[Federal Register Volume 86, Number 230 (Friday, December 3, 2021)]
[Notices]
[Pages 68691-68695]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-26299]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 34428; File No. 812-15204]


Calamos Hunt Alternative Income Fund, et al.

November 30, 2021.
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:  Calamos Hunt Alternative Income Fund (``Calamos Hunt 
Fund'' or the ``Existing Regulated Entity''), Calamos Advisors LLC 
(``Calamos Advisors'') and Hunt Capital Management, LLC (``HCM'').

DATES: The application was filed on February 19, 2021, and amended on 
June 24, 2021 and September 30, 2021.

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 [email protected] 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 December 23, 2021, 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 [email protected].

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 
[email protected]. Applicants: [email protected].

FOR FURTHER INFORMATION CONTACT: Bruce R. MacNeil, Senior Counsel, at 
(202) 551-6817 or Kaitlin C. Bottock, 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. Calamos Hunt Fund is a Delaware statutory trust and is a 
diversified, closed-end management investment company operated as an 
interval fund and registered under the Act. Calamos Hunt Fund's 
investment objective is to produce current income with a secondary 
objective of capital appreciation. The board of directors (``Board'') 
of the Calamos Hunt Fund has five members, four of whom not an 
``interested person'' of the Calamos Hunt Fund within the meaning of

[[Page 68692]]

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. Calamos Advisors serves as the investment advisor to the 
Existing Regulated Entity. Calamos Advisors is registered as an 
investment advisor under the Investment Advisers Act of 1940 
(``Advisers Act'').
    3. HCM is a Delaware limited liability company that is registered 
as an investment adviser under the Advisers Act. HCM serves as the sub-
advisor to the Existing Regulated Entity. Calamos Advisors is not an 
affiliated person (as defined in Section 2(a)(3) of the Act) of HCM.
    4. Applicants seek an order (``Order'') to permit a Regulated 
Entity \2\ and one or more other Regulated Entities and one or more 
Affiliated Funds \3\ 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 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.\4\
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    \2\ ``Regulated Entity'' means the Existing Regulated Entity and 
any Future Regulated Entity. ``Future Regulated Entity'' means any 
closed-end management investment company formed in the future that 
is (a) registered under the Act, (b) whose investment advisor is a 
Calamos Affiliated Advisor, (c) whose investment sub-advisor is a 
Hunt Affiliated Advisor, and (d) that intends to participate in the 
co-investment program described in the Application. The term 
``Calamos Affiliated Advisor'' means (a) Calamos Advisors and (b) 
any future investment advisor that is controlled by or under common 
control with Calamos Advisors and is registered as an investment 
advisor under the Advisers Act. The term ``Hunt Affiliated Advisor'' 
means HCM, any investment advisor controlled by HCM or any future 
investment advisor that (i) is controlled by HCM, (ii) is registered 
as an investment advisor under the Advisers Act, and (iii) is not a 
Regulated Entity or a subsidiary of a Regulated Entity. The term 
``Advisor'' means (a) any Calamos Affiliated Advisor or (b) any Hunt 
Affiliated Advisor; provided that a Hunt Affiliated Advisor serving 
as a sub-advisor to an Affiliated Fund (defined below) is included 
in this term only if (i) the investment advisor is also a Hunt 
Affiliated Advisor and (ii) such Advisor controls the entity. 
Applicants state that the Calamos Affiliated Advisors will only be 
subject to Conditions 2(c)(iv), 12 and 13 of the application.
    \3\ ``Affiliated Fund'' means any Future Affiliated Fund or any 
Hunt Proprietary Account. ``Future Affiliated Fund'' means any 
investment fund that would be an ``investment company'' but for 
Section 3(c)(1), 3(c)(5)(C) or 3(c)(7) of the Act, is formed in the 
future, and whose investment advisor (and any sub-advisor, if any) 
is a Hunt Affiliated Advisor. No Affiliated Fund is or will be a 
subsidiary of a Regulated Entity. ``Hunt Proprietary Account'' means 
HCM in a principal capacity, and any direct or indirect, wholly-
owned subsidiary of HCM that, from time to time, invests in and 
holds, in a principal capacity, financial assets of the type and 
nature pursued by the Calamos Hunt Fund.
    \4\ 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. No Regulated Entity or 
Affiliated Fund that relies on this Order will rely on any other 
order of the Commission authorizing Co-Investment Transactions 
pursuant to section 17(d) and 57(i) of the 1940 Act and no entity 
that relies on another such order of the Commission will rely on 
this Order.
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    5. Applicants state that Calamos Advisors has delegated 
responsibility for the co-investment program to HCM and cannot cause 
the Calamos Hunt Fund or any Affiliated Fund to enter into a Potential 
Co-Investment Transaction. Applicants further state that (a) HCM has 
sole responsibility for causing a Regulated Entity to enter into a 
Potential Co-Investment Transaction and (b) a Hunt Affiliated Advisor 
is responsible for ensuring that the Regulated Entities and any 
Affiliated Funds comply with the conditions of the application, subject 
to oversight of the applicable Board.
    6. Applicants state that a Regulated Entity may, from time to time, 
form one or more Wholly-Owned Investment Subsidiaries.\5\ 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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    \5\ 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 Advisor will consider only the 
Objectives and Strategies,\6\ investment policies, investment 
positions, capital available for investment, and other pertinent 
factors applicable to that Regulated Entity. The Advisors 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.\7\
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    \6\ 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.
    \7\ 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

[[Page 68693]]

Advisor 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'') \8\ 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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    \8\ 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 Advisor, its principals, or any 
person controlling, controlled by, or under common control with the 
Advisor 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 required under Condition 15. 
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 Advisor 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 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 Advisor 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 Advisor 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 Advisor deems a Regulated Entity's participation in 
any Potential Co-Investment Transaction to be appropriate for the 
Regulated Entity, the Advisor will then determine an appropriate level 
of investment for the Regulated Entity.
    (b) If the aggregate amount recommended by the applicable Advisor 
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 Advisor 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 Advisor 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

[[Page 68694]]

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 Advisor 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 Advisor, 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 Advisor 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,\9\ 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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    \9\ 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-
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 Advisor 
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.\10\
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    \10\ Any Hunt Proprietary Account that is not advised by an 
Advisor is itself deemed to be an Advisor for purposes of Conditions 
7(a)(i) and 8(a)(i).
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    (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 Advisor 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 Advisor 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 Advisor 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

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Funds' outstanding investments immediately preceding the Follow-On 
Investment; and
    (ii) the aggregate amount recommended by the Advisor 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 Advisor 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 Advisor pending consummation 
of the transaction, the fee will be deposited into an account 
maintained by the Advisor 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 Advisors, 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 
Advisors, investment advisory fees paid in accordance with the 
agreements between the Advisors 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 Advisors 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 Advisor 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 in 
the same percentages as the Regulated Entity's other shareholders (not 
including the Holders) 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. 2021-26299 Filed 12-2-21; 8:45 am]
BILLING CODE 8011-01-P