Federal Register / Vol. 76, No. 162 / Monday, August 22, 2011 / Notices 52367 

4 If the Fund has been in operation fewer than six 

months, the measured period will begin 

immediately following the Fund’s first public 

offering. 

5 If the Fund has been in operation fewer than five 

years, the measured period will begin immediately 

following the Fund’s first public offering. 

rolling period ending on the last trading 

day of each week); and 

b. The Fund’s annualized distribution 

rate for such 12-week rolling period, 

expressed as a percentage of NAV as of 

the ending date of such 12-week rolling 

period, is greater than the Fund’s 

average annual total return in relation to 

the change in NAV over the 2-year 

period ending on the last day of such 

12-week rolling period; then: 

i. At the earlier of the next regularly 

scheduled meeting or within four 

months of the last day of such 12-week 

rolling period, the Board, including a 

majority of the Independent Directors: 

(1) Will request and evaluate, and the 

Investment Adviser will furnish, such 

information as may be reasonably 

necessary to make an informed 

determination of whether the 

Distribution Policy should be continued 

or continued after amendment; 

(2) Will determine whether 

continuation, or continuation after 

amendment, of the Distribution Policy is 

consistent with the Fund’s investment 

objective(s) and policies and is in the 

best interests of the Fund and its 

stockholders, after considering the 

information in condition 5.b.i.(1) above; 

including, without limitation: 

(A) Whether the Distribution Policy is 

accomplishing its purpose(s); 

(B) The reasonably foreseeable 

material effects of the Distribution 

Policy on the Fund’s long-term total 

return in relation to the market price 

and NAV of the Fund’s common stock; 

and 

(C) The Fund’s current distribution 

rate, as described in condition 5.b. 

above, compared with the Fund’s 

average annual taxable income or total 

return over the 2-year period, as 

described in condition 5.b., or such 

longer period as the Board deems 

appropriate; and 

(3) Based upon that determination, 

will approve or disapprove the 

continuation, or continuation after 

amendment, of the Distribution Policy; 

and 

ii. The Board will record the 

information considered by it, including 

its consideration of the factors listed in 

condition 5.b.i.(2) above, and the basis 

for its approval or disapproval of the 

continuation, or continuation after 

amendment, of the Distribution Policy 

in its meeting minutes, which must be 

made and preserved for a period of not 

less than six years from the date of such 

meeting, the first two years in an easily 

accessible place. 

6. Public Offerings. The Fund will not 

make a public offering of the Fund’s 

common stock other than: 

a. A rights offering below NAV to 

holders of the Fund’s common stock; 

b. An offering in connection with a 

dividend reinvestment plan, merger, 

consolidation, acquisition, spin-off or 

reorganization of the Fund; or 

c. An offering other than an offering 

described in conditions 6.a. and 6.b. 

above, provided that, with respect to 

such other offering: 

i. The Fund’s annualized distribution 

rate for the six months ending on the 

last day of the month ended 

immediately prior to the most recent 

distribution record date, expressed as a 

percentage of NAV per share as of such 

date,4 is no more than 1 percentage 

point greater than the Fund’s average 

annual total return for the 5-year period 

ending on such date; 5 and 

ii. The transmittal letter 

accompanying any registration 

statement filed with the Commission in 

connection with such offering discloses 

that the Fund has received an order 

under section 19(b) to permit it to make 

periodic distributions of long-term 

capital gains with respect to its common 

stock as frequently as twelve times each 

year, and as frequently as distributions 

are specified by or determined in 

accordance with the terms of any 

outstanding preferred stock as such 

Fund may issue. 

7. Amendments to Rule 19b–1. The 

requested order will expire on the 

effective date of any amendment to rule 

19b–1 that provides relief permitting 

certain closed-end investment 

companies to make periodic 

distributions of long-term capital gains 

with respect to their outstanding 

common stock as frequently as twelve 

times each year. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–21323 Filed 8–19–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

29756; 812–13794] 

Golub Capital BDC, Inc., et al.; Notice 

of Application 

August 16, 2011. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice of an application for an 

order under section 6(c) of the 

Investment Company Act of 1940 (the 

‘‘Act’’) for an exemption from sections 

18(a) and 61(a) of the Act. 

Applicants: Golub Capital BDC, Inc. 

(the ‘‘Company’’), GC Advisors LLC (the 

‘‘Investment Adviser’’), GC SBIC IV–GP, 

Inc. (the ‘‘GP Managing Member’’), GC 

SBIC IV–GP, LLC (the ‘‘General 

Partner’’), and GC SBIC IV, L.P. (‘‘Golub 

SBIC’’). 

SUMMARY: Summary of the Application: 

The Company requests an order to 

permit it to adhere to a modified asset 

coverage requirement. 

DATES: Filing Dates: The application was 

filed July 9, 2010 and amended on 

November 12, 2010, March 31, 2011 and 

June 14, 2011. 

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 writing to the 

Commission’s Secretary and serving 

applicants with a copy of the request, 

personally or by mail. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on September 12, 2011 and 

should be accompanied by proof of 

service on the Applicants, in the form 

of an affidavit or, for lawyers, a 

certificate of service. Hearing requests 

should state the nature of the writer’s 

interest, the reason for the request, and 

the issues contested. Persons who wish 

to be notified of a hearing may request 

notification by writing to the 

Commission’s Secretary. 

ADDRESSES: Secretary, U.S. Securities 

and Exchange Commission, 100 F 

Street, NE., Washington, DC 20549– 

1090. Applicants: David B. Golub, GC 

Advisors LLC, 150 South Wacker Drive, 

Suite 800, Chicago, Illinois 60606. 

FOR FURTHER INFORMATION CONTACT: 

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

551–6873, or Dalia Osman Blass, Branch 

Chief, at (202) 551–6821 (Division of 

Investment Management, Office of 

Investment Company Regulation). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 


jlentini on DSK4TPTVN1PROD with NOTICES
52368 Federal Register / Vol. 76, No. 162 / Monday, August 22, 2011 / Notices 

1Section 2(a)(48) defines a BDC to be any closedend investment company that operates for the 

purpose of making investments in securities 

described in section 55(a)(1) through 55(a)(3) of the 

Act and makes available significant managerial 

assistance with respect to the issuers of such 

securities. 

2All existing entities that currently intend to rely 

on the order are named as applicants. Any other 

existing or future entity that may rely on the order 

in the future will comply with the terms and 

condition of the order. 

Web site 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. The Company, a Delaware 

corporation, is an externally managed, 

non-diversified, closed-end 

management investment company that 

has elected to be regulated as a business 

development company (‘‘BDC’’) under 

the Act.1 The Company seeks to 

maximize the total return to its 

stockholders through both current 

income and capital appreciation 

through debt and minority equity 

investments. The Investment Adviser, a 

Delaware limited liability company, is 

the investment adviser to the Company. 

The Investment Adviser is registered 

under the Investment Advisers Act of 

1940. 

2. Golub SBIC, a Delaware limited 

partnership, is a small business 

investment company (‘‘SBIC’’) licensed 

by the Small Business Administration 

(‘‘SBA’’) to operate under the Small 

Business Investment Act of 1958 

(‘‘SBIA’’). Golub SBIC is excluded from 

the definition of investment company 

by section 3(c)(7) of the Act. The 

Company directly owns 99% of Golub 

SBIC in the form of a limited partner 

interest. The General Partner owns 1% 

of Golub SBIC in the form of a general 

partner interest. The GP Managing 

Member, a Delaware corporation, is a 

wholly-owned subsidiary of the 

Company and serves as the managing 

member of the General Partner. The GP 

Managing Member and the Company are 

the sole members of the General Partner. 

Applicants’ Legal Analysis 

1. The Company requests an 

exemption pursuant to section 6(c) of 

the Act from the provisions of sections 

18(a) and 61(a) of the Act to permit it 

to adhere to a modified asset coverage 

requirement with respect to any direct 

or indirect wholly owned subsidiary of 

the Company that is licensed by the 

SBA to operate under the SBIA as a 

SBIC and relies on Section 3(c)(7) for an 

exemption from the definition of 

‘‘investment company’’ under the 1940 

Act (each, a ‘‘SBIC Subsidiary’’).2

Applicants state that companies 

operating under the SBIA, such as the 

SBIC Subsidiary, will be subject to the 

SBA’s substantial regulation of 

permissible leverage in their capital 

structure. 

2. Section 18(a) of the Act prohibits a 

registered closed-end investment 

company from issuing any class of 

senior security or selling any such 

security of which it is the issuer unless 

the company complies with the asset 

coverage requirements set forth in that 

section. Section 61(a) of the Act makes 

section 18 applicable to BDCs, with 

certain modifications. Section 18(k) 

exempts an investment company 

operating as an SBIC from the asset 

coverage requirements for senior 

securities representing indebtedness 

that are contained in section 18(a)(1)(A) 

and (B). 

3. Applicants state that the Company 

may be required to comply with the 

asset coverage requirements of section 

18(a) (as modified by section 61(a)) on 

a consolidated basis because the 

Company may be deemed to be an 

indirect issuer of any class of senior 

security issued by Golub SBIC or 

another SBIC Subsidiary. Applicants 

state that applying section 18(a) (as 

modified by section 61(a)) on a 

consolidated basis generally would 

require that the Company treat as its 

own all assets and any liabilities held 

directly either by itself, by Golub SBIC, 

or by another SBIC Subsidiary. 

Accordingly, the Company requests an 

order under section 6(c) of the Act 

exempting the Company from the 

provisions of section 18(a) (as modified 

by section 61(a)), such that senior 

securities issued by each SBIC 

Subsidiary that would be excluded from 

the SBIC Subsidiary’s asset coverage 

ratio by section 18(k) if it were itself a 

BDC would also be excluded from the 

Company’s consolidated asset coverage 

ratio. 

4. Section 6(c) of the Act, in relevant 

part, permits the Commission to exempt 

any transaction or class of transactions 

from any provision of the Act if and to 

the extent that such 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. Applicants state 

that the requested relief satisfies the 

section 6(c) standard. Applicants 

contend that, because the SBIC 

Subsidiary would be entitled to rely on 

section 18(k) if it were a BDC itself, 

there is no policy reason to deny the 

benefit of that exemption to the 

Company. 

Applicants’ Condition 

Applicants agree that any order 

granting the requested relief will be 

subject to the following condition: 

The Company shall not issue or sell 

any senior security, and the Company 

shall not cause or permit Golub SBIC or 

any other SBIC Subsidiary to issue or 

sell any senior security of which the 

Company, Golub SBIC or any other SBIC 

Subsidiary is the issuer except to the 

extent permitted by section 18 (as 

modified for BDCs by section 61) of the 

Act; provided that, immediately after 

the issuance or sale by any of the 

Company, Golub SBIC or any other SBIC 

Subsidiary of any such senior security, 

the Company, individually and on a 

consolidated basis, shall have the asset 

coverage required by section 18(a) of the 

Act (as modified by section 61(a)). In 

determining whether the Company has 

the asset coverage on a consolidated 

basis required by section 18(a) of the 

Act (as modified by section 61(a)), any 

senior securities representing 

indebtedness of Golub SBIC or another 

SBIC Subsidiary shall not be considered 

senior securities and, for purposes of the 

definition of ‘‘asset coverage’’ in section 

18(h), shall be treated as indebtedness 

not represented by senior securities. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–21322 Filed 8–19–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting 

Notice is hereby given, pursuant to 

the provisions of the Government in the 

Sunshine Act, Public Law 94–409, that 

the Securities and Exchange 

Commission will hold an Open Meeting 

on August 24, 2011 at 10 a.m., in the 

Auditorium, Room L–002, to hear oral 

argument in an appeal by Eric J. Brown, 

Matthew J. Collins, Kevin J. Walsh, and 

Mark W. Wells (collectively, 

‘‘Respondents’’) and a cross-appeal by 

the Division of Enforcement from an 

initial decision of an administrative law 

judge. 

Brown and Walsh were formerly 

associated with registered broker-dealer 

Prime Capital Services, Inc. (‘‘Prime 

Capital’’), and Collins and Wells are 

currently associated with Prime Capital. 


jlentini on DSK4TPTVN1PROD with NOTICES