Triloma EIG Energy Income Fund, et al.; Notice of Application, 27915-27917 [2017-12590]

Download as PDF Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR– PEARL–2017–29 and should be submitted on or before July 10, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–12587 Filed 6–16–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 32679; 812–14435] Triloma EIG Energy Income Fund, et al.; Notice of Application June 13, 2017. Securities and Exchange Commission (‘‘Commission’’). ACTION: Notice. asabaliauskas on DSKBBXCHB2PROD with NOTICES AGENCY: Notice of an application under section 6(c) of the Investment Company Act of 1940 (the ‘‘Act’’) for an exemption from sections 18(a)(2), 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 OF APPLICATION: Applicants request an order to permit certain registered closed-end management investment companies to issue multiple classes of shares of beneficial interest (‘‘Shares’’) with varying sales loads and to impose asset-based service and/or distribution fees, and contingent deferred sales loads (‘‘CDSCs’’). 16 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 Triloma EIG Energy Income Fund (the ‘‘Fund’’), Triloma Energy Advisors, LLC (the ‘‘Adviser’’), and Triloma Securities, LLC (the ‘‘Dealer Manager’’) (together, the ‘‘Applicants’’). FILING DATES: The application was filed on March 20, 2015, and amended on November 29, 2016, April 6, 2017, and June 7, 2017. 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 July 8, 2017, and should be accompanied by proof of service on 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. ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090; Applicants, 201 North New York Avenue, Suite 200, Winter Park, FL 32789. FOR FURTHER INFORMATION CONTACT: Jessica Shin, Attorney-Adviser, at (202) 551–5921 or Robert H. Shapiro, 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: Applicants’ Representations 1. The Fund is a Delaware statutory trust that is registered under the Act as a non-diversified, closed-end management investment company. The Fund’s objective is primarily to provide shareholders with current income; as secondary investment objectives, the Fund will seek to provide capital preservation and, to a lesser extent, long-term capital appreciation. The Fund seeks to achieve its investment objectives by investing primarily in a global portfolio of privately originated energy company and project debt. PO 00000 Frm 00134 Fmt 4703 Sfmt 4703 27915 2. The Adviser, a Florida limited liability company, is registered as an investment adviser under the Investment Advisers Act of 1940. The Adviser serves as investment adviser to the Fund. 3. The Dealer Manager is registered with the Commission as a broker-dealer under the Securities Exchange Act of 1934 (the ‘‘1934 Act’’) and will act as the managing dealer of the Fund. The Dealer Manager is under common control with the Advisor and is an affiliated person, as defined in section 2(a)(3) of the Act, of the Advisor. 4. The applicants seek an order to permit the Fund to issue multiple classes of Shares, each having its own fee and expense structure, and to impose asset-based distribution and/or service fees, and CDSCs. 5. Applicants request that the order also apply to any other continuously offered registered closed-end management investment company existing now or in the future for which the Adviser or the Dealer Manager or any entity controlling, controlled by, or under common control with the Adviser or the Dealer Manager or its successors,1 acts as investment adviser or distributor, respectively, and which provides periodic liquidity with respect to its Shares through tender offers conducted in compliance with either rule 23c–3 under the Act or rule 13e–4 under the 1934 Act.2 6. The Fund currently issues a single class of Shares (the ‘‘Initial Class Shares’’). Shares are currently being offered on a continuous basis pursuant to a registration statement under the Securities Act of 1933 and the Act at daily closings at their public offering price per share. The Fund, as a closedend investment company, does not continuously redeem Shares as does an open-end management investment company. Shares of the Fund 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 ever develop for the Shares. 7. If the requested relief is granted, the Fund intends to offer multiple classes of Shares, such as the Initial Class Shares and additional classes. Because of the different distribution fees, service fees, 1 A successor in interest is limited to an entity that results from a reorganization into another jurisdiction or a change in the type of business organization. 2 The Fund and any other investment company relying on the requested relief will do so in a manner consistent with the terms and conditions of the application. Applicants represent that any person presently intending to rely on the requested relief is listed as an applicant. E:\FR\FM\19JNN1.SGM 19JNN1 asabaliauskas on DSKBBXCHB2PROD with NOTICES 27916 Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices and any other class expenses that may be attributable to the different classes, the net income attributable to, and any dividends payable on, each class of Shares may differ from each other from time to time. 8. Applicants state that, from time to time, the Board of the Fund may create additional classes of Shares, or may vary the characteristics described of the Initial Class, including without limitation, in the following respects: (1) The amount of fees permitted by different distribution plans or different service fee arrangements; (2) voting rights with respect to a distribution and service plan of a class; (3) different class designations; (4) the impact of any class expenses directly attributable to a particular class of Shares allocated on a class basis as described in the Application; (5) differences in any dividends and net asset values per Share resulting from differences in fees under a distribution and service plan or in class expenses; (6) any sales load structure; and (7) any conversion features, as permitted under the Act. 9. The Fund will not impose an ‘‘early withdrawal charge’’ or ‘‘repurchase fee’’ on investors who purchase and tender their Shares. 10. Applicants state that, in order to provide a limited degree of liquidity to shareholders, the Fund is structured as an ‘‘interval fund’’ and intends to make quarterly offers to repurchase up to 5% of the weighted average number of Shares outstanding in the prior four calendar quarters (or a portion thereof during the Fund’s first fiscal year) at a price based on the Fund’s net asset value per share, pursuant to rule 23c– 3 under the Act. At the discretion of the Fund’s board of trustees, the Fund intends to limit the number of Shares to be repurchased during any calendar year to the number of Shares the Fund can repurchase with cash on hand, cash available from borrowings and cash from the sale of its investments as of the end of the applicable period to repurchase Shares. Repurchases of the Fund’s Shares will be made at such times, in such amounts, and on such terms as may be determined by the Fund’s Board in its sole discretion. 11. Applicants represent that any asset-based service and/or distribution fees will comply with the provisions of Rule 2341 of the Rules of the Financial Industry Regulatory Authority (‘‘FINRA Rule 2341’’) as if that rule applied to the Fund.3 Applicants also represent that 3 Any references to FINRA Rule 2341include any successor or replacement rule that may be adopted by the Financial Industry Regulatory Authority (‘‘FINRA’’). VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 the Fund will disclose in its prospectus the fees, expenses and other characteristics of each class of Shares offered for sale by the prospectus, as is required for open-end, multiple class funds under Form N–1A.4 As is required for open-end funds, the Fund will disclose its expenses in shareholder reports, and describe any arrangements that result in breakpoints in or eliminations of sales loads in its prospectus.5 In addition, applicants will comply with applicable enhanced fee disclosure requirements for fund of funds, including registered funds of hedge funds.6 12. The Fund and the Dealer Manager will 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 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 Dealer Manager. The Fund or the Dealer Manager will also contractually require that any other distributor of the Fund’s Shares comply with such requirements in connection with the distribution of Shares of the Fund. 13. The Fund will allocate all expenses incurred by it among the various classes of Shares based on the net assets of the Fund attributable to each class, except that the net asset value and expenses of each class will reflect distribution fees, service fees, and any other incremental expenses of that class. Expenses of the Fund allocated to a particular class of 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. 14. The Fund does not intend to offer any exchange privilege or conversion 4 In all respects other than class-by-class disclosure, the Fund will comply with the requirements of Form N–2. 5 See Shareholder Reports and Quarterly Portfolio Disclosure of Registered Management Investment Companies, Investment Company Act Release No. 26372 (Feb. 27, 2004) (adopting release) (requiring open-end investment companies to disclose fund expenses in shareholder reports); and Disclosure of Breakpoint Discounts by Mutual Funds, Investment Company Act Release No. 26464 (June 7, 2004) (adopting release) (requiring open-end investment companies to provide prospectus disclosure of certain sales load information). 6 Fund of Funds Investments, Investment Company Act Rel. Nos. 26198 (Oct. 1, 2003) (proposing release) and 27399 (Jun. 20, 2006) (adopting release). See also Rules 12d1–1, et seq. of the Act. PO 00000 Frm 00135 Fmt 4703 Sfmt 4703 feature, but any such privilege or feature introduced in the future will comply with rule 11a–1, rule 11a–3, and rule 18f–3 as if the Fund were an open-end investment company. Applicants’ Legal Analysis Multiple Classes of Shares 1. Section 18(a)(2)(A) and (B) makes it unlawful for a registered closed-end investment company to issue a senior security that is a stock unless (a) immediately after such issuance it will have an asset coverage of at least 200% and (b) provision is made to prohibit the declaration of any distribution, upon its common stock, or the purchase of any such common stock, unless in every such case such senior security has at the time of the declaration of any such distribution, or at the time of any such purchase, an asset coverage of at least 200% after deducting the amount of such distribution or purchase price, as the case may be. Applicants state that the creation of multiple classes of shares of the Funds may violate section 18(a)(2) because the Funds may not meet such requirements with respect to a class of shares that may be a senior security. 2. Section 18(c) of the Act provides, in relevant part, that a registered closedend 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 Shares of the Fund may be prohibited by section 18(c), as a class may have priority over another class as to payment of dividends because shareholders of different classes would pay different fees and expenses. 3. 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 Shares of the Fund may violate section 18(i) of the Act because each class would be entitled to exclusive voting rights with respect to matters solely related to that class. 4. 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 or regulation 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 E:\FR\FM\19JNN1.SGM 19JNN1 Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices and provisions of the Act. Applicants request an exemption under section 6(c) from sections 18(a)(2), 18(c) and 18(i) to permit the Fund to issue multiple classes of Shares. 5. Applicants submit that the proposed allocation of expenses relating to distribution and voting rights among multiple classes is equitable and will not discriminate against any group or class of shareholders. Applicants submit that the proposed arrangements would permit the Fund to facilitate the distribution of its Shares and 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 that the Fund will comply with the provisions of rule 18f–3 as if it were an open-end investment company. asabaliauskas on DSKBBXCHB2PROD with NOTICES Asset-Based Service and/or Distribution Fees 1. 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 connection with any joint enterprise or joint arrangement in which the investment company participates 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. 2. 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 asset-based service and/ or distribution fees. Applicants have agreed to comply with rules 12b–1 and 17d–3 as if those rules applied to closed-end investment companies, which they believe will resolve any concerns that might arise in connection with a Fund financing the distribution VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 of its shares through asset-based service and/or distribution fees. 3. For the reasons stated above, applicants submit that the exemptions requested under section 6(c) are necessary and appropriate in the public interest and are consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act. Applicants further submit that the Funds’ imposition of asset-based service and/or distribution fees is consistent with the provisions, policies and purposes of the Act and does not involve participation on a basis different from or less advantageous than that of other participants. Applicants’ Condition The Fund agrees 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, 22d–1, and where applicable, 11a–3 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 FINRA Rule 2341, 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. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–12590 Filed 6–16–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–80912; File No. SR– BatsBZX–2017–42] Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use on Bats BZX Exchange, Inc. June 13, 2017. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 1, 2017, Bats BZX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BZX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the Exchange. The Exchange has designated the proposed rule change as 1 15 2 17 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00136 Fmt 4703 Sfmt 4703 27917 one establishing or changing a member due, fee, or other charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposed rule change effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend the fee schedule applicable to Members 5 and non-Members of the Exchange pursuant to BZX Rules 15.1(a) and (c). The text of the proposed rule change is available at the Exchange’s Web site at www.bats.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend its fee schedule applicable to its equities trading platform (‘‘BZX Equities’’) to: (i) Modify the rates associated with fee codes AA, BJ and RA; (ii) adopt new fee code IX; and (iii) increase the condition necessary to qualify for the enhanced rebate provided by the Step-Up tier under footnote 2. The Exchange notes that Bats EDGA Exchange, Inc. (‘‘EDGA’’) is implementing certain pricing changes effective June 1, 2017, including modification of various fees and rebates to add and remove liquidity with a displayed or IOC order to a flat 3 15 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 5 The term ‘‘Member’’ is defined as ‘‘any registered broker or dealer that has been admitted to membership in the Exchange.’’ See Exchange Rule 1.5(n). 4 17 E:\FR\FM\19JNN1.SGM 19JNN1

Agencies

[Federal Register Volume 82, Number 116 (Monday, June 19, 2017)]
[Notices]
[Pages 27915-27917]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-12590]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 32679; 812-14435]


Triloma EIG Energy Income Fund, et al.; Notice of Application

June 13, 2017.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice.

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    Notice of an application under section 6(c) of the Investment 
Company Act of 1940 (the ``Act'') for an exemption from sections 
18(a)(2), 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 of Application: Applicants request an order to permit certain 
registered closed-end management investment companies to issue multiple 
classes of shares of beneficial interest (``Shares'') with varying 
sales loads and to impose asset-based service and/or distribution fees, 
and contingent deferred sales loads (``CDSCs'').

Applicants: Triloma EIG Energy Income Fund (the ``Fund''), Triloma 
Energy Advisors, LLC (the ``Adviser''), and Triloma Securities, LLC 
(the ``Dealer Manager'') (together, the ``Applicants'').

Filing Dates: The application was filed on March 20, 2015, and amended 
on November 29, 2016, April 6, 2017, and June 7, 2017.

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 July 8, 2017, and should be accompanied by proof of 
service on 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.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F 
Street NE., Washington, DC 20549-1090; Applicants, 201 North New York 
Avenue, Suite 200, Winter Park, FL 32789.

FOR FURTHER INFORMATION CONTACT: Jessica Shin, Attorney-Adviser, at 
(202) 551-5921 or Robert H. Shapiro, 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 Delaware statutory trust that is registered under 
the Act as a non-diversified, closed-end management investment company. 
The Fund's objective is primarily to provide shareholders with current 
income; as secondary investment objectives, the Fund will seek to 
provide capital preservation and, to a lesser extent, long-term capital 
appreciation. The Fund seeks to achieve its investment objectives by 
investing primarily in a global portfolio of privately originated 
energy company and project debt.
    2. The Adviser, a Florida limited liability company, is registered 
as an investment adviser under the Investment Advisers Act of 1940. The 
Adviser serves as investment adviser to the Fund.
    3. The Dealer Manager is registered with the Commission as a 
broker-dealer under the Securities Exchange Act of 1934 (the ``1934 
Act'') and will act as the managing dealer of the Fund. The Dealer 
Manager is under common control with the Advisor and is an affiliated 
person, as defined in section 2(a)(3) of the Act, of the Advisor.
    4. The applicants seek an order to permit the Fund to issue 
multiple classes of Shares, each having its own fee and expense 
structure, and to impose asset-based distribution and/or service fees, 
and CDSCs.
    5. Applicants request that the order also apply to any other 
continuously offered registered closed-end management investment 
company existing now or in the future for which the Adviser or the 
Dealer Manager or any entity controlling, controlled by, or under 
common control with the Adviser or the Dealer Manager or its 
successors,\1\ acts as investment adviser or distributor, respectively, 
and which provides periodic liquidity with respect to its Shares 
through tender offers conducted in compliance with either rule 23c-3 
under the Act or rule 13e-4 under the 1934 Act.\2\
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    \1\ A successor in interest is limited to an entity that results 
from a reorganization into another jurisdiction or a change in the 
type of business organization.
    \2\ The Fund and any other investment company relying on the 
requested relief will do so in a manner consistent with the terms 
and conditions of the application. Applicants represent that any 
person presently intending to rely on the requested relief is listed 
as an applicant.
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    6. The Fund currently issues a single class of Shares (the 
``Initial Class Shares''). Shares are currently being offered on a 
continuous basis pursuant to a registration statement under the 
Securities Act of 1933 and the Act at daily closings at their public 
offering price per share. The Fund, as a closed-end investment company, 
does not continuously redeem Shares as does an open-end management 
investment company. Shares of the Fund 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 ever develop 
for the Shares.
    7. If the requested relief is granted, the Fund intends to offer 
multiple classes of Shares, such as the Initial Class Shares and 
additional classes. Because of the different distribution fees, service 
fees,

[[Page 27916]]

and any other class expenses that may be attributable to the different 
classes, the net income attributable to, and any dividends payable on, 
each class of Shares may differ from each other from time to time.
    8. Applicants state that, from time to time, the Board of the Fund 
may create additional classes of Shares, or may vary the 
characteristics described of the Initial Class, including without 
limitation, in the following respects: (1) The amount of fees permitted 
by different distribution plans or different service fee arrangements; 
(2) voting rights with respect to a distribution and service plan of a 
class; (3) different class designations; (4) the impact of any class 
expenses directly attributable to a particular class of Shares 
allocated on a class basis as described in the Application; (5) 
differences in any dividends and net asset values per Share resulting 
from differences in fees under a distribution and service plan or in 
class expenses; (6) any sales load structure; and (7) any conversion 
features, as permitted under the Act.
    9. The Fund will not impose an ``early withdrawal charge'' or 
``repurchase fee'' on investors who purchase and tender their Shares.
    10. Applicants state that, in order to provide a limited degree of 
liquidity to shareholders, the Fund is structured as an ``interval 
fund'' and intends to make quarterly offers to repurchase up to 5% of 
the weighted average number of Shares outstanding in the prior four 
calendar quarters (or a portion thereof during the Fund's first fiscal 
year) at a price based on the Fund's net asset value per share, 
pursuant to rule 23c-3 under the Act. At the discretion of the Fund's 
board of trustees, the Fund intends to limit the number of Shares to be 
repurchased during any calendar year to the number of Shares the Fund 
can repurchase with cash on hand, cash available from borrowings and 
cash from the sale of its investments as of the end of the applicable 
period to repurchase Shares. Repurchases of the Fund's Shares will be 
made at such times, in such amounts, and on such terms as may be 
determined by the Fund's Board in its sole discretion.
    11. Applicants represent that any asset-based service and/or 
distribution fees will comply with the provisions of Rule 2341 of the 
Rules of the Financial Industry Regulatory Authority (``FINRA Rule 
2341'') as if that rule applied to the Fund.\3\ Applicants also 
represent that the Fund will disclose in its prospectus the fees, 
expenses and other characteristics of each class of Shares offered for 
sale by the prospectus, as is required for open-end, multiple class 
funds under Form N-1A.\4\ As is required for open-end funds, the Fund 
will disclose its expenses in shareholder reports, and describe any 
arrangements that result in breakpoints in or eliminations of sales 
loads in its prospectus.\5\ In addition, applicants will comply with 
applicable enhanced fee disclosure requirements for fund of funds, 
including registered funds of hedge funds.\6\
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    \3\ Any references to FINRA Rule 2341include any successor or 
replacement rule that may be adopted by the Financial Industry 
Regulatory Authority (``FINRA'').
    \4\ In all respects other than class-by-class disclosure, the 
Fund will comply with the requirements of Form N-2.
    \5\ See Shareholder Reports and Quarterly Portfolio Disclosure 
of Registered Management Investment Companies, Investment Company 
Act Release No. 26372 (Feb. 27, 2004) (adopting release) (requiring 
open-end investment companies to disclose fund expenses in 
shareholder reports); and Disclosure of Breakpoint Discounts by 
Mutual Funds, Investment Company Act Release No. 26464 (June 7, 
2004) (adopting release) (requiring open-end investment companies to 
provide prospectus disclosure of certain sales load information).
    \6\ Fund of Funds Investments, Investment Company Act Rel. Nos. 
26198 (Oct. 1, 2003) (proposing release) and 27399 (Jun. 20, 2006) 
(adopting release). See also Rules 12d1-1, et seq. of the Act.
---------------------------------------------------------------------------

    12. The Fund and the Dealer Manager will 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 Dealer Manager. The Fund or 
the Dealer Manager will also contractually require that any other 
distributor of the Fund's Shares comply with such requirements in 
connection with the distribution of Shares of the Fund.
    13. The Fund will allocate all expenses incurred by it among the 
various classes of Shares based on the net assets of the Fund 
attributable to each class, except that the net asset value and 
expenses of each class will reflect distribution fees, service fees, 
and any other incremental expenses of that class. Expenses of the Fund 
allocated to a particular class of 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.
    14. The Fund does not intend to offer any exchange privilege or 
conversion feature, but any such privilege or feature introduced in the 
future will comply with rule 11a-1, rule 11a-3, and rule 18f-3 as if 
the Fund were an open-end investment company.

Applicants' Legal Analysis

Multiple Classes of Shares

    1. Section 18(a)(2)(A) and (B) makes it unlawful for a registered 
closed-end investment company to issue a senior security that is a 
stock unless (a) immediately after such issuance it will have an asset 
coverage of at least 200% and (b) provision is made to prohibit the 
declaration of any distribution, upon its common stock, or the purchase 
of any such common stock, unless in every such case such senior 
security has at the time of the declaration of any such distribution, 
or at the time of any such purchase, an asset coverage of at least 200% 
after deducting the amount of such distribution or purchase price, as 
the case may be. Applicants state that the creation of multiple classes 
of shares of the Funds may violate section 18(a)(2) because the Funds 
may not meet such requirements with respect to a class of shares that 
may be a senior security.
    2. Section 18(c) of the Act provides, in relevant part, that a 
registered 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 Shares of the Fund may be prohibited by 
section 18(c), as a class may have priority over another class as to 
payment of dividends because shareholders of different classes would 
pay different fees and expenses.
    3. 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 Shares of 
the Fund may violate section 18(i) of the Act because each class would 
be entitled to exclusive voting rights with respect to matters solely 
related to that class.
    4. 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 or regulation 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

[[Page 27917]]

and provisions of the Act. Applicants request an exemption under 
section 6(c) from sections 18(a)(2), 18(c) and 18(i) to permit the Fund 
to issue multiple classes of Shares.
    5. Applicants submit that the proposed allocation of expenses 
relating to distribution and voting rights among multiple classes is 
equitable and will not discriminate against any group or class of 
shareholders. Applicants submit that the proposed arrangements would 
permit the Fund to facilitate the distribution of its Shares and 
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 that the Fund will comply with the provisions of 
rule 18f-3 as if it were an open-end investment company.

Asset-Based Service and/or Distribution Fees

    1. 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 connection with any 
joint enterprise or joint arrangement in which the investment company 
participates 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.
    2. 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 asset-based service and/or 
distribution fees. Applicants have agreed to comply with rules 12b-1 
and 17d-3 as if those rules applied to closed-end investment companies, 
which they believe will resolve any concerns that might arise in 
connection with a Fund financing the distribution of its shares through 
asset-based service and/or distribution fees.
    3. For the reasons stated above, applicants submit that the 
exemptions requested under section 6(c) are necessary and appropriate 
in the public interest and are consistent with the protection of 
investors and the purposes fairly intended by the policy and provisions 
of the Act. Applicants further submit that the Funds' imposition of 
asset-based service and/or distribution fees is consistent with the 
provisions, policies and purposes of the Act and does not involve 
participation on a basis different from or less advantageous than that 
of other participants.

Applicants' Condition

    The Fund agrees 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, 22d-1, and where applicable, 11a-3 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 FINRA 
Rule 2341, 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.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-12590 Filed 6-16-17; 8:45 am]
 BILLING CODE 8011-01-P
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