[Federal Register Volume 85, Number 127 (Wednesday, July 1, 2020)]
[Notices]
[Pages 39652-39658]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-14122]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33913; File No. 812-15072]


Conversus StepStone Private Markets, et al.

June 25, 2020.
AGENCY:  Securities and Exchange Commission (``Commission'').

ACTION:  Notice.

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    Notice of application for an order under section 17(d) of the 
Investment Company Act of 1940 (the ``Act'') and rule 17d-1 under the 
Act to permit certain joint transactions otherwise prohibited by 
section 17(d) of the Act and rule 17d-1 under the Act.

Summary of Application: Applicants request an order to permit certain 
closed-end management investment companies to co-invest in portfolio 
companies with each other and with affiliated investment funds.

Applicants: Conversus StepStone Private Markets (``Conversus Fund'' or 
the ``Existing Regulated Entity''); StepStone Conversus LLC 
(``StepStone Conversus''); StepStone Group LP (``StepStone Group''); 
2006 Co-Investment Portfolio, L.P., 2007 Co-Investment Portfolio, L.P., 
2008 Co-Investment Portfolio, L.P., Asia Enterprise II Offshore L.P., 
Asia Enterprise II Onshore LLC, Capitol Private Opportunities II 
(Parallel) LP, Capitol Private Opportunities II LP, Capitol Private 
Opportunities III (Parallel) LP, Capitol Private Opportunities III LP, 
Capitol Private Opportunities LP, CGR/PE, LLC, Europe Enterprise II 
Offshore, L.P., Europe Enterprise II Offshore, L.P., Europe Enterprise 
III Offshore L.P., Europe Enterprise III Onshore L.P., Latin America 
Opportunities (Delaware) L.P., Latin America Opportunities L.P., 
Lexington C/RE, LLC, Masters IV Cayman Holdings, L.P., MBKP North Asian 
Opportunities Partners Offshore L.P., Mezzanine Co-Investment 
Portfolio, L.P., NYSCRF Pioneer Opportunities Fund A, L.P., NYSCRF 
Pioneer Partnership Fund B, L.P., Pegasus Multi-Strategy Series (A) LP, 
Real Estate Domestic Partnership Fund I, L.P., Real Estate Global 
Partnership Fund II, L.P., Real Estate International Partnership Fund 
I, L.P., Silverstone I, LLC, Silverstone II, LLC--Series A, Silverstone 
II, LLC--Series B, Silverstone II, LLC--Series C, Silverstone II, LLC--
Series D, Silverstone II, LLC--Series E, Silverstone II, LLC--Series F, 
Silverstone II, LLC--Series G, Silverstone II, LLC--Series H, 
Silverstone II, LLC--Series I, Silverstone II, LLC--Series J, 
Silverstone II, LLC--Series K (Class 1), Silverstone II, LLC--Series K 
(Class 2), Silverstone III, L.P., SIMA Private Equity 6 GmbH & Co. KG, 
SRE Care--Investco, L.P., SRE Colt Devco--Investco, L.P., SRE Colt 
Opco--Investco, L.P., SRE Curator--Investco, L.P., SRE Curator-TS, LP, 
SRE Encore--Investco, L.P., SRE Freyja--Investco, L.P., SRE Hasso--
Investco, L.P., SRE Magnesia--Investco, L.P., SRE Maple Direct 
Investco, LP, SRE Maple REIT Investco, LP, SRE Panther--Investco, L.P., 
SRE Preservation--Investco, L.P., SRE Ripple--Investco LP, SRE Stern 
Debt--Investco, L.P., SRE Stern Equity--Investco, L.P., SREP III COLT 
OPCO REIT, LLC, SREP III Flight--Investco, L.P., StepStone A 
Opportunities Fund, L.P., StepStone Aegon Opportunities Fund, LP.--
Series

[[Page 39653]]

A, StepStone Aegon Opportunities Fund, LP.--Series B, StepStone AMP 
Opportunities Fund, L.P., Stepstone AMP Opportunities Fund, L.P.--
Series A, StepStone AP Opportunities Fund, L.P., StepStone Atlantic 
Fund, L.P.--Infrastructure Series 1 2011, StepStone Atlantic Fund, 
L.P.--Private Equity Series 1 2009, StepStone Atlantic Fund, L.P.--
Private Equity Series 2 2012, StepStone Atlantic Fund, L.P.--Private 
Markets Series 2014, StepStone Atlas Opportunities Fund II, L.P., 
StepStone Atlas Opportunities Fund LP, StepStone AZ China and Asia 
Opportunities Fund, L.P., StepStone AZ Secondary Opportunities Fund, 
L.P., StepStone BVK Opportunities Fund SCSP, StepStone C Strategic Core 
Infrastructure Partnership, L.P., StepStone Capital Partners II Cayman 
Holdings, L.P., StepStone Capital Partners II Onshore, L.P., StepStone 
Capital Partners III Offshore Holdings, L.P., StepStone Capital 
Partners III, L.P., StepStone Capital Partners IV Europe Holdings SCSP, 
StepStone Capital Partners IV Offshore Holdings, L.P., StepStone 
Capital Partners IV, L.P., StepStone CC Opportunities Fund, LLC, 
StepStone CGC Opportunities I, L.P., StepStone Endurance L.P., 
StepStone European Fund SCS, SICAV-FIS--StepStone Capital Partners III 
Compartment, StepStone European Fund SCS, SICAV-FIS--StepStone Real 
Estate Partners III Compartment, StepStone Ferro Opportunities Fund, 
L.P., StepStone FSS Opportunities Fund, L.P., StepStone G 
Infrastructure Opportunities, L.P., StepStone H Opportunities Fund, 
L.P., StepStone International Investors II, L.P., StepStone 
International Investors II-G, L.P., StepStone International Investors 
III, L.P., StepStone International Investors IV (Delaware), L.P., 
StepStone International Investors IV (Guernsey), L.P., StepStone JP 
Opportunities Fund IA, L.P., StepStone JP Opportunities Fund II, L.P., 
StepStone JP Opportunities Fund, L.P., StepStone K Infrastructure 
Opportunities Fund, L.P., StepStone K Real Estate Co-Investment Fund, 
L.P., StepStone K Strategic Opportunities Fund II, L.P., StepStone K 
Strategic Opportunities Fund III, L.P., StepStone K Strategic 
Opportunities Fund, L.P., StepStone KF Infrastructure Fund II, L.P., 
StepStone KF Infrastructure Fund, L.P., StepStone KF Private Equity 
Fund II, L.P., StepStone KF Private Equity Fund, L.P., StepStone Maple 
Opportunities Fund, L.P., StepStone Masters III L.P., StepStone Masters 
III Offshore L.P., StepStone Masters IV L.P., StepStone Masters V 
Cayman Holdings, L.P., StepStone Masters V LP, StepStone Mexico I Co-
Investment Opportunities Fund, L.P., StepStone Mexico I SPC, StepStone 
Mezzanine Partners (Offshore) I-A L.P., StepStone Mezzanine Partners I-
A L.P., StepStone NL Opportunities Fund II, L.P., StepStone NL 
Opportunities Fund, L.P., StepStone NLGI Infrastructure Opportunities 
Fund, L.P., StepStone NPS Infrastructure Fund, L.P., StepStone NPS PE 
Fund, L.P., StepStone NPS PE Fund, L.P.--Tranche B, StepStone OH 
Secondary Opportunities Fund, L.P., StepStone P Opportunities Fund, 
L.P., StepStone PA Tap Fund I, LP, StepStone Phoenix Opportunities 
Fund, L.P., StepStone PIFSS Real Estate Co-Investment Fund, L.P., 
StepStone Pioneer Capital Buyout Fund I, L.P., StepStone Pioneer 
Capital Buyout Fund II, L.P., StepStone Pioneer Capital Europe II, L.P. 
Incorporated, StepStone Pioneer Capital Europe Opportunities Fund I, 
L.P. Incorporated, StepStone Pioneer Capital Europe Opportunities Fund 
I, L.P. Incorporated, StepStone Pioneer Capital Europe Opportunities 
Fund IB, L.P. Incorporated, StepStone Pioneer Capital I, L.P., 
StepStone Pioneer Capital II, L.P., StepStone Pioneer Capital III, 
L.P., StepStone Pioneer Opportunities Fund II, L.P., StepStone Pioneer 
Opportunities Fund, L.P., StepStone PPL Secondary Opportunities Fund, 
L.P., StepStone Private Access Partnership, L.P., StepStone Private 
Equity Partners II L.P., StepStone Private Equity Partners III Cayman 
Holdings, L.P., StepStone Private Equity Partners III L.P., StepStone 
Private Equity Partners L.P., StepStone Private Equity Partners 
Offshore II L.P., StepStone Private Equity Partners Offshore L.P., 
StepStone Private Equity Portfolio L.P., StepStone R Co-Investment 
Partnership, L.P., StepStone Real Estate Partners III Cayman, LP, 
StepStone Real Estate Partners III I Opportunities Fund, L.P., 
Stepstone Real Estate Partners III Offshore, L.P., StepStone Real 
Estate Partners III TE, L.P., StepStone Real Estate Partners III, L.P., 
StepStone Real Estate Partners IV Parallel, L.P., StepStone Real Estate 
Partners IV, L.P., StepStone Rivas Private Equity Fund, L.P., StepStone 
Scorpio Infrastructure Opportunities Fund, L.P., StepStone Secondary 
Opportunities Fund II Offshore Holdings, L.P., StepStone Secondary 
Opportunities Fund II, L.P., StepStone Secondary Opportunities Fund III 
Offshore Holdings SCSP, StepStone Secondary Opportunities Fund III, 
L.P., StepStone Secondary Opportunities Fund IV Offshore Holdings, 
L.P., StepStone Secondary Opportunities Fund IV, L.P., StepStone 
Secondary Opportunities Fund, L.P., StepStone Sedco European 
Opportunities Fund, L.P., StepStone Sedco U.S. Opportunities Fund, 
L.P., StepStone Tactical Growth Fund II Offshore Holdings, L.P., 
StepStone Tactical Growth Fund II, L.P., StepStone Tactical Growth Fund 
Offshore Holdings, L.P., StepStone Tactical Growth Fund, L.P., 
StepStone UWF Secondary Opportunities Fund, L.P.--Series A, StepStone 
UWF Secondary Opportunities Fund, L.P.--Series B, StepStone XL 
Opportunities Fund II-A, L.P., StepStone XL Opportunities Fund II-B, 
L.P., StepStone XL Opportunities Fund, L.P., StepStone-SYN Investments, 
L.L.L.P., Sunsira Infrastructure Fund, LLC, Sunstone PE Opportunities 
Fund, LLC, Sunstone Real Estate, L.P., T.F. Capital Investors II L.P., 
T.F. Capital Investors II Offshore L.P., Terrace Investment Holdings 
SMF, LLC, Terrace Investment Holdings, LLC, UK Canadian Hydro HoldCo A 
Limited, Bridge Village Limited, StepStone E Opportunities Fund, L.P., 
StepStone E Offshore Opportunities Fund, L.P., StepStone M 
Opportunities Fund, L.P., StepStone LMM Opportunities Fund I, L.P.--
Series A, StepStone LMM Opportunities Fund I, L.P.--Series B, 
Multibrand SICAV-SIF--Valida Private Equity Fund, Heathrow Forest Asia 
Opportunities Fund, L.P., StepStone NPS PE Fund II, L.P., LCIV 
Infrastructure Fund, StepStone B Infrastructure Opportunities Fund, 
L.P., StepStone NPS Infrastructure Fund II, L.P., Swiss Capital FPT 
Private Debt Fund L.P., Swiss Capital GPIM Private Debt Fund L.P., 
Swiss Capital HPS Private Debt Fund L.P., SC ACM Private Debt Fund 
L.P., SC Co-Investments Private Debt Fund L.P., SC NXT Capital Private 
Debt Fund L.P., SC ACA Private Debt Fund L.P., Swiss Capital HYS 
Private Debt Fund L.P., Swiss Capital KKR Private Debt Fund L.P., Swiss 
Capital Capitala Private Debt Fund L.P., SC BTC Private Debt Fund L.P., 
Swiss Capital KA Private Debt Fund L.P., Swiss Capital TLCP Private 
Debt Fund L.P., Swiss Capital DCM Private Debt Fund L.P., Swiss Capital 
PD (Offshore) Funds SPC, SC FPT Private Debt Offshore SP, SC NXT 
Capital Private Debt Offshore SP, SC ACA Private Debt Offshore SP, 
Swiss Capital CAPITALA Private Debt Offshore SP, Swiss Capital BTC 
Private Debt Offshore SP, Swiss Capital Co-Investments Private Debt 
Offshore SP, Swiss Capital HYS Private Debt Offshore SP, Swiss Capital 
ASP Private Debt Offshore SP, SC ACM Private Debt Offshore SP, Swiss 
Capital KA Private Debt Offshore SP, StepStone Private

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Debt Secondary Funds SPC, SC DCM Secondary SP, Swiss Capital 
Alternative Strategies Funds SPC, SC Alternative Strategy 1 SP, SC 
Alternative Strategy 2 SP, SC Alternative Strategy 3 SP, SC Alternative 
Strategy 4 SP, SC Alternative Strategy 5 SP, SC Alternative Strategy 6 
SP, SC Alternative Strategy 7 SP, SC Alternative Strategy 8 SP, SC 
Alternative Strategy 9 SP, SC Alternative Strategy 10 SP, SC 
Alternative Strategy 11 SP, SC Alternative Strategy 12 SP, SC 
Alternative Strategy 13 SP, SC Alternative Strategy 14 SP, StepStone 
ADF Opportunities Fund L.P., SC CWMAA Senior Corporate Lending L.P., 
Senior Corporate Lending Enhanced I Fund L.P., SCL XL I Fund L.P., SSG 
NLGI Private Debt Funds SPC, SSG NLGI European Direct Lending SP, Swiss 
Capital PRO Loan V plc, Swiss Capital PRO Loan VII plc, Swiss Capital 
Private Markets Funds, LG Income Fund, SC LV Private Debt Fund, Swiss 
Capital Private Markets II Funds, AGON Fund, Senior Corporate Lending 
Fund I, EuroPrima Fund, CWPS Global Infrastructure Fund, Senior 
Corporate Lending Europe Fund, Swiss Capital Credit Strategies ICAV, LG 
Direct Lending Platform Fund, SC LV Private Debt Platform Fund, Swiss 
Capital Credit Strategies II ICAV, 3SC PRIDE Fund, SSG Valluga Fund, 
Swiss Capital PRO Colours Funds PLC, SC New Targets Funds, SC Target D 
Fund, SC Target O Fund, Oceanic Global Investment Funds plc, Pacific 
Ocean Fund, Swiss Capital Non-Traditional Funds, Swiss Capital PRO Non-
Traditional Funds, Swiss Capital PRO Matrix Fund, Swiss Capital PRO 
Disintermediation I Fund, Swiss Capital PRO Unicum Fund, Swiss Capital 
PRO SST Fund, SC Private Debt Fund III L.P., Swiss Capital European 
Private Debt Funds I (SICAV) SCSP, ACM European Private Debt Fund, BLK 
European Private Debt Fund, TKH European Private Debt Fund, Co-
Investment European Private Debt Fund, Apera European Private Debt 
Fund, CVC CP SSG European Private Debt Fund, TEREF LUX I, HCM European 
Private Debt Fund, Bridgepoint European Private Debt Fund, StepStone 
Trade Finance ICAV, StepStone Trade Finance Fund, Swiss Capital Credit 
Strategies III ICAV, PR Private Debt Fund, Swiss Capital Private 
Markets III, PR Private Debt Platform Fund, SSG Credit Strategies IV 
ICAV, SSG Gen Credit Fund I, SSG Credit Strategies V ICAV, SSG Gen 
Credit Fund II, SSG ME Private Debt Fund LP, Swiss Capital BG OL 
Private Debt Fund LP, Swiss Capital Alternative Strategies Funds II 
SPC, SC Alternative Strategy A SP, StepStone Real Estate Partners IV 
Europe SCS, and StepStone Secondary Opportunities Fund IV Europe 
Holdings SCSP (collectively, the ``Existing Affiliated Funds'').

Filing Dates: The application was filed on October 7, 2019, and amended 
on January 9, 2020, April 27, 2020, June 22, 2020, and June 23, 2020.

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 emailing the Commission's 
Secretary at Secretarys-Office@sec.gov and serving applicants with a 
copy of the request by email. Hearing requests should be received by 
the Commission by 5:30 p.m. on July 20, 2020, 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, the 
reason for the request, and the issues contested. Persons who wish to 
be notified of a hearing may request notification by emailing the 
Commission's Secretary at Secretarys-Office@sec.gov.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 
Secretarys-Office@sec.gov. Applicants: Robert W. Long, StepStone 
Conversus LLC, conversus@stepstoneglobal.com.

FOR FURTHER INFORMATION CONTACT:  Hae-Sung Lee, Senior Counsel, at 
(202) 551-7345 or Trace W. Rakestraw, Branch Chief, at (202) 551-6825 
(Chief Counsel's 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 website 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. Conversus Fund is a Delaware statutory trust organized as a non-
diversified, closed-end management investment company, registered under 
the Act. Conversus Fund's investment objectives are to invest in a 
broad cross section of private markets assets that will enable the 
Conversus Fund to, over time, achieve long-term capital appreciation 
and provide regular, current income through quarterly distributions. 
The board of directors (``Board'') of the Conversus Fund has five 
members, three of whom are not an ``interested person'' of the 
Conversus Fund within the meaning of Section 2(a)(19) of the Act (the 
``Independent Trustees'').\1\
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    \1\ The term ``Independent Trustees'' refers to the independent 
directors, managers, or trustees of any Regulated Entity (defined 
below).
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    2. StepStone Conversus is a Delaware limited liability company that 
is registered as an investment adviser with the Commission under the 
Investment Advisers Act of 1940 (the ``Advisers Act''). StepStone 
Conversus serves as the investment adviser to the Existing Regulated 
Entity. StepStone Conversus is a wholly-owned subsidiary of StepStone 
Group.
    3. StepStone Group is a Delaware limited partnership that is 
registered as an investment adviser with the Commission under the 
Advisers Act. StepStone Group serves as the sub-adviser to the Existing 
Regulated Entity and controls StepStone Conversus.
    4. The Existing Affiliated Funds pursue strategies focused on 
investing in a portfolio of professionally managed private markets 
funds and select direct private markets investments. Each Existing 
Affiliated Fund is advised by an Existing Adviser \2\ and would be an 
investment company but for section 3(c)(1) or 3(c)(7) of the Act.
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    \2\ ``Existing Adviser'' means StepStone Group or StepStone 
Conversus.
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    5. Applicants seek an order (``Order'') to permit a Regulated 
Entity \3\ and one or more other Regulated Entities and one or more 
Affiliated Funds \4\ to (a) participate in the same investment 
opportunities through a proposed co-investment program where such 
participation would otherwise be prohibited under section 17 of the 
Act; and (b) make additional investments in securities of such issuers 
(``Follow-On Investments''), including through the exercise of 
warrants, conversion privileges, and other rights to purchase 
securities of the issuers. ``Co-Investment Transaction'' means any 
transaction in

[[Page 39655]]

which a Regulated Entity (or its Wholly-Owned Investment Subsidiary, as 
defined below) participated together with one or more other Regulated 
Entities and/or Affiliated Funds in reliance on the requested Order. 
``Potential Co-Investment Transaction'' means any investment 
opportunity in which a Regulated Entity (or its Wholly-Owned Investment 
Subsidiaries) could not participate together with one or more other 
Regulated Entities and/or one or more Affiliated Funds without 
obtaining and relying on the Order.\5\
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    \3\ ``Regulated Entity'' refers to any Existing Regulated Entity 
and any Future Regulated Entity. ``Future Regulated Entity'' means 
any closed-end management investment company formed in the future 
that is registered under the Act whose investment adviser (and sub-
adviser(s), if any) is an Adviser. ``Future Adviser'' means any 
future investment adviser that controls, is controlled by, or is 
under common control with StepStone Conversus and is registered as 
an investment adviser under the Advisers Act.
    \4\ ``Affiliated Fund'' means any Existing Affiliated Fund or 
any Future Affiliated Fund. ``Future Affiliated Fund'' means any 
investment fund that would be an ``investment company'' but for 
section 3(c)(1) or 3(c)(7) of the Act, is formed in the future, and 
whose investment adviser (and sub-adviser(s), if any) is an Adviser. 
The term ``Adviser'' means any Existing Adviser or any Future 
Adviser. No Affiliated Fund is or will be a subsidiary of a 
Regulated Entity.
    \5\ All existing entities that currently intend to rely upon the 
requested Order have been named as applicants. Any other existing or 
future entity that subsequently relies on the Order will comply with 
the terms and conditions of the application.
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    6. Applicants state that a Regulated Entity may, from time to time, 
form one or more Wholly-Owned Investment Subsidiaries.\6\ Such a 
subsidiary would be prohibited from investing in a Co-Investment 
Transaction with any other Regulated Entity or Affiliated Fund because 
it would be a company controlled by its parent Regulated Entity for 
purposes of rule 17d-1. Applicants request that each Wholly-Owned 
Investment Subsidiary be permitted to participate in Co-Investment 
Transactions in lieu of its parent Regulated Entity and that the 
Wholly-Owned Investment Subsidiary's participation in any such 
transaction be treated, for purposes of the Order, as though the parent 
Regulated Entity were participating directly. Applicants represent that 
this treatment is justified because a Wholly-Owned Investment 
Subsidiary would have no purpose other than serving as a holding 
vehicle for the Regulated Entity's investments and, therefore, no 
conflicts of interest could arise between the Regulated Entity and the 
Wholly-Owned Investment Subsidiary. The Regulated Entity's Board would 
make all relevant determinations under the conditions with regard to a 
Wholly-Owned Investment Subsidiary's participation in a Co-Investment 
Transaction, and the Regulated Entity's Board would be informed of, and 
take into consideration, any proposed use of a Wholly-Owned Investment 
Subsidiary in the Regulated Entity's place. If the Regulated Entity 
proposes to participate in the same Co-Investment Transaction with any 
of its Wholly-Owned Investment Subsidiaries, the Board will also be 
informed of, and take into consideration, the relative participation of 
the Regulated Entity and the Wholly-Owned Investment Subsidiary.
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    \6\ The term ``Wholly-Owned Investment Subsidiary'' means an 
entity: (a) That is wholly-owned by a Regulated Entity (with such 
Regulated Entity at all times holding, beneficially and of record, 
100% of the voting and economic interests); (b) whose sole business 
purpose is to hold one or more investments on behalf of such 
Regulated Entity; (c) with respect to which the board of directors 
of such Regulated Entity has the sole authority to make all 
determinations with respect to the entity's participation under the 
conditions of the application; and (d) that would be an investment 
company but for section 3(c)(1) or 3(c)(7) of the Act. All 
subsidiaries participating in Co-Investment Transactions will be 
Wholly-Owned Investment Subsidiaries and will have Objectives and 
Strategies (as defined below) that are either the same as, or a 
subset of, their parent Regulated Entity's Objectives and 
Strategies.
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    7. When considering Potential Co-Investment Transactions for any 
Regulated Entity, the relevant Adviser will consider only the 
Objectives and Strategies,\7\ investment policies, investment 
positions, capital available for investment, and other pertinent 
factors applicable to that Regulated Entity. The Advisers expect that 
any portfolio company that is an appropriate investment for a Regulated 
Entity should also be an appropriate investment for one or more other 
Regulated Entities and/or one or more Affiliated Funds, with certain 
exceptions based on available capital or diversification.\8\
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    \7\ The term ``Objectives and Strategies'' means a Regulated 
Entity's investment objectives and strategies as described in the 
Regulated Entity's registration statement on Form N-2, other filings 
the Regulated Entity has made with the Commission under the 
Securities Act of 1933 (the ``Securities Act'') or the Securities 
Exchange Act of 1934, and the Regulated Entity's reports to 
shareholders.
    \8\ The Regulated Entities, however, will not be obligated to 
invest, or co-invest, when investment opportunities are referred to 
them.
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    8. 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 Adviser will present 
each Potential Co-Investment Transaction and the proposed allocation to 
the directors of the Board eligible to vote on that Co-Investment 
Transaction (the ``Eligible Trustees'') \9\ and the majority of such 
directors of the Board who are Independent Trustees (a ``Required 
Majority'') will approve each Co-Investment Transaction prior to any 
investment by the participating Regulated Entity.
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    \9\ Eligible Trustees may not have a financial interest in such 
transaction, plan, or arrangement.
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    9. With respect to the pro rata dispositions and Follow-On 
Investments provided in conditions 7 and 8, a Regulated Entity 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 Regulated Entity and 
each Affiliated Fund in such disposition 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 Regulated Entity has approved that Regulated Entity's 
participation in pro rata dispositions and Follow-On Investments as 
being in the best interests of the Regulated Entity. If the Board does 
not so approve, any such disposition or Follow-On Investment will be 
submitted to the Regulated Entity's Eligible Trustees. The Board of any 
Regulated Entity 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 Trustees.
    10. No Independent Trustee of a Regulated Entity will have a direct 
or indirect financial interest in any Co-Investment Transaction (other 
than indirectly through share ownership in one of the Regulated 
Entities), including any interest in any company whose securities would 
be acquired in a Co-Investment Transaction.
    11. Under condition 15, if an Adviser, its principals, or any 
person controlling, controlled by, or under common control with the 
Adviser or its principals, and the Affiliated Funds (collectively, the 
``Holders'') own in the aggregate more than 25 percent of the 
outstanding voting shares of a Regulated Entity (the ``Shares''), then 
the Holders will vote such Shares as directed by an independent third 
party when voting on matters specified in the condition. Applicants 
believe that this condition will ensure that the Independent Trustees 
will act independently in evaluating the co-investment program, because 
the ability of an Adviser or its principals to influence the 
Independent Trustees by a suggestion, explicit or implied, that the 
Independent Trustees can be removed will be limited significantly. 
Applicants represent that the Independent Trustees will evaluate and 
approve any such independent third party, taking into account its 
qualifications, reputation for independence, cost to the Regulated 
Entity's shareholders, and other factors that they deem relevant.
    Applicants' Legal Analysis:
    1. 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. In 
passing upon applications under rule 17d-1, the

[[Page 39656]]

Commission considers whether the company's participation in the joint 
transaction is consistent with 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.
    2. Applicants state that in the absence of the requested relief, 
the Regulated Entities may be, in some circumstances, limited in their 
ability to participate in attractive and appropriate investment 
opportunities. Applicants believe that the proposed terms and 
conditions will ensure that the Co-Investment Transactions are 
consistent with the protection of each Regulated Entity's shareholders 
and with the purposes intended by the policies and provisions of the 
Act. Applicants state that the Regulated Entities' 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 the Order will be subject to the following 
conditions:
    1. Each time an Adviser considers a Potential Co-Investment 
Transaction for another Regulated Entity or an Affiliated Fund that 
falls within a Regulated Entity's then-current Objectives and 
Strategies, the Regulated Entity's Adviser will make an independent 
determination of the appropriateness of the investment for the 
Regulated Entity in light of the Regulated Entity's then-current 
circumstances.
    2. (a) If the Adviser deems a Regulated Entity's participation in 
any Potential Co-Investment Transaction to be appropriate for the 
Regulated Entity, the Adviser will then determine an appropriate level 
of investment for the Regulated Entity.
    (b) If the aggregate amount recommended by the applicable Adviser 
to be invested by the applicable Regulated Entity in the Potential Co-
Investment Transaction together with the amount proposed to be invested 
by the other participating Regulated Entities and Affiliated Funds, 
collectively, in the same transaction, exceeds the amount of the 
investment opportunity, the investment opportunity will be allocated 
among them pro rata based on each participant's capital available for 
investment in the asset class being allocated, up to the amount 
proposed to be invested by each. The applicable Adviser will provide 
the Eligible Trustees of each participating Regulated Entity with 
information concerning each participating party's available capital to 
assist the Eligible Trustees with their review of the Regulated 
Entity's investments for compliance with these allocation procedures.
    (c) After making the determinations required in conditions 1 and 
2(a), the applicable Adviser will distribute written information 
concerning the Potential Co-Investment Transaction (including the 
amount proposed to be invested by each Regulated Entity and each 
Affiliated Fund) to the Eligible Trustees of each participating 
Regulated Entity for their consideration. A Regulated Entity will co-
invest with another Regulated Entity or an Affiliated Fund only if, 
prior to the Regulated Entity's participation in the Potential Co-
Investment Transaction, a Required Majority concludes that:
    (i) The terms of the Potential Co-Investment Transaction, including 
the consideration to be paid, are reasonable and fair to the Regulated 
Entity and its investors and do not involve overreaching in respect of 
the Regulated Entity or its investors on the part of any person 
concerned;
    (ii) the Potential Co-Investment Transaction is consistent with:
    (A) The interests of the Regulated Entity's investors; and
    (B) the Regulated Entity's then-current Objectives and Strategies;
    (iii) the investment by any other Regulated Entities or any 
Affiliated Funds would not disadvantage the Regulated Entity, and 
participation by the Regulated Entity would not be on a basis different 
from or less advantageous than that of any other Regulated Entities or 
any Affiliated Funds; provided that, if any other Regulated Entity or 
any Affiliated Fund, but not the Regulated Entity itself, 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 Trustees will have the right to ratify the 
selection of such director or board observer, if any; and
    (B) the applicable Adviser agrees to, and does, provide periodic 
reports to the Board of the Regulated Entity 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 Regulated Entity or any 
Affiliated Fund or any affiliated person of any Regulated Entity or any 
Affiliated Fund receives in connection with the right of a Regulated 
Entity or an Affiliated Fund 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 Affiliated Funds (who may each, in turn, share its 
portion with its affiliated persons) and the participating Regulated 
Entities in accordance with the amount of each party's investment; and
    (iv) the proposed investment by the Regulated Entity will not 
benefit any Adviser, the other Regulated Entities, the Affiliated Funds 
or any affiliated person of any 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 section 17(e) of the Act, 
as applicable, (C) indirectly, as a result of an interest in the 
securities issued by one of the parties to the Co-Investment 
Transaction, or (D) in the case of fees or other compensation described 
in condition 2(c)(iii)(C).
    3. Each Regulated Entity has the right to decline to participate in 
any Potential Co-Investment Transaction or to invest less than the 
amount proposed.
    4. The applicable Adviser will present to the Board of each 
Regulated Entity, on a quarterly basis, a record of all investments in 
Potential Co-Investment Transactions made by any of the other Regulated 
Entities or Affiliated Funds during the preceding quarter that fell 
within the Regulated Entity's then-current Objectives and Strategies 
that were not made available to the Regulated Entity, and an 
explanation of why the investment opportunities were not offered to the 
Regulated Entity. All information presented to the Board pursuant to 
this condition will be kept for the life of the Regulated Entity and at 
least two years thereafter, and will be subject to examination by the 
Commission and its staff.
    5. Except for Follow-On Investments made in accordance with 
condition 8,\10\ a Regulated Entity will not invest in reliance on the 
Order in any issuer in which another Regulated Entity, Affiliated Fund, 
or any affiliated person of another Regulated Entity or Affiliated Fund 
is an existing investor.
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    \10\ This exception applies only to Follow-On Investments by a 
Regulated Entity in issuers in which that Regulated Entity already 
holds investments.
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    6. A Regulated Entity will not participate in any Potential Co-

[[Page 39657]]

Investment Transaction unless the terms, conditions, price, class of 
securities to be purchased, settlement date, and registration rights 
will be the same for each participating Regulated Entity and Affiliated 
Fund. The grant to another Regulated Entity or an Affiliated Fund, but 
not the Regulated Entity, 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 Regulated Entity or an Affiliated Fund elects to 
sell, exchange or otherwise dispose of an interest in a security that 
was acquired in a Co-Investment Transaction, the applicable Adviser 
will:
    (i) Notify each Regulated Entity 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 
Regulated Entity in the disposition.
    (b) Each Regulated Entity 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 the participating 
Regulated Entities and Affiliated Funds.
    (c) A Regulated Entity may participate in such disposition without 
obtaining prior approval of the Required Majority if: (i) The proposed 
participation of each Regulated Entity and each Affiliated Fund in such 
disposition is proportionate to its outstanding investments in the 
issuer immediately preceding the disposition; (ii) the Board of the 
Regulated Entity has approved as being in the best interests of the 
Regulated Entity 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 the Regulated Entity is provided on a quarterly 
basis with a list of all dispositions made in accordance with this 
condition. In all other cases, the Adviser will provide its written 
recommendation as to the Regulated Entity's participation to the 
Regulated Entity's Eligible Trustees, and the Regulated Entity will 
participate in such disposition solely to the extent that a Required 
Majority determines that it is in the Regulated Entity's best 
interests.
    (d) Each Regulated Entity and each Affiliated Fund will bear its 
own expenses in connection with any such disposition.
    8. (a) If a Regulated Entity or an Affiliated Fund desires to make 
a Follow-On Investment in a portfolio company whose securities were 
acquired in a Co-Investment Transaction, the applicable Adviser will:
    (i) Notify each Regulated Entity 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 
Regulated Entity.
    (b) A Regulated Entity may participate in such Follow-On Investment 
without obtaining prior approval of the Required Majority if: (i) The 
proposed participation of each Regulated Entity and each Affiliated 
Fund in such investment is proportionate to its outstanding investments 
in the issuer immediately preceding the Follow-On Investment; and (ii) 
the Board of the Regulated Entity has approved as being in the best 
interests of the Regulated Entity 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 Adviser will provide its 
written recommendation as to the Regulated Entity's participation to 
the Eligible Trustees, and the Regulated Entity will participate in 
such Follow-On Investment solely to the extent that a Required Majority 
determines that it is in the Regulated Entity's best interests.
    (c) If, with respect to any Follow-On Investment:
    (i) The amount of a Follow-On Investment is not based on the 
Regulated Entities' and the Affiliated Funds' outstanding investments 
immediately preceding the Follow-On Investment; and
    (ii) the aggregate amount recommended by the Adviser to be invested 
by each Regulated Entity in the Follow-On Investment, together with the 
amount proposed to be invested by the participating Affiliated Funds 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 each party's capital available for investment in the 
asset class being allocated, 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 Trustees of each Regulated Entity will be 
provided quarterly for review all information concerning Potential Co-
Investment Transactions and Co-Investment Transactions, including 
investments made by other Regulated Entities and the Affiliated Funds 
that the Regulated Entity considered but declined to participate in, so 
that the Independent Trustees may determine whether all investments 
made during the preceding quarter, including those investments which 
the Regulated Entity considered but declined to participate in, comply 
with the conditions of the Order. In addition, the Independent Trustees 
will consider at least annually the continued appropriateness for the 
Regulated Entity of participating in new and existing Co-Investment 
Transactions.
    10. Each Regulated Entity will maintain the records required by 
section 57(f)(3) of the Act as if each of the Regulated Entities were a 
business development company (as defined in section 2(a)(48) of the 
Act) and each of the investments permitted under these conditions were 
approved by the Required Majority under section 57(f) of the Act.
    11. No Independent Trustee of a Regulated Entity will also be a 
director, general partner, managing member or principal, or otherwise 
an ``affiliated person'' (as defined in the Act) of an Affiliated 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) will, to 
the extent not payable by an Adviser under the investment advisory 
agreements with the Regulated Entities and the Affiliated Funds, be 
shared by the Affiliated Funds and the Regulated Entities 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 \11\ (including break-up or commitment fees 
but excluding broker's fees contemplated by section 17(e) of the Act, 
as applicable), received in connection with a Co-Investment Transaction 
will be distributed to the participating Regulated Entities and 
Affiliated Funds on a pro rata basis based on the amounts they invested 
or committed, as the case may be, in such Co-Investment Transaction. If 
any transaction fee is to be held by the Adviser pending

[[Page 39658]]

consummation of the transaction, the fee will be deposited into an 
account maintained by the Adviser 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 among the participating Regulated Entities and 
Affiliated Funds based on the amounts they invest in such Co-Investment 
Transaction. None of the Affiliated Funds, the Advisers, the other 
Regulated Entities or any affiliated person of the Regulated Entities 
or Affiliated 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 the Regulated 
Entities and Affiliated Funds, 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, investment advisory 
fees paid in accordance with the agreements between the Advisers and 
the Regulated Entities or the Affiliated Funds).
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    \11\ Applicants are not requesting and the staff is not 
providing any relief for transaction fees received in connection 
with any Co-Investment Transaction.
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    14. The Advisers will each maintain policies and procedures 
reasonably designed to ensure compliance with the foregoing conditions. 
These policies and procedures will require, among other things, that 
the applicable Adviser will be notified of all Potential Co-Investment 
Transactions that fall within a Regulated Entity's then-current 
Objectives and Strategies and will be given sufficient information to 
make its independent determination and recommendations under conditions 
1, 2(a), 7 and 8.
    15. If the Holders own in the aggregate more than 25 percent of the 
Shares of a Regulated Entity, then the Holders will vote such Shares as 
directed by an independent third party when voting on (1) the election 
of directors; (2) the removal of one or more directors; or (3) all 
other matters under either the Act or applicable State law affecting 
the Board's composition, size or manner of election.
    16. Each Regulated Entity's chief compliance officer, as defined in 
Rule 38a-1(a)(4), will prepare an annual report for its Board that 
evaluates (and documents the basis of that evaluation) the Regulated 
Entity's compliance with the terms and conditions of the application 
and the procedures established to achieve such compliance.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-14122 Filed 6-30-20; 8:45 am]
BILLING CODE 8011-01-P


