
[Federal Register Volume 78, Number 95 (Thursday, May 16, 2013)]
[Notices]
[Pages 28900-28904]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-11604]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. IC-30511; File No. 812-13665]


FS Investment Corporation, et al.; Notice of Application

May 9, 2013.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of application for an order under sections 17(d), 
57(a)(4) and 57(i) of the Investment Company Act of 1940 (the ``Act'') 
and rule 17d-1 under the Act to permit certain joint transactions 
otherwise prohibited by sections 17(d) and 57(a)(4) of the Act and rule 
17d-1 under the Act.

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Summary of Application:  Applicants request an order to permit business 
development companies (``BDCs'') to co-invest with certain affiliated 
investment funds in portfolio companies.

Applicants:  FS Investment Corporation (``FSIC''); FS Energy and Power 
Fund (``FSEP''); FS Investment Corporation II (``FSIC II,'' and 
collectively with FSIC and FSEP, the ``Funds''); FB Income Advisor, LLC 
(``FSIC Investment Adviser''); FS Investment Advisor, LLC (``FSEP 
Investment Adviser''); FSIC II Advisor, LLC (``FSIC II Investment 
Adviser,'' and collectively with FSEP Investment Adviser and FSIC 
Investment Adviser, the ``Investment Advisers''); Broad Street Funding 
LLC, Arch Street Funding LLC, Locust Street Funding LLC, Race Street 
Funding LLC and Walnut Street Funding LLC (the ``FSIC SPV Subs''); FSEP 
Term Funding, LLC, EP Investments LLC, FSEP-BBH, Inc., Energy Funding 
LLC and EP Funding LLC (the ``FSEP SPV Subs''); and Del River LLC, 
Cooper River LLC, Lehigh River LLC and Cobbs Creek LLC (the ``FSIC II 
SPV Subs,'' and collectively with the FSIC SPV Subs and FSEP SPV Subs, 
the ``SPV Subs''.

Filing Dates:  The application was filed on June 12, 2009, and amended 
on August 17, 2010, February 22, 2012, May 15, 2012, October 15, 2012, 
March 27, 2013 and May 9, 2013.

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 June 3, 2013, and should be accompanied by proof of 
service on applicants, in the form of an affidavit or, for lawyers, a 
certificate of service. Hearing requests should state the nature of the 
writer's interest, 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: Elizabeth M. Murphy, Secretary, U.S. Securities and Exchange 
Commission, 100 F St. NE., Washington, DC 20549-1090. Applicants: c/o 
Michael C. Forman, FS Investment Corporation, Cira Centre, 2929 Arch 
Street, Suite 675, Philadelphia, PA 19104-1150.

FOR FURTHER INFORMATION CONTACT: Laura L. Solomon, Senior Counsel, at 
(202) 551-6915 or Daniele Marchesani, Branch Chief, at (202) 551-6821 
(Exemptive Applications Office, Division of Investment Management).

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 for an 
applicant using the Company name box, at http://www.sec.gov/search/search.htm or by calling (202) 551-8090.

Applicants' Representations

    1. FSIC, FSEP and FSIC II are externally managed, non-diversified, 
closed-end management investment companies that have elected or intend 
to elect, to be regulated as BDCs under the Act.\1\ Each of FSIC, FSEP 
and FSIC II's investment objective is to generate current income and 
long-term capital appreciation. A majority of the members of the board 
of directors (``Board'') of each of the Funds are not ``interested 
persons'' as defined in section 2(a)(19) of the Act (``Independent 
Directors'').
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    \1\ Section 2(a)(48) defines a BDC to be any closed-end 
investment company that operates for the purpose of making 
investments in securities described in sections 55(a)(1) through 
55(a)(3) of the Act and makes available significant managerial 
assistance with respect to the issuers of such securities.
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    2. FSIC Investment Adviser, FSEP Investment Adviser and FSIC II 
Investment Adviser is each registered as an investment adviser under 
the Investment Advisers Act of 1940 (the ``Advisers Act'') and serves 
as the investment adviser to FSIC, FSEP and FSIC II, respectively.\2\ 
Each Investment Adviser is an affiliate of Franklin Square Holdings, 
L.P. (``Franklin Square Capital Partners''). Franklin Square Capital 
Partners owns a majority interest in FSEP Investment Adviser and FSIC 
II Investment Adviser and a minority interest in FSIC Investment 
Adviser.

[[Page 28901]]

Applicants represent that there is and will continue to be substantial 
overlap of the members of the investment committees of the Investment 
Advisers, which unanimously approve all investment decisions for the 
Funds.
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    \2\ Each of FSIC, FSIC II and FSEP has sub-advisors who are only 
affiliated with the Funds as a result of an investment sub-advisory 
agreement.
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    3. Each of the FSIC SPV Subs, the FSEP SPV Subs and the FSIC II SPV 
Subs is a wholly-owned subsidiary controlled by FSIC, FSEP or FSIC II, 
as applicable and formed specifically for the purpose of procuring 
financing or otherwise holding investments. Each SPV Sub is relying on 
section 3(c)(1) or 3(c)(7) of the Act.
    4. Applicants request an order (``Order'') to permit a Fund (and 
any SPV Sub of such Fund),\3\ on the one hand, and one or more Funds 
(and any SPV Sub of such Funds) or one or more unregistered funds for 
which an Investment Adviser serves as the main investment adviser 
(collectively referred to as ``Co-Investment Affiliates''), on the 
other hand, to (a) participate in the same investment opportunities 
through a proposed co-investment program where such participation would 
otherwise be prohibited under section 57 of the Act, and (b) make 
additional investments in securities of such issuers, including through 
the exercise of warrants, conversion privileges, and other rights to 
purchase securities of the issuers. For purposes of the application, a 
``Co-Investment Transaction'' means any transaction in which any of the 
Funds (or any SPV Sub) participate together with one or more Co-
Investment Affiliates in reliance on the Order, and a ``Potential Co-
Investment Transaction'' means any investment opportunity in which any 
of the Funds (or any SPV Sub) could not participate together with one 
or more Co-Investment Affiliates without obtaining and relying on the 
Order.\4\
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    \3\ For purposes of the application, a ``Fund'' includes any 
future closed-end management investment companies that elect to be 
regulated as a BDC and are advised by any of the Investment 
Advisers.
    \4\ All existing entities that currently intend to rely on the 
Order have been named as applicants. Any other existing or future 
entity that relies on the Order in the future will comply with the 
terms and conditions of the application.
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    5. Upon issuance of the requested Order, all Potential Co-
Investment Transactions within a Fund's Objectives and Strategies \5\ 
that are presented to a Co-Investment Affiliate will be referred to the 
Fund's Investment Adviser, and such investment opportunities may result 
in a Co-Investment Transaction. When considering Potential Co-
Investment Transactions for any Fund, the Investment Adviser will 
analyze and evaluate the investment opportunity based on the Fund's 
investment objectives, investment policies, investment positions, 
capital available for investment, and other factors relevant to such 
Fund. The Investment Advisers will, from time to time, determine that 
certain investments they recommend to their respective Funds would also 
be appropriate investments for one or more Co-Investment Affiliates in 
accordance with the policies and procedures that have been adopted by 
the Investment Adviser. This determination may result in a Fund, on the 
one hand, and one or more Co-Investment Affiliates, on the other hand, 
co-investing in certain investment opportunities (the ``Co-Investment 
Program''). Other than pro rata dispositions and follow-on investments 
as provided in conditions 7 and 8, and after making the determinations 
required in conditions 1 and 2(a), the applicable Investment Adviser 
will present each Potential Co-Investment Transaction and the proposed 
allocation to the directors or trustees, as applicable, eligible to 
vote under section 57(o) of the Act (``Eligible Directors''). The 
``required majority,'' as defined in section 57(o) of the Act 
(``Required Majority''), will approve each Co-Investment Transaction 
prior to any investment by a Fund.\6\
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    \5\ ``Objectives and Strategies'' means, with respect to each 
Fund, such Fund's investment objectives and strategies, as described 
in such Fund's registration statement on Form N-2, other filings 
such Fund has made with the Commission under the Securities Act of 
1933 (``Securities Act''), or under the Securities Exchange Act of 
1934, and such Fund's reports to shareholders. In the case of a SPV 
Sub generally the objectives and strategies will be the same as that 
of its parent Fund.
    \6\ In the case of an SPV Sub, the Required Majority refers to 
the Eligible Directors of the parent Fund.
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    6. With respect to the pro rata dispositions and follow-on 
investments provided in conditions 7 and 8, a Fund may participate in a 
pro rata disposition or follow-on investment without obtaining prior 
approval of the Required Majority if, among other things: (i) The 
proposed participation of each Co-Investment Affiliate in such 
disposition or follow-on investment is proportionate to its outstanding 
investments in the issuer immediately preceding the disposition or 
follow-on investment, as the case may be; and (ii) the Board of the 
Fund has approved that Fund's participation in pro rata dispositions 
and follow-on investments as being in the best interests of the Fund. 
If the Board does not so approve, any such disposition or follow-on 
investment will be submitted to the Fund's Eligible Directors. The 
Board of any Fund may at any time rescind, suspend or qualify its 
approval of pro rata dispositions and follow-on investments with the 
result that all dispositions and/or follow-on investments must be 
submitted to the Eligible Directors.
    7. Applicants state that no Independent Director of a Fund will 
have a financial interest in any Co-Investment Transaction, other than 
through ownership of securities in the Funds and none will participate 
individually in any Co-Investment Transaction.

Applicants' Legal Analysis

    1. Section 57(a)(4) of the Act prohibits certain affiliated persons 
of a BDC from participating in joint transactions with the BDC (or a 
company controlled by such BDC) in contravention of rules as prescribed 
by the Commission. Under section 57(b)(2) of the Act, any person who is 
directly or indirectly controlling, controlled by, or under common 
control with a BDC is subject to section 57(a)(4). Applicants submit 
that the Advisers and the entities that they advise would be deemed to 
be a person related to a Fund in a manner described by section 57(b) 
and therefore prohibited by section 57(a)(4) and rule 17d-1 from 
participating in the Co-Investment Program. Further, because the SPV 
Subs are controlled by the Funds, the SPV Subs are subject to section 
57(a)(4) and would be prohibited from participating in the Co-
Investment Program without the Order.
    2. Section 57(i) of the Act provides that, until the Commission 
prescribes rules under section 57(a)(4), the Commission's rules under 
section 17(d) of the Act applicable to registered closed-end investment 
companies will be deemed to apply to BDCs. Because the Commission has 
not adopted any rules under section 57(a)(4), rule 17d-1 applies.
    3. Section 17(d) of the Act and rule 17d-1 under the Act prohibit 
affiliated persons of a registered investment company from 
participating in joint transactions with the company unless the 
Commission has granted an order permitting such transactions. Rule 17d-
1, as made applicable to BDCs by section 57(i), prohibits any person 
who is related to a BDC in a manner described in section 57(b), acting 
as principal, from participating in, or effecting any transaction in 
connection with, any joint enterprise or other joint arrangement or 
profit-sharing plan in which the BDC (or a company controlled by such 
BDC) is a participant, absent an order from the Commission. In passing 
upon applications under rule 17d-1, the Commission considers whether 
the company's participation in the joint transaction is consistent with

[[Page 28902]]

the provisions, policies, and purposes of the Act and the extent to 
which such participation is on a basis different from or less 
advantageous than that of other participants.
    4. Applicants state that they expect that co-investment in 
portfolio companies by any of the Funds and the Co-Investment 
Affiliates will increase favorable investment opportunities for the 
Funds and that the Co-Investment Program will be implemented only if 
the Required Majority approves it.
    5. Applicants submit that the Required Majority's approval of each 
Co-Investment Transaction before investment, and other protective 
conditions set forth in the application, will ensure that the Company 
will be treated fairly. Applicants state that each Fund's participation 
in the Co-Investment Transactions will be consistent with the 
provisions, policies, and purposes of the Act and on a basis that is 
not different from or less advantageous than that of other 
participants.

Applicants' Conditions

    Applicants agree that any Order granting the requested relief will 
be subject to the following conditions: \7\
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    \7\ For purposes of the conditions set forth in the application, 
the term ``Fund'' includes the SPV Subs. In the case of an SPV Sub, 
all actions to be taken by or with respect to a Required Majority of 
such SPV Sub shall refer to the Eligible Directors of the parent 
Fund on behalf of such SPV Sub, as if the Fund and the SPV Sub 
operated as one company.
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    1. Each time a Co-Investment Affiliate or an Investment Adviser to 
any Co-Investment Affiliate considers a Potential Co-Investment 
Transaction for a Co-Investment Affiliate that falls within Fund's 
then-current Objectives and Strategies, the Fund's Investment Adviser 
will make an independent determination of the appropriateness of the 
investment for the Fund in light of such Fund's then-current 
circumstances.
    2. (a) If the applicable Investment Adviser deems that the 
applicable Fund's participation in any such Potential Co-Investment 
Transaction is appropriate, it will then determine an appropriate level 
of investment for such Fund.
    (b) If the aggregate amount recommended by an Investment Adviser to 
be invested by the applicable Fund in the Potential Co-Investment 
Transaction together with the amount proposed to be invested by the 
other Co-Investment Affiliates, collectively, in the same transaction, 
exceeds the amount of the investment opportunity, the amount proposed 
to be invested by each such party will be allocated among them pro rata 
based on the ratio of the applicable Fund's capital available for 
investment in the asset class being allocated, on the one hand, and the 
other Co-Investment Affiliates' capital available for investment in the 
asset class being allocated, on the other hand, to the aggregated 
capital available for investment for the asset class being allocated of 
all Co-Investment Affiliates involved in the investment opportunity, up 
to the amount proposed to be invested by each. The applicable 
Investment Advisers will provide the Eligible Directors of each 
participating Fund with information concerning each party's available 
capital to assist the Eligible Directors with their review of the 
applicable Fund's investments for compliance with these allocation 
procedures.
    (c) After making the determinations required in conditions 1 and 
2(a), the applicable Investment Adviser will distribute written 
information concerning the Potential Co-Investment Transaction, 
including the amount proposed to be invested by the applicable Fund and 
any Co-Investment Affiliate, to the Eligible Directors of each 
participating Fund for their consideration. The applicable Fund will 
co-invest with Co-Investment Affiliates only if, prior to such Fund's 
and any Co-Investment Affiliates' participation in the Potential Co-
Investment Transaction, a Required Majority of such Fund concludes 
that:
    (i) the terms of the Potential Co-Investment Transaction, including 
the consideration to be paid, are reasonable and fair to the Fund and 
its shareholders and do not involve overreaching of such Fund or its 
shareholders on the part of any person concerned;
    (ii) the Potential Co-Investment Transaction is consistent with:
    (A) the interests of the shareholders of such Fund; and
    (B) such Fund's then-current Objectives and Strategies;
    (iii) the investment by Co-Investment Affiliates would not 
disadvantage such Fund, and participation by such Fund is not on a 
basis different from or less advantageous than that of any Co-
Investment Affiliate; provided, that if a Co-Investment Affiliate, 
other than such Fund, gains the right to nominate a director for 
election to a portfolio company's board of directors or the right to 
have a board observer or any similar right to participate in the 
governance or management of the portfolio company, such event shall not 
be interpreted to prohibit the Required Majority from reaching the 
conclusions required by this condition (2)(c)(iii), if:
    (A) the Eligible Directors will have the right to ratify the 
selection of such director or board observer, if any;
    (B) the Investment Advisers agree to, and do, provide, periodic 
reports to such Fund's Board with respect to the actions of such 
director or the information received by such board observer or obtained 
through the exercise of any similar right to participate in the 
governance or management of the portfolio company; and
    (C) any fees or other compensation that any Co-Investment Affiliate 
or any affiliated person of a Co-Investment Affiliate receives in 
connection with the right of the Co-Investment Affiliate to nominate a 
director or appoint a board observer or otherwise to participate in the 
governance or management of the portfolio company will be shared 
proportionately among the participating Co-Investment Affiliates (the 
Co-Investment Affiliates (other than the Fund) may, in turn, share 
their portion with their affiliated persons) and the applicable Fund in 
accordance with the amount of each party's investment; and
    (iv) the proposed investment by such Fund will not benefit the 
Investment Advisers or the Co-Investment Affiliates or any affiliated 
person of either of them (other than the parties to the Co-Investment 
Transaction), except (A) to the extent permitted by condition 13, (B) 
to the extent permitted by sections 17(e) and 57(k) of the Act, as 
applicable, (C) in the case of fees or other compensation described in 
condition 2(c)(iii)(C), or (D) indirectly, as a result of an interest 
in the securities issued by one of the parties to the Co-Investment 
Transaction.
    3. The applicable Fund has the right to decline to participate in 
any Potential Co-Investment Transaction or to invest less than the 
amount proposed.
    4. The applicable Investment Adviser will present to the applicable 
Fund's Board, on a quarterly basis, a record of all investments made by 
the Co-Investment Affiliates in Potential Co-Investment Transactions 
during the preceding quarter that fell within such Fund's then-current 
Objectives and Strategies that were not made available to the Fund, and 
an explanation of why the investment opportunities were not offered to 
the Fund. All information presented to such Fund's Board pursuant to 
this condition will be kept for the life of such Fund and at least two 
years thereafter, and will be subject to examination by the Commission 
and its staff.

[[Page 28903]]

    5. Except for follow-on investments made in accordance with 
condition 8, below, a Fund will not invest in reliance on the Order in 
any portfolio company in which any Co-Investment Affiliate or any 
affiliated person of a Co-Investment Affiliate is an existing investor.
    6. A Fund will not participate in any Potential Co-Investment 
Transaction unless the terms, conditions, price, class of securities to 
be purchased, settlement date, and registration rights will be the same 
for such Fund as for the Co-Investment Affiliates. The grant to a Co-
Investment Affiliate, but not such Fund, of the right to nominate a 
director for election to a portfolio company's board of directors, the 
right to have an observer on the board of directors or similar rights 
to participate in the governance or management of the portfolio company 
will not be interpreted so as to violate this condition 6, if 
conditions 2(c)(iii)(A), (B) and (C) are met.
    7. (a) If any Co-Investment Affiliate elects to sell, exchange or 
otherwise dispose of an interest in a security that was acquired in a 
Co-Investment Transaction, the applicable Investment Advisers will:
    (i) notify each Fund that participated in the Co-Investment 
Transaction of the proposed disposition at the earliest practical time; 
and
    (ii) formulate a recommendation as to participation by each Fund in 
the disposition.
    (b) Each Fund will have the right to participate in such 
disposition on a proportionate basis, at the same price and on the same 
terms and conditions as those applicable to other Co-Investment 
Affiliates.
    (c) A Fund may participate in such disposition without obtaining 
prior approval of the Required Majority if: (i) The proposed 
participation of each Co-Investment Affiliate in such disposition is 
proportionate to its outstanding investments in the issuer immediately 
preceding the disposition; (ii) the Board of the Fund has approved as 
being in the best interests of the Fund the ability to participate in 
such dispositions on a pro rata basis (as described in greater detail 
in the application); and (iii) the Board of each Fund is provided on a 
quarterly basis with a list of all dispositions made in accordance with 
this condition. In all other cases, the applicable Investment Adviser 
will provide its written recommendation as to the Fund's participation 
to the Eligible Directors, and the Fund will participate in such 
disposition solely to the extent that a Required Majority determines 
that it is in the Fund's best interests.
    (d) Each Co-Investment Affiliate will bear its own expenses in 
connection with any such disposition.
    8. (a) If any Co-Investment Affiliate desires to make a follow-on 
investment in a portfolio company whose securities were acquired in a 
Co-Investment Transaction, the Investment Advisers will:
    (i) notify each Fund that participated in the Co-Investment 
Transaction of the proposed transaction at the earliest practical time; 
and
    (ii) formulate a recommendation as to the proposed participation, 
including the amount of the proposed follow-on investment, by each 
Fund.
    (b) A Fund may participate in such follow-on investment without 
obtaining prior approval of the Required Majority if: (i) The proposed 
participation of each Co-Investment Affiliate in such investment is 
proportionate to its outstanding investments in the issuer immediately 
preceding the follow-on investment; and (ii) the Board of the Fund has 
approved as being in the best interests of the Fund the ability to 
participate in follow-on investments on a pro rata basis (as described 
in greater detail in the application). In all other cases, the 
applicable Investment Adviser will provide its written recommendation 
as to the Fund's participation to the Eligible Directors, and the Fund 
will participate in such follow-on investment solely to the extent that 
a Required Majority determines that it is in the Fund's best interests.
    (c) If, with respect to any follow-on investment:
    (i) the amount of the opportunity is not based on the Co-Investment 
Affiliate's outstanding investments immediately preceding the follow-on 
investment; and
    (ii) the aggregate amount recommended by the applicable Investment 
Adviser to be invested by such Fund in the follow-on investment, 
together with the amount proposed to be invested by the other Co-
Investment Affiliates in the same transaction, exceeds the amount of 
the opportunity, then the amount invested by each such party will be 
allocated among them pro rata based on the ratio of such Fund's capital 
available for investment in the asset class being allocated, on the one 
hand, and the Co-Investment Affiliates' capital available for 
investment in the asset class being allocated, on the other hand, to 
the aggregated capital available for investment for the asset class 
being allocated of all Co-Investment Affiliates involved in the follow-
on investment opportunity, up to the amount proposed to be invested by 
each.
    (d) The acquisition of follow-on investments as permitted by this 
condition will be considered a Co-Investment Transaction for all 
purposes and subject to the other conditions set forth in the 
application.
    9. The Independent Directors of each Fund will be provided 
quarterly for review all information concerning Potential Co-Investment 
Transactions and Co-Investment Transactions, including investments made 
by any Co-Investment Affiliate that the applicable Fund considered but 
declined to participate in, so that the Independent Directors may 
determine whether all investments made during the preceding quarter, 
including those investments which such Fund considered but declined to 
participate in, comply with the conditions of the Order. In addition, 
the Independent Directors will consider at least annually the continued 
appropriateness for the applicable Fund of participating in new and 
existing Co-Investment Transactions. All information presented to such 
Fund's Board pursuant to this condition will be kept for the life of 
such Fund and at least two years thereafter, and will be subject to 
examination by the Commission and its staff.
    10. Each Fund will maintain the records required by section 
57(f)(3) of the Act as if each of the investments permitted under these 
conditions were approved by the Required Majority under section 57(f).
    11. No director or trustee of a Fund will be considered an 
Independent Director or an Eligible Director if such director or 
trustee is also a director, general partner, managing member or 
principal, or otherwise an ``affiliated person'' (as defined in the 
1940 Act) of any of the Co-Investment Affiliates (other than any other 
Fund).
    12. The expenses, if any, associated with acquiring, holding or 
disposing of any securities acquired in a Co-Investment Transaction 
(including, without limitation, the expenses of the distribution of any 
such securities registered for sale under the Securities Act) shall, to 
the extent not payable by the applicable Investment Adviser under any 
agreement with the applicable Fund or other Co-Investment Affiliate, be 
shared by such Fund and each Co-Investment Affiliate in proportion to 
the relative amounts of the securities held or to be acquired or 
disposed of, as the case may be.
    13. Any transaction fee (including break-up or commitment fees but 
excluding broker's fees contemplated by section 17(e) or 57(k) of the 
Act, as applicable) received in connection with a Co-Investment 
Transaction will be

[[Page 28904]]

distributed to the applicable Fund and the Co-Investment Affiliates on 
a pro rata basis based on the amount they invested or committed, as the 
case may be, in such Co-Investment Transaction. If any transaction fee 
is to be held by the Investment Advisers or other investment adviser of 
a Co-Investment Affiliate pending consummation of the transaction, the 
fee will be deposited into an account maintained by the Investment 
Advisers or other investment adviser of a Co-Investment Affiliate at a 
bank or banks having the qualifications prescribed in section 26(a)(1) 
of the Act, and the account will earn a competitive rate of interest 
that will also be divided pro rata between such Fund and the Co-
Investment Affiliates based on the amount they invest in such Co-
Investment Transaction. None of the Co-Investment Affiliates, their 
investment advisers, nor any affiliated person (as defined in the Act) 
of the Funds will receive additional compensation or remuneration of 
any kind as a result of or in connection with a Co-Investment 
Transaction (other than (a) in the case of Co-Investment Affiliates, 
the pro rata transaction fees described above and fees or other 
compensation described in condition 2(c)(iii)(C) and (b) in the case of 
the advisers of the Co-Investment Affiliates, investment advisory fees 
paid in accordance with the agreements between such advisers and the 
Funds or other Co-Investment Affiliates).

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-11604 Filed 5-15-13; 8:45 am]
BILLING CODE 8011-01-P


