EXHIBIT 77 to Xxxxxxxxx Xxxxxx Dividend
Advantage Fund Inc. NSAR 10/31/08
File Number: 81121499
CIK Number: 0001276893
Item 77I
In September 2008, Xxxxxxxxx Xxxxxx Dividend
Advantage Inc. (the Fund) entered into
a Master Securities Purchase Agreement and a
Master Note Purchase Agreement
pursuant to which it issued privately placed
notes (PNs) and privately placed perpetual
preferred shares (PPS and, together with PNs,
Private Securities). The PNs mature in
October 2013 and interest thereon is accrued
daily and paid quarterly. The PPS have a
liquidation preference of $25,000 per share
plus any accumulated unpaid distributions,
whether or not earned or declared by the Fund,
but excluding interest thereon (PPS
Liquidation Value). Dividends are accrued daily
and paid quarterly for PPS. The Fund
may redeem PPS or prepay PNs, in whole or in
part, at its option after giving a minimum
amount of notice to the relevant holders of the
Private Securities but will incur additional
expenses if it chooses to so redeem or prepay.
The Fund is also subject to certain restrictions
relating to the Private Securities. Failure to
comply with these restrictions could preclude the
Fund from declaring any distributions
to common shareholders or repurchasing common
shares and/or could trigger the
mandatory redemption of PPS at PPS Liquidation
Value and/or mandatory prepayment of
PNs at par plus accrued but unpaid interest. The
holders of PPS are entitled to one vote
per share and will vote with holders of common
shares as a single class, except that the
holders of PPS will vote separately as a class
on certain matters, as required by law or the
Funds charter. The holders of PPS, voting as a
separate class, are entitled at all times to
elect two Directors of the Fund, and to elect a
majority of the Directors of the Fund if the
Fund fails to pay distributions on PPS for two
consecutive years. The holders of PNs do
not have voting rights.
