[Federal Register Volume 83, Number 70 (Wednesday, April 11, 2018)]
[Notices]
[Pages 15648-15653]
[FR Doc No: 2018-07430]

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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33068; File No. 812-14601]

Application; Benefit Street Partners BDC, Inc., et al.

April 6, 2018.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice.

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

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

Applicants: Benefit Street Partners BDC, Inc. (``BSP BDC''), Providence
Flexible Credit Allocation Fund (``Providence Flexible Credit''),
Business Development Corporation of America (``BDCA,'' together with
BSP BDC and Providence Flexible Credit, the ``Existing Regulated
Funds''), Providence TMT Debt Opportunity Fund II L.P. (``Fund II''),
PECM Strategic Funding L.P. (``Strategic Funding''), SEI Energy Debt
Fund, LP (``SEI Fund''), Providence Debt Fund III L.P. (``Fund III''),
Providence Debt Fund III Master (Non-US) L.P. (``Fund III Offshore''),
Benefit Street Partners Capital Opportunity Fund L.P. (``BSP Capital
Fund''), Benefit Street Partners Capital Opportunity Fund II L.P.
(``BSP Capital Fund II''), Benefit Street Partners SMA LM L.P.
(``Benefit Street LM''), Benefit Street Partners SMA-C L.P. (``Benefit
Street SMA-C''), Benefit Street Partners Senior Secured Opportunities
Fund L.P. (``Benefit Street Senior Secured''), Benefit Street Partners
Senior Secured Opportunities Master Fund (Non-US) L.P. (``Benefit
Street Senior Secured Offshore''), Benefit Street Partners Senior
Secured Opportunities (U) Fund (Non-US) L.P. (``Opportunities (U)
Fund''), Benefit Street Partners Senior Secured Opportunities (U)
Master Fund (Non-US) L.P. (``Opportunities (U) Master Fund''), BSP
Special Situations Master A L.P. (``BSP Master A''), BSP Special
Situations Master B L.P. (``BSP Master B''), Benefit Street Partners
Debt Fund IV L.P. (``Fund IV''), Benefit Street Partners Debt Fund IV
Master (Non-US) L.P. (``Fund IV Offshore''), Benefit Street Partners
SMA-T L.P. (``SMA-T'' and each of Fund II, Strategic Funding, SEI Fund,
Fund III, Fund III Offshore, BSP Capital Fund, BSP Capital Fund II,
Benefit Street LM, Benefit Street SMA-C, Benefit Street Senior Secured,
Benefit Street Senior Secured Offshore, Opportunities (U) Fund,
Opportunities (U) Master Fund, BSP Master A, BSP Master B, Fund IV and
Fund IV Offshore is referred to as an ``Existing Affiliated Fund'' and
collectively, the ``Existing Affiliated Funds''), Providence Equity
Capital Markets L.L.C. (``Fund II Affiliated Adviser''), Benefit Street
Partners L.L.C. (``BSP Adviser''), BDCA Adviser, LLC (``BDCA
Adviser''), and SEI Investments Management Corporation (``SEI
Adviser'').

Filing Dates: The application was filed on January 15, 2016, and
amended on January 9, 2017, June 23, 2017, and December 13, 2017.

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 April 30, 2018, 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, 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: BSP BDC, Providence
Flexible Credit, BDCA, Fund II, Strategic Funding, Fund III, Fund III
Offshore, BSP Capital Fund, BSP Capital Fund II, Benefit Street LM,
Benefit Street SMA-C, Benefit Street Senior Secured, Benefit Street
Senior Secured Offshore, Opportunities (U) Fund, Opportunities (U)
Master Fund, BSP Master A, BSP Master B, Fund IV, Fund IV Offshore,
SMA-T, Fund II Affiliated Adviser, BSP Adviser, and BDCA Adviser, 9
West 57th Street, 49th Floor, New York, NY 10019; SEI Fund and SEI
Adviser, One Freedom Valley Drive, Oaks, PA 19456.

FOR FURTHER INFORMATION CONTACT: Christine Y. Greenlees, Senior
Counsel, at<PHONE_NUMBER> or Robert H. Shapiro, Branch Chief, at (202)
551-6821 (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<PHONE_NUMBER>.

Applicants' Representations

    1. BSP BDC is a Maryland corporation organized as a closed-end
management investment company that intends to elect to be regulated as
a BDC under section 54(a) of the Act.\1\ BSP BDC's Objectives and
Strategies \2\ are to generate both current income and capital
appreciation by primarily investing in secured debt, unsecured debt, as
well as related equity securities issued by private U.S. middle market
companies. The board of directors (``Board'') of BSP BDC will be
comprised of five directors, three of whom will be persons who are not
``interested persons'' of BSP BDC as defined in section 2(a)(19) of the
Act (``Non-Interested Directors'').
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    \1\ Section 2(a)(48) defines a BDC to be any closed-end
investment company that operates for the purpose of making
investments in securities described in sections 55(a)(1) through
55(a)(3) of the Act and makes available significant managerial
assistance with respect to the issuers of such securities.
    \2\ ``Objectives and Strategies'' means a Regulated Fund's
investment objectives and strategies, as described in the Regulated
Fund's registration statement on Form N-2, other filings the
Regulated Fund has made with the Commission under the Securities Act
of 1933 (the ``Securities Act''), or under the Securities Exchange
Act of 1934, and the Regulated Fund's reports to shareholders.
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    2. Providence Flexible Credit is a Massachusetts business trust
organized as closed-end investment company registered under the Act.
Providence Flexible Credit's Objectives and Strategies are to seek
total return through a combination of current income and capital
appreciation. Providence Flexible Credit will seek to achieve its
investment objective by investing primarily in a portfolio of (i)
secured loans made primarily to companies whose debt is below
investment grade quality; (ii) corporate

bonds that are expected to be primarily high yield issues of below
investment grade quality; and (iii) debt investment opportunities in
middle market companies in the United States that are of below
investment grade quality. Providence Flexible Credit will have a Board
with a majority of trustees that are Non-Interested Directors.
    3. BDCA is a Maryland corporation organized as a closed-end
management investment company that has elected to be regulated as a BDC
under the Act. BDCA's Objectives and Strategies are to generate both
current income and capital appreciation by primarily investing in
senior secured loans and mezzanine debt issued by middle market
companies. BDCA's Board consists of seven members, a majority of whom
are Non-Interested Directors.
    4. Each of the Affiliated Funds (defined below) would be an
investment company but for section 3(c)(1) or 3(c)(7) of the Act. Each
Affiliated Fund has, or will have, investment objectives and strategies
that are similar to or that overlap with the Regulated Funds'
Objectives and Strategies.
    5. Fund II Affiliated Adviser, BSP Adviser, and BDCA Adviser are
each Delaware limited liability companies registered as investment
advisers under the Investment Advisers Act of 1940 (the ``Advisers
Act''). Applicants state that the Providence Advisers (defined below)
are controlled by their principal owners (the ``Principals'') and are
thus affiliated persons of each other as described by section
2(a)(3)(C) of the Act. Fund II Affiliated Adviser serves as investment
adviser to Fund II and Strategic Funding. BSP Adviser serves as
investment adviser to BSP BDC, Providence Flexible Credit, Fund III,
Fund III Offshore, BSP Capital Fund, BSP Capital Fund II, Benefit
Street LM, Benefit Street SMA-C, Benefit Street Senior Secured, Benefit
Street Senior Secured Offshore, Opportunities (U) Fund, Opportunities
(U) Master Fund, BSP Master A, BSP Master B, Fund IV, Fund IV Offshore,
and SMA-T. In addition, BSP Adviser serves as sub-adviser to SEI Fund,
whose investment adviser, SEI Adviser, is not affiliated with BSP
Adviser. BDCA Adviser serves as investment adviser to BDCA.
    6. SEI Adviser is a Delaware corporation registered as an
investment adviser under the Advisers Act. SEI Adviser serves as
investment adviser to SEI Fund. As noted above, BSP Adviser serves as
Sub-Adviser to SEI Fund. SEI Adviser is not an affiliated person of any
Providence Adviser.
    7. Applicants seek to supersede the Prior Order \3\ to permit one
or more Regulated Funds \4\ and/or one or more Affiliated Funds \5\ to
participate in the same investment opportunities through a proposed co-
investment program (the ``Co-Investment Program'') where such
participation would otherwise be prohibited under section 57(a)(4) and
rule 17d-1 by (a) co-investing with each other in securities issued by
issuers in private placement transactions in which an Adviser
negotiates terms in addition to price; \6\ and (b) making 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 Regulated
Fund (or its Wholly-Owned Investment Sub, as defined below)
participated together with one or more other Regulated Funds and/or one
or more Affiliated Funds in reliance on the requested Order.
``Potential Co-Investment Transaction'' means any investment
opportunity in which a Regulated Fund (or its Wholly-Owned Investment
Sub) could not participate together with one or more Affiliated Funds
and/or one or more other Regulated Funds without obtaining and relying
on the Order.\7\
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    \3\ The requested order (the ``Order'') would supersede an
exemptive order issued by the Commission on June 23, 2015 (the
``Prior Order'') that was granted pursuant to sections 57(a)(4) and
57(i) and rule 17d-1, with the result that no person will continue
to rely on the Prior Order if the Order is granted. Benefit Street
Partners BDC, Inc., et al., Investment Company Act Release Nos.
31651 (May 27, 2015) (notice) and 31686 (Jun. 23, 2015) (order).
    \4\ ``Regulated Fund'' means any of the Existing Regulated Funds
and any Future Regulated Fund. ``Future Regulated Fund'' means any
closed-end management investment company (a) that is registered
under the Act or has elected to be regulated as a BDC, (b) whose
investment adviser is a Providence Adviser, and (c) that intends to
participate in the Co-Investment Program. The term ``Providence
Adviser'' means (a) BSP Adviser, (b) BDCA Adviser, (c) Fund II
Affiliated Adviser, and (d) any future investment adviser, other
than Providence Equity Partners L.L.C., that controls, is controlled
by or is under common control with BSP Adviser, BDCA Adviser and
Fund II Affiliated Adviser and is registered under the Advisers Act.
The term ``Adviser'' means any Providence Adviser and SEI Adviser.
Providence Equity Partners L.L.C. is excluded from the definition of
Adviser because none of its clients will participate in any Co-
Investment Transaction.
    \5\ ``Affiliated Fund'' means (a) the Existing Affiliated Funds
and (b) any Future Affiliated Fund. ``Future Affiliated Fund'' means
any entity (a) whose investment adviser is a Providence Adviser, (b)
that would be an investment company but for section 3(c)(1) or
3(c)(7) of the Act, and (c) that intends to participate in the Co-
Investment Program.
    \6\ The term ``private placement transactions'' means
transactions in which the offer and sale of securities by the issuer
are exempt from registration under the Securities Act.
    \7\ 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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    8. Applicants state that a Regulated Fund may, from time to time,
form a Wholly-Owned Investment Sub.\8\ Such a subsidiary would be
prohibited from investing in a Co-Investment Transaction with any
Affiliated Fund or Regulated Fund because it would be a company
controlled by its parent Regulated Fund for purposes of section
57(a)(4) and rule 17d-1. Applicants request that each Wholly-Owned
Investment Sub be permitted to participate in Co-Investment
Transactions in lieu of its parent Regulated Fund and that the Wholly-
Owned Investment Sub's participation in any such transaction be
treated, for purposes of the requested order, as though the parent
Regulated Fund were participating directly. Applicants represent that
this treatment is justified because a Wholly-Owned Investment Sub would
have no purpose other than serving as a holding vehicle for the
Regulated Fund's investments and, therefore, no conflicts of interest
could arise between the Regulated Fund and the Wholly-Owned Investment
Sub. The Regulated Fund's Board would make all relevant determinations
under the conditions with regard to a Wholly-Owned Investment Sub's
participation in a Co-Investment Transaction, and the Regulated Fund's
Board would be informed of, and take into consideration, any proposed
use of a Wholly-Owned Investment Sub in the Regulated Fund's place. If
the Regulated Fund proposes to participate in the same Co-Investment
Transaction with any of its Wholly-Owned Investment Subs, the Board
will also be informed of, and take into consideration, the relative
participation of the Regulated Fund and the Wholly-Owned Investment
Sub.
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    \8\ The term ``Wholly-Owned Investment Sub'' means an entity (i)
that is wholly-owned by a Regulated Fund (with the Regulated 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 the Regulated Fund; (iii) with
respect to which the Regulated Fund's Board has the sole authority
to make all determinations with respect to the entity's
participation under the conditions of the application; and (iv) that
would be an investment company but for section 3(c)(1) or 3(c)(7) of
the Act.
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    9. When considering Potential Co-Investment Transactions for any
Regulated Fund, the Adviser (or Advisers if there are more than one)
will consider only the Objectives and

Strategies, investment policies, investment positions, capital
available for investment (``Available Capital''), and other pertinent
factors applicable to that Regulated Fund. The Advisers expect that any
portfolio company that is an appropriate investment for a Regulated
Fund should also be an appropriate investment for one or more other
Regulated Funds and/or one or more Affiliated Funds, with certain
exceptions based on Available Capital or diversification. The Regulated
Funds, however, will not be obligated to invest, or co-invest, when
investment opportunities are referred to them.
    10. Applicants state that SEI Adviser serves as investment adviser
to SEI Fund, while BSP Adviser serves as sub-adviser. Applicants
represent that SEI Adviser is responsible for the overall management of
SEI Fund's activities, and BSP Adviser is responsible for the day-to-
day management of SEI Fund's investment portfolio. Applicants represent
that although BSP Adviser identifies and recommends investments for SEI
Fund, SEI Adviser has ultimate authority with respect to SEI Fund's
investments.
    11. Applicants represent that each Providence Adviser has adopted
allocation policies and procedures which are designed to allocate
investment opportunities fairly and equitably among their clients over
time. Applicants state that in the case of a Potential Co-Investment
Transaction, the applicable Providence Adviser applies its allocation
policies and procedures in determining the proposed allocation for the
applicable Regulated Fund consistent with the requirements of condition
2(a). Applicants state that, as a result, all Potential Co-Investment
Transactions that are presented to any Providence Adviser would also be
presented to each Providence Adviser advising or sub-advising a
Regulated Fund, which, as required by condition 1, would make an
independent determination of the appropriateness of the investments for
such Regulated Fund.
    12. 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(s) will
present each Potential Co-Investment Transaction and the proposed
allocation to the directors of the Board eligible to vote under section
57(o) of the Act (``Eligible Directors''), and the ``required
majority,'' as defined in section 57(o) of the Act (``Required
Majority'') \9\ will approve each Co-Investment Transaction prior to
any investment by the participating Regulated Fund.
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    \9\ In the case of a Regulated Fund that is a registered closed-
end fund, the Board members that make up the Required Majority will
be determined as if the Regulated Fund were a BDC subject to section
57(o).
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    13. With respect to the pro rata dispositions and Follow-On
Investments provided in conditions 7 and 8, a Regulated 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 Regulated Fund and
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 Fund has approved that Regulated Fund's participation in pro
rata dispositions and Follow-On Investments as being in the best
interests of the Regulated Fund. If the Board does not so approve, any
such disposition or Follow-On Investment will be submitted to the
Regulated Fund's Eligible Directors. The Board of any Regulated Fund
may at any time rescind, suspend or qualify its approval of pro rata
dispositions and Follow-On Investments with the result that all
dispositions and/or Follow-On Investments must be submitted to the
Eligible Directors.
    14. No Non-Interested Director of a Regulated Fund will have a
financial interest in any Co-Investment Transaction, other than
indirectly through share ownership in one of the Regulated Funds.
    15. Under condition 15, if the Providence Advisers, the Principals,
or any person controlling, controlled by, or under common control with
the Providence Advisers or the Principals, and the Affiliated Funds
(collectively, the ``Holders'') own in the aggregate more than 25% of
the outstanding voting securities of a Regulated Fund (``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 Non-
Interested Directors will act independently in evaluating the Co-
Investment Program, because the ability of the Providence Advisers or
the Principals to influence the Independent Directors by a suggestion,
explicit or implied, that the Non-Interested Directors can be removed
will be limited significantly. Applicants represent that the Non-
Interested Directors will evaluate and approve any such independent
party, taking into account its qualifications, reputation for
independence, cost to the 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
participation by a registered investment company and an affiliated
person in any ``joint enterprise or other joint arrangement or profit-
sharing plan,'' as defined in the rule, without prior approval by the
Commission by order upon application. Section 17(d) of the Act and rule
17d-1 under the Act are applicable to Regulated Funds that are
registered closed-end investment companies. Similarly, with regard to
BDCs, section 57(a)(4) of the Act generally prohibits certain persons
specified in section 57(b) from participating in joint transactions
with the BDC or a company controlled by the BDC in contravention of
rules as prescribed by the Commission. Section 57(i) of the Act
provides that, until the Commission prescribes rules under section
57(a)(4), the Commission's rules under section 17(d) of the Act
applicable to registered closed-end investment companies will be deemed
to apply to transactions subject to section 57(a)(4). Because the
Commission has not adopted any rules under section 57(a)(4), rule 17d-1
also applies to joint transactions with Regulated Funds that are BDCs.
    2. 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.
    3. Applicants submit that each of the other Regulated Funds and the
Affiliated Funds may be deemed to be affiliated persons of a Regulated
Fund within the meaning of section 2(a)(3)(C) of the Act by reason of
common control because (i) a Providence Adviser may be deemed to
control each of the Existing Regulated Funds and the Existing
Affiliated Funds, (ii) a Providence Adviser may be deemed to control
any Future Regulated Funds or Future Affiliated Funds, (iii) the
Providence Advisers are owned and controlled by the Principals and (iv)
a Providence Adviser sub-advises SEI Fund and, therefore, SEI Fund may
be deemed to be under common control with the Existing Regulated Funds.
As a result, a Regulated Fund and one or more other

Regulated Funds and/or one or more Affiliated Funds would be prohibited
from participating in Co-Investment Transactions by sections 17(d) or
57(a)(4) of the Act, and rule 17d-1 of the Act.
    4. Applicants state that in the absence of the requested relief, in
some circumstances the Regulated Funds would be limited in their
ability to participate in attractive and appropriate investment
opportunities. Applicants believe that the proposed terms and
conditions of the application will ensure that the Co-Investment
Transactions are consistent with the protection of each Regulated
Fund's shareholders and with the purposes intended by the policies and
provisions of the Act. Applicants state that the Regulated Funds'
participation in the Co-Investment Transactions will be consistent with
the provisions, policies, and purposes of the Act and would be done in
a manner 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 a Providence Adviser considers a Potential Co-
Investment Transaction for an Affiliated Fund or another Regulated Fund
that falls within a Regulated Fund's then-current Objectives and
Strategies, each Adviser to the Regulated Fund will make an independent
determination of the appropriateness of the investment for such
Regulated Fund in light of the Regulated Fund's then-current
circumstances.
    2. (a) If each Adviser to a Regulated Fund deems the participation
in any Potential Co-Investment Transaction to be appropriate for the
Regulated Fund, the Adviser (or Advisers if there are more than one)
will then determine an appropriate level of investment for the
Regulated Fund.
    (b) If the aggregate amount recommended by the Adviser (or Advisers
if there are more than one) to a Regulated Fund to be invested by the
Regulated Fund in the Potential Co-Investment Transaction, together
with the amount proposed to be invested by the other participating
Regulated Funds 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 Available Capital, up to the amount proposed to be
invested by each. The Adviser (or Advisers if there are more than one)
to each participating Regulated Fund will provide the Eligible
Directors of each participating Regulated Fund with information
concerning each participating party's Available Capital to assist the
Eligible Directors with their review of the Regulated Fund's
investments for compliance with these allocation procedures.
    (c) After making the determinations required in conditions 1 and
2(a), the Adviser to the Regulated Fund (or Advisers if there are more
than one) will distribute written information concerning the Potential
Co-Investment Transaction (including the amount proposed to be invested
by each participating Regulated Fund and Affiliated Fund) to the
Eligible Directors of each participating Regulated Fund for their
consideration. A Regulated Fund will co-invest with one or more other
Regulated Funds and/or one or more Affiliated Funds only if, prior to
the Regulated 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 Regulated
Fund and its shareholders and do not involve overreaching in respect of
the Regulated 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 Regulated Fund; and
    (B) the Regulated Fund's then-current Objectives and Strategies;
    (iii) the investment by any other Regulated Funds or any Affiliated
Funds would not disadvantage the Regulated Fund, and participation by
the Regulated Fund would not be on a basis different from or less
advantageous than that of other Regulated Funds or Affiliated Funds;
provided that, if any other Regulated Fund or Affiliated Fund, but not
the Regulated 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, if any;
    (B) the Adviser to the Regulated Fund (or Advisers if there are
more than one) agrees to, and does, provide periodic reports to the
Regulated 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 Affiliated Fund or any
Regulated Fund or any affiliated person of any Affiliated Fund or
Regulated Fund receives in connection with the right of an Affiliated
Fund or a Regulated 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 each may, in turn, share its
portion with its affiliated persons) and the participating Regulated
Funds in accordance with the amount of each party's investment; and
    (iv) the proposed investment by the Regulated Fund will not benefit
the Advisers, the Affiliated Funds or the other Regulated 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) or 57(k) 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 Fund has the right to decline to participate in
any Potential Co-Investment Transaction or to invest less than the
amount proposed.
    4. The Adviser to the Regulated Fund (or Advisers if there are more
than one) will present to the Board of each Regulated Fund, on a
quarterly basis, a record of all investments in Potential Co-Investment
Transactions made by any of the other Regulated Funds or Affiliated
Funds during the preceding quarter that fell within the Regulated
Fund's then-current Objectives and Strategies that were not made
available to the Regulated Fund, and an explanation of why the
investment opportunities were not offered to the Regulated Fund. All
information presented to the Board pursuant to this condition will be
kept for the life of the Regulated 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,\10\

a Regulated Fund will not invest in reliance on the Order in any issuer
in which another Regulated Fund, Affiliated Fund, or any affiliated
person of another Regulated Fund or Affiliated Fund is an existing
investor.
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    \10\ This exception applies only to Follow-On Investments by a
Regulated Fund in issuers in which that Regulated Fund already holds
investments.
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    6. A Regulated 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 Regulated Fund and Affiliated
Fund. The grant to an Affiliated Fund or another Regulated Fund, but
not the Regulated 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 Affiliated Fund or any Regulated Fund elects to sell,
exchange or otherwise dispose of an interest in a security that was
acquired in a Co-Investment Transaction, the applicable Providence
Adviser will:
    (i) Notify each Regulated 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
Regulated Fund in the disposition.
    (b) Each Regulated 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
Affiliated Funds and Regulated Funds.
    (c) A Regulated Fund may participate in such disposition without
obtaining prior approval of the Required Majority if: (i) The proposed
participation of each Regulated Fund 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 Fund has approved as being in the best interests of the
Regulated Fund the ability to participate in such dispositions on a pro
rata basis (as described in greater detail in the application); and
(iii) the Board of the Regulated Fund is provided on a quarterly basis
with a list of all dispositions made in accordance with this condition.
In all other cases, the Adviser to the Regulated Fund (or Advisers if
there are more than one) will provide its written recommendation as to
the Regulated Fund's participation to the Eligible Directors, and the
Regulated Fund will participate in such disposition solely to the
extent that a Required Majority determines that it is in the Regulated
Fund's best interests.
    (d) Each Affiliated Fund and each Regulated Fund will bear its own
expenses in connection with any such disposition.
    8. (a) If any Affiliated Fund or any Regulated Fund desires to make
a Follow-On Investment in a portfolio company whose securities were
acquired in a Co-Investment Transaction, the applicable Providence
Adviser will:
    (i) Notify each Regulated 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
Regulated Fund.
    (b) A Regulated Fund may participate in such Follow-On Investment
without obtaining prior approval of the Required Majority if: (i) The
proposed participation of each Regulated Fund 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 Fund has approved as being in the best interests
of the Regulated 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 Adviser to the Regulated Fund (or
Advisers if there are more than one) will provide its written
recommendation as to the Regulated Fund's participation to the Eligible
Directors, and the Regulated Fund will participate in such Follow-On
Investment solely to the extent that a Required Majority determines
that it is in the Regulated Fund's best interests.
    (c) If, with respect to any Follow-On Investment:
    (i) The amount of the opportunity is not based on the Affiliated
Funds' and the Regulated Funds' outstanding investments immediately
preceding the Follow-On Investment; and
    (ii) the aggregate amount recommended by the Adviser(s) to be
invested by each Regulated Fund 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 participant's Available Capital, 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 Non-Interested Directors of each Regulated Fund will be
provided quarterly for review all information concerning Potential Co-
Investment Transactions and Co-Investment Transactions, including
investments made by other Regulated Funds or Affiliated Funds that the
Regulated Fund considered but declined to participate in, so that the
Non-Interested Directors may determine whether all investments made
during the preceding quarter, including those investments that the
Regulated Fund considered but declined to participate in, comply with
the conditions of the Order. In addition, the Non-Interested Directors
will consider at least annually the continued appropriateness for the
Regulated Fund of participating in new and existing Co-Investment
Transactions.
    10. Each Regulated Fund will maintain the records required by
section 57(f)(3) of the Act as if each of the Regulated Funds were a
BDC and each of the investments permitted under these conditions were
approved by the Required Majority under section 57(f) of the Act.
    11. No Non-Interested Director of a Regulated Fund 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 the Advisers under their respective
investment advisory agreements with the Affiliated Funds and the
Regulated Funds, be shared by the Regulated Funds and the Affiliated
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 \11\ (including break-up or commitment fees
but excluding broker's fees contemplated by section 17(e) or 57(k) of
the Act, as

applicable), received in connection with a Co-Investment Transaction
will be distributed to the participating Regulated Funds 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 an Adviser pending consummation of
the transaction, the fee will be deposited into an account maintained
by such 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 Funds and Affiliated Funds based on the amounts
they invest in such Co-Investment Transaction. None of the Affiliated
Funds, the Advisers, the other Regulated Funds or any affiliated person
of the Regulated Funds 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 Funds 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 an Adviser, investment
advisory fees paid in accordance with the agreement between the Adviser
and the Regulated Fund or Affiliated Fund).
---------------------------------------------------------------------------

    \11\ Applicants are not requesting and the staff of the
Commission is not providing any relief for transaction fees received
in connection with any Co-Investment Transaction.
---------------------------------------------------------------------------

    14. If the Holders own in the aggregate more than 25% of the Shares
of a Regulated 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 Regulated Fund'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
Fund'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.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-07430 Filed 4-10-18; 8:45 am]
 BILLING CODE 8011-01-P


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[Federal Register Volume 80, Number 187 (Monday, September 28, 2015)]
[Notices]
[Pages 58245-58246]
[FR Doc No: 2015-24539]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 14550-001]

New England Hydropower Company, LLC; Notice of Application
Accepted for Filing With the Commission, Intent To Waive Scoping,
Soliciting Motions To Intervene and Protests, Ready for Environmental
Analysis, and Soliciting Comments, Terms and Conditions, and
Recommendations, and Establishing an Expedited Schedule for Processing

    Take notice that the following hydroelectric application has been
filed with the Commission and is available for public inspection.
    a. Type of Application: Exemption from Licensing.
    b. Project No.: 14550-001.
    c. Date filed: June 26, 2015.
    d. Applicant: New England Hydropower Company, LLC.
    e. Name of Project: Hanover Pond Dam Hydroelectric Project.
    f. Location: On the Quinnipiac River, in the City of Meriden, New
Haven County, Connecticut. The project would not occupy lands of the
United States.
    g. Filed Pursuant to: Public Utility Regulatory Policies Act of
1978, 16 U.S.C. 2705, 2708.
    h. Applicant Contact: Michael C. Kerr, New England Hydropower
Company, LLC, P.O. Box 5524, Beverly, MA 01915;<PHONE_NUMBER>.
    i. FERC Contact: Erin Kimsey,<PHONE_NUMBER>, or email at
<EMAIL_ADDRESS>    j. Deadline for filing motions to intervene and protests, comments,
terms and conditions, and recommendations: Due to the small size and
location of this project and the close coordination with state and
federal agencies during preparation of the application, the 60-day
timeframe in 18 CFR 4.34(b) is shortened. Instead, motions to intervene
and protests, comments, terms and conditions, and recommendations are
due 30 days from the issuance date of this notice. All reply comments
must be filed with the Commission within 45 days from the issuance date
of this notice.
    The Commission strongly encourages electronic filing. Please file
motions to intervene, protests, comments, and recommendations using the
Commission's eFiling system at http://www.ferc.gov/docs-filing/efiling.asp. Commenters can submit brief comments up to 6,000
characters, without prior registration, using the eComment system at
http://www.ferc.gov/docs-filing/ecomment.asp. You must include your
name and contact information at the end of your comments. For
assistance, please contact FERC Online Support at
<EMAIL_ADDRESS>(866) 208-3676 (toll free), or (202) 502-
8659 (TTY). In lieu of electronic filing, please send a paper copy to:
Secretary, Federal Energy Regulatory Commission, 888 First Street NE.,
Washington, DC 20426. The first page of any filing should include
docket number P-13806-004.
    The Commission's Rules of Practice require all intervenors filing
documents with the Commission to serve a copy of that document on each
person on the official service list for the project. Further, if an
intervenor files comments or documents with the Commission relating to
the merits of an issue that may affect the responsibilities of a
particular resource agency, they must also serve a copy of the document
on that resource agency.
    k. Waiver of Pre-filing Consultation: In its application, the New
England Hydropower Company requested that the Commission waive the
requirement to conduct second stage consultation pursuant to section
4.38(c) of the Commission's regulations. The applicant provided
documentation indicating that the Connecticut Department of Energy and
Environmental Protection, National Marine Fisheries Service, and United
States Fish and Wildlife Service had agreed to waive second stage
consultation on September 10, 2015, August 26, 2015, and August 26,
2015, respectively. Therefore, we are waiving the requirement to
conduct second stage consultation pursuant to section 4.38(c) of the
regulations and accepting the application.

    l. This application has been accepted for filing and is now ready
for environmental analysis.
    m. The proposed Hanover Pond Dam Hydroelectric Project would
consist of: (1) An existing 25-foot-high, 150-foot-long earth
embankment dam with four low-level sluice gates and a 250-foot-long
concrete spillway; (2) an existing 71.0-acre impoundment (i.e., Hanover
Pond) with a storage capacity of 1,800 acre-feet at a normal operating
elevation of about 87.3 feet National Geodetic Vertical Datum of 1929
(NGVD29); (3) an existing 175-foot-long, 16.0-foot-wide fish ladder;
(4) a new 8-foot-high, 12.5-foot-wide hydraulically-powered sluice gate
equipped with a new 8-foot-high, 17-foot-wide trashrack with 9-inch bar
spacing; (5) a new 78-foot-long, 12-foot-diameter buried precast
concrete penstock; (6) a new 46.5-foot-long, 11.65-foot-wide Archimedes
screw generator unit, with an installed capacity of 192 kilowatts; (7)
a new 12-foot-high, 18-foot-long, 16.0-foot-wide concrete powerhouse
containing a new gearbox, generator, and electrical controls; (8) a new
15-foot-long, variable-width concrete tailrace; (9) a new 500-foot-
long, 35-kilovolt above-ground transmission line connecting the
powerhouse to Connecticut Light and Power's distribution system; and
(10) appurtenant facilities. The estimated annual generation of the
proposed Hanover Pond Dam Hydroelectric Project would be about 900
megawatt-hours.
    n. Due to the applicant's close coordination with federal and state
agencies during the preparation of the application, completed studies
during pre-filing consultation, and agency recommended preliminary
terms and conditions, we intend to waive scoping and expedite the
exemption process. Based on a review of the application, resource
agency consultation letters including the preliminary 30(c) terms and
conditions, and comments filed to date, Commission staff intends to
prepare a single environmental assessment (EA). Commission staff
determined that the issues that need to be addressed in its EA have
been adequately identified during the pre-filing period, which included
a public scoping meeting and site visit, and no new issues are likely
to be identified through additional scoping. The EA will consider
assessing the potential effects of project construction and operation
on geology and soils, aquatic, terrestrial, threatened and endangered
species, recreation and land use, aesthetic, and cultural and historic
resources.
    o. A copy of the application is available for review at the
Commission in the Public Reference Room or may be viewed on the
Commission's Web site at http://www.ferc.gov using the ``eLibrary''
link. Enter the docket number excluding the last three digits in the
docket number field to access the document. For assistance, contact
FERC Online Support. For assistance, contact FERC Online Support. A
copy is also available for inspection and reproduction at the address
in item h above.
    You may also register online at http://www.ferc.gov/docs-filing/esubscription.asp to be notified via email of new filings and issuances
related to this or other pending projects. For assistance, contact FERC
Online Support.
    p. Any qualified applicant desiring to file a competing application
must submit to the Commission, on or before the specified intervention
deadline date, a competing development application, or a notice of
intent to file such an application. Submission of a timely notice of
intent allows an interested person to file the competing development
application no later than 120 days after the specified intervention
deadline date. Applications for preliminary permits will not be
accepted in response to this notice.
    A notice of intent must specify the exact name, business address,
and telephone number of the prospective applicant, and must include an
unequivocal statement of intent to submit a development application. A
notice of intent must be served on the applicant(s) named in this
public notice.
    Anyone may submit comments, a protest, or a motion to intervene in
accordance with the requirements of Rules of Practice and Procedure, 18
CFR 385.210, .211, .214. In determining the appropriate action to take,
the Commission will consider all protests or other comments filed, but
only those who file a motion to intervene in accordance with the
Commission's Rules may become a party to the proceeding. Any comments,
protests, or motions to intervene must be received on or before the
specified comment date for the particular application.
    All filings must (1) bear in all capital letters the title
``PROTEST'', ``MOTION TO INTERVENE'', ``NOTICE OF INTENT TO FILE
COMPETING APPLICATION,'' ``COMPETING APPLICATION,'' ``COMMENTS,''
``REPLY COMMENTS,'' ``RECOMMENDATIONS,'' or ``TERMS AND CONDITIONS;''
(2) set forth in the heading the name of the applicant and the project
number of the application to which the filing responds; (3) furnish the
name, address, and telephone number of the person protesting or
intervening; and (4) otherwise comply with the requirements of 18 CFR
385.2001 through 385.2005. All comments, recommendations, terms and
conditions or prescriptions must set forth their evidentiary basis and
otherwise comply with the requirements of 18 CFR 4.34(b). Agencies may
obtain copies of the application directly from the applicant. A copy of
any protest or motion to intervene must be served upon each
representative of the applicant specified in the particular
application. A copy of all other filings in reference to this
application must be accompanied by proof of service on all persons
listed in the service list prepared by the Commission in this
proceeding, in accordance with 18 CFR 4.34(b) and 385.2010.
    q. Procedural Schedule: The application will be processed according
to the following procedural schedule. Revisions to the schedule may be
made as appropriate.

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               Milestone                           Target date
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Notice of the availability of the EA..  January 2016.
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    Dated: September 16, 2015.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2015-24539 Filed 9-25-15; 8:45 am]
BILLING CODE 6717-01-P