Federal Register / Vol. 83, No. 135 / Friday, July 13, 2018 / Notices 32699 

1The requested order (‘‘Order’’) would supersede 

an exemptive order issued by the Commission on 

October 11, 2016 (In the Matter of AB Private Credit 

Investors Corporation, et al., Investment Company 

Act Release Nos. 32261 (Sept. 13, 2016) (notice) and 

32310 (Oct. 11, 2016) (order) (the ‘‘Prior Order’’), 

with the result that no person will continue to rely 

on the Prior Order if the Order is granted. 

ADDRESSES: Submit comments 

electronically via the Commission’s 

Filing Online system at http://

www.prc.gov. Those who cannot submit 

comments electronically should contact 

the person identified in the FOR FURTHER

INFORMATION CONTACT section by 

telephone for advice on filing 

alternatives. 

FOR FURTHER INFORMATION CONTACT: 

David A. Trissell, General Counsel, at 

202–789–6820. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Introduction 

II. Docketed Proceeding(s) 

I. Introduction 

The Commission gives notice that the 

Postal Service filed request(s) for the 

Commission to consider matters related 

to negotiated service agreement(s). The 

request(s) may propose the addition or 

removal of a negotiated service 

agreement from the market dominant or 

the competitive product list, or the 

modification of an existing product 

currently appearing on the market 

dominant or the competitive product 

list. 

Section II identifies the docket 

number(s) associated with each Postal 

Service request, the title of each Postal 

Service request, the request’s acceptance 

date, and the authority cited by the 

Postal Service for each request. For each 

request, the Commission appoints an 

officer of the Commission to represent 

the interests of the general public in the 

proceeding, pursuant to 39 U.S.C. 505 

(Public Representative). Section II also 

establishes comment deadline(s) 

pertaining to each request. 

The public portions of the Postal 

Service’s request(s) can be accessed via 

the Commission’s website (http://

www.prc.gov). Non-public portions of 

the Postal Service’s request(s), if any, 

can be accessed through compliance 

with the requirements of 39 CFR 

3007.40. 

The Commission invites comments on 

whether the Postal Service’s request(s) 

in the captioned docket(s) are consistent 

with the policies of title 39. For 

request(s) that the Postal Service states 

concern market dominant product(s), 

applicable statutory and regulatory 

requirements include 39 U.S.C. 3622, 39 

U.S.C. 3642, 39 CFR part 3010, and 39 

CFR part 3020, subpart B. For request(s) 

that the Postal Service states concern 

competitive product(s), applicable 

statutory and regulatory requirements 

include 39 U.S.C. 3632, 39 U.S.C. 3633, 

39 U.S.C. 3642, 39 CFR part 3015, and 

39 CFR part 3020, subpart B. Comment 

deadline(s) for each request appear in 

section II. 

II. Docketed Proceeding(s) 

1. Docket No(s).: CP2018–266; Filing 

Title: Notice of United States Postal 

Service of Filing a Functionally 

Equivalent Global Expedited Package 

Services 7 Negotiated Service 

Agreement and Application for NonPublic Treatment of Materials Filed 

Under Seal; Filing Acceptance Date: 

July 9, 2018; Filing Authority: 39 CFR 

3015.5; Public Representative: 

Christopher C. Mohr; Comments Due: 

July 17, 2018. 

2. Docket No(s).: MC2018–191 and 

CP2018–267; Filing Title: USPS Request 

to Add Priority Mail Contract 453 to 

Competitive Product List and Notice of 

Filing Materials Under Seal; Filing 

Acceptance Date: July 9, 2018; Filing 

Authority: 39 U.S.C. 3642, 39 CFR 

3020.30 et seq., and 39 CFR 3015.5; 

Public Representative: Christopher C. 

Mohr, Comments Due: July 17, 2018. 

This Notice will be published in the 

Federal Register. 

Stacy L. Ruble, 

Secretary. 

[FR Doc. 2018–14987 Filed 7–12–18; 8:45 am] 

BILLING CODE 7710–FW–P 

POSTAL SERVICE 

Product Change—Priority Mail 

Negotiated Service Agreement 

AGENCY: Postal ServiceTM. 

ACTION: Notice. 

SUMMARY: The Postal Service gives 

notice of filing a request with the Postal 

Regulatory Commission to add a 

domestic shipping services contract to 

the list of Negotiated Service 

Agreements in the Mail Classification 

Schedule’s Competitive Products List. 

DATES: Date of required notice: July 13, 

2018. 

FOR FURTHER INFORMATION CONTACT: 

Maria W. Votsch, 202–268–6525. 

SUPPLEMENTARY INFORMATION: The 

United States Postal Service® hereby 

gives notice that, pursuant to 39 U.S.C. 

3642 and 3632(b)(3), on July 9, 2018, it 

filed with the Postal Regulatory 

Commission a USPS Request to Add 

Priority Mail Contract 453 to 

Competitive Product List. Documents 

are available at www.prc.gov, Docket 

Nos. MC2018–191, CP2018–267. 

Maria W. Votsch, 

Attorney, Corporate and Postal Business Law. 

[FR Doc. 2018–14969 Filed 7–12–18; 8:45 am] 

BILLING CODE 7710–12–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83456; File No. SR–LCH 

SA–2018–003] 

Self-Regulatory Organizations; LCH 

SA; Notice of Filing of Proposed Rule 

Change Relating to Liquidity Risk 

Management 

June 18, 2018. 

Correction 

In notice document 2018–13378 

beginning on page 29146 in the issue of 

Friday, June 22, 2018, make the 

following change: 

On page 29148, in the second column, 

in line 43, ‘‘July 12, 2018’’ should read 

‘‘July 13, 2018’’. 

[FR Doc. C1–2018–13378 Filed 7–12–18; 8:45 am] 

BILLING CODE 1301–00–D 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

33152; File No. 812–14925] 

AB Private Credit Investors Corp., et al. 

July 9, 2018. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of application for an order 

under sections 17(d) and 57(i) of the 

Investment Company Act of 1940 (the 

‘‘Act’’) and rule 17d–1 under the Act to 

permit certain joint transactions 

otherwise prohibited by sections 17(d) 

and 57(a)(4) of the Act and rule 17d–1 

under the Act. 

SUMMARY OF APPLICATION: Applicants 

request an order to permit business 

development companies (‘‘BDCs’’) to coinvest in portfolio companies with each 

other and with certain affiliated 

investment funds and accounts.1

APPLICANTS: AB Private Credit Investors 

Corporation (‘‘AB BDC I’’); AB Private 

Credit Investors Middle Market Direct 

Lending Fund, L.P. (‘‘AB PCI Fund I’’); 

AB Energy Opportunity Fund, L.P. (‘‘AB 

Energy Fund,’’ and together with AB 

PCI Fund I, the ‘‘Existing Affiliated 

Funds’’); AB Private Credit Investors, 

LLC (‘‘AB–PCI’’) on behalf of itself and 


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2The term ‘‘successor,’’ as applied to any AB–PCI 

Adviser (defined below), means an entity that 

results from a reorganization into another 

jurisdiction or change in the type of business 

organization. 

3Section 2(a)(48) defines a business development 

company (BDC) to be any closed-end investment 

company that operates for the purpose of making 

investments in securities described in sections 

55(a)(1) through 55(a)(3) of the Act and makes 

available significant managerial assistance with 

respect to the issuers of such securities. 

4 ‘‘Objectives and Strategies’’ means a Regulated 

Fund’s (defined below) investment objectives and 

strategies, as described in the Regulated Fund’s 

registration statement on Form N–2 or Form 10– 

12G, as applicable, other filings the Regulated Fund 

has made with the Commission under the Securities 

Act of 1933 (the ‘‘Securities Act’’), or under the 

Securities Exchange Act of 1934, and the Regulated 

Fund’s reports to shareholders. 

5 ‘‘Existing Affiliated Managed Accounts’’ means 

one or more investment accounts that have been 

established by AXA Equitable, and that are advised 

by: (i) AB–PCI; and (ii) any future investment 

adviser that is controlled by AB–PCI and is 

registered as an investment adviser under the 

Advisers Act (‘‘AB–PCI Adviser’’). 

‘‘Affiliated Managed Account’’ means: (i) The 

Existing Affiliated Managed Accounts; and (ii) any 

Future Affiliated Managed Account. ‘‘Future 

Affiliated Managed Account’’ means an account: (i) 

For which an AB–PCI Adviser is acting as 

investment adviser or sub-adviser; (b) of a person 

who is a Section 57(b) affiliate of a Regulated Fund 

and who would not be able to rely on Section 

3(c)(1) or 3(c)(7) of the Act; and (c) that intends to 

participate in the Co-Investment Program. 

6Although AXA Equitable is an indirect parent 

company of AB–PCI, AB–PCI has a separate 

management team from AXA Equitable and 

operates as a separate and distinct business and 

legal entity. 

7AXA Equitable is excluded from the definition 

of investment company by Section 3(c)(3) of the 

Act. 

8 ‘‘Regulated Fund’’ means AB BDC I and any 

Future Regulated Fund. ‘‘Future Regulated Fund’’ 

means any closed-end management investment 

company other than AB BDC I: (i) That is registered 

under the Act or has elected to be regulated as a 

BDC; (ii) whose investment adviser is an AB–PCI 

Adviser; and (iii) that intends to participate in the 

Co-Investment Program. 

9 ‘‘Affiliated Fund’’ means: (i) The Existing 

Affiliated Funds; (ii) any Future Affiliated Fund; 

and (iii) any Affiliated Managed Account. ‘‘Future 

Affiliated Fund’’ means any entity: (i) Whose 

investment adviser or sub-adviser is an AB–PCI 

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. 

its successors; 2 and AXA Equitable Life 

Insurance Company (‘‘AXA Equitable’’). 

FILING DATES: The application was filed 

on June 28, 2018. Applicants have 

agreed to file an amendment during the 

notice period, the substance of which is 

reflected in this notice. 

HEARING OR NOTIFICATION OF HEARING: An 

order granting the requested relief will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by writing to the 

Commission’s Secretary and serving 

applicants with a copy of the request, 

personally or by mail. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on August 3, 2018, and 

should be accompanied by proof of 

service on 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 St. 

NE, Washington, DC 20549–1090. 

Applicants: J. Brent Humphries, AB 

Private Credit Investors LLC, 1345 

Avenue of the Americas, New York, NY 

10105. 

FOR FURTHER INFORMATION CONTACT: 

Stephan N. Packs, Senior Counsel, at 

(202) 551–6853 or David J. Marcinkus, 

Branch Chief, at (202) 551–6821 (Chief 

Counsel’s Office, Division of Investment 

Management). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

website by searching for the file 

number, or for an applicant using the 

Company name box, at http://

www.sec.gov/search/search.htm or by 

calling (202) 551–8090. 

Applicants’ Representations 

1. AB BDC I, a Maryland corporation, 

is organized as a closed-end 

management investment company that 

has elected to be regulated as a BDC 

under section 54(a) of the Act.3 AB BDC 

I’s Objectives and Strategies 4 are to 

principally generate current income 

through direct investments in private 

loans and notes and, to a lesser extent, 

long-term capital appreciation through 

private equity investments. 

2. The board of directors of AB BDC 

I is comprised of five directors. The AB 

BDC I Board and any board of directors 

of a Future Regulated Fund (each a 

‘‘Board’’) will be comprised of directors, 

a majority of whom will not be 

‘‘interested persons’’ within the 

meaning of Section 2(a)(19) of the Act 

(the ‘‘Non-Interested Directors’’), of AB 

BDC I or any Future Regulated Fund, as 

applicable. 

3. AB PCI Fund I is a Delaware 

limited partnership that is exempt from 

registration pursuant to section 3(c)(7) 

of the Act. AB PCI Fund I’s investment 

objective and strategies are to generate 

both current income and long-term 

capital appreciation through debt and 

equity investments. 

4. AB Energy Fund is a Delaware 

limited partnership that is exempt from 

registration pursuant to section 3(c)(7) 

of the Act. AB Energy Fund’s 

investment objective and strategies are 

to generate attractive risk-adjusted 

returns, through current income and 

capital gains, by capitalizing on private 

and public debt and equity investment 

opportunities in North American oil and 

gas producers. 

5. AB–PCI, a Delaware limited 

liability company, is registered with the 

Commission as an investment adviser 

under the Investment Advisers Act of 

1940 (the ‘‘Advisers Act’’). AB–PCI is a 

wholly-owned subsidiary of 

AllianceBernstein L.P., a New York 

based global asset management firm. 

AB–PCI is the investment adviser to 

each of AB BDC I and the Existing 

Affiliated Funds. AB–PCI also advises 

certain Affiliated Managed Accounts 

that may participate in the CoInvestment Program, including the 

Existing Affiliated Managed Accounts.5

6. AXA Equitable is a stock life 

insurance corporation organized under 

the laws of New York, and is the 

indirect parent company of AB–PCI.6

AXA Equitable has established an 

Existing Affiliated Managed Account, 

and may from time to time establish 

Future Affiliated Managed Accounts, 

advised by an AB–PCI Adviser.7

7. Applicants seek an order (‘‘Order’’) 

to permit a Regulated Fund 8 and one or 

more Regulated Funds and/or one or 

more Affiliated Funds 9 to participate in 

the same investment opportunities 

through a proposed co-investment 

program (the ‘‘Co-Investment Program’’) 

where such participation would 

otherwise be prohibited under section 

57(a)(4) and rule 17d–1 by (a) coinvesting with each other in securities 

issued by issuers in private placement 

transactions in which an AB–PCI 

Adviser negotiates terms in addition to 

price, 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’’). 

8. The Order would amend the Prior 

Order to extend the relief granted under 

the Prior Order to certain Existing 

Affiliated Managed Accounts and 

Future Affiliated Managed Accounts 

whose investment adviser is an AB–PCI 

Adviser. 

9. For purposes of the requested 

Order, ‘‘Co-Investment Transaction’’ 

means any transaction in which a 

Regulated Fund (or its Wholly-Owned 

Investment Sub, as defined below) 

participated together with one or more 


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10The term ‘‘Wholly-Owned Investment Sub’’ 

means an entity: (i) That is wholly-owned by a 

Regulated Fund (with the Regulated Fund at all 

times holding, beneficially and of record, 100% of 

the voting and economic interests); (ii) whose sole 

business purpose is to hold one or more 

investments on behalf of the Regulated Fund; (iii) 

with respect to which the Regulated Fund’s Board 

has the sole authority to make all determinations 

with respect to the entity’s participation under the 

Conditions of the Application; and (iv) that would 

be an investment company but for section 3(c)(1) or 

3(c)(7) of the Act. 

11 ‘‘Board-Established Criteria’’ means criteria 

that the Board of a Regulated Fund may establish 

from time to time to describe the characteristics of 

Potential Co-Investment Transactions regarding 

which the AB–PCI Adviser to the Regulated Fund 

should be notified under Condition 1. 

12 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). 

other Regulated Funds and/or one or 

more Affiliated Funds in reliance on the 

requested Order. ‘‘Potential CoInvestment Transaction’’ means any 

investment opportunity in which a 

Regulated Fund (or its Wholly-Owned 

Investment Sub, as defined below) 

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. 

10. Applicants state that a Regulated 

Fund may, from time to time, form one 

or more Wholly-Owned Investment 

Subs.10 Such a subsidiary would be 

prohibited from investing in a CoInvestment Transaction with any 

Affiliated Fund or Regulated Fund 

because it would be a company 

controlled by its parent Regulated Fund 

for purposes of section 57(a)(4) and rule 

17d–1. Applicants request that each 

Wholly-Owned Investment Sub be 

permitted to participate in CoInvestment Transactions in lieu of its 

parent Regulated Fund and that the 

Wholly-Owned Investment Sub’s 

participation in any such transaction be 

treated, for purposes of the requested 

Order, as though the parent Regulated 

Fund were participating directly. The 

Regulated Fund’s Board would make all 

relevant determinations under the 

Conditions with regard to a WhollyOwned Investment Sub’s participation 

in a Co-Investment Transaction, and the 

Regulated Fund’s Board would be 

informed of, and take into 

consideration, any proposed use of a 

Wholly-Owned Investment Sub in the 

Regulated Fund’s place. If the Regulated 

Fund proposes to participate in the 

same Co-Investment Transaction with 

any of its Wholly-Owned Investment 

Subs, the Board will also be informed 

of, and take into consideration, the 

relative participation of the Regulated 

Fund and the Wholly-Owned 

Investment Sub. 

11. When considering Potential CoInvestment Transactions for any 

Regulated Fund, the AB–PCI Adviser 

will consider only the Objectives and 

Strategies, Board-Established Criteria,11

investment policies, investment 

positions, capital available for 

investment, and other pertinent factors 

applicable to that Regulated Fund. 

12. Other than pro rata dispositions 

and Follow-On Investments as provided 

in Conditions 7 and 8, and after making 

the determinations required in 

Conditions 1 and 2(a), the Advisers will 

present each Potential Co-Investment 

Transaction and the proposed allocation 

to the directors of the Board eligible to 

vote under section 57(o) of the Act 

(‘‘Eligible Directors’’), and the ‘‘required 

majority,’’ as defined in section 57(o) of 

the Act (‘‘Required Majority’’) 12 will 

approve each Co-Investment 

Transaction prior to any investment by 

the participating Regulated Fund. 

13. AXA Equitable may decline the 

opportunity for its Affiliated Managed 

Accounts to participate in whole or in 

part in a Potential Co-Investment 

Transaction pursuant to AXA 

Equitable’s arrangement with AB–PCI 

with respect to its Affiliated Managed 

Accounts. AXA Equitable does not have 

the ability to cause AB–PCI to change 

the allocations of any Potential CoInvestment Transaction. 

14. With respect to the pro rata 

dispositions and Follow-On Investments 

provided in Conditions 7 and 8, a 

Regulated Fund may participate in a pro 

rata disposition or Follow-On 

Investment without obtaining prior 

approval of the Required Majority if, 

among other things: (i) The proposed 

participation of each Regulated Fund 

and Affiliated Fund in such disposition 

is proportionate to its outstanding 

investments in the issuer immediately 

preceding the disposition or Follow-On 

Investment, as the case may be; and (ii) 

the Board of the Regulated Fund has 

approved that Regulated Fund’s 

participation in pro rata dispositions 

and Follow-On Investments as being in 

the best interests of the Regulated Fund. 

If the Board does not so approve, any 

such disposition or Follow-On 

Investment will be submitted to the 

Regulated Fund’s Eligible Directors. The 

Board of any Regulated Fund may at any 

time rescind, suspend or qualify its 

approval of pro rata dispositions and 

Follow-On Investments with the result 

that all dispositions and/or Follow-On 

Investments must be submitted to the 

Eligible Directors. 

15. No Non-Interested Director of a 

Regulated Fund will have a financial 

interest in any Co-Investment 

Transaction, other than through share 

ownership in one of the Regulated 

Funds. 

Applicants’ Legal Analysis: 

1. Section 57(a)(4) of the Act prohibits 

certain affiliated persons of a BDC from 

participating in joint transactions with 

the BDC or a company controlled by a 

BDC in contravention of rules as 

prescribed by the Commission. Under 

section 57(b)(2) of the Act, any person 

who is directly or indirectly controlling, 

controlled by, or under common control 

with a BDC is subject to section 57(a)(4). 

Applicants submit that each of the 

Regulated Funds and Affiliated Funds 

be deemed to be a person related to each 

Regulated Fund in a manner described 

by section 57(b) by virtue of being under 

common control. In addition, section 

57(b) applies to any investment adviser 

to a Regulated Fund that is a BDC and 

to any section 2(a)(3)(C) affiliates of the 

investment adviser, including AXA 

Equitable and the Affiliated Managed 

Accounts. Section 57(i) of the Act 

provides that, until the Commission 

prescribes rules under section 57(a)(4), 

the Commission’s rules under section 

17(d) of the Act applicable to registered 

closed-end investment companies will 

be deemed to apply to transactions 

subject to section 57(a)(4). Because the 

Commission has not adopted any rules 

under section 57(a)(4), rule 17d–1 also 

applies to joint transactions with 

Regulated Funds that are BDCs. Section 

17(d) of the Act and rule 17d–1 under 

the Act are applicable to Regulated 

Funds that are registered closed-end 

investment companies. 

2. Section 17(d) of the Act and rule 

17d–1 under the Act prohibit affiliated 

persons of a registered investment 

company from participating in joint 

transactions with the company unless 

the Commission has granted an order 

permitting such transactions. In passing 

upon applications under rule 17d–1, the 

Commission considers whether the 

company’s participation in the joint 

transaction is consistent with the 

provisions, policies, and purposes of the 

Act and the extent to which such 

participation is on a basis different from 

or less advantageous than that of other 

participants. 

3. Applicants state that in the absence 

of the requested relief, the Regulated 

Funds would be, in some 

circumstances, limited in their ability to 

participate in attractive and appropriate 

investment opportunities. Applicants 

believe that the proposed terms and 

conditions will ensure that the CoInvestment Transactions are consistent 

with the protection of each Regulated 

Fund’s shareholders and with the 


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32702 Federal Register / Vol. 83, No. 135 / Friday, July 13, 2018 / Notices 

purposes intended by the policies and 

provisions of the Act. Applicants state 

that the Regulated Funds’ participation 

in the Co-Investment Transactions will 

be consistent with the provisions, 

policies, and purposes of the Act and on 

a basis that is not different from or less 

advantageous than that of other 

participants. 

4. Applicants also represent that if the 

AB–PCI Adviser or its principals, or any 

person controlling, controlled by, or 

under common control with an AB–PCI 

Adviser or its principals, and the 

Affiliated Funds (collectively, the 

‘‘Holders’’) own in the aggregate more 

than 25 percent of the outstanding 

voting securities of a Regulated Fund 

(‘‘Shares’’), then the Holders will vote 

such Shares as required under 

Condition 14. Applicants believe that 

this Condition will ensure that the NonInterested Directors will act 

independently in evaluating the CoInvestment Program, because the ability 

of an AB–PCI Adviser or its principals 

to influence the Non-Interested 

Directors by a suggestion, explicit or 

implied, that the Non-Interested 

Directors can be removed will be 

limited significantly. Applicants 

represent that the Non-Interested 

Directors will evaluate and approve any 

such independent party, taking into 

account its qualifications, reputation for 

independence, cost to the shareholders, 

and other factors that they deem 

relevant. 

Applicants’ Conditions: 

Applicants agree that the Order will 

be subject to the following Conditions: 

1. Each time an AB–PCI Adviser 

considers a Potential Co-Investment 

Transaction for an Affiliated Fund or 

another Regulated Fund that falls within 

a Regulated Fund’s then-current 

Objectives and Strategies and BoardEstablished Criteria, the Regulated 

Fund’s AB–PCI Adviser will make an 

independent determination of the 

appropriateness of the investment for 

such Regulated Fund in light of the 

Regulated Fund’s then-current 

circumstances. 

2. (a) If the AB–PCI Adviser deems the 

Regulated Fund’s participation in any 

Potential Co-Investment Transaction to 

be appropriate for the Regulated Fund, 

the AB–PCI Adviser will then determine 

an appropriate level of investment for 

the Regulated Fund. 

(b) If the aggregate amount 

recommended by the applicable AB–PCI 

Adviser to be invested by the applicable 

Regulated Fund in the Potential CoInvestment 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 the Regulated Funds 

and Affiliated Funds pro rata based on 

each participant’s capital available for 

investment in the asset class being 

allocated, up to the amount proposed to 

be invested by each. The applicable AB– 

PCI Adviser to a Regulated Fund will 

provide the Eligible Directors of each 

participating Regulated Fund with 

information concerning each 

participating party’s available capital to 

assist the Eligible Directors with their 

review of the Regulated Fund’s 

investments for compliance with these 

allocation procedures. 

(c) After making the determinations 

required in Conditions 1 and 2(a), the 

AB–PCI 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 

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’ and Affiliated 

Funds’ participation in the Potential CoInvestment Transaction, a Required 

Majority concludes that: 

(i) The terms of the Potential CoInvestment 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 Regulated 

Fund’s shareholders; and 

(B) the Regulated Fund’s then-current 

Objectives and Strategies and BoardEstablished Criteria; 

(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 any other Regulated Fund or 

Affiliated Fund; provided that, if any 

other Regulated Fund or Affiliated 

Fund, but not the Regulated Fund itself, 

gains the right to nominate a director for 

election to a portfolio company’s board 

of directors or the right to have a board 

observer or any similar right to 

participate in the governance or 

management of the portfolio company, 

such event shall not be interpreted to 

prohibit the Required Majority from 

reaching the conclusions required by 

this Condition 2(c)(iii), if: 

(A) The Eligible Directors will have 

the right to ratify the selection of such 

director or board observer, if any; 

(B) the applicable AB–PCI Adviser 

agrees to, and does, provide periodic 

reports to the Regulated Fund’s Board 

with respect to the actions of such 

director or the information received by 

such board observer or obtained through 

the exercise of any similar right to 

participate in the governance or 

management of the portfolio company; 

and 

(C) any fees or other compensation 

that any Affiliated Fund or any 

Regulated Fund or any affiliated person 

of any Affiliated Fund or any Regulated 

Fund receives in connection with the 

right of an Affiliated Fund or a 

Regulated Fund to nominate a director 

or appoint a board observer or otherwise 

to participate in the governance or 

management of the portfolio company 

will be shared proportionately among 

the participating Affiliated Funds (who 

each may, in turn, share its portion with 

its affiliated persons) and the 

participating Regulated Funds in 

accordance with the amount of each 

party’s investment; and 

(iv) the proposed investment by the 

Regulated Fund will not benefit the AB– 

PCI 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 sections 17(e) or 

57(k) of the Act, as applicable, (C) 

indirectly, as a result of an interest in 

the securities issued by one of the 

parties to the Co-Investment 

Transaction, or (D) in the case of fees or 

other compensation described in 

Condition 2(c)(iii)(C). 

3. Each Regulated Fund has the right 

to decline to participate in any Potential 

Co-Investment Transaction or to invest 

less than the amount proposed. 

4. The applicable AB–PCI 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 

Fund’s then-current Objectives and 

Strategies and Board-Established 

Criteria 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 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 135 / Friday, July 13, 2018 / Notices 32703 

13This exception applies only to Follow-On 

Investments by a Regulated Fund in issuers in 

which that Regulated Fund already holds 

investments. 

subject to examination by the 

Commission and its staff. 

5. Except for Follow-On Investments 

made in accordance with Condition 8,13

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 an 

Affiliated Fund is an existing investor. 

6. A Regulated Fund will not 

participate in any Potential CoInvestment Transaction unless the 

terms, conditions, price, class of 

securities to be purchased, settlement 

date, and registration rights will be the 

same for each participating Regulated 

Fund and Affiliated Fund. The grant to 

an Affiliated Fund or another Regulated 

Fund, but not the Regulated Fund, of 

the right to nominate a director for 

election to a portfolio company’s board 

of directors, the right to have an 

observer on the board of directors or 

similar rights to participate in the 

governance or management of the 

portfolio company will not be 

interpreted so as to violate this 

Condition 6, if Conditions 2(c)(iii)(A), 

(B) and (C) are met. 

7. (a) If any Affiliated Fund or any 

Regulated Fund elects to sell, exchange 

or otherwise dispose of an interest in a 

security that was acquired by one or 

more Regulated Funds and/or Affiliated 

Funds in a Co-Investment Transaction, 

the applicable AB–PCI 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 the 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 any 

other Regulated Fund. 

(c) A Regulated Fund may participate 

in such disposition without obtaining 

prior approval of the Required Majority 

if: (i) The proposed participation of each 

Regulated Fund and each Affiliated 

Fund in such disposition is 

proportionate to its outstanding 

investments in the issuer immediately 

preceding the disposition; (ii) the Board 

of the Regulated Fund has approved as 

being in the best interests of the 

Regulated Fund the ability to participate 

in such dispositions on a pro rata basis 

(as described in greater detail in the 

application); and (iii) the Board of the 

Regulated Fund is provided on a 

quarterly basis with a list of all 

dispositions made in accordance with 

this Condition. In all other cases, the 

AB–PCI Adviser will provide its written 

recommendation as to the Regulated 

Fund’s participation to the Eligible 

Directors, and the Regulated Fund will 

participate in such disposition solely to 

the extent that a Required Majority 

determines that it is in the Regulated 

Fund’s best interests. 

(d) Each Affiliated Fund and each 

Regulated Fund will bear its own 

expenses in connection with any such 

disposition. 

8. (a) If any Affiliated Fund or any 

Regulated Fund desires to make a 

Follow-On Investment in a portfolio 

company whose securities were 

acquired by the Regulated Fund and the 

Affiliated Fund in a Co-Investment 

Transaction, the applicable AB–PCI 

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 

the application). In all other cases, the 

AB–PCI Adviser will provide its written 

recommendation as to such Regulated 

Fund’s participation to the Eligible 

Directors, and the Regulated Fund will 

participate in such Follow-On 

Investment solely to the extent that the 

Required Majority determines that it is 

in such Regulated Fund’s best interests. 

(c) If, with respect to any Follow-On 

Investment: 

(i) The amount of the opportunity is 

not based on the Regulated Funds’ and 

the Affiliated Funds’ outstanding 

investments immediately preceding the 

Follow-On Investment; and 

(ii) the aggregate amount 

recommended by the AB–PCI Adviser to 

be invested by each Regulated Fund in 

the Follow-On Investment, together 

with the amount proposed to be 

invested by the other participating 

Regulated Funds and the Affiliated 

Funds in the same transaction, exceeds 

the amount of the opportunity; then the 

amount invested by each such party will 

be allocated among them pro rata based 

on each participant’s capital available 

for investment in the asset class being 

allocated, up to the amount proposed to 

be invested by each. 

(d) The acquisition of Follow-On 

Investments as permitted by this 

Condition will be considered a CoInvestment Transaction for all purposes 

and subject to the other Conditions set 

forth in the application. 

9. The Non-Interested Directors of 

each Regulated Fund will be provided 

quarterly for review all information 

concerning Potential Co-Investment 

Transactions and Co-Investment 

Transactions, including investments 

made by other Regulated Funds or 

Affiliated Funds that a 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: (i) The continued 

appropriateness for such Regulated 

Fund of participating in new and 

existing Co-Investment Transactions; 

and (ii) the continued appropriateness 

of any Board-Established Criteria. 

10. Each Regulated Fund will 

maintain the records required by section 

57(f)(3) of the Act as if each of the 

Regulated Funds were a BDC and each 

of the investments permitted under 

these Conditions were approved by the 

Required Majority under section 57(f) of 

the Act. 

11. No Non-Interested Director of a 

Regulated Fund will also be a director, 

general partner, managing member or 

principal, or otherwise an ‘‘affiliated 

person’’ (as defined in the Act), of any 

Affiliated Fund. 

12. The expenses, if any, associated 

with acquiring, holding or disposing of 

any securities acquired in a CoInvestment Transaction (including, 

without limitation, the expenses of the 

distribution of any such securities 

registered for sale under the Securities 

Act) will, to the extent not payable by 

the AB–PCI Advisers under their 

respective investment advisory 

agreements with the Affiliated Funds 

and the Regulated Funds, be shared by 

the Regulated Funds and the Affiliated 

Funds in proportion to the relative 

amounts of the securities held or to be 


sradovich on DSK3GMQ082PROD with NOTICES
32704 Federal Register / Vol. 83, No. 135 / Friday, July 13, 2018 / Notices 

14Applicants are not requesting and the staff is 

not providing any relief for transaction fees 

received in connection with any Co-Investment 

Transaction. 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4 15 U.S.C. 78s(b)(1). 

5 17 CRF [sic] 240.19b–4. 

6 17 CRF [sic] 240.19b–4(e). 

7 15 U.S.C. 78s(b)(3)(A). 

8 17 CFR 240.19b–4(e) [sic]. 

9 17 CFR 240.12f–2. 

acquired or disposed of, as the case may 

be. 

13. Any transaction fee 14 (including 

break-up or commitment fees but 

excluding broker’s fees contemplated by 

section 17(e) or 57(k) of the Act, as 

applicable) received in connection with 

a Co-Investment Transaction will be 

distributed to the participating 

Regulated Funds and Affiliated Funds 

on a pro rata basis based on the amounts 

they invested or committed, as the case 

may be, in such Co-Investment 

Transaction. If any transaction fee is to 

be held by an AB–PCI Adviser pending 

consummation of the transaction, the 

fee will be deposited into an account 

maintained by such AB–PCI Adviser at 

a bank or banks having the 

qualifications prescribed in section 

26(a)(1) of the Act, and the account will 

earn a competitive rate of interest that 

will also be divided pro rata among the 

participating Regulated Funds and 

Affiliated Funds based on the amounts 

they invest in such Co-Investment 

Transaction. None of the Affiliated 

Funds, the AB–PCI 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 AB–PCI Adviser, investment 

advisory fees paid in accordance with 

the agreement between the AB–PCI 

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 Act or 

applicable State law affecting the 

Board’s composition, size or manner of 

election. 

15. Each Regulated Fund’s chief 

compliance officer, as defined in rule 

38a–1(a)(4), will prepare an annual 

report for its Board each year that 

evaluates (and documents the basis of 

that evaluation) the Regulated Fund’s 

compliance with the terms and 

conditions of the application and the 

procedures established to achieve such 

compliance. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2018–14963 Filed 7–12–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83609; File No. SR–IEX– 

2018–14] 

Self-Regulatory Organizations; 

Investors Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend Rule 

16.160 To Remove Form 19b–4(e) 

Filing Requirement 

July 9, 2018. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 2 and 

Rule 19b–4 thereunder,3 notice is 

hereby given that, on June 26, 2018, the 

Investors Exchange LLC (‘‘IEX’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the self-regulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Pursuant to the provisions of Section 

19(b)(1) under the Securities Exchange 

Act of 1934 (‘‘Act’’),4 and Rule 19b–4 

thereunder,5 IEX is filing with the 

Commission a proposed rule change to 

amend IEX Rule 16.160 related to 

derivative securities traded under 

unlisted trading privileges (‘‘UTP’’) to 

remove the requirement in Rule 

16.160(a)(1) for the Exchange to file 

with the Commission a Form 19b–4(e) 

for each ‘‘new derivative securities 

product’’ as defined in Rule 19b–4(e) 

under the Act 6 (a ‘‘Derivative Security’’) 

traded under UTP and renumber the 

remaining provisions of Rule 16.160(a) 

to maintain an organized rule structure. 

The Exchange has designated this rule 

change as ‘‘non-controversial’’ under 

Section 19(b)(3)(A) of the Act 7 and 

provided the Commission with the 

notice required by Rule 19b–4(f)(6) 

thereunder.8 The text of the proposed 

rule change is available at the 

Exchange’s website at 

www.iextrading.com, at the principal 

office of the Exchange, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of 

and basis for the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statement [sic] may be 

examined at the places specified in Item 

IV below. The self-regulatory 

organization has prepared summaries, 

set forth in Sections A, B, and C below, 

of the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to amend Rule 16.160 related 

to derivative securities traded under 

UTP by removing the requirement in 

Rule 16.160(a)(1) for the Exchange to 

file with the Commission a Form 19b– 

4(e) for each Derivative Security, and 

renumbering the remaining rules of Rule 

16.160(a) to maintain an organized rule 

structure, as described below. 

Rule 16.160(a)(1) sets forth the 

requirement for IEX to file with the 

Commission a Form 19b–4(e) with 

respect to each Derivative Security that 

is traded under UTP. However, IEX 

believes that it should not be necessary 

to file a Form 19b–4(e) with the 

Commission if it begins trading a 

Derivative Security on a UTP basis, 

because Rule 19b–4(e)(1) under the Act 

refers to the ‘‘listing and trading’’ of a 

‘‘new derivative securities product.’’ 

The Exchange believes that the 

requirements of that rule refers [sic] to 

when an exchange lists and trades a 

Derivative Security, and not when an 

exchange seeks only to trade such 

product on a UTP basis pursuant to Rule 

12f–2 under the Act.9 Therefore, IEX 

proposes to delete the requirement in 

current Rule 16.160(a)(1) for IEX to file 

a Form 19b–4(e) with the Commission 


sradovich on DSK3GMQ082PROD with NOTICES