File
No. 812-14735
Before the
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
In the Matter of the Application of:
SOLAR CAPITAL LTD.,
SOLAR SENIOR CAPITAL LTD.,
SOLAR CAPITAL PARTNERS, LLC,
SUNS SPV LLC
SECOND
AMENDED AND RESTATED APPLICATION FOR AN ORDER UNDER
SECTIONS 17(d) AND 57(i) OF THE INVESTMENT COMPANY ACT OF
1940 AND RULE 17d1 UNDER THE INVESTMENT COMPANY ACT
OF 1940 PERMITTING CERTAIN JOINT TRANSACTIONS OTHERWISE PROHIBITED
BY SECTIONS 17(d) AND 57(a)(4) OF THE INVESTMENT COMPANY ACT OF
1940 AND RULE 17dl UNDER THE INVESTMENT COMPANY ACT OF 1940
Please direct all communications, notices and orders to:
Michael S. Gross
Chief
Executive Officer
Solar Capital Ltd.
Solar Senior Capital Ltd.
500 Park Avenue
New
York, NY 10022
(212) 993-1670
Copies to:
Steven B. Boehm
Anne G.
Oberndorf
Eversheds Sutherland (US) LLP
700 Sixth
Street, NW
Washington, DC 20001
(202)
383-0100
This document contains 17 pages (including exhibits), which have been numbered sequentially.
UNITED STATES OF AMERICA
BEFORE THE
SECURITIES AND
EXCHANGE COMMISSION
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In the Matter of:
SOLAR CAPITAL LTD.
SOLAR SENIOR CAPITAL LTD.
SOLAR CAPITAL PARTNERS, LLC
SUNS SPV LLC
500 Park Avenue
New York, NY 10022
(212)
993-1670
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Second Amended and Restated Application for an Order under Sections 17(d) and 57(i) of the Investment Company Act of 1940 and Rule 17d1 under the Investment Company Act of 1940 Permitting Certain
Joint Transactions Otherwise Prohibited by Sections 17(d) and 57(a)(4) of the Investment Company Act of 1940 and Rule 17d1 under the Investment Company Act of 1940.
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I.
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Summary of Application
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The following entities hereby request an order (the
Order
) of the U.S. Securities and Exchange Commission (the
Commission
) pursuant to Sections 17(d) and 57(i) of the Investment Company Act of 1940, as amended (the
1940
Act
), and Rule 17d1 promulgated under the 1940 Act, authorizing certain joint transactions that otherwise may be prohibited by either or both of Sections 17(d) and 57(a)(4) as modified by the exemptive rules
adopted by the Commission under the 1940 Act:
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Solar Capital Ltd. (
Solar Capital
),
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Solar Senior Capital Ltd. (
Solar Senior
and together with Solar Capital, the
Solar Funds
),
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SUNS SPV LLC (the
Solar Senior Subsidiary
), and
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Solar Capital Partners, LLC (
Solar Adviser
), on behalf of itself and its successors
1
(Solar Capital, Solar Senior, Solar Advisor, and Solar Senior
Subsidiary are referred to collectively herein as the
Applicants
).
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In particular, the relief requested
in this application (the
Application
) would permit a Regulated Fund
2
and one or more other Regulated Funds and/or one or more Affiliated Funds
3
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 17d1 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 (
Private Placement
Securities
);
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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
1
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The term successor, as applied to each Adviser, means an entity that results from a reorganization into another jurisdiction or change in the type of business organization.
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2
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Regulated Fund
means Solar Capital, Solar Senior and any Future Regulated Fund.
Future Regulated Fund
means any
closed-end
management
investment company (a) that is registered under the 1940 Act or has elected to be regulated as a BDC (as defined below), (b) whose investment adviser is an Adviser, and (c) that intends to participate in the
Co-Investment
Program. The term
Adviser
means (a) Solar Adviser, and (b) any future investment adviser that controls, is controlled by or is under common control with Solar Adviser and
is registered as an investment adviser under the Investment Advisers Act of 1940 (the
Advisers Act
).
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Affiliated Fund
means any entity (a) whose investment adviser is an Adviser, (b) that would be an investment company but for Section 3(c)(1) or 3(c)(7) of the 1940 Act, and
(c) that intends to participate in the
Co-Investment
Program. No Affiliated Funds exist at this time.
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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 of 1933, as amended (the
1933 Act
).
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2
(or its Wholly-Owned Investment Sub)
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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.
The Order
sought by this Application would supersede the order, dated July 28, 2014, issued by the Commission to the Solar Funds and Solar Adviser under Sections 17(d) and 57(i) of the 1940 Act and
Rule 17d-1
under the 1940 Act permitting certain joint transactions otherwise prohibited by Sections 17(d) and 57(a)(4) of the 1940 Act and Rule
17d-1
under the
1940 Act (the
Prior Order
), with the result that no person will continue to rely on the Prior Order if the Order is granted.
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A Regulated Fund may, from time to time, form a Wholly-Owned Investment Sub. Such a subsidiary would be prohibited from investing in a
Co-Investment
Transaction with any other Regulated Fund or Affiliated 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 Subs participation in any such transaction be treated, for purposes of the Order, as though the 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 Funds investments and, therefore, no conflicts of interest could arise between the Regulated Fund and the Wholly-Owned Investment Sub. The Regulated
Funds Board would make all relevant determinations under the conditions with regard to a Wholly-Owned Investment Subs participation in a
Co-Investment
Transaction, and the Regulated Funds
Board would be informed of, and take into consideration, any proposed use of a Wholly-Owned Investment Sub in the Regulated Funds 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.
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. Applicants do not seek relief for transactions that would be permitted under other regulatory or interpretive guidance,
including, for example, transactions effected consistent with Commission staff
no-action
positions.
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Each of Solar Capital and Solar Senior is a Maryland
corporation that is an externally managed,
non-diversified,
closed-end
management investment company that has elected to be regulated as a BDC under the 1940
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The term
Wholly-Owned Investment Sub
means an entity (a) whose sole business purpose is to hold one or more investments on behalf of a Regulated Fund (and, in the case of an SBIC Subsidiary (as
defined below), maintain a license under the SBA Act (as defined below) and issue debentures guaranteed by the SBA (as defined below)); (b) that is wholly-owned by the Regulated Fund (with the Regulated Fund at all times holding, beneficially
and of record, 100% of the voting and economic interests), (c) with respect to which the Regulated Funds Board of Directors has the sole authority to make all determinations with respect to the entitys participation under the
conditions to this Application; and (d) that would be an investment company but for Section 3(c)(1) or 3(c)(7) of the 1940 Act. All subsidiaries of the Regulated Fund participating in
Co-Investment
Transactions will be Wholly-Owned Investment Subs and will have Objectives and Strategies (as defined below) that are either the same as, or a subset of, the Regulated Funds Objectives and Strategies. The term
SBIC
Subsidiary
means a Wholly-Owned Investment Sub that is licensed by the Small Business Administration (the
SBA
) to operate under the Small Business Investment Act of 1958, as amended, (the
SBA Act
) as a
small business investment company (an
SBIC
).
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Solar Capital Ltd., et al.
, Investment Company Act Rel. Nos. 31143 (July 1, 2014) (notice) and 31187 (July 28, 2014) (order).
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See, e.g.
, Massachusetts Mutual Life Insurance Co. (pub. avail. June 7, 2000), Massachusetts Mutual
Life Insurance Co. (pub. avail. July 28, 2000) and SMC Capital, Inc. (pub. avail. Sept. 5, 1995).
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Act.
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Solar Capital was formed in February 2007 as Solar Capital LLC. Immediately prior to Solar Capitals initial public offering, Solar
Capital LLC was merged with and into Solar Capital. Solar Capital completed its initial public offering on February 12, 2010. Solar Senior was formed in December 2010 and completed its initial public offering on February 24, 2011. Each of
Solar Capital and Solar Senior is managed by Solar Adviser and is provided with administrative services by Solar Capital Management, LLC. The Solar Funds business models are focused primarily on the origination of investments through portfolio
companies or their financial sponsors.
The Solar Funds invest primarily in U.S. middle-market companies, where they believe the supply of
primary capital is limited and the investment opportunities are most attractive. Solar Capitals investment objective is to generate both current income and capital appreciation through debt and equity investments. Solar Capital invests
primarily in leveraged middle-market companies in the form of senior secured loans, mezzanine loans and equity securities. Solar Capitals investments generally range between $5 million and $100 million each, although Solar Capital
expects that investment size will vary proportionately with the size of its capital base and/or with strategic initiatives.
Solar
Seniors investment objective is to seek to maximize current income consistent with the preservation of capital. Solar Senior seeks to achieve its investment objective by directly and indirectly investing primarily in senior loans, including
first lien and second lien debt instruments, made to private middle-market companies whose debt is rated below investment grade, which we refer to collectively as senior loans. Solar Seniors investments generally range between
$5 million and $30 million each, although Solar Senior expects that investment size will vary proportionately with the size of its capital base. From time to time, the Solar Funds may each invest in public companies that are thinly traded.
The Solar Senior Subsidiary is a Wholly-Owned Investment Sub, as defined above, whose sole business purpose is to hold one or more
investments on behalf of Solar Senior. As a result, the Solar Senior Subsidiary does not have a specific investment objective and strategy. Because it is a wholly-owned, consolidated subsidiary of Solar Senior, and Solar Seniors investment
adviser is Solar Adviser, Solar Adviser also manages the assets of the Solar Senior Subsidiary. The Solar Senior Subsidiary is a Delaware entity.
Solar Capital and Solar Senior each has a five-member Board,
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of which the same three
members serve as
Non-Interested
Directors.
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No
Non-Interested
Director will have any direct or indirect financial
interest in any
Co-Investment
Transaction or any interest in any portfolio company, other than through an interest (if any) in the securities of the Regulated Funds.
Solar Adviser, a privately held investment adviser registered with
the Commission pursuant to Section 203 of the Advisers Act, was organized as a limited liability company under the laws of the state of Delaware in January 2007. Solar Adviser serves as the investment adviser to each of Solar Capital and Solar
Senior and manages their respective portfolios in accordance with each Solar Funds Objectives and Strategies,
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makes investment decisions for each Solar Fund, places purchase and sale
orders for portfolio transactions for each Solar Fund and otherwise manages the
day-to-day
operations of each Solar Fund, subject to the oversight of each Solar
Funds Board.
Solar Adviser manages the investment activities of Solar Capital pursuant to an investment advisory agreement with
Solar Capital and the investment activities of Solar Senior pursuant to an investment advisory agreement with Solar Senior.
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Section 2(a)(48) of the 1940 Act defines a BDC to be any
closed-end
investment company that operates for the purpose of making investments in securities described in Section
55(a)(1) through 55(a)(3) of the 1940 Act and makes available significant managerial assistance with respect to the issuers of such securities.
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The term
Board
refers to the Board of Directors of the relevant Regulated Fund.
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The term
Non-Interested
Directors
means, with respect to any Board, the directors who are not interested persons within the meaning of Section
2(a)(19).
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The term
Objectives and Strategies
means a Regulated Funds investment objectives and strategies as described in the Regulated Funds registration statement on Form
N-2,
other filings the Regulated Fund has made with the Commission under the 1933 Act or the Securities Exchange Act of 1934, and the Regulated Funds reports to shareholders.
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The Applicants request the Order of the Commission under
Sections 17(d) and 57(i) under the 1940 Act, and
Rule 17d-l
under the 1940 Act to permit, subject to the terms and conditions set forth below in this Application (the
Conditions), one or more Regulated Funds to be able to participate in
Co-Investment
Transactions with one or more other Regulated Funds and/or one or more Affiliated Funds.
The Regulated Funds seek relief to invest in
Co-Investment
Transactions because such
Co-Investment
Transactions would otherwise be prohibited by Sections 17(d) and 57(a)(4) of the 1940 Act and
Rule 17d-l
under the 1940 Act. This
Application seeks relief in order to (i) enable the Regulated Funds and the Affiliated Funds to avoid the practical difficulties of trying to structure, negotiate and persuade counterparties to enter into transactions while awaiting the
granting of the relief requested in individual applications with respect to each
Co-Investment
Transaction that arises in the future, and (ii) enable the Regulated Funds and the Affiliated Funds to avoid
the significant legal and other expenses that would be incurred in preparing such individual applications.
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A.
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Section 17(d) and Section 57(a)(4)
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Section 17(d) of the 1940 Act
generally prohibits an affiliated person (as defined in Section 2(a)(3) of the 1940 Act), or an affiliated person of such affiliated person, of a registered
closed-end
investment company acting as
principal, from effecting any transaction in which the registered
closed-end
investment company is a joint or a joint and several participant, in contravention of such rules as the Commission may prescribe for
the purpose of limiting or preventing participation by the registered
closed-end
investment company on a basis different from or less advantageous than that of such other participant. Rule 17d1
under the 1940 Act generally prohibits participation by a registered investment company and an affiliated person (as defined in Section 2(a)(3) of the 1940 Act) or principal underwriter for that investment company, or an affiliated
person of such affiliated person or principal underwriter, 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.
Similarly, with regard to BDCs, Section 57(a)(4) of the 1940 Act prohibits certain persons specified in Section 57(b) of
the 1940 Act from participating in a joint transaction with a BDC or a company controlled by a BDC in contravention of rules as prescribed by the Commission. In particular Section 57(a)(4) of the 1940 Act applies to:
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Any director, officer, employee, or member of an advisory board of a BDC, or any person (other than the BDC itself) who is an affiliated person of the foregoing pursuant to Section 2(a)(3)(C) of the 1940 Act;
or
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Any investment adviser or promoter of, general partner in, principal underwriter for, or person directly or indirectly either controlling, controlled by, or under common control with, a BDC,
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or any person who is an affiliated person of any of the foregoing within the meaning of Section 2(a)(3)(C) or (D) of the 1940 Act.
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Section 2(a)(3)(C) of the 1940 Act defines an affiliated person of another person to include any person directly or
indirectly controlling, controlled by, or under common control with, such other person. Section 2(a)(9) of the 1940 Act defines control as the power to exercise a controlling influence over the management or policies of a
company, unless such power is solely the result of an official position with that company. Under Section 2(a)(9) of the 1940 Act a person who beneficially owns, either directly or through one or more controlled companies, more
than 25% of the voting securities of a company is presumed to control such company. The Commission and its staff have indicated on a number of occasions their belief that an investment adviser controls the fund that it advises, absent
compelling evidence to the contrary.
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Solar Adviser is the investment adviser to
the Solar Funds, and an Adviser will be the investment adviser to each of the Future Regulated Funds. Solar Adviser may be deemed to control the Solar Funds, and any other Adviser will be controlling, controlled by, or under common control with
Solar Adviser. In addition, an Adviser will be the
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Excluded from this category are the BDC itself and any person who, if it were not directly or indirectly controlled by the BDC, would not otherwise be under common control with the BDC.
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See, e.g.,
In re Investment Company Mergers
, SEC Rel. No. IC25259 (Nov. 8, 2001);
In re Steadman
Security Corp
., 46 S.E.C. 896, 920 n.81 (1977) ([T]he investment adviser almost always controls the fund. Only in the very rare case where the advisers role is simply that of advising others who may or may not elect to be guided
by his advice
can the adviser realistically be deemed not in control.).
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investment adviser to each Affiliated Fund. The Regulated Funds may be deemed to be under common control, and thus affiliated persons of each other under Section 2(a)(3)(C) of the 1940
Act. In addition, the Affiliated Funds may be deemed to be under common control with the Regulated Funds, and thus affiliated persons of each Regulated Fund under Section 2(a)(3)(C) of the 1940 Act. As a result, these relationships might
cause a Regulated Fund and one or more other Regulated Funds and/or one or more Affiliated Funds participating in
Co-Investment
Transactions to be subject to Sections 17(d) or 57(a)(4) of
the 1940 Act, and thus subject to the provisions of
Rule 17d-l
of the 1940 Act.
Rule 17dl under the 1940 Act
generally prohibits participation by a registered investment company and an affiliated person (as defined in Section 2(a)(3) of the 1940 Act) or principal underwriter for that investment company, or an affiliated person of such affiliated
person or principal underwriter, 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.
Rule 17d1 was promulgated by the Commission pursuant to Section 17(d) of the 1940 Act and made applicable to BDCs by
Section 57(i) of the 1940 Act. Section 57(i) of the 1940 Act provides that, until the Commission prescribes rules under Section 57(a)(4) of the 1940 Act, the Commissions rules under Section 17(d) of
the 1940 Act applicable to registered
closed-end
investment companies will be deemed to apply. Because the Commission has not adopted any rules under Section 57(a)(4) of the 1940 Act,
Rule 17dI under the 1940 Act applies.
Applicants seek relief pursuant to
Rule 17d-l
under the 1940 Act, which permits the Commission to authorize joint transactions upon application. In passing upon applications filed pursuant to Rule I7dl under the 1940
Act, the Commission is directed by Rule 17d1(b) under the 1940 Act to consider whether the participation of a registered investment company or controlled company thereof in the joint enterprise or joint arrangement under scrutiny is
consistent with provisions, policies and purposes of the 1940 Act and the extent to which such participation is on a basis different from or less advantageous than that of other participants.
The Commission has stated that Section 17(d) of the 1940 Act, upon which Rule 17d1 under the 1940 Act is based, and
upon which Section 57(a)(4) of the 1940 Act was modeled, was designed to protect investment companies from self-dealing and overreaching by insiders. The Commission has also taken notice that there may be transactions subject to these
prohibitions that do not present the dangers of overreaching. See
Protecting Investors: A Half-Century of Investment Company Regulation
, 1504 Fed. Sec. L. Rep., Extra Edition (May 29, 1992) at 488
et seq
. The Court of Appeals
for the Second Circuit has enunciated a like rationale for the purpose behind Section 17(d): The objective of [Section] 17(d)
is to prevent
injuring the interest of stockholders of registered investment companies by causing
the company to participate on a basis different from or less advantageous than that of such other participants.
Securities and Exchange Commission v. Talley Industries. Inc.
, 399 F.2d 396, 405 (2d Cir. 1968),
cert. denied
393 U.S. 1015 (1969). Furthermore, Congress acknowledged that the protective system established by the enactment of Section 57 is similar to that applicable to registered investment companies under section 17 of the 1940
Act, and rules thereunder, but is modified to address concerns relating to unique characteristics presented by business development companies. H.Rep.
No. 96-1341,
96th Cong., 2d Sess. 45
(1980)
reprinted in
1980 U.S.C.C.A.N. 4827.
Applicants believe that the terms and conditions of this Application would
ensure that the conflicts of interest that Section 17(d) and Section 57(a)(4) of the 1940 Act were designed to prevent would be addressed and the standards for an order under Rule 17d1 under the 1940 Act are met.
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C.
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Protection Provided by the Proposed Conditions
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Applicants believe that the
proposed conditions, as discussed more fully in Section III.D. of this Application (the
Conditions
), will ensure the protection of shareholders of the Regulated Funds and compliance with the purposes and policies of
the 1940 Act with respect to the
Co-Investment
Transactions. In particular, the Conditions, as outlined below, would ensure that each Regulated Fund would only invest in investments that are appropriate
to the interests of shareholders and the investment needs and abilities of that Regulated Fund. In addition, each Regulated Fund would be able to invest on equal footing with each other Regulated Fund and the Affiliated Funds, including identical
terms, conditions, price, class of securities purchased, settlement date, and registration rights. Each Regulated Fund would have the ability to engage in
Follow-On
Investments in a fair
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manner consistent with the protections of the other conditions. Each Regulated Fund would have the ability to participate on a proportionate basis, at the same price and on the same terms and
conditions in any sale of a security purchased in a
Co-Investment
Transaction. Fees and expenses of
Co-Investment
Transactions would be borne by the applicable Adviser,
or shared
pro-rata
among the Regulated Funds and Affiliated Funds who participate in the
Co-Investment
Transactions. The conditions would also prevent a Regulated Fund
from investing in any issuer in which another Regulated Fund, Affiliated Fund, or any affiliated person thereof, is an existing investor, which eliminates the possibility of a Regulated Fund being forced to invest in a manner that would benefit an
affiliated persons existing investment. Also, sufficient records of the transactions would be maintained to permit the examination staff of the Commission to monitor compliance with the terms of the requested order.
The Conditions impose a variety of duties on the Advisers with respect to
Co-Investment
Transactions
and Potential
Co-Investment
Transactions by the Regulated Funds. These duties include determinations regarding investment appropriateness, the appropriate level of investment, and the provision of information
to the Board of any Regulated Fund. In addition, when considering Potential
Co-Investment
Transactions for any Regulated Fund, the applicable Adviser will consider only the Objectives and Strategies,
investment policies, investment positions, Available Capital (defined below), and other pertinent factors applicable to that Regulated Fund. Each Adviser, as applicable, undertakes to perform these duties consistently for each Regulated Fund, as
applicable, regardless of which of them serves as investment adviser to these entities. The participation of a Regulated Fund in a Potential
Co-Investment
Transaction may only be approved by a required
majority, as defined in Section 57(o) (a
Required Majority
), of the directors of the Board eligible to vote on that
Co-Investment
Transaction under Section 57(o) (the
Eligible Directors
).
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The amount of each Regulated Funds
capital available for investment (
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 Regulated Fund or imposed by applicable laws, rules, regulations or interpretations. Likewise, an Affiliated Funds capital available for investment 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 by the Affiliated Funds directors, general partners or adviser or
imposed by applicable laws, rules, regulations or interpretations.
If an Adviser or its principal owners (the
Principals
), or any person controlling, controlled by, or under common control with an Adviser or the Principals, and the Affiliated Funds (collectively, the
Holders
) own in the aggregate more than
25 percent of the outstanding voting shares of a Regulated Fund (the
Shares
), then the Holders will vote such Shares as required under condition 14.
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 an Adviser or the Principals to influence the
Non-Interested
Directors by a suggestion,
explicit or implied, that the
Non-Interested
Directors can be removed if desired by the Holders will be limited significantly. The
Non-Interested
Directors shall
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.
In sum, the Applicants believe that the proposed conditions would ensure that each Regulated Fund that participates in a
Co-Investment
Transaction does not participate on a basis different from, or less advantageous than, that of such other participants. As a result, the Applicants believe that the participation of the Regulated Funds
in
Co-Investment
Transactions done in accordance with the Conditions would be consistent with the provisions, policies, and purposes of the 1940 Act, and would be done in a manner that was not different
from, or less advantageous than, the other participants.
Applicants agree that any Order granting the requested
relief shall be subject to the following Conditions:
1. Each time an Adviser considers a Potential
Co-Investment
Transaction for an Affiliated Fund or another Regulated Fund that falls within a Regulated Funds then-current Objectives and Strategies, the Regulated Funds Adviser will make an
independent determination of the appropriateness of the investment for such Regulated Fund in light of the Regulated Funds then-current circumstances.
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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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2. (a) If the Adviser deems a Regulated Funds participation in any Potential
Co-Investment
Transaction to be appropriate for the Regulated Fund, it will then determine an appropriate level of investment for the Regulated Fund.
(b) If the aggregate amount recommended by the applicable Adviser to be invested by the applicable 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 participants Available Capital, up to the amount proposed to be invested by each. The applicable Adviser will provide the Eligible
Directors of each participating Regulated Fund with information concerning each participating partys Available Capital to assist the Eligible Directors with their review of the Regulated Funds investments for compliance with these
allocation procedures.
(c) After making the determinations required in conditions 1 and 2(a), the applicable
Adviser will distribute written information concerning the Potential
Co-Investment
Transaction (including the amount proposed to be invested by each 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 Funds 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 Funds then-current Objectives and Strategies;
(iii) the investment by any other Regulated Funds or 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 companys 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 applicable Adviser agrees to, and does, provide periodic reports to the Regulated Funds 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 any Regulated Fund receives in connection with the right of the 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
8
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
partys 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 1940 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 applicable Adviser 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
Funds 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,
15
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.
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 companys 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 Advisers 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 this 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 will
provide its written recommendation as to the Regulated Funds 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 Funds best interests.
(d) Each Affiliated Fund and each Regulated Fund will bear its own expenses in
connection with any such disposition.
15
|
This exception applies only to
Follow-On
Investments by a Regulated Fund in issuers in which the Regulated Fund already holds investments.
|
9
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 Advisers 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 this application). In all other cases, the Adviser will provide its written recommendation as to the Regulated Funds 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 Funds best interests.
(c) If, with respect to any
Follow-On
Investment:
(i) the amount of the opportunity is not based on the Regulated Funds and the Affiliated Funds outstanding
investments immediately preceding the
Follow-On
Investment; and
(ii) the
aggregate amount recommended by the applicable Adviser to be invested by the applicable Regulated Fund in the
Follow-On
Investment, 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, then the investment opportunity will be allocated among them pro rata based on each participants Available Capital,
up to the maximum 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
this 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 1940 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 1940 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 1940 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 1933 Act) will, to the extent not payable by the Advisers under their
10
respective investment advisory agreements with 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
16
(including
break-up
or commitment fees but excluding brokers fees contemplated by Section 17(e) or 57(k) of the 1940 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 1940 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 the
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.
14. If the Holders own in the aggregate more than 25 percent 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
1940 Act or applicable state law affecting the Boards composition, size, or manner of election.
15. Each Regulated Funds
chief compliance officer, as defined in Rule
38a-1(a)(4),
will prepare an annual report for its Board each year that evaluates (and documents the basis of that evaluation) the Regulated Funds compliance
with the terms and conditions of the application and the procedures established to achieve such compliance.
IV.
|
Statement in Support of Relief Requested
|
Applicants submit that allowing the
Co-Investment
Transactions described by this Application is justified on the basis of (i) the potential benefits to the Regulated Funds and the shareholders thereof and (ii) the protections found in the
terms and conditions set forth in this Application.
In the absence of the relief sought hereby, in some
circumstances the Regulated Funds would be limited in their ability to participate in attractive and appropriate investment opportunities. Section 17(d) and Section 57(a)(4) of the 1940 Act and Rule 17d1 under the 1940 Act
should not prevent BDCs and registered closedend investment companies from making investments that are in the best interests of their shareholders.
In cases where the Advisers identify investment opportunities requiring larger capital commitments, they must seek the participation of other
entities with similar investment styles. The ability to participate in
Co-Investment
Transactions that involve committing larger amounts of financing would enable each Regulated Fund to participate with one or
more of the Affiliated Funds and the other Regulated Funds in larger financing commitments, which would, in turn, be expected to obtain discounted prices and increase income, expand investment opportunities and provide better access to due diligence
information for the Regulated Funds. Indeed, each Regulated Funds inability to
co-invest
with one or more of the Affiliated Funds and the other Regulated Funds could potentially result in the loss of
beneficial investment opportunities for such Regulated Fund and, in turn, adversely affect such Regulated Funds shareholders. For example, a Regulated Fund may lose investment opportunities if the Adviser cannot provide
one-stop
financing to a potential portfolio company. Portfolio companies may reject an offer of funding arranged by an Adviser due to a Regulated Funds inability to commit the full amount of
financing required by the portfolio company in a timely manner (i.e., without the delay that typically would be associated with obtaining single-transaction exemptive relief from the Commission). 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
16
|
Applicants are not requesting and the staff is not providing any relief for transaction fees received in connection with any
Co-Investment
Transaction.
|
11
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.
Each Regulated Fund and
its shareholders will benefit from the ability to participate in
Co-Investment
Transactions. The Board of each Regulated Fund, including the
Non-Interested
Directors,
has (or will have prior to relying on the requested Order) determined that it is in the best interests of the Regulated Fund to participate in
Co-Investment
Transactions because, among other matters,
(i) the Regulated Fund will be able to participate in a larger number and greater variety of transactions; (ii) the Regulated Fund will be able to participate in larger transactions; (iii) the Regulated Fund will be able to
participate in all opportunities approved by a Required Majority or otherwise permissible under the Order rather than risk underperformance through rotational allocation of opportunities among the Regulated Funds; (iv) the Regulated Fund and
any other Regulated Funds participating in the proposed investment will have greater bargaining power, more control over the investment and less need to bring in other external investors or structure investments to satisfy the different needs of
external investors; (v) the Regulated Fund will be able to obtain greater attention and better deal flow from investment bankers and others who act as sources of investments; and (vi) the general terms and conditions of the proposed Order
are fair to the Regulated Funds and their shareholders. The Board of each Solar Fund, including the
Non-Interested
Directors, also determined that it is in the best interests of its respective Solar Fund and
the Solar Funds shareholders to obtain the Order at the earliest possible time and instructed the officers of the respective Solar Fund, Solar Adviser and counsel to use all appropriate efforts to accomplish such goal. For these reasons, each
Board has determined (or will have prior to relying on the requested Order) that it is proper and desirable for its respective Solar Fund to participate in
Co-Investment
Transactions with the other Regulated
Funds and/or one or more Affiliated Funds.
|
B.
|
Protective Representations and Conditions
|
The terms and conditions set forth in
this application ensure that the proposed
Co-Investment
Transactions are consistent with the protection of each Regulated Funds shareholders and with the purposes intended by the policies and provisions
of the 1940 Act. Specifically, the Conditions incorporate the following critical protections: (i) in each
Co-Investment
Transaction, all Regulated Funds and Affiliated Funds participating in the
Co-Investment
Transactions will invest at the same time for the same price and with the same terms, conditions, class, registration rights and any other rights, so that none of them receives terms more favorable
than any other; (ii) a Required Majority of each Regulated Fund must approve various investment decisions with respect to such Regulated Fund in accordance with the Conditions; and (iii) the Regulated Funds are required to retain and
maintain certain records.
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 Adviser will present each Potential
Co-Investment
Transaction and the proposed allocation
to the Eligible Directors, and the Required Majority will approve each
Co-Investment
Transaction prior to any investment by the participating Regulated Fund. 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 Funds 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 Funds 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.
The
Applicants believe that participation by the Regulated Funds in pro rata dispositions and
Follow-On
Investments, as provided in conditions 7 and 8, is consistent with the provisions, policies and
purposes of the 1940 Act and will not be made on a basis different from or less advantageous than that of other participants. A formulaic approach, such as pro rata dispositions and
Follow-On
Investments,
eliminates the discretionary ability to make allocation determinations, and in turn eliminates the possibility for overreaching and promotes fairness. The Applicants note that the Commission has adopted a similar pro rata approach in the context of
Rule 23c-2
under the 1940 Act, which relates to the redemption by a
closed-end
investment company of less than all of a class of its securities, indicating the
general fairness and lack of overreaching that such approach provides.
12
The foregoing analysis applies equally where a Wholly-Owned Investment Sub is involved in a
Co-Investment
Transaction as each Wholly-Owned Investment Sub will be treated as one company with its parent for purposes of this Application.
The Commission previously has issued orders permitting certain investment
companies subject to regulation under the 1940 Act and their affiliated persons to
co-invest
in Private Placement Securities.
See
Medley Capital Corporation, et al.
(File
No. 812-14679)
Investment Company Act Rel. Nos. 32520 (March 3, 2017) (notice) and 32581 (March 29, 2017) (order);
Golub Capital BDC, Inc, et al.
(File
No. 812-13764)
Investment Company Act Rel. Nos. 32461 (January 31, 2017) (notice) and 32509 (February 27, 2017) (order);
Owl Rock Capital Corporation, et al.
(File
No. 812-14568)
Investment Company Act Rel. Nos. 32422 (January 11, 2017) (notice) and 32469 (February 7, 2017) (order);
Ares Capital Corporation, et al.
(File
No. 812-13603)
Investment Company Act Rel. Nos. 32399 (December 21, 2016) (notice) and 32427 (January 18, 2017) (order);
Fidus Investment Corporation, et al.
(File
No. 812-14605)
Investment Company Act Rel. Nos. 32381 (December 7, 2016) (notice) and 32411 (January 4, 2017) (order);
Goldman Sachs BDC Inc., et al.
(File
No. 812-14219)
Investment Company Act Rel. Nos. 32382 (December 7, 2016) (notice) and 32409 (January 4, 2017) (order).
Pursuant to
Rule 0-2(f)
under the 1940 Act, each Applicant states that its address is as indicated below:
Michael S. Gross
Chief Executive Officer
Solar
Capital Ltd.
Solar Senior Capital Ltd.
500 Park Avenue
New York, NY 10022
Applicants further state that all written or oral communications concerning this Application should be directed to:
Steven B. Boehm, Esq.
Anne G.
Oberndorf, Esq.
Eversheds Sutherland (US) LLP
700 Sixth Street, N.W.
Washington,
D.C. 20001
(202)
383-0100
The Applicants desire that the Commission issue an Order pursuant to
Rule 0-5
under the 1940
Act without conducting a hearing.
Pursuant to
Rule 0-2
under the 1940 Act, each
Applicant each Applicant declares that all requirements for the execution and filing of this Application in its name and on its behalf by the undersigned have been complied with and that the undersigned is fully authorized to do so. The
verifications required by
Rule 0-2(d)
under the 1940 Act are attached hereto as Exhibit A. The filing of this Application for the order sought hereby and the taking of all acts reasonably necessary to
obtain the relief requested herein was authorized by each Board of the Regulated Fund pursuant to resolutions duly adopted by each Board on January 13, 2017 (attached hereto as Exhibits B and C), which remain in effect.
Applicants request that any questions regarding this Application be directed to the persons listed on the facing page of this Application.
13
VII.
|
Request for Order of Exemption
|
For the foregoing reasons, the Applicants request that
the Commission enter an Order under Sections 17(d) and 57(i) of the 1940 Act and Rule 17d1 under the 1940 Act granting Applicants the relief sought by the Application. Applicants submit that the requested exemption is
consistent with the protection of investors.
Dated: May 4, 2017
|
|
|
Solar Capital Ltd.
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Chief Executive Officer, President, Chairman of the Board of Directors
|
|
Solar Senior Capital Ltd.
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Chief Executive Officer, President, Chairman of the Board of Directors
|
|
Solar Capital Partners, LLC
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Managing Member
|
|
SUNS SPV LLC
|
|
|
By:
|
|
/s/ Richard L. Peteka
|
Name:
|
|
Richard L. Peteka
|
Title:
|
|
Chief Financial Officer
|
14
Exhibit A
Verification
The undersigned
states that he has duly executed the foregoing Application, dated May 4, 2017, for and on behalf of the Applicants, as the case may be, that he holds the office with such entity as indicated below and that all action by the directors,
stockholders, general partners, trustees or members of each entity, as applicable, necessary to authorize the undersigned to execute and file such instrument has been taken. The undersigned further states that he is familiar with such
instrument and the contents thereof and that the facts set forth therein are true to the best of his knowledge, information and belief.
|
|
|
Solar Capital Ltd.
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Chief Executive Officer, President, Chairman of the Board of Directors
|
|
Solar Senior Capital Ltd.
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Chief Executive Officer, President, Chairman of the Board of Directors
|
|
Solar Capital Partners, LLC
|
|
|
By:
|
|
/s/ Michael S. Gross
|
Name:
|
|
Michael S. Gross
|
Title:
|
|
Managing Member
|
|
SUNS SPV LLC
|
|
|
By:
|
|
/s/ Richard L. Peteka
|
Name:
|
|
Richard L. Peteka
|
Title:
|
|
Chief Financial Officer
|
A-1
Exhibit B
Resolutions of the Board of Directors of Solar Capital Ltd.
WHEREAS
, the Board of Directors has reviewed Solar Capital Ltd.s (the
Company)
Co-Investment
Exemptive Application (the
Exemptive Application
) involving the Company, Solar Senior Capital Ltd. and certain affiliates thereof as specified in the
Exemptive Application, a copy of which is attached hereto as
Exhibit A,
for an amended order of the U.S. Securities and Exchange Commission (the
SEC
) pursuant to Section 57(i) of the Investment Company Act of
1940, as amended (the
1940 Act
), and
Rule 17d-1
promulgated under the 1940 Act, permitting certain joint transactions that otherwise may be prohibited by Section 17(d) and
Section 57(a)(4) of the 1940 Act. WHEREAS, the sole Director deems it advisable and in the best interest of the Company that the Company file the
Co-Investment
Exemptive Application;
NOW, THEREFORE, BE IT RESOLVED
, that the Authorized Officers (as defined below), shall be, and each of them individually hereby is,
authorized, empowered and directed, in the name and on behalf of the Company, to cause to be executed, delivered and filed with the SEC the Exemptive Application, in substantially the form attached hereto as
Exhibit A
;
and
FURTHER RESOLVED
, that the Authorized Officers shall be, and each of them individually hereby is, authorized, empowered and directed,
in the name and on behalf of the Company, to cause to be made, executed, delivered and filed with the SEC any amendments to the Exemptive Application and any additional applications for exemptive relief as are determined necessary, advisable or
appropriate by any such officers in order to effectuate the foregoing, such determination to be conclusively evidenced by the taking of any such action;
and
FURTHER RESOLVED
, that all acts and things previously done by any of the Authorized Officers, on or prior to the date hereof, in the
name and on behalf of the Company in connection with the foregoing resolutions are in all respects authorized, ratified, approved, confirmed and adopted as the acts and deeds by and on behalf of the Company;
and
FURTHER RESOLVED
, that any officer of the Company be, and each of them hereby is, authorized, empowered and directed to certify and
deliver copies of these resolutions to such governmental bodies, agencies, persons, firms or corporations as such officer may deem necessary and to identify by such officers signature or certificate, or in such form as may be required, the
documents and instruments presented to and approved herein and to furnish evidence of the approval, by an officer authorized to give such approval, of any document, instrument or provision or any addition, deletion or change in any document or
instrument; and
FURTHER RESOLVED
, that for purposes of the foregoing resolutions, the Authorized Officers of the Company shall be
the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer and the Secretary of the Company (collectively, the
Authorized Officers
).
B-1
Exhibit C
Resolutions of the Board of Directors of Solar Senior Capital Ltd.
WHEREAS
, the Board of Directors has reviewed Solar Senior Capital Ltd.s (the
Company)
Co-Investment
Exemptive Application (the
Exemptive Application
) involving the Company, Solar Capital Ltd. and certain affiliates thereof as specified in the Exemptive
Application, a copy of which is attached hereto as
Exhibit A
, for an amended order of the U.S. Securities and Exchange Commission (the
SEC
) pursuant to Section 57(i) of the Investment Company Act of 1940, as
amended (the
1940 Act
), and
Rule 17d-1
promulgated under the 1940 Act, permitting certain joint transactions that otherwise may be prohibited by Section 17(d) and
Section 57(a)(4) of the 1940 Act.
NOW, THEREFORE, BE IT RESOLVED
, that the Authorized Officers (as defined below), shall be,
and each of them individually hereby is, authorized, empowered and directed, in the name and on behalf of the Company, to cause to be executed, delivered and filed with the SEC the Exemptive Application, in substantially the form attached hereto as
Exhibit A
;
and
FURTHER RESOLVED
, that the Authorized Officers shall be, and each of them individually hereby is,
authorized, empowered and directed, in the name and on behalf of the Company, to cause to be made, executed, delivered and filed with the SEC any amendments to the Exemptive Application and any additional applications for exemptive relief as are
determined necessary, advisable or appropriate by any such officers in order to effectuate the foregoing, such determination to be conclusively evidenced by the taking of any such action;
and
FURTHER RESOLVED
, that all acts and things previously done by any of the Authorized Officers, on or prior to the date hereof, in the
name and on behalf of the Company in connection with the foregoing resolutions are in all respects authorized, ratified, approved, confirmed and adopted as the acts and deeds by and on behalf of the Company;
and
FURTHER RESOLVED
, that any officer of the Company be, and each of them hereby is, authorized, empowered and directed to certify and
deliver copies of these resolutions to such governmental bodies, agencies, persons, firms or corporations as such officer may deem necessary and to identify by such officers signature or certificate, or in such form as may be required, the
documents and instruments presented to and approved herein and to furnish evidence of the approval, by an officer authorized to give such approval, of any document, instrument or provision or any addition, deletion or change in any document or
instrument; and
FURTHER RESOLVED
, that for purposes of the foregoing resolutions, the Authorized Officers of the Company shall be
the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer and the Secretary of the Company (collectively, the
Authorized Officers
).
C-1
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