Morgan Creek Global Equity Long/Short Institutional Fund, et al.; Notice of Application, 75192-75194 [2014-29500]
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75192
Federal Register / Vol. 79, No. 242 / Wednesday, December 17, 2014 / Notices
mstockstill on DSK4VPTVN1PROD with NOTICES
No. 3235–0287.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget this
request for extension of the previously
approved collection of information
discussed below.
Under the Exchange Act of 1934 (15
U.S.C. 78a et seq.) every person who is
directly or indirectly the beneficial
owner of more than 10 percent of any
class of any equity security (other than
an exempted security) which registered
under Section 12 of the Exchange Act
(15 U.S.C. 78l), or who is a director or
any officer of the issuer of such security
(collectively ‘‘insider), must file a
statement with the Commission
reporting their ownership. Form 4 is a
statement to disclose changes in an
insider’s ownership of securities. The
information is used for the purpose of
disclosing the equity holdings of
insiders of reporting companies.
Approximately 204,054 insiders file
Form 4 annually and it takes
approximately 0.5 hours to prepare for
a total of 102,027 annual burden hours.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
The public may view the background
documentation for this information
collection at the following Web site,
www.reginfo.gov . Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503,
or by sending an email to: Shagufta_
Ahmed@omb.eop.gov; and (ii) Pamela
Dyson, Acting Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington,
DC 20549 or send an email to: PRA_
Mailbox@sec.gov. Comments must be
submitted to OMB within 30 days of
this notice.
Dated: December 11, 2014.
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–29513 Filed 12–16–14; 8:45 am]
BILLING CODE 8011–01–P
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SECURITIES AND EXCHANGE
COMMISSION
Dated: December 11, 2014.
Kevin M. O’Neill,
Deputy Secretary.
Submission for OMB Review;
Comment Request
[FR Doc. 2014–29512 Filed 12–16–14; 8:45 am]
BILLING CODE 8011–01–P
Upon Written Request Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE., Washington, DC
20549–2736.
Extension: Form 3;
SEC File No. 270–125, OMB Control
No. 3235–0104.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget this
request for extension of the previously
approved collection of information
discussed below.
Under the Exchange Act of 1934 (15
U.S.C. 78a et seq.) every person who is
directly or indirectly the beneficial
owner of more than 10 percent of any
class of any equity security (other than
an exempted security) which registered
under Section 12 of the Exchange Act
(15 U.S.C. 78l), or who is a director or
an officer of the issuer of such security
(collectively ‘‘insiders’’), must file
statement with the Commission
reporting their ownership. Form 3 (17
CFR 249.103) is an initial statement of
beneficial ownership of securities.
Approximately 16,855 insiders file
Form 3 annually and it takes
approximately 0.5 hours to prepare for
a total of 8,428 annual burden hours.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
The public may view the background
documentation for this information
collection at the following Web site,
www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503,
or by sending an email to: Shagufta_
Ahmed@omb.eop.gov; and (ii) Pamela
Dyson, Acting Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington,
DC 20549 or send an email to: PRA_
Mailbox@sec.gov. Comments must be
submitted to OMB within 30 days of
this notice.
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SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
31369; 812–14093]
Morgan Creek Global Equity Long/
Short Institutional Fund, et al.; Notice
of Application
December 11, 2014.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice of an application under
section 6(c) of the Investment Company
Act of 1940 (the ‘‘Act’’) for an
exemption from sections 18(c) and 18(i)
of the Act and for an order pursuant to
section 17(d) of the Act and rule 17d–
1 under the Act.
AGENCY:
Applicants request an order to
permit certain registered closed-end
management investment companies to
issue multiple classes of shares
(‘‘Classes’’) with varying sales loads and
to impose asset-based service and/or
distribution fees and contingent
deferred sales loads (‘‘CDSCs’’).
Applicants: Morgan Creek Global
Equity Long/Short Institutional Fund
(the ‘‘Fund’’), Morgan Creek Capital
Management, LLC (the ‘‘Adviser’’) and
Town Hall Capital, LLC (the
‘‘Distributor’’).
DATES: Filing Dates: The application was
filed on November 15, 2012, and
amended on April 18, 2013, April 11,
2014, August 13, 2014 and November
21, 2014.
Hearing or Notification of Hearing: An
order granting the requested relief will
be issued unless the Commission orders
a hearing. Interested persons may
request a hearing by writing to the
Commission’s Secretary and serving
applicants with a copy of the request,
personally or by mail.
Hearing requests should be received
by the Commission by 5:30 p.m. on
January 5, 2015, and should be
accompanied by proof of service on the
applicants, in the form of an affidavit,
or, for lawyers, a certificate of service.
Pursuant to rule 0–5 under the Act,
hearing requests should state the nature
of the writer’s interest, any facts bearing
upon the desirability of a hearing on the
matter, the reason for the request, and
the issues contested. Persons who wish
to be notified of a hearing may request
notification by writing to the
Commission’s Secretary.
SUMMARY:
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Federal Register / Vol. 79, No. 242 / Wednesday, December 17, 2014 / Notices
Secretary, U.S. Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090;
Applicants, c/o David James, State
Street Bank and Trust Company, 4
Copley Place, 5th Floor, Mail Stop CPH
0326, Boston, MA 02116.
ADDRESSES:
FOR FURTHER INFORMATION CONTACT:
Barbara T. Heussler, Senior Counsel, at
(202) 551–6990 or Mary Kay Frech,
Branch Chief, at (202) 551–6821
(Division of Investment Management,
Chief Counsel’s Office).
The
following is a summary of the
application. The complete application
may be obtained via the Commission’s
Web site by searching for the file
number, or an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm or by
calling (202) 551–8090.
SUPPLEMENTARY INFORMATION:
mstockstill on DSK4VPTVN1PROD with NOTICES
Applicants’ Representations
1. The Fund is a continuously offered
non-diversified closed-end management
investment company registered under
the Act and organized as a Delaware
statutory trust. The Adviser, a North
Carolina limited liability company, is
registered as an investment adviser
under the Investment Advisers Act of
1940 and serves as investment adviser
to the Fund. The Distributor, a brokerdealer registered under the Securities
Exchange Act of 1934 (‘‘1934 Act’’), acts
as principal underwriter of the Fund.
The Distributor is under common
control with the Adviser and is an
affiliated person, as defined in section
2(a)(3) of the Act, of the Adviser.
2. The Fund continuously offers its
shares pursuant to its currently effective
registration statement under the
Securities Act of 1933. The Fund’s
shares are not listed on any securities
exchange and do not trade on an overthe-counter system such as Nasdaq.
Applicants do not expect that any
secondary market will develop for the
Fund’s shares.
3. The Fund currently issues a single
class of shares (‘‘Initial Class’’) at net
asset value per share (‘‘NAV’’). The
Initial Class is not currently subject to
any sales loads or distribution and/or
service fees. The Fund proposes to offer
additional Classes of shares that will
adopt a distribution and service plan in
compliance with rules 12b–1 and 17d–
3 under the Act as if such rules applied
to closed-end management investment
companies (‘‘Distribution and Service
Plan’’). Additional Classes may be
subject to a sales load, a distribution fee
(‘‘Distribution Fee’’), and/or a service
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fee (‘‘Service Fee’’), pursuant to the
Distribution and Service Plan.1
4. In order to provide a limited degree
of liquidity to shareholders, the Fund
may from time to time offer to
repurchase shares at their then-current
NAV in accordance with rule 13e–4
under the 1934 Act pursuant to written
tenders by shareholders. Repurchases of
the Fund’s shares are made at such
times, in such amounts and on such
terms as may be determined by the
board of trustees of the Fund (‘‘Board’’)
in its sole discretion. The Adviser
ordinarily recommends that the Board
authorize the Fund to offer to
repurchase shares from shareholders
quarterly.
5. Applicants request that the order
also apply to any continuously-offered
registered closed-end management
investment company existing now or in
the future for which the Adviser or the
Distributor, or any entity controlling,
controlled by, or under common control
with the Adviser or the Distributor acts
as investment adviser or principal
underwriter, and which provides
periodic liquidity with respect to its
shares pursuant to rule 13e–4 under the
1934 Act (collectively with the Fund,
the ‘‘Funds’’).2
6. Applicants represent that any assetbased Distribution and Service Fees will
comply with the provisions of rule
2830(d) of the Conduct Rules of the
National Association of Securities
Dealers, Inc. (‘‘NASD Conduct Rule
2830’’).3 Applicants also represent that
the Fund will disclose in its prospectus,
the fees, expenses and other
characteristics of each Class offered for
sale by the prospectus, as is required for
open-end, multiple class funds under
Form N–1A. As if it were an open-end
management investment company, the
Fund will disclose fund expenses in
shareholder reports, and disclose in its
prospectus any arrangements that result
in breakpoints in, or elimination of,
sales loads.4 Applicants will also
comply with any requirements that may
1 The Fund will not impose an ‘‘early withdrawal
charge’’ or ‘‘repurchase fee’’ on shareholders who
purchase and tender their shares.
2 Any Fund relying on this relief will do so in a
manner consistent with the terms and conditions of
the application. Applicants represent that each
investment company presently intending to rely on
the requested order is listed as an applicant.
3 Any references to NASD Conduct Rule 2830
include any successor or replacement Financial
Industry Regulatory Authority Rule to NASD
Conduct Rule 2830.
4 See Shareholder Reports and Quarterly Portfolio
Disclosure of Registered Management Investment
Companies, Investment Company Act Release No.
26372 (Feb. 27, 2004) (adopting release); and
Disclosure of Breakpoint Discounts by Mutual
Funds, Investment Company Act Release No. 26464
(June 7, 2004) (adopting release).
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75193
be adopted by the Commission or
FINRA regarding disclosure at the point
of sale and in transaction confirmations
about the costs and conflicts of interest
arising out of the distribution of openend investment company shares, and
regarding prospectus disclosure of sales
loads and revenue sharing arrangements
as if those requirements applied to the
Fund and the Distributor.5
7. The Fund will allocate all expenses
incurred by it among the various Classes
based on net assets of the Fund
attributable to each such Class, except
that the NAV and expenses of each
Class will reflect the expenses
associated with the Distribution and
Service Plan of that Class (if any), and
any other incremental expenses of that
Class (including transfer agency fees, if
any). Expenses of the Fund allocated to
a particular Class of the Fund’s shares
will be borne on a pro rata basis by each
outstanding share of that Class.
Applicants state that the Fund will
comply with the provisions of rule 18f–
3 under the Act as if it were an openend investment company.
8. In the event the Funds impose a
CDSC, applicants will comply with the
provisions of rule 6c–10 under the Act,
as if that rule applied to closed-end
management investment companies.
With respect to any waiver of,
scheduled variation in, or elimination of
the CDSC, the Fund will comply with
the requirements of rule 22d–1 under
the Act as if the Fund were an open-end
investment company.
Applicants’ Legal Analysis
Multiple Classes of Shares
1. Section 18(c) of the Act provides,
in relevant part, that a closed-end
investment company may not issue or
sell any senior security if, immediately
thereafter, the company has outstanding
more than one class of senior security.
Applicants state that the creation of
multiple Classes of the Fund may be
prohibited by section 18(c).
2. Section 18(i) of the Act provides
that each share of stock issued by a
registered management investment
company will be a voting stock and
have equal voting rights with every
other outstanding voting stock.
Applicants state that permitting
multiple Classes of the Fund may
violate section 18(i) of the Act because
each Class would be entitled to
5 See Confirmation Requirements and Point of
Sale Disclosure Requirements for Transactions in
Certain Mutual Funds and Other Securities, and
Other Confirmation Requirement Amendments, and
Amendments to the Registration Form for Mutual
Funds, Investment Company Act Release No. 26341
(Jan. 29, 2004) (proposing release).
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Federal Register / Vol. 79, No. 242 / Wednesday, December 17, 2014 / Notices
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exclusive voting rights with respect to
matters solely related to that Class.
3. Section 6(c) of the Act provides that
the Commission may exempt any
person, security or transaction or any
class or classes of persons, securities or
transactions from any provision of the
Act, or from any rule under the Act, if
and to the extent such exemption is
necessary or appropriate in the public
interest and consistent with the
protection of investors and the purposes
fairly intended by the policy and
provisions of the Act. Applicants
request an exemption under section 6(c)
from sections 18(c) and 18(i) to permit
the Fund to issue multiple Classes.
4. Applicants submit that the
proposed allocation of expenses and
voting rights among multiple classes is
equitable and will not discriminate
against any group or class of
shareholders. Applicants submit that
the proposed system would permit the
Fund to facilitate the distribution of
Classes through diverse distribution
channels and would provide investors
with a broader choice of shareholder
options. Applicants assert that the
proposed closed-end investment
company multiple class structure does
not raise the concerns underlying
section 18 of the Act to any greater
degree than open-end investment
companies’ multiple class structures
that are permitted by rule 18f–3 under
the Act. Applicants state the Fund will
comply with the provisions of rule 18f–
3 as if it were an open-end investment
company.
CDSCs
5. Applicants believe that the
requested relief meets the standards of
section 6(c) of the Act. Rule 6c–10
under the Act permits open-end
investment companies to impose
CDSCs, subject to certain conditions.
Applicants state that the Fund does not
anticipate imposing CDSCs and would
only do so in compliance with rule 6c–
10 under the Act as if that rule were
applied to closed-end investment
companies. The Fund also will make all
required disclosures in accordance with
the requirements of Form N–1A
concerning CDSCs. Applicants further
state that, in the event the Fund imposes
CDSCs, the Fund will apply the CDSCs
(and any waivers or scheduled
variations of the CDSCs) uniformly to all
shareholders in a given class and
consistently with the requirements of
rule 22d–1 under the Act.
Asset-Based Service and/or Distribution
Fees
6. Section 17(d) of the Act and rule
17d–1 under the Act prohibit an
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affiliated person of a registered
investment company or an affiliated
person of such person, acting as
principal, from participating in or
effecting any transaction in which such
registered company is a joint or a joint
and several participant unless the
Commission issues an order permitting
the transaction. In reviewing
applications submitted under section
17(d) and rule 17d–1, the Commission
considers whether the participation of
the investment company in a joint
enterprise or joint arrangement is
consistent with the provisions, policies
and purposes of the Act, and the extent
to which the participation is on a basis
different from or less advantageous than
that of other participants.
7. Rule 17d–3 under the Act provides
an exemption from section 17(d) and
rule 17d–1 to permit open-end
investment companies to enter into
distribution arrangements pursuant to
rule 12b–1 under the Act. Applicants
request an order under section 17(d) and
rule 17d–1 under the Act to permit the
Fund to impose Distribution Fees and/
or Service Fees. Applicants have agreed
to comply with rules 12b–1 and 17d–3
as if those rules applied to closed-end
investment companies.
Applicants’ Condition
Applicants agree that any order
granting the requested relief will be
subject to the following condition:
Applicants will comply with the
provisions of rules 6c–10, 12b–1, 17d–
3, 18f–3 and 22d–1 under the Act, as
amended from time to time or replaced,
as if those rules applied to closed-end
management investment companies,
and will comply with the NASD
Conduct Rule 2830, as amended from
time to time, as if that rule applied to
all closed-end management investment
companies.
Notice of an application under
section 6(c) of the Investment Company
Act of 1940 (the ‘‘Act’’) for an
exemption from sections 18(c) and 18(i)
of the Act, under sections 6(c) and
23(c)(3) of the Act for an exemption
from rule 23c–3 under the Act, and for
an order pursuant to section 17(d) of the
Act and rule 17d–1 under the Act.
ACTION:
Applicants request an order to
permit certain registered closed-end
management investment companies to
issue multiple classes of shares and to
impose asset-based distribution fees and
early withdrawal charges (‘‘EWCs’’).
Applicants: ACAP Strategic Fund
(‘‘Initial Fund’’) and SilverBay Capital
Management LLC (‘‘Adviser’’).
SUMMARY:
Filing Dates: The application was
filed on July 15, 2014, and amended on
November 5, 2014 and December 8,
2014.
Hearing or Notification of Hearing: An
order granting the requested relief will
be issued unless the Commission orders
a hearing. Interested persons may
request a hearing by writing to the
Commission’s Secretary and serving
applicants with a copy of the request,
personally or by mail.
Hearing requests should be received
by the Commission by 5:30 p.m. on
January 5, 2015 and should be
accompanied by proof of service on the
applicants, in the form of an affidavit,
or, for lawyers, a certificate of service.
Pursuant to rule 0–5 under the Act,
hearing requests should state the nature
of the writer’s interest, any facts bearing
upon the desirability of a hearing on the
matter, the reason for the request, and
the issues contested. Persons who wish
to be notified of a hearing may request
notification by writing to the
Commission’s Secretary.
DATES:
Secretary, U.S. Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090;
Applicants: 350 Madison Avenue, 9th
Floor, New York, NY 10017.
For the Commission, by the Division of
Investment Management, under delegated
authority.
Kevin M. O’Neill,
Deputy Secretary.
ADDRESSES:
[FR Doc. 2014–29500 Filed 12–16–14; 8:45 am]
FOR FURTHER INFORMATION CONTACT:
BILLING CODE 8011–01–P
Courtney S. Thornton, Senior Counsel,
at (202) 551–6812, or David P. Bartels,
Branch Chief, at (202) 551–6821
(Division of Investment Management,
Chief Counsel’s Office).
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
31372; File No. 812–14333]
ACAP Strategic Fund and SilverBay
Capital Management LLC; Notice of
Application
December 11, 2014.
Securities and Exchange
Commission (‘‘Commission’’).
AGENCY:
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The
following is a summary of the
application. The complete application
may be obtained via the Commission’s
Web site by searching for the file
number, or for an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm or by
calling (202) 551–8090.
SUPPLEMENTARY INFORMATION:
E:\FR\FM\17DEN1.SGM
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]]>Agencies
[Federal Register Volume 79, Number 242 (Wednesday, December 17, 2014)]
[Notices]
[Pages 75192-75194]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-29500]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 31369; 812-14093]
Morgan Creek Global Equity Long/Short Institutional Fund, et al.;
Notice of Application
December 11, 2014.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice of an application under section 6(c) of the Investment
Company Act of 1940 (the ``Act'') for an exemption from sections 18(c)
and 18(i) of the Act and for an order pursuant to section 17(d) of the
Act and rule 17d-1 under the Act.
-----------------------------------------------------------------------
SUMMARY: Applicants request an order to permit certain registered
closed-end management investment companies to issue multiple classes of
shares (``Classes'') with varying sales loads and to impose asset-based
service and/or distribution fees and contingent deferred sales loads
(``CDSCs'').
Applicants: Morgan Creek Global Equity Long/Short Institutional
Fund (the ``Fund''), Morgan Creek Capital Management, LLC (the
``Adviser'') and Town Hall Capital, LLC (the ``Distributor'').
DATES: Filing Dates: The application was filed on November 15, 2012,
and amended on April 18, 2013, April 11, 2014, August 13, 2014 and
November 21, 2014.
Hearing or Notification of Hearing: An order granting the requested
relief will be issued unless the Commission orders a hearing.
Interested persons may request a hearing by writing to the Commission's
Secretary and serving applicants with a copy of the request, personally
or by mail.
Hearing requests should be received by the Commission by 5:30 p.m.
on January 5, 2015, and should be accompanied by proof of service on
the applicants, in the form of an affidavit, or, for lawyers, a
certificate of service. Pursuant to rule 0-5 under the Act, hearing
requests should state the nature of the writer's interest, any facts
bearing upon the desirability of a hearing on the matter, the reason
for the request, and the issues contested. Persons who wish to be
notified of a hearing may request notification by writing to the
Commission's Secretary.
[[Page 75193]]
ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F
Street NE., Washington, DC 20549-1090; Applicants, c/o David James,
State Street Bank and Trust Company, 4 Copley Place, 5th Floor, Mail
Stop CPH 0326, Boston, MA 02116.
FOR FURTHER INFORMATION CONTACT: Barbara T. Heussler, Senior Counsel,
at (202) 551-6990 or Mary Kay Frech, Branch Chief, at (202) 551-6821
(Division of Investment Management, Chief Counsel's Office).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained via the
Commission's Web site by searching for the file number, or an applicant
using the Company name box, at https://www.sec.gov/search/search.htm or
by calling (202) 551-8090.
Applicants' Representations
1. The Fund is a continuously offered non-diversified closed-end
management investment company registered under the Act and organized as
a Delaware statutory trust. The Adviser, a North Carolina limited
liability company, is registered as an investment adviser under the
Investment Advisers Act of 1940 and serves as investment adviser to the
Fund. The Distributor, a broker-dealer registered under the Securities
Exchange Act of 1934 (``1934 Act''), acts as principal underwriter of
the Fund. The Distributor is under common control with the Adviser and
is an affiliated person, as defined in section 2(a)(3) of the Act, of
the Adviser.
2. The Fund continuously offers its shares pursuant to its
currently effective registration statement under the Securities Act of
1933. The Fund's shares are not listed on any securities exchange and
do not trade on an over-the-counter system such as Nasdaq. Applicants
do not expect that any secondary market will develop for the Fund's
shares.
3. The Fund currently issues a single class of shares (``Initial
Class'') at net asset value per share (``NAV''). The Initial Class is
not currently subject to any sales loads or distribution and/or service
fees. The Fund proposes to offer additional Classes of shares that will
adopt a distribution and service plan in compliance with rules 12b-1
and 17d-3 under the Act as if such rules applied to closed-end
management investment companies (``Distribution and Service Plan'').
Additional Classes may be subject to a sales load, a distribution fee
(``Distribution Fee''), and/or a service fee (``Service Fee''),
pursuant to the Distribution and Service Plan.\1\
---------------------------------------------------------------------------
\1\ The Fund will not impose an ``early withdrawal charge'' or
``repurchase fee'' on shareholders who purchase and tender their
shares.
---------------------------------------------------------------------------
4. In order to provide a limited degree of liquidity to
shareholders, the Fund may from time to time offer to repurchase shares
at their then-current NAV in accordance with rule 13e-4 under the 1934
Act pursuant to written tenders by shareholders. Repurchases of the
Fund's shares are made at such times, in such amounts and on such terms
as may be determined by the board of trustees of the Fund (``Board'')
in its sole discretion. The Adviser ordinarily recommends that the
Board authorize the Fund to offer to repurchase shares from
shareholders quarterly.
5. Applicants request that the order also apply to any
continuously-offered registered closed-end management investment
company existing now or in the future for which the Adviser or the
Distributor, or any entity controlling, controlled by, or under common
control with the Adviser or the Distributor acts as investment adviser
or principal underwriter, and which provides periodic liquidity with
respect to its shares pursuant to rule 13e-4 under the 1934 Act
(collectively with the Fund, the ``Funds'').\2\
---------------------------------------------------------------------------
\2\ Any Fund relying on this relief will do so in a manner
consistent with the terms and conditions of the application.
Applicants represent that each investment company presently
intending to rely on the requested order is listed as an applicant.
---------------------------------------------------------------------------
6. Applicants represent that any asset-based Distribution and
Service Fees will comply with the provisions of rule 2830(d) of the
Conduct Rules of the National Association of Securities Dealers, Inc.
(``NASD Conduct Rule 2830'').\3\ Applicants also represent that the
Fund will disclose in its prospectus, the fees, expenses and other
characteristics of each Class offered for sale by the prospectus, as is
required for open-end, multiple class funds under Form N-1A. As if it
were an open-end management investment company, the Fund will disclose
fund expenses in shareholder reports, and disclose in its prospectus
any arrangements that result in breakpoints in, or elimination of,
sales loads.\4\ Applicants will also comply with any requirements that
may be adopted by the Commission or FINRA regarding disclosure at the
point of sale and in transaction confirmations about the costs and
conflicts of interest arising out of the distribution of open-end
investment company shares, and regarding prospectus disclosure of sales
loads and revenue sharing arrangements as if those requirements applied
to the Fund and the Distributor.\5\
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\3\ Any references to NASD Conduct Rule 2830 include any
successor or replacement Financial Industry Regulatory Authority
Rule to NASD Conduct Rule 2830.
\4\ See Shareholder Reports and Quarterly Portfolio Disclosure
of Registered Management Investment Companies, Investment Company
Act Release No. 26372 (Feb. 27, 2004) (adopting release); and
Disclosure of Breakpoint Discounts by Mutual Funds, Investment
Company Act Release No. 26464 (June 7, 2004) (adopting release).
\5\ See Confirmation Requirements and Point of Sale Disclosure
Requirements for Transactions in Certain Mutual Funds and Other
Securities, and Other Confirmation Requirement Amendments, and
Amendments to the Registration Form for Mutual Funds, Investment
Company Act Release No. 26341 (Jan. 29, 2004) (proposing release).
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7. The Fund will allocate all expenses incurred by it among the
various Classes based on net assets of the Fund attributable to each
such Class, except that the NAV and expenses of each Class will reflect
the expenses associated with the Distribution and Service Plan of that
Class (if any), and any other incremental expenses of that Class
(including transfer agency fees, if any). Expenses of the Fund
allocated to a particular Class of the Fund's shares will be borne on a
pro rata basis by each outstanding share of that Class. Applicants
state that the Fund will comply with the provisions of rule 18f-3 under
the Act as if it were an open-end investment company.
8. In the event the Funds impose a CDSC, applicants will comply
with the provisions of rule 6c-10 under the Act, as if that rule
applied to closed-end management investment companies. With respect to
any waiver of, scheduled variation in, or elimination of the CDSC, the
Fund will comply with the requirements of rule 22d-1 under the Act as
if the Fund were an open-end investment company.
Applicants' Legal Analysis
Multiple Classes of Shares
1. Section 18(c) of the Act provides, in relevant part, that a
closed-end investment company may not issue or sell any senior security
if, immediately thereafter, the company has outstanding more than one
class of senior security. Applicants state that the creation of
multiple Classes of the Fund may be prohibited by section 18(c).
2. Section 18(i) of the Act provides that each share of stock
issued by a registered management investment company will be a voting
stock and have equal voting rights with every other outstanding voting
stock. Applicants state that permitting multiple Classes of the Fund
may violate section 18(i) of the Act because each Class would be
entitled to
[[Page 75194]]
exclusive voting rights with respect to matters solely related to that
Class.
3. Section 6(c) of the Act provides that the Commission may exempt
any person, security or transaction or any class or classes of persons,
securities or transactions from any provision of the Act, or from any
rule under the Act, if and to the extent such exemption is necessary or
appropriate in the public interest and consistent with the protection
of investors and the purposes fairly intended by the policy and
provisions of the Act. Applicants request an exemption under section
6(c) from sections 18(c) and 18(i) to permit the Fund to issue multiple
Classes.
4. Applicants submit that the proposed allocation of expenses and
voting rights among multiple classes is equitable and will not
discriminate against any group or class of shareholders. Applicants
submit that the proposed system would permit the Fund to facilitate the
distribution of Classes through diverse distribution channels and would
provide investors with a broader choice of shareholder options.
Applicants assert that the proposed closed-end investment company
multiple class structure does not raise the concerns underlying section
18 of the Act to any greater degree than open-end investment companies'
multiple class structures that are permitted by rule 18f-3 under the
Act. Applicants state the Fund will comply with the provisions of rule
18f-3 as if it were an open-end investment company.
CDSCs
5. Applicants believe that the requested relief meets the standards
of section 6(c) of the Act. Rule 6c-10 under the Act permits open-end
investment companies to impose CDSCs, subject to certain conditions.
Applicants state that the Fund does not anticipate imposing CDSCs and
would only do so in compliance with rule 6c-10 under the Act as if that
rule were applied to closed-end investment companies. The Fund also
will make all required disclosures in accordance with the requirements
of Form N-1A concerning CDSCs. Applicants further state that, in the
event the Fund imposes CDSCs, the Fund will apply the CDSCs (and any
waivers or scheduled variations of the CDSCs) uniformly to all
shareholders in a given class and consistently with the requirements of
rule 22d-1 under the Act.
Asset-Based Service and/or Distribution Fees
6. Section 17(d) of the Act and rule 17d-1 under the Act prohibit
an affiliated person of a registered investment company or an
affiliated person of such person, acting as principal, from
participating in or effecting any transaction in which such registered
company is a joint or a joint and several participant unless the
Commission issues an order permitting the transaction. In reviewing
applications submitted under section 17(d) and rule 17d-1, the
Commission considers whether the participation of the investment
company in a joint enterprise or joint arrangement is consistent with
the provisions, policies and purposes of the Act, and the extent to
which the participation is on a basis different from or less
advantageous than that of other participants.
7. Rule 17d-3 under the Act provides an exemption from section
17(d) and rule 17d-1 to permit open-end investment companies to enter
into distribution arrangements pursuant to rule 12b-1 under the Act.
Applicants request an order under section 17(d) and rule 17d-1 under
the Act to permit the Fund to impose Distribution Fees and/or Service
Fees. Applicants have agreed to comply with rules 12b-1 and 17d-3 as if
those rules applied to closed-end investment companies.
Applicants' Condition
Applicants agree that any order granting the requested relief will
be subject to the following condition:
Applicants will comply with the provisions of rules 6c-10, 12b-1,
17d-3, 18f-3 and 22d-1 under the Act, as amended from time to time or
replaced, as if those rules applied to closed-end management investment
companies, and will comply with the NASD Conduct Rule 2830, as amended
from time to time, as if that rule applied to all closed-end management
investment companies.
For the Commission, by the Division of Investment Management, under
delegated authority.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-29500 Filed 12-16-14; 8:45 am]
BILLING CODE 8011-01-P
