[Federal Register Volume 84, Number 226 (Friday, November 22, 2019)]
[Notices]
[Pages 64595-64600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-25308]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33687; File No. 812-14626-01]


AMG Pantheon Master Fund, LLC, et al.

November 18, 2019.
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 closed-
end management investment companies to co-invest in portfolio companies 
with each other and with certain affiliated investment funds.

Applicants:  AMG Pantheon Master Fund, LLC (the ``Existing Registered 
Fund'' or the ``Fund''), AMG Pantheon Subsidiary Fund, LLC (the 
``Wholly-Owned Subsidiary''), Pantheon Ventures (US) LP, Pantheon 
Ventures (UK) LLP (individually or collectively, ``Pantheon''), 
Pantheon Asia Fund VI, L.P., Pantheon Emerging Asia Fund VI, L.P., 
Pantheon Emerging Markets Fund (Ex-Asia), L.P., Pantheon Global 
Infrastructure Fund II, L.P., Pantheon Global Secondary Fund IV, L.P., 
Pantheon Global Secondary Fund V, L.P., Pantheon USA Fund VIII, L.P., 
Pantheon USA Fund IX, L.P., Pantheon USA Small Funds Program IX, L.P., 
Pantheon Global Co-Investment Opportunities Fund II, L.P., Pantheon 
Global Co-Investment Opportunities Fund III, L.P., Pantheon Access 
(US), L.P., Pantheon Access (ERISA), L.P., Pantheon Multi-Strategy 
Program 2014 (US), L.P., Pantheon Multi-Strategy Program 2014 (ERISA), 
L.P., BVK Private Equity 2011, L.P., BVK Private Equity 2014, L.P., 
Industriens Vintage Infrastructure, L.P., Industriens Vintage 
Infrastructure II, L.P., Pantheon Global Secondary Fund IV OPERS, L.P., 
Pantheon Global GT Fund, L.P., Pantheon Global HO Fund, L.P., Pantheon 
Global Secondary Fund IV KSA, L.P., Pantheon Global Real Assets GT 
Fund, L.P., Pantheon Global Real Assets HO Fund, L.P., Global 
Infrastructure 2015-K, L.P., Pantheon Global Infrastructure Fund II 
NPS, L.P., Pantheon Global Infrastructure Fund III NPS, L.P., Psagot-
Pantheon 1, L.P., Sacramento County Employees' Retirement System 
Secondary Infrastructure and Real Assets Fund, LLC, KFH Strategic 
Private Investments, L.P., KGT Strategic Private Investments, L.P., 
Pantheon Real Assets Opportunities Fund, L.P., Pantheon/VA NRP, LP, 
Pantheon Global Infrastructure EUR Investments Unit Trust, Pantheon 
Global Infrastructure USD Investments Unit Trust, Pantheon Global 
Infrastructure Investments Fund (Cayman) LP, PGIF III Co-mingled Fund, 
L.P., VA-Pantheon Infrastructure II, LP, Pantheon G Infrastructure 
Opportunities LP, Amalienborg Vintage Infrastructure K/S, Global 
Infrastructure 2015-K Holdings, L.P., Pantheon Global Co-Investment 
Opportunities Fund, L.P., Pantheon Global Co-Investment Opportunities 
Fund II (Sidecar), L.P., Pantheon Global Secondary Holdings, L.P., 
Pantheon Global Secondary Holdings II, L.P., Pantheon GT Holdings, 
L.P., Pantheon HO Holdings, L.P., SCERS SIRF (Holdings), LLC, Pantheon 
Multi-Strategy Primary Program 2014, L.P., Pantheon Multi-Strategy 
Secondary Program 2014, L.P., Pantheon Multi-Strategy Co-Investment 
Program 2014, L.P., Pantheon Access Primary Program, L.P., Pantheon 
Access Secondary Program, L.P., Pantheon Access Co-Investment Program, 
L.P., Pantheon Strategic Investments A, L.P., Pantheon G Infrastructure 
Holdings LP, BVK Private Equity 2018, L.P., Lincoln Brook Opportunities 
Fund, L.P., Pantheon Global Infrastructure Fund II (Luxembourg) SCSP, 
Pantheon Access (Luxembourg) SLP SICAV SIF, Pantheon Multi-Strategy 
Program 2014 (Luxembourg) SLP SICAV SIF, PGCO IV Co-Mingled Fund SCSP, 
ASGA Global Infrastructure L.P., CPEG-Pantheon Infrastructure L.P., 
Solutio Premium Private Equity VI Master SCSP, Solutio Premium Private 
Equity VII Master SCSP, Solutio Premium Private Debt I SCSP and 
Pantheon Global Secondary Fund VI SCSP (the ``Existing Affiliated 
Funds,'' and together with the Existing Registered Fund, the Wholly-
Owned Subsidiary and Pantheon, the ``Applicants'').

Filing Dates:  The application was filed on March 15, 2016, and amended 
on December 29, 2017, December 27, 2018, September 5, 2019 and October 
30, 2019.

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 December 12, 2019, and

[[Page 64596]]

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 
St. NE, Washington, DC 20549-1090. Applicants: 600 Steamboat Road, 
Suite 300, Greenwich, CT 06830.

FOR FURTHER INFORMATION CONTACT: Bruce R. MacNeil, Senior Counsel, at 
(202) 551-6817, or Kaitlin C. Bottock, Branch Chief, at (202) 551-6825 
(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 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. The Existing Registered Fund \1\ is a Delaware limited liability 
company that is registered as a closed-end management investment 
company under the Act. The Fund's investment objective is to seek long-
term capital appreciation by investing in private equity investments. 
The board of directors of the Fund (the ``Board'') \2\ is currently 
comprised of four members, three of whom are not ``interested persons'' 
within the meaning of Section 2(a)(19) of the 1940 Act (the 
``Independent Directors''),\3\ of the Fund.
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    \1\ The Existing Registered Fund and any Future Registered Fund 
are referred to collectively as the ``Registered Funds.'' The term 
``Future Registered Fund'' means any closed-end management 
investment company (a) that is registered under the Act, (b) whose 
investment adviser is an Investment Adviser (defined below), and (c) 
that intends to participate in Co-Investment Transactions (defined 
below). The term ``Investment Adviser'' means (a) Pantheon and (b) 
any future investment adviser that controls, is controlled by or is 
under common control with Pantheon and is registered as an 
investment adviser or is an exempt reporting adviser under the 
Investment Advisers Act of 1940, as amended (the ``Advisers Act'').
    \2\ The term ``Board'' means the board of directors of the 
Existing Registered Fund as well as the board of directors or 
trustees of any Future Registered Fund.
    \3\ The ``Independent Directors'' means the members of a Board 
who are not ``interested persons'' of a Registered Fund within the 
meaning of Section 2(a)(19) of the 1940 Act.
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    2. Each of the Existing Affiliated Funds would be an investment 
company but for section 3(c)(1) or 3(c)(7) of the Act.
    3. Pantheon Ventures (US) LP is a limited partnership organized 
under the laws of the State of Delaware and is registered with the 
Commission as an investment adviser under the Advisers Act. Affiliated 
Managers Group, Inc. (``AMG''), a publicly-traded company, indirectly 
owns a majority of the interests of Pantheon Ventures (US) LP. Pantheon 
Ventures (US) LP serves as the investment adviser to the Existing 
Registered Fund pursuant to an investment advisory agreement and as the 
investment adviser of many of the Existing Unregistered Funds.
    4. Pantheon Ventures (UK) LLP is a limited liability partnership 
organized under the laws of England and Wales and is an exempt 
reporting adviser under the Advisers Act. AMG indirectly owns a 
majority of the interests of Pantheon Ventures (UK) LLP. Pantheon 
Ventures (UK) LLP serves as the investment adviser of many of the 
Existing Unregistered Funds.
    5. Applicants seek an order (``Order'') to permit a Registered Fund 
and one or more other Registered Funds and/or Unregistered Funds \4\ 
(collectively ``Co-Investment Affiliates'') to (a) participate in the 
same investment opportunities through a proposed co-investment program 
in circumstances where such participation would otherwise be prohibited 
under Section 17 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 (``Follow-On Investments''). ``Co-Investment Transaction'' 
means any transaction in which a Registered Fund (or its Wholly-Owned 
Investment Subsidiary, as defined below) participate with one or more 
Co-Investment Affiliates in reliance on the Order. ``Potential Co-
Investment Transaction'' means any investment opportunity in which a 
Regulated Fund (or its Wholly-Owned Investment Subsidiaries) could not 
participate together with one or more Co-Investment Affiliates without 
obtaining and relying on the Order.\5\
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    \4\ ``Unregistered Funds'' means (a) the Existing Unregistered 
Funds and (b) any future entity (i) whose investment adviser is an 
Investment Adviser, (ii) that would be an investment company but for 
Section 3(c)(1) or 3(c)(7) of the Act, and (iii) that intends to 
participate in Co-Investment Transactions.
    \5\ All existing entities that currently intend to rely on the 
requested Order have been named as Applicants, and any 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 Registered Fund 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 Co-Investment Affiliate because it would be a 
company controlled by its parent Registered Fund for purposes of rule 
17d-1 under the Act. Applicants request that a Wholly-Owned Investment 
Subsidiary be permitted to participate in Co-Investment Transactions in 
lieu of its parent Registered Fund and that the Wholly-Owned Investment 
Subsidiary's participation in any such transaction be treated, for 
purposes of the Order, as though the parent Registered Fund 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 Registered 
Fund's investments and, therefore, no conflicts of interest could arise 
between the Registered Fund and the Wholly-Owned Investment Subsidiary. 
The Registered Fund'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 
Registered Fund's Board would be informed of, and take into 
consideration, any proposed use of a Wholly-Owned Investment Subsidiary 
in the Registered Fund's place. If the Registered Fund 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 
Registered Fund and the Wholly-Owned Investment Subsidiary.
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    \6\ The term ``Wholly-Owned Investment Subsidiary'' means any 
entity: (i) That is wholly-owned by a Registered Fund (with such 
Registered Fund at all times holding, beneficially and of record, 
100% of the voting and economic interests); (ii) whose sole business 
purpose is to hold one or more investments on behalf of such 
Registered Fund; (iii) with respect to which the Board of such 
Registered Fund has the sole authority to make all determinations 
with respect to the entity's participation under the conditions of 
this Application; and (iv) that would be an investment company but 
for Section 3(c)(1) or 3(c)(7) of the Act. The Wholly-Owned 
Subsidiary is a Wholly-Owned Investment Subsidiary, and any 
subsidiary of a Registered Fund that participates in a Co-Investment 
Transaction will be a Wholly-Owned Investment Subsidiary.
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    7. When considering Potential Co-Investment Transactions for any 
Registered Fund, an Investment Adviser will consider only the 
Objectives and

[[Page 64597]]

Strategies,\7\ investment restrictions, regulatory and tax 
requirements, capital available for investment (``Available 
Capital''),\8\ and other pertinent factors applicable to the Registered 
Fund. Each Investment Adviser, as applicable, undertakes to perform 
these duties consistently for each Registered Fund, as applicable, 
regardless of which of them serves as investment advisers to these 
entities. The participation of a Registered Fund in a Potential Co-
Investment Transaction may only be approved by a Required Majority \9\ 
of the directors eligible to vote on that Co-Investment Transaction 
(the ``Eligible Directors'').\10\ Due to the similarity in Objectives 
and Strategies of certain Registered Funds with the investment 
objectives, policies and strategies of certain Co-Investment 
Affiliates, the Investment Adviser expects that investments for a 
Registered Fund should also generally be appropriate investments for 
one or more other Co-Investment Affiliates.
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    \7\ ``Objectives and Strategies'' means the investment 
objectives and strategies of the Registered Funds, as described in 
the Registered Funds' registration statements on Form N-2, other 
filings the Registered Funds have made with the Commission under the 
Securities Act of 1933 (``Securities Act'') or under the Securities 
Exchange Act of 1934, as amended, and the Registered Funds' reports 
to shareholders.
    \8\ ``Available Capital'' will be determined based on the amount 
of cash on hand, existing commitments and reserves, if any, the 
targeted leverage level, targeted asset mix and other investment 
policies and restrictions set from time to time by the Board of the 
applicable Registered Fund or imposed by applicable laws, rules, 
regulations or interpretations.
    \9\ ``Required Majority'' has the meaning provided in Section 
57(o) of the 1940 Act. The Board members of a Registered Fund that 
make up the Required Majority will be determined as if the 
Registered Fund was a was a business development company subject to 
section 57(o) (``BDC'').
    \10\ The term ``Eligible Directors'' means the directors who are 
eligible to vote under Section 57(o) of the 1940 Act as if the 
Registered Fund was a BDC.
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    8. With respect to participation in a Potential Co-Investment 
Transaction by a Registered Fund, the applicable Investment Adviser 
will present each Potential Co-Investment Transaction and the proposed 
allocation of each investment opportunity to the Eligible Directors. 
The Required Majority of a Registered Fund will approve each Co-
Investment Transaction prior to any investment by the Registered Fund.
    9. With respect to the pro rata dispositions and Follow-On 
Investments provided in conditions 7 and 8, a Registered 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 
and a Registered Fund and each Affiliated Account 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 has approved the Registered Fund's 
participation in pro rata dispositions and Follow-On Investments as 
being in the best interests of the Registered Fund. If the Board does 
not so approve, any such disposition or Follow-On Investment will be 
submitted to the Eligible Directors. The Board 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.
    10. No Independent Director of any Registered Fund will have a 
direct or indirect financial interest in any Co-Investment Transaction 
(other than indirectly through share ownership in one of the Registered 
Funds), including any interest in any issuer whose securities would be 
acquired in a Co-Investment Transaction.
    11. If the Investment Adviser, the principal owners of the 
Investment Adviser (``Principals''), or any person controlling, 
controlled by, or under common control with the Investment Adviser or 
the Principals, and the Co-Investment Affiliates (collectively, the 
``Holders'') own in the aggregate more than 25 percent of the 
outstanding voting shares of a Registered Fund (the ``Shares''), then 
the Holders will vote such Shares as required under the condition 14. 
Applicants believe that this condition will ensure that the Independent 
Directors will act independently in evaluating the Co-Investment 
Transactions, because the ability of the Investment Adviser or the 
Principals to influence the Independent Directors by a suggestion, 
explicit or implied, that the Independent Directors can be removed will 
be limited significantly. The Independent Directors shall evaluate and 
approve the independent third party, taking into account its 
qualifications, reputation for independence, cost to the investors, 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 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 they expect that participation in 
Potential Co-Investment Transactions by any of the Registered Funds and 
the Co-Investment Affiliates may increase favorable investment 
opportunities for the Registered Funds and the Co-Investmant 
Affiliates. The conditions are designed to ensure that the Investment 
Advisers would not be able to favor a Co-Investment Affiliate over a 
Registered Fund through the allocation of investment opportunities 
between them. Applicants state that the Regulated 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, the other participants.

Applicants' Conditions

    Applicants agree that any Order granting the requested relief shall 
be subject to the following conditions:
    1. Each time an Investment Adviser considers a Potential Co-
Investment Transaction for an Unregistered Fund or another Registered 
Fund that falls within a Registered Fund's then-current Objectives and 
Strategies, the Investment Adviser to the Registered Fund will make an 
independent determination of the appropriateness of the investment for 
such Registered Fund in light of the Registered Fund's then-current 
circumstances.
    2.(a). If the Investment Adviser to a Registered Fund deems the 
Registered Fund's participation in any Potential Co-Investment 
Transaction to be appropriate for the Registered Fund, it will then 
determine an appropriate level of investment for the Registered Fund.
    (b). If the aggregate amount recommended by the applicable 
Investment Adviser to be invested by the applicable Registered Fund in 
the Potential Co-Investment Transaction, together with the amount 
proposed to be invested by the other participating Registered Funds and 
Unregistered Funds, collectively, in the same transaction, exceeds the 
amount of the investment opportunity, the amount of the investment 
opportunity will be allocated among them pro rata based on each 
participant's Available Capital for investment in the asset class being 
allocated, up to the amount proposed to be invested by each. The 
applicable

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Investment Adviser will provide the Eligible Directors of each 
participating Registered Fund with information concerning each 
participating party's Available Capital to assist the Eligible 
Directors with their review of the Registered 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 each participating 
Registered Fund and Unregistered Fund, to the Eligible Directors of 
each participating Registered Fund for their consideration. A 
Registered Fund will co-invest with one or more other Registered Funds 
and/or one or more Unregistered Funds only if, prior to the Registered 
Fund'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 
Registered Fund and its shareholders and do not involve overreaching in 
respect of the Registered 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 the Registered Fund; and
    (B). the Registered Fund's then-current Objectives and Strategies;
    (iii). the investment by any other Registered Funds or Unregistered 
Funds would not disadvantage the Registered Fund, and participation by 
the Registered Fund would not be on a basis different from or less 
advantageous than that of other Registered Funds or Unregistered Funds; 
provided, that if any other Registered Fund or Unregistered Fund, but 
not the Registered Fund 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 Directors will have the right to ratify the 
selection of such director or board observer or participant, if any;
    (B). the applicable Investment Adviser agrees to, and does, provide 
periodic reports to the Registered 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 Unregistered Fund or 
any Registered Fund or any affiliated person of any Unregistered Fund 
or any Registered Fund receives in connection with the right of an 
Unregistered Fund or a Registered 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 Unregistered Funds (who each may, in turn, 
share its portion with its affiliated persons) and the participating 
Registered Funds in accordance with the amount of each party's 
investment; and
    (iv). the proposed investment by the Registered Fund will not 
benefit the Investment Advisers, the Unregistered Funds or the other 
Registered 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 Registered 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 Board of 
each Registered Fund, on a quarterly basis, a record of all investments 
in Potential Co-Investment Transactions made by any of the other 
Registered Funds or Unregistered Funds during the preceding quarter 
that fell within the Registered Fund's then-current Objectives and 
Strategies that were not made available to the Registered Fund, and an 
explanation of why the investment opportunities were not offered to the 
Registered Fund. All information presented to the Board pursuant to 
this condition will be kept for the life of the Registered Fund 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,\11\ a Registered Fund will not invest in reliance on the 
Order in any issuer in which another Registered Fund, Unregistered 
Fund, or any affiliated person of another Registered Fund or 
Unregistered Fund is an existing investor.
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    \11\ This exception applies only to Follow-On Investments by a 
Registered Fund in issuers in which that Registered Fund already 
holds investments.
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    6. A Registered 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 each participating Registered Fund and 
Unregistered Fund. The grant to an Unregistered Fund or another 
Registered Fund, but not the Registered 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 Unregistered Fund or any Registered Fund elects to 
sell, exchange or otherwise dispose of an interest in a security that 
was acquired in a Co-Investment Transaction, the applicable Investment 
Adviser will:
    (i). Notify each Registered 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 
Registered Fund in the disposition.
    (b). Each Registered 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 the participating 
Unregistered Funds and Registered Funds.
    (c). A Registered Fund may participate in such disposition without 
obtaining prior approval of the Required Majority if:
    (i). The proposed participation of each Registered Fund and each 
Unregistered Fund in such disposition is proportionate to its 
outstanding investments in the issuer immediately preceding the 
disposition;
    (ii). the Board of the Registered Fund has approved as being in the 
best interests of the Registered Fund the ability to participate in 
such dispositions on a pro rata basis (as

[[Page 64599]]

described in greater detail in the application); and
    (iii). the Board of the Registered Fund is provided on a quarterly 
basis with a list of all dispositions made in accordance with this 
condition. In all other cases, the Investment Adviser will provide its 
written recommendation as to the Registered Fund's participation to the 
Eligible Directors, and the Registered Fund will participate in such 
disposition solely to the extent that a Required Majority determines 
that it is in the Registered Fund's best interests.
    (d). Each Unregistered Fund and each Registered Fund will bear its 
own expenses in connection with any such disposition.
    8.(a). If any Unregistered Fund or any Registered Fund desires to 
make a Follow-On Investment in a portfolio company whose securities 
were acquired in a Co-Investment Transaction, the applicable Investment 
Adviser will:
    (i). Notify each Registered 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 
Registered Fund.
    (b). A Registered Fund may participate in such Follow-On Investment 
without obtaining prior approval of the Required Majority if:
    (i). The proposed participation of each Registered Fund and each 
Unregistered 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 Registered Fund has approved as being in the 
best interests of the Registered 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 Investment Adviser 
will provide its written recommendation as to the Registered Fund's 
participation to the Eligible Directors, and the Registered Fund will 
participate in such Follow-On Investment solely to the extent that a 
Required Majority determines that it is in the Registered Fund's best 
interests.
    (c). If, with respect to any Follow-On Investment:
    (i). The amount of the opportunity is not based on the Registered 
Funds' and the Unregistered Funds' outstanding investments immediately 
preceding the Follow-On Investment; and
    (ii). the aggregate amount recommended by the applicable Investment 
Adviser to be invested by the applicable Registered Fund in the Follow-
On Investment, together with the amount proposed to be invested by the 
other participating Registered Funds and Unregistered Funds, 
collectively, in the same transaction, exceeds the amount of the 
investment opportunity, then amount invested by each such party will be 
allocated among them pro rata based on each participant's Available 
Capital 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 Directors of each Registered Fund will be 
provided quarterly for review all information concerning Potential Co-
Investment Transactions and Co-Investment Transactions, including 
investments made by other Registered Funds or Unregistered Funds that 
the Registered 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 that the 
Registered 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 
Registered Fund of participating in new and existing Co-Investment 
Transactions.
    10. Each Registered Fund will maintain the records required by 
Section 57(f)(3) of the Act as if each of the Registered Funds were a 
business development company 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 Director of a Registered Fund will also be a 
director, general partner, managing member or principal, or otherwise 
an ``affiliated person'' (as defined in the Act) of an Unregistered 
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 the Investment Advisers under their 
respective investment advisory agreements with Unregistered Funds and 
the Registered Funds, be shared by the Registered Funds and the 
Unregistered Funds 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 \12\ (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 Registered Funds and 
Unregistered 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 an Investment 
Adviser pending consummation of the transaction, the fee will be 
deposited into an account maintained by such Investment 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 Registered 
Funds and Unregistered Funds based on the amounts they invest in such 
Co-Investment Transaction. None of the Unregistered Funds, the 
Investment Advisers, the other Registered Funds or any affiliated 
person of the Registered Funds or Unregistered 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 Registered Funds and the Unregistered 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 an 
Investment Adviser, investment advisory fees paid in accordance with 
the agreement between the Investment Adviser and the Registered Fund or 
Unregistered Fund).
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    \12\ Applicants are not requesting and the Commission is not 
providing any relief for transaction fees received in connection 
with any Co-Investment Transaction.
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    14. If the Holders own in the aggregate more than 25% of the Shares 
of a Registered Fund, 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) any 
other matter under either the Act or applicable State law affecting the 
Board's composition, size or manner of election.
    15. Each Registered Fund's chief compliance officer, as defined in 
Rule 38a-1(a)(4) of the Act, will prepare an annual report for its 
Board that evaluates (and documents the basis of that evaluation) the 
Registered Fund's

[[Page 64600]]

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.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-25308 Filed 11-21-19; 8:45 am]
 BILLING CODE 8011-01-P