as securities with similar yields,
quality, type of issue, coupon, duration and rating.



The Company generally will value short-term debt securities at prices based on
market quotations for such securities, except those securities purchased with 60
days or less to maturity are valued on the basis of amortized cost, which
approximates market value. If events occur that will affect the value of the
Company's portfolio securities before the net asset value has been calculated (a
"significant event"), the portfolio securities so affected will generally be
priced using a fair value procedure.



C. Security Transaction and Investment Income - Security transactions will be
accounted for on the date the securities are purchased or sold (trade date).
Realized gains and losses will be reported on an identified cost basis. Dividend
and distribution income will be recorded on the ex-dividend date. Interest
income will be recognized on the accrual basis, including amortization of
premiums and accretion of discounts.



D. Distributions to Shareholders - Distributions to shareholders will be
recorded on the ex-dividend date. The character of distributions made during the
year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes.




                                      F-2

<PAGE>


E. Federal Income Taxation - The Company is treated as a corporation for federal
and state income tax purposes. Thus, the Company will be obligated to pay
federal and state income tax on its taxable income. The Company intends to
invest its assets primarily in Master Limited Partnerships ("MLPs"), which
generally are treated as partnerships for federal income tax purposes. As a
partner in the MLPs, the Company will report its allocable share of the MLP's
taxable income in computing its own taxable income. The Company's tax expense or
benefit will be included in the Statement of Operations based on the component
of income or gains (losses) to which such expense or benefit relates. Deferred
income taxes reflect the net tax effects of temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and
the amounts used for income tax purposes. A valuation allowance is recognized
if, based on the weight of available evidence, it is more likely than not that
some portion or all of the deferred income tax asset will not be realized.
Future realization of deferred income tax assets ultimately depends on the
existence of sufficient taxable income of the appropriate character in either
the carryback or carryforward period under the tax law.

F. Organization Expenses and Offering Costs - The Company is responsible for
paying all organization and offering expenses. Offering costs paid by the
Company will be charged as a reduction of paid-in capital at the completion of
the Company's initial public offering. Organization costs are expensed as
incurred, and are reported in the accompanying statement of operations.

3.       Concentration of Risk

The Company's investment objective is to seek a high level of total return with
an emphasis on current distributions paid to its shareholders. Under normal
circumstances, the Company intends to invest at least 90% of its total assets in
securities of energy infrastructure companies, and will invest at least 70% of
its total assets in equity securities of MLPs. The Company may invest up to 25%
of its assets in debt securities, which may include below investment grade
securities. The Company may, for defensive purposes, temporarily invest all or a
significant portion of its assets in investment grade securities, short-term
debt securities and cash or cash equivalents. To the extent the Company uses
this strategy, it may not achieve its investment objectives.

4.       Agreements

The Company has entered into an Investment Advisory Agreement with Tortoise
Capital Advisors, LLC (the "Adviser"). Under the terms of the agreement, the
Company will pay the Adviser a fee equal to an annual rate of 0.95% of the
Company's average monthly total assets (including any assets attributable to
leverage) minus the sum of accrued liabilities other than deferred income taxes,
debt entered into for purposes of leverage and the aggregate liquidation
preference of outstanding preferred shares, if any, ("Managed Assets") in
exchange for the investment advisory services provided. For the period following
the commencement of the Company's operations through January 31, 2006, the
Adviser has agreed to waive or reimburse the Company for fees and expenses in an
amount equal to 0.23% of the average monthly Managed Assets of the Company. For
years ending January 31, 2007, 2008 and 2009, the Adviser has agreed to waive or
reimburse the Company for fees and expenses in an amount equal to 0.10% of the
average monthly Managed Assets of the Company.

As of February 6, 2004, the Company owes the Adviser $31,967 for costs incurred
in connection with the registration statement and organization of the Company.
This amount is payable to the Adviser upon the closing date of the public
offering.

The Company has engaged U.S. Bancorp Fund Services, LLC to serve as the
Company's administrator. The Company will pay the administrator a monthly fee
computed at an annual rate of 0.07% of the first $300 million of the Company's
Managed Assets, 0.06% on the next $500 million of Managed Assets and 0.04% on
the balance of the Company's Managed Assets, subject to a minimum annual fee of
$45,000.

Computershare Investor Services, LLC will serve as the Company's transfer agent,
dividend paying agent, and agent for the automatic dividend reinvestment plan.

U.S. Bank N.A. will serve as the Company's custodian. The Company will pay the
custodian a monthly fee computed at an annual rate of 0.015% on the first $100
million of the Company's Managed Assets and 0.01% on the balance of the
Company's Managed Assets, subject to a minimum annual fee of $4,800.




                                      F-2
<PAGE>


5.       Income Taxes

As of February 6, 2004, the Company has a deferred income tax asset in the
amount of approximately $61,000 related to organization costs incurred by the
Company, which cannot be deducted for income tax purposes. However, the Company
has an equal and offsetting valuation allowance against its deferred income tax
asset, since the Company has not developed a history of taxable income, based on
available evidence.



                                      F-3
<PAGE>

                       APPENDIX A -- RATING OF INVESTMENTS

COMMERCIAL PAPER RATINGS

         An S&P commercial paper rating is a current assessment of the
likelihood of timely payment of debt considered short-term in the relevant
market. The following summarizes the rating categories used by S &P's for
commercial paper:

         "A-1" - Issue's degree of safety regarding timely payment is strong.
Those issues determined to possess extremely strong safety characteristics are
denoted "A-1+."

         "A-2" - Issue's capacity for timely payment is satisfactory. However,
the relative degree of safety is not as high as for issues designated "A-1."

         "A-3" - Issue has an adequate capacity for timely payment. It is,
however, somewhat more vulnerable to the adverse effects of changes in
circumstances than an obligation carrying a higher designation.

         "B" - Issue has only a speculative capacity for timely payment.

         "C" - Issue has a doubtful capacity for payment.

         "D" - Issue is in payment default.

         Moody's commercial paper ratings are opinions of the ability of issuers
to repay punctually promissory obligations not having an original maturity in
excess of 9 months. The following summarizes the rating categories used by
Moody's for commercial paper:

         "Prime-1" - Issuer or related supporting institutions are considered to
have a superior capacity for repayment of short-term promissory obligations.
Prime-1 repayment capacity will normally be evidenced by the following
characteristics: leading market positions in well established industries; high
rates of return on funds employed; conservative capitalization structures with
moderate reliance on debt and ample asset protection; broad margins in earning
coverage of fixed financial charges and high internal cash generation; and well
established access to a range of financial markets and assured sources of
alternate liquidity.

         "Prime-2" - Issuer or related supporting institutions are considered to
have a strong capacity for repayment of short-term promissory obligations. This
will normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternative liquidity is
maintained.

         "Prime-3" - Issuer or related supporting institutions have an
acceptable capacity for repayment of short-term promissory obligations. The
effects of industry characteristics and market composition may be more
pronounced.

         Variability in earnings and profitability may result in changes in the
level of debt protection measurements and the requirement for relatively high
financial leverage. Adequate alternate liquidity is maintained.

         "Not Prime" - Issuer does not fall within any of the Prime rating
categories.


                                      A-1

<PAGE>

CORPORATE AND MUNICIPAL LONG-TERM DEBT RATINGS

         The following summarizes the ratings used by S&P for corporate and
municipal debt:

         "AAA" - This designation represents the highest rating assigned by S&P
to a debt obligation and indicates an extremely strong capacity to pay interest
and repay principal.

         "AA" - Debt is considered to have a very strong capacity to pay
interest and repay principal and differs from AAA issues only in small degree.

         "A" - Debt is considered to have a strong capacity to pay interest and
repay principal although such issues are somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than debt in
higher-rated categories.

         "BBB" - Debt is regarded as having an adequate capacity to pay interest
and repay principal. Whereas such issues normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher-rated categories.

         "BB," "B," "CCC," "CC" and "C" - Debt is regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. "BB" indicates the
lowest degree of speculation and "C" the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.

         "BB" - Debt has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or exposure to
adverse business, financial or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. The "BB"
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied "BBB-" rating.

         "B" - Debt has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial or economic conditions will likely impair capacity or willingness to
pay interest and repay principal. The "B" rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied "BB" or "BB-"
rating.

         "CCC" - Debt has a currently identifiable vulnerability to default, and
is dependent upon favorable business, financial and economic conditions to meet
timely payment of interest and repayment of principal. In the event of adverse
business, financial or economic conditions, it is not likely to have the
capacity to pay interest and repay principal. The "CCC" rating category is also
used for debt subordinated to senior debt that is assigned an actual or implied
"B" or "B-" rating.

         "CC" - This rating is typically applied to debt subordinated to senior
debt that is assigned an actual or implied "CCC" rating.

         "C" - This rating is typically applied to debt subordinated to senior
debt that is assigned an actual or implied "CCC-" debt rating. The "C" rating
may be used to cover a situation where a bankruptcy petition has been filed, but
debt service payments are continued "CI." This rating is reserved for income
bonds on which no interest is being paid.


                                      A-2

<PAGE>

         "D" - Debt is in payment default. This rating is used when interest
payments or principal payments are not made on the date due, even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. "D" rating is also used upon the filing
of a bankruptcy petition if debt service payments are jeopardized.

         PLUS (+) OR MINUS (-) - The ratings from "AA" through "CCC" may be
modified by the addition of a plus or minus sign to show relative standing
within the major rating categories.

         "r" - This rating is attached to highlight derivative, hybrid, and
certain other obligations that S&P believes may experience high volatility or
high variability in expected returns due to non-credit risks. Examples of such
obligations are: securities whose principal or interest return is indexed to
equities, commodities, or currencies; certain swaps and options; and interest
only and principal only mortgage securities. The absence of an "r" symbol should
not be taken as an indication that an obligation will exhibit no volatility or
variability in total return.

         The following summarizes the ratings used by Moody's for corporate and
municipal long-term debt:

         "Aaa" - Bonds are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt
edged." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.

         "Aa" - Bonds are judged to be of high quality by all standards.
Together with the "Aaa" group, they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than in "Aaa"
securities.

         "A" - Bonds possess many favorable investment attributes and are to be
considered as upper medium-grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.

         "Baa" - Bonds considered medium-grade obligations, I.E., they are
neither highly protected nor poorly secured. Interest payments and principal
security appear adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great length of time.
Such bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.

         "Ba," "B," "Caa," "Ca," and "C" - Bonds that possess one of these
ratings provide questionable protection of interest and principal ("Ba"
indicates some speculative elements; "B" indicates a general lack of
characteristics of desirable investment; "Caa" represents a poor standing; "Ca"
represents obligations which are speculative in a high degree; and "C"
represents the lowest rated class of bonds). "Caa," "Ca" and "C" bonds may be in
default.

         Con. (---) - Bonds for which the security depends upon the completion
of some act or the fulfillment of some condition are rated conditionally. These
are bonds secured by (1) earnings of projects under construction, (2) earnings
of projects unseasoned in operation experience, (3) rentals which begin when
facilities are completed, or (4) payments to which some other limiting condition
attaches. Parenthetical rating denotes probable credit stature upon completion
of construction or elimination of basis of condition.


                                      A-3

<PAGE>


         (P) - When applied to forward delivery bonds, indicates that the rating
is provisional pending delivery of the bonds. The rating may be revised prior to
delivery if changes occur in the legal documents or the underlying credit
quality of the bonds.

         Note: Those bonds in the Aa, A, Baa, Ba and B groups which Moody's
believes possess the strongest investment attributes are designated by the
symbols, Aa1, A1, Ba1 and B1.

                                      A-4
<PAGE>
                           PART C - OTHER INFORMATION

ITEM 24: FINANCIAL STATEMENTS AND EXHIBITS

         1. Financial Statements:


         The Registrant's financial statements dated February 6, 2004, notes
to the financial statements and report of independent public auditors thereon
are filed herein and appear in the statement of additional information.


         2. Exhibits:


<Table>
<S>                 <C>
            a.1.    Articles of Incorporation. (***)
            a.2.    Articles of Amendment and Restatement (**)
            b.1.    Bylaws. (***)
            b.2.    Amended and Restated ByLaws (**)
            c.      None.
            d.      Form of Common Share Certificate. (**)
            e.      Form of Terms and Conditions of the Dividend Reinvestment
                    Plan. (**)
            f.      Not applicable.
            g.1.    Form of Investment Advisory Agreement with Tortoise Capital
                    Advisors, L.L.C., (**)
            g.2.    Form of Reimbursement Agreement (**)
            h.1.    Form of Underwriting Agreement. (*)
            h.2.    Form of Master Agreement Among Underwriters. (*)
            h.3.    Form of Master Selected Dealers Agreement (*)
            i.      None.
            j.      Form of Custody Agreement. (**)
            k.1     Form of Stock Transfer Agency Agreement. (**)
            k.2     Form of Administration Agreement. (**)
            k.3     Form of Fund Accounting Agreement (**)
            l.      Opinion of Venable LLP  (*)
            m.      Not applicable.
            n.1.    Opinion of Blackwell Sanders Peper Martin, L.L.P. related to
                    Tax Matters(*)
            n.2.    Opinion of Blackwell Sanders Peper Martin, L.L.P. related to
                    UBTI Tax Matters(*)
            n.3.    Consent of Auditors(*)
            o.      Not applicable.
            p.      Subscription Agreement. (**)
            q.      None.
            r.      Code of Ethics for the Registrant and the Adviser. (**)
            s.      Powers of Attorney. (**)
</Table>


(*)     Filed herewith.


(**)    Incorporated by reference to Pre-Effective Amendment No. 1 to
        Registrant's Registration Statement on Form N-2, filed on January 30,
        2004 (File Nos. 333-110143 and 811-21462).


(***)   Incorporated by reference to Registrant's Registration Statement on Form
        N-2, filed on October 31, 2003 (File Nos. 333-110143 and 811-21462).

ITEM 25: MARKETING ARRANGEMENTS


         See the form of Underwriting Agreement filed herewith as Exhibit
2.h.(1) of this Registration Statement.




<PAGE>

ITEM 26: OTHER EXPENSES AND DISTRIBUTION

         The following table sets forth the estimated expenses to be incurred in
connection with the offering described in this Registration Statement:


<Table>
<S>                                                        <C>
Registration Fees.......................................   $ 36,000
NYSE Listing Fees.......................................     95,000
Directors' Fees and Expenses............................      6,000
Printing (other than certificates)......................    100,000
Accounting Fees and Expenses............................      7,000
Legal Fees and Expenses.................................    500,000
NASD Fee................................................     26,000
Miscellaneous...........................................     30,000
                                                           --------
   Total................................................   $800,000
                                                           ========
</Table>


ITEM 27. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL

         None.

ITEM 28. NUMBER OF HOLDERS OF SECURITIES


         As of February 19, 2004, the number or record holders of each class of
securities of the Registrant was



<Table>
<Caption>
               TITLE OF CLASS                   NUMBER OF RECORD HOLDERS
-----------------------------------------       ------------------------
<S>                                             <C>
Common Shares (no par value).............                  11
</Table>


ITEM 29. INDEMNIFICATION


         Maryland law permits a Maryland corporation to include in its charter
a provision limiting the liability of its directors and officers to the
corporation and its stockholders for money damages except for liability
resulting from (a) actual receipt of an improper benefit or profit in money,
property or services or (b) active and deliberate dishonesty which is
established by a final judgement as being material to the cause of action. The
Registrant's charter contains such a provision which eliminates directors' and
officers' liability to the maximum extent permitted by Maryland law.



         The Registrant's charter authorizes it, to the maximum extent
permitted by Maryland law and the Investment Company Act of 1940, as amended
(the "1940 Act"), to indemnify any present or former director or officer or any
individual who, while a director of the Registrant and at the request of the
Registrant, serves or has served another corporation, real estate investment
trust, partnership, joint venture, trust, employee benefit plan or other
enterprise as a director, officer, partner or trustee, from and against any
claim or liability to which that person may become subject or which that person
may incur by reason of his or her status as a present or former director or
officer of the Registrant and to pay or reimburse his or her reasonable
expenses in advance of final disposition of a proceeding. The Registrant's
Bylaws obligate it, to the maximum extent permitted by Maryland law and the
1940 Act, to indemnify any present or former director or officer or any
individual who, while a director of the Registrant and at the request of the
Registrant, serves or has served another corporation, real estate investment
trust, partnership, joint venture, trust, employee benefit plan or other
enterprise as a director, officer, partner or trustee and who is made a party
to the proceeding by reason of his service in that capacity from and against
any claim or liability to which that person may become subject or which that
person may incur by reason of his or her status as a present or former director
or officer of the Registrant and to pay or reimburse his or her reasonable
expenses in advance of final disposition of a proceeding. The charter and
Bylaws also permit the Registrant to indemnify and advance expenses to any
person who served a predecessor of the Registrant in any of the capacities
described above and any employee or agent of the Registrant or a predecessor of
the Registrant.



         Maryland law requires a corporation (unless its charter provides
otherwise, which the Registrant's charter does not) to indemnify a director or
officer who has been successful in the defense of any proceeding to which he is
made a party by reason of his service in that capacity. Maryland law permits a
corporation to indemnify its present and former directors and officers, among
others, against judgements, penalties, fines, settlements and reasonable
expenses actually incurred by them in connection with any proceeding to which
they may be made a party by reason of their service in those or other
capacities unless it is established that (a) the act or omission of the
director or officer was material to the matter giving rise to the proceeding
and (i) was committed in bad faith or (ii) was the result of active and
deliberate dishonesty, (b) the director or officer actually received an
improper personal benefit in money, property or services or (c) in the case of
any criminal proceeding, the director or officer had reasonable cause to
believe that the act or omission was unlawful. However, under Maryland law, a
Maryland corporation may not indemnify for an adverse judgement in a suit by or
in the right of the corporation or for a judgement of liability on the basis
that personal benefit was improperly received, unless in either case a court
orders indemnification and then only for expenses. In addition, Maryland law
permits a corporation to advance reasonable expenses to a director or officer
upon the corporation's receipt of (a) a written affirmation by the director or
officer of his good faith belief that he has met the standard of conduct
necessary for indemnification by the corporation and (b) a written undertaking
by him or on his behalf to repay the amount paid or reimbursed by the
corporation if it is ultimately determined that the standard of conduct was not
met.



The provisions set forth above apply insofar as they are consistent with Section
17(h) of the 1940 Act, which prohibits indemnification of any director or
officer of the Registrant against any liability to the Registrant or its
shareholders to which such director or officer otherwise would be subject by
reason of willful



<PAGE>

misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office.

Insofar as indemnification for liabilities arising under the Securities Act of
1933, as amended ("1933 Act"), may be provided to directors, officers and
controlling persons of the Registrant, pursuant to the foregoing provisions or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the 1933 Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in connection with the successful defense
of any action, suit or proceeding or payment pursuant to any insurance policy)
is asserted against the Registrant by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the 1933 Act
and will be governed by the final adjudication of such issue.

ITEM 30. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

         The information in the Statement of Additional Information under the
caption "Management of the Company--Directors and Officers" is hereby
incorporated by reference.

ITEM 31. LOCATION OF ACCOUNTS AND RECORDS


         All such accounts, books, and other documents are maintained at the
offices of the Registrant, at the offices of the Registrant's investment
adviser, Tortoise Capital Advisors, L.L.C., 10801 Mastin Boulevard, Suite 222,
Overland Park, Kansas 66210, at the offices of the custodian, U.S. Bank National
Association, 425 Walnut Street, M.L. CN-OH-W6TC, Cincinnati, Ohio 45202, at
the offices of the transfer agent, Computershare Investor Services, LLC, Two
North LaSalle Street, Chicago, Illinois 60602, or at the officers of the
administrator, U.S. Bancorp Fund Services, LLC, 615 East Michigan Street,
Milwaukee, WI 53202.


ITEM 32. MANAGEMENT SERVICES

         Not applicable.

ITEM 33. UNDERTAKINGS

         1. The Registrant undertakes to suspend the offering of shares until
the prospectus is amended if (1) subsequent to the effective date of its
registration statement, the net asset value declines more than ten percent from
its net asset value as of the effective date of the registration statement or
(2) the net asset value increases to an amount greater than its net proceeds as
stated in the prospectus.

         2. Not applicable.

         3. Not applicable.

         4. Not applicable.

         5. (a) For the purposes of determining any liability under the 1933
Act, the information omitted from the form of prospectus filed as part of a
registration statement in reliance upon Rule 430A and contained in the form of
prospectus filed by the Registrant under Rule 497(h) under the 1933 Act shall be
deemed to be part of the Registration Statement as of the time it was declared
effective.


<PAGE>

                  (b) For the purpose of determining any liability under the
1933 Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of the securities at that time shall be deemed to be
the initial bona fide offering thereof.

         6. The Registrant undertakes to send by first class mail or other means
designed to ensure equally prominent delivery within two business days of
receipt of a written or oral request the Registrant's statement of additional
information.


<PAGE>


                                   SIGNATURES


         Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in this City of Overland Park and State of Kansas, on the 19th day
of February, 2004.


                                      Tortoise Energy Infrastructure Corporation

                                      By: /s/ David J. Schulte
                                          --------------------------------------
                                          David J. Schulte, President

         Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.


<Table>
<Caption>
<S>                                        <C>                                            <C>
/s/ Terry C. Matlack*                      Director and Treasurer (Principal
------------------------------------       Financial and Accounting Officer)
Terry C. Matlack                                                                          February 19, 2004

/s/ Conrad S. Ciccotello*                              Director
------------------------------------
Conrad S. Ciccotello                                                                      February 19, 2004

/s/ John R. Graham*                                    Director
------------------------------------
John R. Graham                                                                            February 19, 2004

/s/ Charles E. Heath*                                  Director
------------------------------------
Charles E. Heath                                                                          February 19, 2004

/s/ H. Kevin Birzer*                                   Director
------------------------------------
H. Kevin Birzer                                                                           February 19, 2004

/s/ David J. Schulte                     President and Chief Executive Officer
------------------------------------          (Principal Executive Officer)
David J. Schulte                                                                          February 19, 2004
</Table>



* By David J. Schulte pursuant to power of attorney, filed on January 30, 2004
in connection with Pre-Effective Amendment No. 1 to Registration Statement and
is hereby incorporated by reference.


<PAGE>
                                  EXHIBIT INDEX


<Table>
<Caption>
  EXHIBIT       DOCUMENT
  -------       --------
<S>             <C>
     a.1.       Articles of Incorporation. (***)
     a.2.       Articles of Amendment and Restatement (**)
     b.1.       Bylaws. (***)
     b.2.       Amended and Restated Bylaws (**)
     c.         None.
     d.         Form of Common Share Certificate. (**)
     e.         Form of Terms and Conditions of the Dividend Reinvestment Plan. (**)
     f.         Not applicable.
     g.1.       Form of Investment Advisory Agreement with Tortoise Capital Advisors, L.L.C., (**)
     g.2.       Form of Reimbursement Agreement (**)
     h.1.       Form of Underwriting Agreement. (*)
     h.2.       Form of Master Agreement Among Underwriters. (*)
     h.3.       Form of Master Selected Dealers Agreement (*)
     i.         None.
     j.         Form of Custody Agreement. (**)
     k.1        Form of Stock Transfer Agency Agreement. (**)
     k.2        Form of Administration Agreement. (**)
     k.3        Form of Fund Accounting Agreement (**)
     l.         Opinion of Venable LLP  (*)
     m.         Not applicable.
     n.1.       Opinion of Blackwell Sanders Peper Martin, L.L.P. related to Tax Matters(*)
     n.2.       Opinion of Blackwell Sanders Peper Martin, L.L.P. related to UBTI Tax Matters(*)
     n.3        Consent of Auditors (*)
     o.         Not applicable.
     p.         Subscription Agreement. (**)
     q.         None.
     r.         Code of Ethics for the Registrant and the Adviser. (**)
     s.         Powers of Attorney. (**)
</Table>


(*)     Filed herewith.


(**)    Incorporated by reference to Pre-Effective Amendment No. 1 to
        Registrant's Registration Statement on Form N-2, filed January 30, 2004
        (File Nos. 333-110143 and 811-21462).


(***)   Incorporated by reference to Registrant's Registration Statement on Form
        N-2, filed on October 31, 2003 (File Nos. 333-110143 and 811-21462).


</TEXT>
</DOCUMENT>
