[Federal Register Volume 83, Number 244 (Thursday, December 20, 2018)]
[Notices]
[Pages 65385-65386]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-27516]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 33323; 812-14893]
Investment Managers Series Trust and 361 Capital, LLC
December 14, 2018.
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 (``Act'') for an exemption from section 15(a) of
the Act and rule 18f-2 under the Act, as well as from certain
disclosure requirements in rule 20a-1 under the Act, Item 19(a)(3) of
Form N-1A, Items 22(c)(1)(ii), 22(c)(1)(iii), 22(c)(8) and 22(c)(9) of
Schedule 14A under the Securities Exchange Act of 1934, and sections 6-
07(2)(a), (b), and (c) of Regulation S-X (``Disclosure Requirements'').
The requested exemption would permit an investment adviser to hire and
replace certain sub-advisers without shareholder approval and grant
relief from the Disclosure Requirements as they relate to fees paid to
the sub-advisers.
Applicants: Investment Managers Series Trust (the ``Trust''), a
Delaware statutory trust registered under the Act as an open-end
management investment company, and 361 Capital, LLC (the ``Adviser''),
a Delaware limited liability company registered as an investment
adviser under the Investment Advisers Act of 1940 (together with the
Trust, the ``Applicants'').
Filing Dates: The application was filed on April 5, 2018 and amended
on August 16, 2018.
Hearing or Notification of Hearing: An order granting the application
will be issued unless the Commission orders a hearing. Interested
persons may request a hearing by writing to the Commission's Secretary
and serving applicants with a copy of the request, personally or by
mail. Hearing requests should be received by the Commission by 5:30
p.m. on January 8, 2019, and should be accompanied by proof of service
on the applicants, in the form of an affidavit or, for lawyers, a
certificate of service. Pursuant to rule 0-5 under the Act, hearing
requests should state the nature of the writer's interest, any facts
bearing upon the desirability of a hearing on the matter, the reason
for the request, and the issues contested. Persons who wish to be
notified of a hearing may request notification by writing to the
Commission's Secretary.
ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F
Street NE, Washington, DC 20549-1090. Applicants: 235 West Galena
Street, Milwaukee, WI 53212 and 4600 South Syracuse Street, Suite 500,
Denver, Colorado 80237.
FOR FURTHER INFORMATION CONTACT: Deepak T. Pai, Senior Counsel, at
(202) 551-6876, or Andrea Ottomanelli Magovern, 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 website by searching for the file number, or an applicant
using the Company name box, at http://www.sec.gov/search/search.htm or
by calling (202) 551-8090.
Summary of the Application:
1. The Adviser will serve as the investment adviser to the
Subadvised Series pursuant to an investment advisory agreement with the
Trust (each, an ``Investment Management Agreement'' and, collectively,
the ``Investment Management Agreements'').\1\ The Adviser will
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provide the Subadvised Series with continuous and comprehensive
investment management services, subject to the supervision of, and
policies established by, the Trust's board of trustees (the ``Board'').
The Investment Management Agreement permits the Adviser, subject to the
approval of the Board, to delegate to one or more Sub-Advisers the
responsibility to provide the day-to-day portfolio investment
management of each Subadvised Series, subject to the supervision and
direction of the Adviser.\2\ The primary responsibility for managing
the Subadvised Series will remain vested in the Adviser. The Adviser
will hire, evaluate, allocate assets to and oversee the Sub-Advisers,
including determining whether a Sub-Adviser should be terminated, at
all times subject to the authority of the Board.
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\1\ Applicants request relief with respect to any existing or
future series of the Trust and any other existing or future
registered open-end management company or series thereof that
intends to rely on the requested order and that: (a) Is advised by
the Adviser, or any person controlling, controlled by or under
common control with the Adviser or its successors; (b) uses the
multi-manager structure described in the application; and (c)
complies with the terms and conditions of the application (each, a
``Subadvised Series''). For purposes of the requested order,
``successor'' is limited to an entity that results from a
reorganization into another jurisdiction or a change in the type of
business organization.
\2\ A ``Sub-Adviser'' for a Subadvised Series is an investment
sub-adviser for that Series that is not an ``affiliated person'' (as
such term is defined in Section 2(a)(3) of the Act) of the
Subadvised Series or the Adviser, except to the extent that an
affiliation arises solely because the Sub-Adviser serves as a sub-
adviser to one or more Subadvised Series (each a ``Non-Affiliated
Sub-Adviser'' and collectively, the ``Non-Affiliated Sub-
Advisers'').
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2. Applicants request an exemption to permit the Adviser, subject
to Board approval, to hire a Non-Affiliated Sub-Adviser, pursuant to
Sub-Advisory Agreements and materially amend Sub-Advisory Agreements
with Non-Affiliated Sub-Advisers without obtaining the shareholder
approval required under section 15(a) of the Act and rule 18f-2 under
the Act.\3\ Applicants also seek an exemption from the Disclosure
Requirements to permit a Subadvised Series to disclose (as both a
dollar amount and a percentage of the Subadvised Series' net assets):
(a) The aggregate fees paid to the Adviser; (b) the aggregate fees paid
to Non-Affiliated Sub-Advisers; and (c) the fee paid to each Affiliated
Sub-Adviser.
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\3\ The requested relief will not extend to any sub-adviser
which is an affiliated person, as defined in section 2(a)(3) of the
Act, of the Subadvised Series or of its Adviser, other than by
reason of serving as a sub-adviser to one or more of the Subadvised
Series (``Affiliated Sub-Adviser'').
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3. Applicants agree that any order granting the requested relief
will be subject to the terms and conditions stated in the application.
Such terms and conditions provide for, among other safeguards,
appropriate disclosure to Subadvised Series' shareholders and
notification about sub-advisory changes and enhanced Board oversight to
protect the interests of the Subadvised Series' shareholders.
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 provisions of the Act, or
any rule thereunder, if such relief is necessary or appropriate in the
public interest and consistent with the protection of investors and
purposes fairly intended by the policy and provisions of the Act.
Applicants believe that the requested relief meets this standard
because, as further explained in the application, the Investment
Management Agreements will remain subject to shareholder approval while
the role of the Sub-Advisers is substantially equivalent to that of
individual portfolio managers, so that requiring shareholder approval
of Sub-Advisory Agreements would impose unnecessary delays and expenses
on the Subadvised Series. Applicants believe that the requested relief
from the Disclosure Requirements meets this standard because it will
improve the Adviser's ability to negotiate fees paid to the Sub-
Advisers that are more advantageous for the Subadvised Series.
For the Commission, by the Division of Investment Management,
under delegated authority.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2018-27516 Filed 12-19-18; 8:45 am]
BILLING CODE 8011-01-P