85784 Federal Register / Vol. 85, No. 249 / Tuesday, December 29, 2020 / Notices 

13 17 CFR 200.30–3(a)(12). 

1The term ‘‘BDC’’ means business development 

company as defined under Section 2(a)(48) of the 

Act. 

2The term ‘‘Fund’’ means (i) the KREST Fund 

and (ii) any existing or future closed-end 

management investment company (A) that is 

registered under the Act or has elected to be 

similar to, recent changes made to 

FINRA Rule 1015 that addressed the 

issue of balancing public health risks 

with conducting hearings during the 

COVID–19 pandemic. The Exchange 

proposes to adopt the rule change in 

substantially the same form as it was 

adopted by FINRA. The Exchange 

further believes that the proposed rule 

change would not significantly affect 

the protection of investors or the public 

interest or impose any significant 

burden on competition because the 

changes are based on the rules of 

FINRA. Moreover, the proposed rule 

change is not intended to address 

competitive issues but rather is 

concerned solely with providing 

temporary relief given the impacts of the 

COVID–19 pandemic. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

Phlx–2020–53 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–Phlx–2020–53. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–Phlx–2020–53 and should 

be submitted on or before January 19, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2020–28672 Filed 12–28–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

34147; 812–15096–01] 

KKR Registered Advisor LLC and KKR 

Real Estate Select Trust Inc. 

December 22, 2020. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of an application for an order 

under section 6(c) of the Investment 

Company Act of 1940 (‘‘Act’’) for an 

exemption from section 23(a)(1) of the 

Act. 

SUMMARY OF APPLICATION: Applicants 

request an order to permit certain 

registered closed-end management 

investment companies (‘‘closed-end 

funds’’) and business development 

companies (‘‘BDCs’’,1 and together with 

the closed-end funds, ‘‘Funds’’) to pay 

Advisory Fees (defined below) in shares 

of their common stock (‘‘Shares’’). 

APPLICANTS: KKR Registered Advisor 

LLC (the ‘‘Existing Adviser’’) and KKR 

Real Estate Select Trust Inc. (the 

‘‘KREST Fund’’ and together with the 

Existing Adviser, the ‘‘Applicants’’). 

FILING DATES: The application was filed 

on February 19, 2020, and amended on 

May 28, 2020, September 14, 2020, 

November 5, 2020, and December 18, 

2020. 

HEARING OR NOTIFICATION OF HEARING: 

An order granting the application will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov and serving Applicants 

with a copy of the request by email. 

Hearing requests should be received by 

the Commission by 5:30 p.m. on January 

18, 2021, and should be accompanied 

by proof of service on the Applicants, in 

the form of an affidavit or, for lawyers, 

a certificate of service. Pursuant to rule 

0–5 under the Act, hearing requests 

should state the nature of the writer’s 

interest, any facts bearing upon the 

desirability of a hearing on the matter, 

the reason for the request, and the issues 

contested. Persons who wish to be 

notified of a hearing may request 

notification by emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov. 

ADDRESSES: Secretary, U.S. Securities 

and Exchange Commission: SecretarysOffice@sec.gov. Applicants: Lori 

Hoffman, Esq., General.Counsel@

kkr.com. 

FOR FURTHER INFORMATION CONTACT: HaeSung Lee, Senior Counsel, at (202) 551– 

7345, or Trace W. Rakestraw, Branch 

Chief, at (202) 551–6825 (Division of 

Investment Management, Chief 

Counsel’s Office). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

website by searching for the file number 

or an Applicant using the ‘‘Company’’ 

name box, at http://www.sec.gov/ 

search/search.htm or by calling (202) 

551–8090. 

Applicants’ Representations 

1. Applicants seek an order of the 

Commission under section 6(c) of the 

Act, granting an exemption from section 

23(a)(1) of the Act to the extent 

necessary to allow a Fund 2 to pay its 


KHAMMOND on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 85, No. 249 / Tuesday, December 29, 2020 / Notices 85785 

regulated as a BDC, (B) whose investment adviser 

is an Adviser (as defined below) and (C) that 

intends to rely the requested order. Each person 

that currently intends to rely on the requested order 

is named as an Applicant. Any person that relies 

on the requested order in the future would do so 

only in accordance with the terms and conditions 

contained in the Application. 

3The term ‘‘Adviser’’ means (i) the Existing 

Adviser, (ii) any investment adviser that controls, 

is controlled by or is under common control with 

the Existing Adviser and is registered as an 

investment adviser under the Investment Advisers 

Act of 1940, as amended (the ‘‘Advisers Act’’) or 

(iii) any successor in interest to any entity described 

under (i) and (ii) of this definition. For purposes of 

the requested order, the term ‘‘successor’’ is limited 

to an entity that results from a reorganization into 

another jurisdiction or a change in the type of 

business organization. 

4The term ‘‘Advisory Fees’’ means the 

compensation a Fund agrees to pay its Adviser 

pursuant to an investment advisory agreement with 

its Adviser subject to section 15 of the Act (each, 

an ‘‘Advisory Agreement’’). Such compensation 

may include base management fees, income-based 

incentive fees, and/or capital gains-based incentive 

fees, as applicable and permissible under the 

Advisers Act. With respect to the requested relief, 

the Applicants do not differentiate among these 

types of Advisory Fees because, in each case, an 

Adviser would receive shares in lieu of a dollar 

amount of Advisory Fees. 

5Other Funds that rely on the requested order in 

the future may offer periodic liquidity in 

compliance with rule 23c–3 under the Act 

(‘‘Interval Funds’’). 

6 If the KREST Fund, or any other Fund, lists its 

Shares, it would no longer rely on the requested 

order. 

7 If an Adviser elects to receive its Advisory Fees 

in a combination of cash and shares of common 

stock, it would also choose at the beginning of the 

Fee Calculation Period what portion of Advisory 

Fees it would receive in Shares. 

Adviser 3 all or part of the Advisory 

Fees 4 earned by the Adviser in Shares 

in lieu of paying an equivalent amount 

in cash. 

2. The Existing Adviser, a Delaware 

limited liability company registered as 

an investment adviser under the 

Advisers Act, currently serves as the 

investment adviser to the KREST Fund 

pursuant to its Advisory Agreement. 

The Existing Adviser, or another 

Adviser registered under the Advisers 

Act, would serve as investment adviser 

to each Fund. 

3. The KREST Fund, a Maryland 

corporation that would register under 

the Act as a closed-end management 

investment company, would 

continuously offer its Shares and 

expects to offer periodic liquidity with 

respect to its Shares through tender 

offers conducted in compliance with 

rule 13e–4 under the Securities 

Exchange Act of 1934 (as amended, the 

‘‘Exchange Act’’).5 The KREST Fund 

would be non-listed, and the Shares 

would not trade on an exchange.6 The 

KREST Fund expects to invest primarily 

in illiquid assets. 

4. As required by section 15 of the 

Act, the Adviser would manage the 

Fund pursuant to an Advisory 

Agreement that precisely describes the 

nature and method of calculation of the 

Advisory Fees. The Advisory Agreement 

would specify that the Adviser may 

elect to receive payment of the Advisory 

Fees it has earned, in whole or in part, 

in an amount of Shares equal in value 

to the dollar figure of the Advisory Fees 

owed. Each fund would disclose this 

mechanism in its registration statements 

and proxy statements. 

5. Applicants represent that each 

fund’s advisory agreement would 

specify the fee calculation period for 

Advisory Fees (e.g., annually, quarterly, 

monthly, etc.) (such period, the ‘‘Fee 

Calculation Period’’). At the beginning 

of each Fee Calculation Period, each 

Fund’s Adviser would elect to receive 

its Advisory Fees for such period in 

cash, Shares or some combination of 

both.7 In making such an election, the 

Adviser must consider the best interests 

of the Fund and its shareholders. 

6. The number of Shares the Adviser 

would receive would be calculated by 

dividing the earned Advisory Fees 

elected by the Adviser for payment in 

Shares by the greater of (i) the current 

net asset value (‘‘NAV’’) per share of the 

class of Shares the Adviser would 

receive, as determined by or under the 

supervision of the Fund’s board of 

directors in accordance with the Act 

and (ii) the current offering price of the 

class of Shares the Adviser would 

receive. For example, if an Adviser 

earned Advisory Fees amounting to 

$200,000 for a given Fee Calculation 

Period and the Fund’s NAV per share 

and offering price per share was $25 at 

the time of issuance to the Adviser, the 

Fund would issue 8,000 Shares to the 

Adviser if the Adviser had elected to 

receive its entire Advisory Fee in Shares 

for that Fee Calculation Period. 

7. A Fund would only rely on the 

requested relief to issue Shares of a class 

that is otherwise available for purchase, 

and reasonably expected to be 

purchased, by other similarly eligible 

investors. Furthermore, the Adviser 

would receive Shares at the same price 

as such other investors acquiring the 

same class of Shares. Such class of 

Shares would not exist solely for 

investment by the Adviser and/or its 

affiliates. The Fund’s Advisory 

Agreement would detail the specific 

class of Shares that the Fund may issue 

to the Adviser as compensation in lieu 

of a cash payment. 

8. For any Fee Calculation Period 

during which the Adviser has elected to 

receive all or a portion of its Advisory 

Fees in Shares, the Fund would post a 

notice to that effect on the Fund’s 

website. The Fund would also maintain 

and make publicly available on its 

website a historical record of how the 

Adviser was compensated for each Fee 

Calculation Period during the Fund’s 

last three fiscal years. The Fund would 

include, in response to any item on the 

applicable form for registration of 

securities requiring a description of the 

Adviser’s compensation (currently Item 

9 of Form N–2), a cross-reference noting 

the availability of such historical 

information on the Fund’s website. 

9. Any Shares received by the Adviser 

in lieu of cash would be subject to the 

same fees and expenses applicable to 

the Fund’s other shareholders in the 

relevant class, would not receive 

preferential voting, dividend or 

liquidity rights with respect to its 

Shares, and would otherwise have the 

same rights and obligations as Shares of 

the same class issued to other investors 

in the Fund, except that an Adviser 

would ‘‘mirror vote’’ any Shares 

received in lieu of a cash payment for 

Advisory Fees. 

10. Each Adviser would have the 

same opportunity and rights to liquidate 

Shares of a fund it received in lieu of 

cash payment of Advisory Fees as other 

shareholders of that fund. As required 

by section 30(h) of the Act, each Adviser 

and its affiliated persons would make 

public filings with the Commission 

disclosing any transactions in a Fund’s 

Shares as required by Section 16 of the 

Exchange Act. 

11. An Adviser that elects to receive 

payment in Shares, however, would 

commit to not selling those Shares for 

at least 12 months from the date of 

issuance, except in exceptional 

circumstances such as if it no longer 

serves as the investment adviser of the 

Fund. In such a case, the Adviser would 

keep a record of the reason for selling 

the Shares within 12 months and the 

records would be maintained and 

preserved in accordance with rule 204– 

2(e)(1) under the Advisers Act. 

Applicants state that this commitment 

would provide further assurances that 

an Adviser bears the long-term benefits 

and risks of an investment in a Fund’s 

Shares and decreases the likelihood of 

any potential over-reaching by the 

Adviser. Each fund would publicly 

disclose the Adviser’s commitment in 

the Fund’s registration statement. 

12. Consistent with fiduciary 

obligations under the Act, on an annual 

basis, the Independent Directors 

(defined below) of each Fund will 

review such Fund’s Advisory 

Agreement in accordance with section 

15(c) and subject to section 36 of the 

Act, including those provisions 

allowing for payment of Advisory Fees 


KHAMMOND on DSKJM1Z7X2PROD with NOTICES
85786 Federal Register / Vol. 85, No. 249 / Tuesday, December 29, 2020 / Notices 

8The term ‘‘Independent Directors’’ means 

members of the Fund’s board of directors who are 

not ‘‘interested persons’’ of the Fund within the 

meaning of section 2(a)(19) of the Act. 

9See H.R. Rep. No. 76–2639, at 8 (1940) and S. 

Rep. No. 76–1775, at 7 (1940). 

10 Investment Trusts and Investment Companies: 

Hearings on H.R. 10065 Before the House 

Subcomm, on Interstate and Foreign Commerce, 

76th Cong., 3d Sess. 109 (1940) (statement of David 

Schenker, Chief Counsel, Investment Trust Study, 

SEC). 

in Shares. To the extent an Adviser 

receives any fallout benefits from 

receiving compensation in Shares rather 

than in cash, the Adviser would 

disclose such benefits to the 

Independent Directors. 

13. The Adviser would have the 

ability to assign its right to receive 

payment of any Advisory Fees to an 

entity it controls, is controlled by or 

with which it is under common control 

(a ‘‘control affiliate’’); provided that 

such an assignment may not 

disadvantage the fund. Any Shares 

issued to a control affiliate of an Adviser 

would be subject to the same conditions 

of the requested relief as if the Shares 

were issued to and held by the Adviser 

directly and an Adviser’s obligations to 

a Fund under the Advisory Agreement 

would remain unchanged. To the extent 

an Adviser receives any fallout benefits 

from an assignment to a control affiliate, 

the Adviser would disclose such 

benefits to the Independent Directors 8

of the applicable Fund in connection 

with their annual review of such Fund’s 

Advisory Agreement in accordance with 

section 15(c) of the Act. 

Applicants’ Legal Analysis 

14. Section 23(a)(1) of the Act 

prohibits a registered closed-end 

investment company from issuing any 

of its securities in exchange for services. 

Section 63 of the Act makes the 

prohibition in section 23(a)(1) 

applicable to BDCs. 

15. Section 6(c) of the Act provides 

that an exemptive order may be granted 

if and to the extent that such an 

exemption is ‘‘necessary or appropriate 

in the public interest and consistent 

with the protection of investors and the 

purposes fairly intended by the policy 

and provisions’’ of the Act. 

16. Applicants assert that the 

concerns underlying section 23(a)(1) of 

the Act do not exist under the requested 

relief. These concerns include: (i) 

Preferential treatment of investment 

company insiders and the use of options 

and other rights by insiders to obtain 

control of the investment company; (ii) 

complication of the investment 

company’s structure that made it 

difficult to determine the value of the 

company’s shares; and (iii) dilution of 

stockholders’ equity in the investment 

company.9

17. In particular, section 23(a)(1) of 

the Act was enacted in response to a 

then-common practice of funds paying 

insiders a definite number of shares of 

the fund at a future date for their 

services (rather than assigning a fixed 

dollar value to the services).10 If the 

value of the fund’s shares appreciated 

by the time the shares were payable by 

the fund, the compensation paid to the 

insiders exceeded the original cash 

value of the services provided. As a 

result, the fund treated insiders on a 

basis more favorable than other 

shareholders by allowing them to 

acquire fund shares at less than the net 

asset value of the shares. The insiders 

received a ‘‘windfall’’ that diluted the 

value of the shares held by other 

shareholders. Applicants maintain that 

the proposed arrangement addresses 

this concern because the value of the 

Shares an investment adviser would 

receive would be equal to a fixed-dollar 

amount as calculated under the fund’s 

investment advisory agreement. 

18. Applicants assert that the 

requested relief does not raise otherwise 

concerns about preferential treatment of 

Applicant’s insiders because an Adviser 

would receive a class of Shares that is 

available for purchase by similarly 

qualified investors and that would be 

issued at the same price per share 

available to other investors in the Fund 

at the time of issuance to the Adviser. 

No Adviser would receive any 

preferential voting, dividend or 

liquidity rights with respect to Shares. 

The Shares would be subject to the same 

fees and expenses applicable to other 

shareholders in the relevant class. 

Furthermore, the Adviser and any 

control affiliate would mirror vote any 

Shares received in lieu of cash for 

Advisory Fees. Thus, Applicants state 

that the requested relief would not 

become a means for insiders to obtain 

control of any Fund. 

19. The Funds would not modify their 

capital structure as a result of the 

requested relief. The Fund’s registration 

statements and proxy statements would 

include ‘‘plain English’’ disclosure on 

the existence of the relief, a statement 

that the Adviser may be compensated in 

Shares in lieu of cash and any potential 

risks associated with relying on the 

relief. Such risk disclosure may explain 

that third party shareholders would not 

have priority over the Adviser or its 

affiliates with respect to receiving 

liquidity during any periodic tender or 

repurchase offers and that may have the 

effect of diluting third party 

shareholders with respect to any such 

offers. 

20. Applicants believe the proposed 

arrangement does not raise dilution 

concerns associated with other forms of 

equity-based compensation, such as 

stock options. The Fund would issue 

Shares to the Adviser at the greater of 

their current NAV per share and their 

current offering price, and the Fund 

would increase its assets in direct 

proportion to the Shares issued to the 

Adviser, forestalling any dilutive effect. 

21. Applicants believe the requested 

relief is appropriate and in the interest 

of the Funds’ shareholders because 

when an Adviser elects to receive its 

Advisory Fees in Shares, it would 

increase fund assets available for 

investment purposes and create better 

alignment of interests between the Fund 

and the Adviser. Absent the requested 

relief, a fund would be required to hold 

a greater amount of investable assets in 

cash for payment of Advisory Fees or 

could be forced to liquidate assets at 

unfavorable times or prices to pay 

Advisory Fees in cash, which could be 

problematic for a fund that invests 

primarily in illiquid assets. For any Fee 

Calculation Period where the Adviser 

elects payment in Shares, the advance 

notice provided by the Adviser’s 

election would allow the Fund to 

deploy the cash that would otherwise 

need to be held for payment of Advisory 

Fees, reducing cash ‘‘drag’’ and 

opportunity costs for the Fund. 

22. Applicants assert that the 

requested relief further aligns the 

interests of an Adviser with those of 

Fund shareholders because the Adviser 

has more so-called ‘‘skin in the game.’’ 

As opposed to payment in cash, an 

Adviser would invest in the Fund 

alongside, and at the same price as, 

other investors. This would further align 

the interests of Fund shareholders and 

the Fund’s Adviser because the 

Adviser’s realizable compensation for 

any past payment is tied to maintaining 

or increasing the NAV per share price 

until the Adviser liquidates such 

Shares. 

23. Applicants state that the 

Commission has previously provided 

exemptive relief to allow internally 

managed closed-end funds and BDCs to 

issue restricted stock, and in some 

cases, stock options, as part of a 

compensation package for employees, 

officers, and directors. Applicants 

believe the rationale for such relief is 

similar to the requested relief because 

both would provide for investment 

strategy alignment while allowing the 

funds to maximize cash available to 

investments. 


KHAMMOND on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 85, No. 249 / Tuesday, December 29, 2020 / Notices 85787 

1Blue Tractor ETF Trust and Blue Tractor Group, 

LLC, Investment Company Act Rel. Nos. 33682 

(Nov. 14, 2019) (notice) and 33710 (Dec. 10, 2019) 

(order). Applicants are not seeking relief under 

section 12(d)(1)(J) of the Act for an exemption from 

sections 12(d)(1)(A) and 12(d)(1)(B) of the Act (the 

‘‘Section 12(d)(1) Relief’’), and relief under sections 

6(c) and 17(b) of the Act for an exemption from 

sections 17(a)(1) and 17(a)(2) of the Act relating to 

the Section 12(d)(1) Relief, as granted in the 

Reference Order. Accordingly, to the extent the 

terms and conditions of the Reference Order relate 

to such relief, they are not incorporated by 

reference into the Order. 

Applicants’ Conditions 

Applicants agree that any order 

granting the requested relief would be 

subject to the following conditions: 

1. Each Fund will adopt an Advisory 

Agreement that specifies that its Adviser 

may opt to receive Shares in lieu of cash 

payment of Advisory Fees. Such 

Advisory Agreement will contain: 

a. A precise formula for determining 

the number of Shares to be issued as 

compensation to the Adviser for each 

applicable Fee Calculation Period, 

including the date upon which the 

calculation shall be performed, stating 

that the number of Shares that an 

Adviser will receive will be equal to the 

quotient of (x) the sum of Advisory Fees 

elected by the Adviser for payment in 

Shares and (y) the greater of (i) the 

current NAV per share of the class of 

Shares the Adviser will receive, as 

determined by or under the supervision 

of the Fund’s board of directors in 

accordance with section 23(b) of the Act 

and (ii) the current offering price of the 

class of Shares the Adviser will receive. 

b. A provision ensuring that such 

Adviser must elect in advance of each 

Fee Calculation Period whether the 

Advisory Fees for that Fee Calculation 

Period will be payable in cash, Shares 

of the Fund, or some combination of 

cash and Shares of the Fund, and if a 

combination of cash and Shares, what 

the breakdown will be. 

2. Any Shares received by an Adviser 

in lieu of cash payment of Advisory 

Fees will have the same rights and 

obligations as Shares of the same class 

issued to other investors in the Fund, 

except that an Adviser will mirror vote 

any Shares received in lieu of cash 

payment of Advisory Fees in the same 

proportion as the vote of all other 

shareholders that are not (i) an Adviser 

or its control affiliates, and (ii) to the 

Adviser’s knowledge, affiliates of the 

Adviser (excluding control affiliates), 

for so long as the Adviser serves as the 

investment adviser to the Fund. The 

Adviser will not receive preferential 

voting, dividend or liquidity rights with 

respect to its Shares and will be subject 

to the same fees and expenses 

applicable to the Fund’s other 

shareholders in the relevant class. 

3. Each Fund will disclose in its 

registration statements and proxy 

statements (i) that its Adviser may be 

compensated in Shares in lieu of cash 

payments in reliance on the relief, (ii) 

that its Adviser will commit not to sell 

any Shares received in lieu of a cash 

payment of Advisory Fees for at least 12 

months from the date of issuance, 

except in exceptional circumstances (in 

such a case, the Adviser will keep a 

record of the reason for selling the 

Shares within 12 months and the 

records will be maintained and 

preserved in accordance with rule 204– 

2(e)(1) under the Advisers Act), and (iii) 

any potential risks related to relying on 

the relief. For any Fee Calculation 

Period during which the Adviser has 

elected to receive all or a portion of its 

Advisory Fees in Shares, the Fund will 

post a notice to that effect on the Fund’s 

website. The Fund will maintain and 

make publicly available on the Fund’s 

website a historical record of how the 

Adviser was compensated for each Fee 

Calculation Period during the Fund’s 

last three fiscal years. The Fund will 

include, in response to any item on the 

applicable form for registration of 

securities requiring a description of the 

Adviser’s compensation (currently Item 

9 of Form N–2), a cross-reference noting 

the availability of such historical 

information on the Fund’s website. 

4. The requested relief will expire on 

the effective date of any Commission 

rule under the Act that provides relief 

addressing the ability of closed-end 

investment companies to pay their 

investment advisers their advisory fees 

in shares in lieu of paying an equivalent 

amount in cash. 

By the Commission. 

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2020–28749 Filed 12–28–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

34149; File No. 812–15169] 

ALPS ETF Trust, et al. 

December 22, 2020. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of an application for an order 

under section 6(c) of the Investment 

Company Act of 1940 (‘‘Act’’) for an 

exemption from sections 2(a)(32), 

5(a)(1), 22(d) and 22(e) of the Act and 

rule 22c–1 under the Act, and under 

sections 6(c) and 17(b) of the Act for an 

exemption from sections 17(a)(1) and 

17(a)(2) of the Act. 

APPLICANTS: ALPS ETF Trust (the 

‘‘Trust’’), ALPS Advisors, Inc. (the 

‘‘Initial Adviser’’), and ALPS Portfolio 

Solutions Distributor, Inc. (the 

‘‘Distributor’’). 

SUMMARY OF APPLICATION: Applicants 

request an order (‘‘Order’’) that permits: 

(a) Shielded Alpha ETFs (as described 

in the Reference Order (defined below)) 

to issue shares (‘‘Shares’’) redeemable in 

large aggregations only (‘‘creation 

units’’); (b) secondary market 

transactions in Shares to occur at 

negotiated market prices rather than at 

net asset value; (c) certain Shielded 

Alpha ETFs to pay redemption 

proceeds, under certain circumstances, 

more than seven days after the tender of 

Shares for redemption; and (d) certain 

affiliated persons of a Shielded Alpha 

ETF to deposit securities into, and 

receive securities from, the Shielded 

Alpha ETF in connection with the 

purchase and redemption of creation 

units. The relief in the Order would 

incorporate by reference terms and 

conditions of the same relief of a 

previous order granting the same relief 

sought by applicants, as that order may 

be amended from time to time 

(‘‘Reference Order’’).1

FILING DATE: The application was filed 

on October 8, 2020 and amended on 

December 21, 2020. 

HEARING OR NOTIFICATION OF HEARING: An 

order granting the requested relief will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov and serving applicants 

with a copy of the request by email. 

Hearing requests should be received by 

the Commission by 5:30 p.m. on January 

19, 2021, and should be accompanied 

by proof of service on applicants, in the 

form of an affidavit or, for lawyers, a 

certificate of service. Pursuant to rule 0– 

5 under the Act, hearing requests should 

state the nature of the writer’s interest, 

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 

emailing the Commission’s Secretary at 

Secretarys-Office@sec.gov. 

ADDRESSES: Secretary, U.S. Securities 

and Exchange Commission, SecretarysOffice@sec.gov. Applicants: Cara B. 

Owen, Esq., cara.owen@alpsinc.com. 

FOR FURTHER INFORMATION CONTACT: 

Laura J. Riegel, Senior Counsel, at (202) 

551–3038 or Trace W. Rakestraw, 


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