Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 52265 

26 15 U.S.C. 78s(b)(3)(A). 

27 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

give the Commission written notice of its intent to 

file the proposed rule change, along with a brief 

description and text of the proposed rule change, 

at least five business days prior to the date of filing 

of the proposed rule change, or such shorter time 

as designated by the Commission. The Commission 

has waived that requirement in this case. 

28 17 CFR 240.19b–4(f)(6). 

29 17 CFR 240.19b–4(f)(6)(iii). 

30See supra notes 21–24. 

31For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 32 17 CFR 200.30–3(a)(12). 

19(b)(3)(A) of the Act 26 and Rule 19b– 

4(f)(6) thereunder.27

A proposed rule change filed under 

Rule 19b–4(f)(6) 28 normally does not 

become operative prior to 30 days after 

the date of the filing. However, Rule 

19b–4(f)(6)(iii) 29 permits the 

Commission to designate a shorter time 

if such action is consistent with the 

protection of investors and the public 

interest. The Exchange has proposed to 

implement this proposed rule change on 

August 31, 2021 and has asked the 

Commission to waive the 30-day 

operative delay for this filing. The 

Exchange states that the proposed data 

to be included in the proposed Cboe 

Premium Exchange Tools is already 

generally available to all users without 

a subscription to Cboe Premium 

Exchange Tools and/or is substantially 

similar to information that was 

historically, or currently is, included in 

similar products offered on Nasdaq.30

The Commission believes waiver of the 

operative delay will allow a description 

of Cboe Premium Exchange Tools 

product to be immediately reflected in 

the Exchange’s rules and is consistent 

with the protection of investors and the 

public interest because the proposed 

rule change does not raise any new or 

novel issues. Accordingly, the 

Commission hereby waives the 30-day 

operative delay and designates the 

proposed rule change as operative upon 

filing.31

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 

change 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 No. SR– 

CboeBZX–2021–047 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 No. 

SR-CboeBZX–2021–047. 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 No. 

SR–CboeBZX–2021–047, and should be 

submitted on or before October 12, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.32

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–20210 Filed 9–17–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

34374; File No. 812–15218] 

Pomona Investment Fund, et al. 

September 14, 2021. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of application for an order 

under section 17(d) of the Investment 

Company Act of 1940 (the ‘‘Act’’) and 

rule 17d–1 under the Act to permit 

certain joint transactions otherwise 

prohibited by section 17(d) of the Act 

and rule 17d–1 under the Act. 

SUMMARY OF APPLICATION: Applicants 

request an order to permit certain 

closed-end management investment 

companies to co-invest in portfolio 

companies with each other and with 

certain affiliated investment funds and 

accounts. 

APPLICANTS: Pomona Investment Fund 

(the ‘‘Fund’’); Pomona Management LLC 

(‘‘Pomona’’); Pomona Capital X, L.P., 

Pomona Capital IX L.P. and Pomona 

Partnership Holdings VIII, L.P., 

(collectively, the ‘‘Existing Affiliated 

Funds’’). 

FILING DATES: The application was filed 

on April 19, 2021, and amended on July 

13, 2021. 

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 

October 12, 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 

52266 Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 

1 ‘‘Regulated Funds’’ means the Fund and any 

Future Regulated Funds. ‘‘Future Regulated Fund’’ 

means a closed-end management investment 

company (a) that is registered under the Act, (b) 

whose investment adviser is an Adviser, and (c) 

that intends to participate in the proposed coinvestment program (the ‘‘Co-Investment 

Program’’). 

‘‘Adviser’’ means Pomona and any other 

investment adviser that is (i) controlling, under 

common control with, or controlled by Pomona, (ii) 

registered as an investment adviser under the 

Investment Advisers Act of 1940 (the ‘‘Advisers 

Act’’) and (iii) not a Regulated Fund or a subsidiary 

of a Regulated Fund. 

2 ‘‘Affiliated Fund’’ means the Existing Affiliated 

Funds, any Future Affiliated Fund or any Pomona 

Proprietary Account. ‘‘Future Affiliated Fund’’ 

means any entity (a) whose investment adviser is 

an Adviser, (b) that would be an investment 

company but for section 3(c)(1), 3(c)(5)(C) or 3(c)(7) 

of the Act, and (c) that intends to participate in the 

Co-Investment Program. ‘‘Pomona Proprietary 

Account’’ means any account of an Adviser or its 

affiliates or any company that is a direct or indirect, 

wholly- or majority-owned subsidiary of the 

Adviser or its affiliates, which, from time to time, 

may hold various financial assets in a principal 

capacity. 

3All existing entities that currently intend to rely 

on the Order have been named as Applicants and 

any existing or future entities that may rely on the 

Order in the future will comply with the terms and 

Conditions of the application. 

4 ‘‘Board’’ means the board of trustees (or the 

equivalent) of the applicable Regulated Fund. 

5 ‘‘Independent Trustee’’ means a member of the 

Board of any relevant entity who is not an 

‘‘interested person’’ as defined in section 2(a)(19) of 

the Act. No Independent Trustee of a Regulated 

Fund will have a direct or indirect financial interest 

in any Co-Investment Transaction or any interest in 

any portfolio company, other than indirectly 

through share ownership in one of the Regulated 

Funds. 

6 ‘‘Wholly-Owned Investment Sub’’ means an 

entity (i) that is wholly-owned by a Regulated Fund 

(with such 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 such Regulated Fund (and, in the case of 

a SBIC Subsidiary (defined below), maintain a 

license under the SBA Act (defined below) and 

issue debentures guaranteed by the SBA (defined 

below)); (iii) with respect to which such Regulated 

Fund’s Board has the sole authority to make all 

determinations with respect to the entity’s 

participation under the Conditions; and (iv) that 

would be an investment company but for section 

3(c)(1) or 3(c)(7) of the Act. ‘‘SBIC Subsidiary’’ 

means a Wholly-Owned Investment Sub that is 

licensed by the Small Business Administration (the 

‘‘SBA’’) to operate under the Small Business 

Investment Act of 1958, as amended, (the ‘‘SBA 

Act’’) as a small business investment company. 

7 ‘‘Objectives and Strategies’’ means a Regulated 

Fund’s investment objectives and strategies, as 

described in its most current registration statement 

on Form N–2, other current filings with the 

Commission under the Securities Act of 1933 (the 

‘‘Securities Act’’) or under the Securities Exchange 

Act of 1934, as amended, and its most current 

report to stockholders. 

8 ‘‘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 Adviser to such Regulated Fund should 

be notified under Condition 1. The BoardEstablished Criteria will be consistent with the 

Regulated Fund’s Objectives and Strategies. If no 

Board-Established Criteria are in effect, then the 

Regulated Fund’s Adviser will be notified of all 

Potential Co-Investment Transactions that fall 

Commission’s Secretary at SecretarysOffice@sec.gov. 

ADDRESSES: Secretary, U.S. Securities 

and Exchange Commission: SecretarysOffice@sec.gov. 

Applicants: c/o William.bielefeld@

dechert.com. 

FOR FURTHER INFORMATION CONTACT: 

Barbara T. Heussler, Senior Counsel, at 

202–551–6990, 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 for an applicant using the 

Company name box, at http://

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

calling (202) 551–8090. 

Introduction 

1. The Applicants request an order of 

the Commission under section 17(d) of 

the Act and rule 17d–1 under the Act 

(the ‘‘Order’’) to permit, subject to the 

terms and conditions set forth in the 

application (the ‘‘Conditions’’), a 

Regulated Fund and one or more other 

Regulated Funds 1 and/or one or more 

Affiliated Funds 2 to enter into CoInvestment Transactions with each 

other. ‘‘Co-Investment Transaction’’ 

means any transaction in which one or 

more Regulated Funds (or its WhollyOwned Investment Sub (defined below)) 

participated together with one or more 

Affiliated Funds and/or one or more 

other Regulated Funds in reliance on 

the Order. ‘‘Potential Co-Investment 

Transaction’’ means any investment 

opportunity in which a Regulated Fund 

(or its Wholly-Owned Investment Sub) 

could not participate together with one 

or more Affiliated Funds and/or one or 

more other Regulated Funds without 

obtaining and relying on the Order.3

Applicants 

2. The Fund is organized as a 

Delaware Statutory Trust and is a 

closed-end management investment 

company registered under the Act. The 

Fund’s Board 4 will be comprised of a 

majority of members who are 

Independent Trustees.5

3. Pomona is a Delaware limited 

liability company and is a registered 

investment adviser with the 

Commission under the Advisers Act. 

Pomona serves as the investment 

adviser to the Fund and the investment 

adviser to the Existing Affiliated Funds. 

4. Applicants represent that each 

Existing Affiliated Fund would be an 

investment company but for section 

3(c)(1) or 3(c)(7) of the Act. The Pomona 

Proprietary Accounts will hold various 

financial assets in a principal capacity. 

Pomona and its affiliates may operate 

through wholly- or majority-owned 

subsidiaries. Currently, there are no 

Pomona Proprietary Accounts or 

subsidiaries that exist and currently 

intend to participate in the CoInvestment Program. 

5. Applicants state that a Regulated 

Fund may, from time to time, form one 

or more Wholly-Owned Investment 

Subs.6 Such a subsidiary may be 

prohibited from investing in a CoInvestment Transaction with a 

Regulated Fund (other than its parent) 

or any Affiliated Fund because it would 

be a company controlled by its parent 

Regulated Fund for purposes of rule 

17d–1. Applicants request that each 

Wholly-Owned Investment Sub be 

permitted to participate in CoInvestment Transactions in lieu of the 

applicable parent Regulated Fund that 

owns it and that the Wholly-Owned 

Investment Sub’s participation in any 

such transaction be treated, for purposes 

of the Order, as though the parent 

Regulated Fund were participating 

directly. 

Applicants’ Representations 

A. Allocation Process 

6. Applicants state that the Advisers 

are presented with a substantial number 

of investment opportunities each year 

on behalf of their clients, and that the 

Advisers must determine how to 

allocate those opportunities in a manner 

that, over time, is fair and equitable to 

all of their clients. Such investment 

opportunities may be Potential CoInvestment Transactions. 

7. Applicants represent that the 

Adviser has established processes for 

allocating initial investment 

opportunities, opportunities for 

subsequent investment in an issuer and 

dispositions of securities holdings 

reasonably designed to treat all clients 

fairly and equitably. Further, Applicants 

represent that these processes will be 

extended and modified in a manner 

reasonably designed to ensure that the 

additional transactions permitted under 

the Order will both (i) be fair and 

equitable to the Regulated Funds and 

Affiliated Funds and (ii) comply with 

the Conditions. In particular, consistent 

with Condition 1, if a Potential CoInvestment Transaction falls within the 

then-current Objectives and Strategies 7

and any Board-Established Criteria 8 of a 

Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 52267 

within the Regulated Fund’s then-current 

Objectives and Strategies. Board-Established 

Criteria will be objective and testable, meaning that 

they will be based on observable information, such 

as industry/sector of the issuer, minimum EBITDA 

of the issuer, asset class of the investment 

opportunity or required commitment size, and not 

on characteristics that involve a discretionary 

assessment. The Adviser to the Regulated Fund may 

from time to time recommend criteria for the 

Board’s consideration, but Board-Established 

Criteria will only become effective if approved by 

a majority of the Independent Trustees. The 

Independent Trustees of a Regulated Fund may at 

any time rescind, suspend or qualify its approval 

of any Board-Established Criteria, though 

Applicants anticipate that, under normal 

circumstances, the Board would not modify these 

criteria more often than quarterly. 

9The reason for any such adjustment to a 

proposed order amount will be documented in 

writing and preserved in the records of the 

Advisers. 10 ‘‘Required Majority’’ means a required 

majority, as defined in section 57(o) of the Act. 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 business development 

company (‘‘BDC’’) subject to section 57(o). 

11Each Adviser will maintain records of all 

proposed order amounts, Internal Orders and 

External Submissions in conjunction with Potential 

Co-Investment Transactions. Each applicable 

Adviser will provide the Eligible Trustees with 

information concerning the Affiliated Fund’s and 

Regulated Funds’ order sizes to assist the Eligible 

Trustees with their review of the applicable 

Regulated Fund’s investments for compliance with 

the Conditions. ‘‘Eligible Trustees’’ means, with 

respect to a Regulated Fund and a Potential CoInvestment Transaction, the members of the 

Regulated Fund’s Board eligible to vote on that 

Potential Co-Investment Transaction under section 

57(o) of the Act (treating any registered investment 

company or series thereof as a BDC for this 

purpose). 

12 ‘‘Follow-On Investment’’ means an additional 

investment in the same issuer, including, but not 

limited to, through the exercise of warrants, 

conversion privileges or other rights to purchase 

securities of the issuer. 

13 ‘‘Pre-Boarding Investments’’ are investments in 

an issuer held by a Regulated Fund as well as one 

or more Affiliated Funds and/or one or more other 

Regulated Funds that were acquired prior to 

participating in any Co-Investment Transaction: (i) 

In transactions in which the only term negotiated 

by or on behalf of such funds was price in reliance 

on one of the JT No-Action Letters (defined below); 

or (ii) in transactions occurring at least 90 days 

apart and without coordination between the 

Regulated Fund and any Affiliated Fund or other 

Regulated Fund. 

14A ‘‘Pro Rata Follow-On Investment’’ is a 

Follow-On Investment (i) in which the participation 

of each Affiliated Fund and each Regulated Fund 

is proportionate to its outstanding investments in 

the issuer or security, as appropriate, immediately 

preceding the Follow-On Investment, and (ii) in the 

case of a Regulated Fund, a majority of the Board 

has approved the Regulated Fund’s participation in 

the pro rata Follow-On Investments as being in the 

best interests of the Regulated Fund. The Regulated 

Fund’s Board may refuse to approve, or at any time 

rescind, suspend or qualify, its approval of Pro Rata 

Follow-On Investments, in which case all 

subsequent Follow-On Investments will be 

submitted to the Regulated Fund’s Eligible Trustees 

in accordance with Condition 8(c). 

15A ‘‘Non-Negotiated Follow-On Investment’’ is a 

Follow-On Investment in which a Regulated Fund 

participates together with one or more Affiliated 

Funds and/or one or more other Regulated Funds 

(i) in which the only term negotiated by or on behalf 

of the funds is price and (ii) with respect to which, 

if the transaction were considered on its own, the 

funds would be entitled to rely on one of the JT NoAction Letters. ‘‘JT No-Action Letters’’ means SMC 

Capital, Inc., SEC No-Action Letter (pub. avail. 

Sept. 5, 1995) and Massachusetts Mutual Life 

Continued 

Regulated Fund, the policies and 

procedures will require that the Adviser 

to such Regulated Fund receives 

sufficient information to allow such 

Adviser’s investment committee to 

make its independent determination 

and recommendations under the 

Conditions. 

8. The Adviser to each applicable 

Regulated Fund will then make an 

independent determination of the 

appropriateness of the investment for 

the Regulated Fund in light of the 

Regulated Fund’s then-current 

circumstances. If the Adviser to a 

Regulated Fund deems the Regulated 

Fund’s participation in any Potential 

Co-Investment Transaction to be 

appropriate, then it will formulate a 

recommendation regarding the proposed 

order amount for the Regulated Fund. 

9. Applicants state that, for each 

Regulated Fund and Affiliated Fund 

whose Adviser recommends 

participating in a Potential CoInvestment Transaction, the Adviser’s 

investment committee will approve an 

investment amount to be allocated to 

each Regulated Fund and/or Affiliated 

Fund participating in the Potential CoInvestment Transaction. Applicants 

state further that, each proposed order 

amount may be reviewed and adjusted, 

in accordance with the Advisers’ 

written allocation policies and 

procedures, by the Adviser’s investment 

committee.9 The order of a Regulated 

Fund or Affiliated Fund resulting from 

this process is referred to as its ‘‘Internal 

Order.’’ The Internal Order will be 

submitted for approval by the Required 

Majority of any participating Regulated 

Funds in accordance with the 

Conditions.10

10. If the aggregate Internal Orders for 

a Potential Co-Investment Transaction 

do not exceed the size of the investment 

opportunity immediately prior to the 

submission of the orders to the 

underwriter, broker, dealer or issuer, as 

applicable (the ‘‘External Submission’’), 

then each Internal Order will be 

fulfilled as placed. If, on the other hand, 

the aggregate Internal Orders for a 

Potential Co-Investment Transaction 

exceed the size of the investment 

opportunity immediately prior to the 

External Submission, then the allocation 

of the opportunity will be made pro rata 

on the basis of the size of the Internal 

Orders.11 If, subsequent to such External 

Submission, the size of the opportunity 

is increased or decreased, or if the terms 

of such opportunity, or the facts and 

circumstances applicable to the 

Regulated Funds’ or the Affiliated 

Funds’ consideration of the opportunity, 

change, the participants will be 

permitted to submit revised Internal 

Orders in accordance with written 

allocation policies and procedures that 

the Advisers will establish, implement 

and maintain. The Board of the 

Regulated Fund will then either approve 

or disapprove of the investment 

opportunity in accordance with 

condition 2, 6, 7, 8 or 9, as applicable. 

B. Follow-On Investments 

11. Applicants state that from time to 

time the Regulated Funds and Affiliated 

Funds may have opportunities to make 

Follow-On Investments 12 in an issuer in 

which a Regulated Fund and one or 

more other Regulated Funds and/or 

Affiliated Funds previously have 

invested. 

12. Applicants propose that FollowOn Investments would be divided into 

two categories depending on whether 

the prior investment was a CoInvestment Transaction or a PreBoarding Investment.13 If the Regulated 

Funds and Affiliated Funds have 

previously participated in a CoInvestment Transaction with respect to 

the issuer, then the terms and approval 

of the Follow-On Investment would be 

subject to the Standard Review FollowOns described in Condition 8. If the 

Regulated Funds and Affiliated Funds 

have not previously participated in a 

Co-Investment Transaction with respect 

to the issuer but hold a Pre-Boarding 

Investment, then the terms and approval 

of the Follow-On Investment would be 

subject to the Enhanced-Review FollowOns described in Condition 9. All 

Enhanced Review Follow-Ons require 

the approval of the Required Majority. 

For a given issuer, the participating 

Regulated Funds and Affiliated Funds 

need to comply with the requirements 

of Enhanced-Review Follow-Ons only 

for the first Co-Investment Transaction. 

Subsequent Co-Investment Transactions 

with respect to the issuer will be 

governed by the requirements of 

Standard Review Follow-Ons. 

13. A Regulated Fund would be 

permitted to invest in Standard Review 

Follow-Ons either with the approval of 

the Required Majority under Condition 

8(c) or without Board approval under 

Condition 8(b) if it is (i) a Pro Rata 

Follow-On Investment 14 or (ii) a NonNegotiated Follow-On Investment.15

52268 Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 

Insurance Company, SEC No-Action Letter (pub. 

avail. June 7, 2000). 

16 ‘‘Disposition’’ means the sale, exchange or 

other disposition of an interest in a security of an 

issuer. 

17However, with respect to an issuer, if a 

Regulated Fund’s first Co-Investment Transaction is 

an Enhanced Review Disposition, and the Regulated 

Fund does not dispose of its entire position in the 

Enhanced Review Disposition, then before such 

Regulated Fund may complete its first Standard 

Review Follow-On in such issuer, the Eligible 

Trustees must review the proposed Follow-On 

Investment not only on a stand-alone basis but also 

in relation to the total economic exposure in such 

issuer (i.e., in combination with the portion of the 

Pre-Boarding Investment not disposed of in the 

Enhanced Review Disposition), and the other terms 

of the investments. This additional review is 

required because such findings were not required 

in connection with the prior Enhanced Review 

Disposition, but they would have been required had 

the first Co-Investment Transaction been an 

Enhanced Review Follow-On. 

18A ‘‘Pro Rata Disposition’’ is a Disposition (i) in 

which the participation of each Affiliated Fund and 

each Regulated Fund is proportionate to its 

outstanding investment in the security subject to 

Disposition immediately preceding the Disposition; 

and (ii) in the case of a Regulated Fund, a majority 

of the Board has approved the Regulated Fund’s 

participation in pro rata Dispositions as being in the 

best interests of the Regulated Fund. The Regulated 

Fund’s Board may refuse to approve, or at any time 

rescind, suspend or qualify, its approval of Pro Rata 

Dispositions, in which case all subsequent 

Dispositions will be submitted to the Regulated 

Fund’s Eligible Trustees. 

19 ‘‘Tradable Security’’ means a security that 

meets the following criteria at the time of 

Disposition: (i) It trades on a national securities 

exchange or designated offshore securities market 

as defined in rule 902(b) under the Securities Act; 

(ii) it is not subject to restrictive agreements with 

the issuer or other security holders; and (iii) it 

trades with sufficient volume and liquidity 

(findings as to which are documented by the 

Advisers to any Regulated Funds holding 

investments in the issuer and retained for the life 

of the Regulated Fund) to allow each Regulated 

Fund to dispose of its entire position remaining 

after the proposed Disposition within a short period 

of time not exceeding 30 days at approximately the 

value (as defined by section 2(a)(41) of the Act) at 

which the Regulated Fund has valued the 

investment. 

Applicants believe that these Pro Rata 

and Non-Negotiated Follow-On 

Investments do not present a significant 

opportunity for overreaching on the part 

of any Adviser and thus do not warrant 

the time or the attention of the Board. 

Pro Rata Follow-On Investments and 

Non-Negotiated Follow-On Investments 

remain subject to the Board’s periodic 

review in accordance with Condition 

10. 

C. Dispositions 

14. Applicants propose that 

Dispositions 16 would be divided into 

two categories. If the Regulated Funds 

and the Affiliated Funds holding 

investments in the issuer have 

previously participated in a CoInvestment Transaction with respect to 

the issuer, then the terms and approval 

of the Disposition would be subject to 

the Standard Review Dispositions 

described in Condition 6. If the 

Regulated Funds and Affiliated Funds 

have not previously participated in a 

Co-Investment Transaction with respect 

to the issuer but hold a Pre-Boarding 

Investment, then the terms and approval 

of the Disposition would be subject to 

the Enhanced Review Dispositions 

described in Condition 7. Subsequent 

Dispositions with respect to the same 

issuer would be governed by Condition 

6 under the Standard Review 

Dispositions.17

15. A Regulated Fund may participate 

in a Standard Review Disposition either 

with the approval of the Required 

Majority under Condition 6(d) or 

without Board approval under 

Condition 6(c) if (i) the Disposition is a 

Pro Rata Disposition 18 or (ii) the 

securities are Tradable Securities 19 and 

the Disposition meets the other 

requirements of Condition 6(c)(ii). Pro 

Rata Dispositions and Dispositions of a 

Tradable Security remain subject to the 

Board’s periodic review in accordance 

with Condition 10. 

D. Delayed Settlement 

16. Applicants represent that under 

the terms and Conditions of the 

application, all Regulated Funds and 

Affiliated Funds participating in a CoInvestment Transaction will invest at 

the same time, for the same price and 

with the same terms, conditions, class, 

registration rights and any other rights, 

so that none of them receives terms 

more favorable than any other. 

However, the settlement date for an 

Affiliated Fund in a Co-Investment 

Transaction may occur up to ten 

business days after the settlement date 

for the Regulated Fund, and vice versa. 

Nevertheless, in all cases, (i) the date on 

which the commitment of the Affiliated 

Funds and Regulated Funds is made 

will be the same even where the 

settlement date is not and (ii) the 

earliest settlement date and the latest 

settlement date of any Affiliated Fund 

or Regulated Fund participating in the 

transaction will occur within ten 

business days of each other. 

E. Holders 

17. Under Condition 15, if an Adviser, 

its principals, or any person controlling, 

controlled by, or under common control 

with the Adviser or its principals, and 

the Affiliated Funds (collectively, the 

‘‘Holders’’) own in the aggregate more 

than 25 percent of the outstanding 

voting shares of a Regulated Fund (the 

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

such Shares in the same percentages as 

the Regulated Fund’s other shareholders 

(not including the Holders) when voting 

on matters specified in the Condition. 

Applicants’ Legal Analysis 

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

17d–1 under the Act prohibit 

participation by a registered investment 

company and an affiliated person in any 

‘‘joint enterprise or other joint 

arrangement or profit-sharing plan,’’ as 

defined in the rule, without prior 

approval by the Commission by order 

upon application. 

2. Co-Investment Transactions are 

prohibited by rule 17d–1 without a prior 

exemptive order of the Commission to 

the extent that the Affiliated Funds and 

the Regulated Funds participating in 

such transactions fall within the 

category of persons described by rule 

17d–1, vis-a`-vis each participating 

Regulated Fund. Each of the 

participating Regulated Funds and 

Affiliated Funds may be deemed to be 

affiliated persons vis-a`-vis a Regulated 

Fund within the meaning of section 

2(a)(3) by reason of common control 

because (i) Pomona manages, and may 

be deemed to control, the Existing 

Affiliated Funds and any other 

Affiliated Fund will be managed by, and 

may be deemed to be controlled by, an 

Adviser to Affiliated Funds; (ii) Pomona 

is the investment adviser to, and may be 

deemed to control, the Fund and an 

Adviser to the Regulated Funds will be 

the investment adviser to, and may be 

deemed to control, any Future 

Regulated Fund; and (iii) the Advisers 

to Affiliated Funds and the Advisers to 

Regulated Funds are under common 

control. Thus, each of the Affiliated 

Funds could be deemed to be a person 

related to the Regulated Funds in a 

manner described by rule 17d–1; and 

therefore the prohibitions of rule 

17d–1 would apply respectively to 

prohibit the Affiliated Funds from 

participating in Co-Investment 

Transactions with the Regulated Funds. 

3. In addition, because the Pomona 

Proprietary Accounts are controlled by 

the Adviser or its affiliates and, 

therefore, may be under common 

control with the Fund, any future 

Advisers, and any Future Regulated 

Funds, the Pomona Proprietary 

Accounts could be deemed to be 

persons related to the Regulated Funds 

(or a company controlled by the 

Regulated Funds) in a manner described 

by section 17(d) and also prohibited 

from participating in the Co-Investment 

Program. Each Regulated Fund would 

also be related to each other Regulated 

Fund in a manner described by rule 

17d–1, and thus prohibited from 

participating in Co-Investment 

Transactions with each other. 

Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 52269 

20For example, procuring the Regulated Fund’s 

investment in a Potential Co-Investment 

Transaction to permit an affiliate to complete or 

obtain better terms in a separate transaction would 

constitute an indirect financial benefit. 

4. 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. 

5. Applicants state that in the absence 

of the requested relief, in many 

circumstances the Regulated Funds 

would be limited in their ability to 

participate in attractive and appropriate 

investment opportunities. Applicants 

state that, as required by rule 17d–1(b), 

the Conditions ensure that the terms on 

which Co-Investment Transactions may 

be made will be consistent with the 

participation of the Regulated Funds 

being on a basis that it is neither 

different from nor less advantageous 

than other participants, thus protecting 

the equity holders of any participant 

from being disadvantaged. Applicants 

further state that the Conditions ensure 

that all Co-Investment Transactions are 

reasonable and fair to the Regulated 

Funds and their shareholders and do 

not involve overreaching by any person 

concerned, including the Advisers. 

Applicants state that the Regulated 

Funds’ participation in the CoInvestment Transactions in accordance 

with the Conditions will be consistent 

with the provisions, policies, and 

purposes of the Act and would be done 

in a manner that is not different from, 

or less advantageous than, that of other 

participants. 

Applicants’ Conditions 

Applicants agree that the Order shall 

be subject to the following conditions: 

1. Identification and Referral of 

Potential Co-Investment Transactions 

(a) The Advisers will establish, 

maintain and implement policies and 

procedures reasonably designed to 

ensure that each Adviser is promptly 

notified of all Potential Co-Investment 

Transactions that fall within the thencurrent Objectives and Strategies and 

Board-Established Criteria of any 

Regulated Fund the Adviser manages. 

(b) When an Adviser to a Regulated 

Fund is notified of a Potential CoInvestment Transaction under 

Condition 1(a), the Adviser will make 

an independent determination of the 

appropriateness of the investment for 

the Regulated Fund in light of the 

Regulated Fund’s then-current 

circumstances. 

2. Board Approvals of Co-Investment 

Transactions 

(a) If an Adviser deems a Regulated 

Fund’s participation in any Potential 

Co-Investment Transaction to be 

appropriate for the Regulated Fund, it 

will then determine an appropriate level 

of investment for the Regulated Fund. 

(b) If the aggregate amount 

recommended by the Advisers to be 

invested in the Potential Co-Investment 

Transaction by the participating 

Regulated Funds and any participating 

Affiliated Funds, collectively, exceeds 

the amount of the investment 

opportunity, the investment opportunity 

will be allocated among them pro rata 

based on the size of the Internal Orders, 

as described in section III.A.1.b. of the 

application. Each Adviser to a 

participating Regulated Fund will 

promptly notify and provide the Eligible 

Trustees with information concerning 

the Affiliated Funds’ and Regulated 

Funds’ order sizes to assist the Eligible 

Trustees with their review of the 

applicable Regulated Fund’s 

investments for compliance with these 

Conditions. 

(c) After making the determinations 

required in Condition 1(b) above, each 

Adviser to a participating Regulated 

Fund will distribute written information 

concerning the Potential Co-Investment 

Transaction (including the amount 

proposed to be invested by each 

participating Regulated Fund and each 

participating Affiliated Fund) to the 

Eligible Trustees of its participating 

Regulated Fund(s) for their 

consideration. A Regulated Fund will 

enter into a Co-Investment Transaction 

with one or more other Regulated Funds 

or the Affiliated Funds only if, prior to 

the Regulated Fund’s participation in 

the Potential Co-Investment 

Transaction, a Required Majority 

concludes that: 

(i) The terms of the 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 transaction is consistent with: 

(A) The interests of the Regulated 

Fund’s shareholders; and 

(B) the Regulated Fund’s then-current 

Objectives and Strategies; 

(iii) the investment by any other 

Regulated Fund(s) or Affiliated Fund(s) 

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(s) or Affiliated Fund(s) 

participating in the transaction; 

provided that the Required Majority 

shall not be prohibited from reaching 

the conclusions required by this 

Condition 2(c)(iii) if: 

(A) The settlement date for another 

Regulated Fund or an Affiliated Fund in 

a Co-Investment Transaction is later 

than the settlement date for the 

Regulated Fund by no more than ten 

business days or earlier than the 

settlement date for the Regulated Fund 

by no more than ten business days, in 

either case, so long as: (x) The date on 

which the commitment of the Affiliated 

Fund and Regulated Funds is made is 

the same; and (y) the earliest settlement 

date and the latest settlement date of 

any Affiliated Fund or Regulated Fund 

participating in the transaction will 

occur within ten business days of each 

other; or 

(B) 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, the right 

to have a board observer or any similar 

right to participate in the governance or 

management of the portfolio company 

so long as: (x) The Eligible Trustees will 

have the right to ratify the selection of 

such director or board observer, if any; 

(y) the 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 (z) any fees or other compensation 

that any other Regulated Fund or 

Affiliated Fund or any affiliated person 

of any other Regulated Fund or 

Affiliated Fund receives in connection 

with the right of one or more Regulated 

Funds or Affiliated Funds 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 any participating 

Affiliated Funds (who may, in turn, 

share their portion with their affiliated 

persons) and any participating 

Regulated Fund(s) in accordance with 

the amount of each such party’s 

investment; and 

(iv) the proposed investment by the 

Regulated Fund will not involve 

compensation, remuneration or a direct 

or indirect 20 financial benefit to the 

Advisers, any other Regulated Fund, the 

Affiliated 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 

52270 Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 

21This exception applies only to Follow-On 

Investments by a Regulated Fund in issuers in 

which that Regulated Fund already holds 

investments. 

22 ‘‘Related Party’’ means (i) any Close Affiliate 

and (ii) in respect of matters as to which any 

Adviser has knowledge, any Remote Affiliate. 

‘‘Close Affiliate’’ means the Adviser, the Regulated 

Funds, the Affiliated Fund and any other person 

described in section 57(b) (after giving effect to rule 

57b–1) in respect of any Regulated Fund (treating 

any registered investment company or series thereof 

as a BDC for this purpose) except for limited 

partners included solely by reason of the reference 

in section 57(b) to section 2(a)(3)(D). ‘‘Remote 

Affiliate’’ means any person described in section 

57(e) in respect of any Regulated Fund (treating any 

registered investment company or series thereof as 

a BDC for this purpose) and any limited partner 

holding 5% or more of the relevant limited partner 

interests that would be a Close Affiliate but for the 

exclusion in that definition. 

23Any Pomona Proprietary Account that is not 

advised by an Adviser is itself deemed to be an 

Adviser for purposes of Conditions 6(a)(i), 7(a)(i), 

8(a)(i), and 9(a)(i). 24 In the case of any Disposition, proportionality 

will be measured by each participating Regulated 

Fund’s and Affiliated Fund’s outstanding 

investment in the security in question immediately 

preceding the Disposition. 

14, (B) to the extent permitted by 

section 17(e), (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)(B)(z). 

3. Right to Decline. Each Regulated 

Fund has the right to decline to 

participate in any Potential CoInvestment Transaction or to invest less 

than the amount proposed. 

4. General Limitation. Except for 

Follow-On Investments made in 

accordance with Conditions 8 and 9 

below,21 a Regulated Fund will not 

invest in reliance on the Order in any 

issuer in which a Related Party has an 

investment.22

5. Same Terms and Conditions. A 

Regulated Fund will not participate in 

any Potential Co-Investment 

Transaction unless (i) the terms, 

conditions, price, class of securities to 

be purchased, date on which the 

commitment is entered into and 

registration rights (if any) will be the 

same for each participating Regulated 

Fund and Affiliated Fund and (ii) the 

earliest settlement date and the latest 

settlement date of any participating 

Regulated Fund or Affiliated Fund will 

occur as close in time as practicable and 

in no event more than ten business days 

apart. The grant to one or more 

Regulated Funds or Affiliated Funds, 

but not the respective 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 5, if Condition 2(c)(iii)(B) is 

met. 

6. Standard Review Dispositions. 

(a) General. If any Regulated Fund or 

Affiliated Fund elects to sell, exchange 

or otherwise dispose of an interest in a 

security and one or more Regulated 

Funds and Affiliated Funds have 

previously participated in a CoInvestment Transaction with respect to 

the issuer, then: 

(i) The Adviser to such Regulated 

Fund or Affiliated Fund 23 will notify 

each Regulated Fund that holds an 

investment in the issuer of the proposed 

Disposition at the earliest practical time; 

and 

(ii) the Adviser to each Regulated 

Fund that holds an investment in the 

issuer will formulate a recommendation 

as to participation by such Regulated 

Fund in the Disposition. 

(b) Same Terms and Conditions. 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 Affiliated 

Funds and any other Regulated Fund. 

(c) No Board Approval Required. A 

Regulated Fund may participate in such 

a Disposition without obtaining prior 

approval of the Required Majority if: 

(i) (A) The participation of each 

Regulated Fund and Affiliated Fund in 

such Disposition is proportionate to its 

then-current holding of the security (or 

securities) of the issuer that is (or are) 

the subject of the Disposition; 24 (B) 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 (C) the Board of 

the Regulated Fund is provided on a 

quarterly basis with a list of all 

Dispositions made in accordance with 

this Condition; or 

(ii) each security is a Tradable 

Security and (A) the Disposition is not 

to the issuer or any affiliated person of 

the issuer; and (B) the security is sold 

for cash in a transaction in which the 

only term negotiated by or on behalf of 

the participating Regulated Funds and 

Affiliated Funds is price. 

(d) Standard Board Approval. In all 

other cases, the Adviser will provide its 

written recommendation as to the 

Regulated Fund’s participation to the 

Eligible Trustees 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. 

7. Enhanced Review Dispositions. 

(a) General. If any Regulated Fund or 

Affiliated Fund elects to sell, exchange 

or otherwise dispose of a Pre-Boarding 

Investment in a Potential Co-Investment 

Transaction and the Regulated Funds 

and Affiliated Funds have not 

previously participated in a CoInvestment Transaction with respect to 

the issuer: 

(i) The Adviser to such Regulated 

Fund or Affiliated Fund will notify each 

Regulated Fund that holds an 

investment in the issuer of the proposed 

Disposition at the earliest practical time; 

(ii) the Adviser to each Regulated 

Fund that holds an investment in the 

issuer will formulate a recommendation 

as to participation by such Regulated 

Fund in the Disposition; and 

(iii) the Advisers will provide to the 

Board of each Regulated Fund that 

holds an investment in the issuer all 

information relating to the existing 

investments in the issuer of the 

Regulated Funds and Affiliated Fund, 

including the terms of such investments 

and how they were made, that is 

necessary for the Required Majority to 

make the findings required by this 

Condition. 

(b) Enhanced Board Approval. The 

Adviser will provide its written 

recommendation as to the Regulated 

Fund’s participation to the Eligible 

Trustees, and the Regulated Fund will 

participate in such Disposition solely to 

the extent that a Required Majority 

determines that: 

(i) The Disposition complies with 

Condition 2(c)(i), (ii), (iii)(A), and (iv); 

and 

(ii) the making and holding of the PreBoarding Investments were not 

prohibited by rule 17d–1 and records 

the basis for the finding in the Board 

minutes. 

(c) Additional Requirements. The 

Disposition may only be completed in 

reliance on the Order if: 

(i) Same Terms and Conditions. Each 

Regulated Fund has 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 Affiliated 

Funds and any other Regulated Fund; 

(ii) Original Investments. All of the 

Affiliated Funds’ and Regulated Funds’ 

investments in the issuer are PreBoarding Investments; 

(iii) Advice of counsel. Independent 

counsel to the Board advises that the 

making and holding of the investments 

in the Pre-Boarding Investments were 

not prohibited by rule 17d–1; 

(iv) Multiple Classes of Securities. All 

Regulated Funds and Affiliated Funds 

that hold Pre-Boarding Investments in 

Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 52271 

25 In determining whether a holding is 

‘‘immaterial’’ for purposes of the Order, the 

Required Majority will consider whether the nature 

and extent of the interest in the transaction or 

arrangement is sufficiently small that a reasonable 

person would not believe that the interest affected 

the determination of whether to enter into the 

transaction or arrangement or the terms of the 

transaction or arrangement. 

26To the extent that a Follow-On Investment 

opportunity is in a security or arises in respect of 

a security held by the participating Regulated 

Funds and any Affiliated Fund, proportionality will 

be measured by each participating Regulated Fund’s 

and Affiliated Fund’s outstanding investment in the 

security in question immediately preceding the 

Follow-On Investment using the most recent 

available valuation thereof. To the extent that a 

Follow-On Investment opportunity relates to an 

opportunity to invest in a security that is not in 

respect of any security held by any of the 

participating Regulated Funds or any Affiliated 

Fund, proportionality will be measured by each 

participating Regulated Fund’s and Affiliated 

Fund’s outstanding investment in the issuer 

immediately preceding the Follow-On Investment 

using the most recent available valuation thereof. 

the issuer immediately before the time 

of completion of the Co-Investment 

Transaction hold the same security or 

securities of the issuer. For the purpose 

of determining whether the Regulated 

Funds and Affiliated Funds hold the 

same security or securities, they may 

disregard any security held by some but 

not all of them if, prior to relying on the 

Order, the Required Majority is 

presented with all information 

necessary to make a finding, and finds, 

that: (x) Any Regulated Fund’s or 

Affiliated Fund’s holding of a different 

class of securities (including for this 

purpose a security with a different 

maturity date) is immaterial 25 in 

amount, including immaterial relative to 

the size of the issuer; and (y) the Board 

records the basis for any such finding in 

its minutes. In addition, securities that 

differ only in respect of issuance date, 

currency, or denominations may be 

treated as the same security; and 

(v) No control. The Affiliated Funds, 

the other Regulated Funds and their 

affiliated persons (within the meaning 

of section 2(a)(3)(C) of the Act), 

individually or in the aggregate, do not 

control the issuer of the securities 

(within the meaning of section 2(a)(9) of 

the Act). 

8. Standard Review Follow-Ons. 

(a) General. If any Regulated Fund or 

Affiliated Fund desires to make a 

Follow-On Investment in an issuer and 

the Regulated Funds and Affiliated 

Funds holding investments in the issuer 

previously participated in a CoInvestment Transaction with respect to 

the issuer: 

(i) The Adviser to each such 

Regulated Fund or Affiliated Fund will 

notify each Regulated Fund that holds 

securities of the portfolio company of 

the proposed transaction at the earliest 

practical time; and 

(ii) the Adviser to each Regulated 

Fund that holds an investment in the 

issuer will formulate a recommendation 

as to the proposed participation, 

including the amount of the proposed 

investment, by such Regulated Fund. 

(b) No Board Approval Required. A 

Regulated Fund may participate in the 

Follow-On Investment without 

obtaining prior approval of the Required 

Majority if: 

(i) (A) The proposed participation of 

each Regulated Fund and each 

Affiliated Fund in such investment is 

proportionate to its outstanding 

investments in the issuer or the security 

at issue, as appropriate,26 immediately 

preceding the Follow-On Investment; 

and (B) 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); or 

(ii) it is a Non-Negotiated Follow-On 

Investment. 

(c) Standard Board Approval. In all 

other cases, the Adviser will provide its 

written recommendation as to the 

Regulated Fund’s participation to the 

Eligible Trustees and the Regulated 

Fund will participate in such Follow-On 

Investment solely to the extent that a 

Required Majority makes the 

determinations set forth in Condition 

2(c). If the only previous Co-Investment 

Transaction with respect to the issuer 

was an Enhanced Review Disposition 

the Eligible Trustees must complete this 

review of the proposed Follow-On 

Investment both on a stand-alone basis 

and together with the Pre-Boarding 

Investments in relation to the total 

economic exposure and other terms of 

the investment. 

(d) Allocation. If, with respect to any 

such Follow-On Investment: 

(i) The amount of the opportunity 

proposed to be made available to any 

Regulated Fund is not based on the 

Regulated Funds’ and the Affiliated 

Funds’ outstanding investments in the 

issuer or the security at issue, as 

appropriate, immediately preceding the 

Follow-On Investment; and 

(ii) the aggregate amount 

recommended by the Advisers to be 

invested in the Follow-On Investment 

by the participating Regulated Funds 

and any participating Affiliated Funds, 

collectively, exceeds the amount of the 

investment opportunity, then the 

Follow-On Investment opportunity will 

be allocated among them pro rata based 

on the size of the Internal Orders, as 

described in section III.A.1.b. of the 

application. 

(e) Other Conditions. The acquisition 

of Follow-On Investments as permitted 

by this Condition will be considered a 

Co-Investment Transaction for all 

purposes and subject to the other 

Conditions set forth in the application. 

9. Enhanced Review Follow-Ons. 

(a) General. If any Regulated Fund or 

Affiliated Fund desires to make a 

Follow-On Investment in an issuer that 

is a Potential Co-Investment Transaction 

and the Regulated Funds and any 

Affiliated Funds holding investments in 

the issuer have not previously 

participated in a Co-Investment 

Transaction with respect to the issuer: 

(i) The Adviser to each such 

Regulated Fund or Affiliated Fund will 

notify each Regulated Fund that holds 

securities of the portfolio company of 

the proposed transaction at the earliest 

practical time; 

(ii) the Adviser to each Regulated 

Fund that holds an investment in the 

issuer will formulate a recommendation 

as to the proposed participation, 

including the amount of the proposed 

investment, by such Regulated Fund; 

and 

(iii) the Advisers will provide to the 

Board of each Regulated Fund that 

holds an investment in the issuer all 

information relating to the existing 

investments in the issuer of the 

Regulated Funds and Affiliated Funds, 

including the terms of such investments 

and how they were made, that is 

necessary for the Required Majority to 

make the findings required by this 

Condition. 

(b) Enhanced Board Approval. The 

Adviser will provide its written 

recommendation as to the Regulated 

Fund’s participation to the Eligible 

Trustees, and the Regulated Fund will 

participate in such Follow-On 

Investment solely to the extent that a 

Required Majority reviews the proposed 

Follow-On Investment both on a standalone basis and together with the PreBoarding Investments in relation to the 

total economic exposure and other 

terms and makes the determinations set 

forth in Condition 2(c). In addition, the 

Follow-On Investment may only be 

completed in reliance on the Order if 

the Required Majority of each 

participating Regulated Fund 

determines that the making and holding 

of the Pre-Boarding Investments were 

not prohibited by rule 17d–1. The basis 

for the Board’s findings will be recorded 

in its minutes. 

(c) Additional Requirements. The 

Follow-On Investment may only be 

completed in reliance on the Order if: 

52272 Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 

27Applicants are not requesting and the 

Commission is not providing any relief for 

transaction fees received in connection with any 

Co-Investment Transaction. 

(i) Original Investments. All of the 

Affiliated Funds’ and Regulated Funds’ 

investments in the issuer are PreBoarding Investments; 

(ii) Advice of counsel. Independent 

counsel to the Board advises that the 

making and holding of the investments 

in the Pre-Boarding Investments were 

not prohibited by rule 17d–1; 

(iii) Multiple Classes of Securities. All 

Regulated Funds and Affiliated Funds 

that hold Pre-Boarding Investments in 

the issuer immediately before the time 

of completion of the Co-Investment 

Transaction hold the same security or 

securities of the issuer. For the purpose 

of determining whether the Regulated 

Funds and Affiliated Funds hold the 

same security or securities, they may 

disregard any security held by some but 

not all of them if, prior to relying on the 

Order, the Required Majority is 

presented with all information 

necessary to make a finding, and finds, 

that: (x) Any Regulated Fund’s or 

Affiliated Fund’s holding of a different 

class of securities (including for this 

purpose a security with a different 

maturity date) is immaterial in amount, 

including immaterial relative to the size 

of the issuer; and (y) the Board records 

the basis for any such finding in its 

minutes. In addition, securities that 

differ only in respect of issuance date, 

currency, or denominations may be 

treated as the same security; and 

(iv) No control. The Affiliated Funds, 

the other Regulated Funds and their 

affiliated persons (within the meaning 

of section 2(a)(3)(C) of the Act), 

individually or in the aggregate, do not 

control the issuer of the securities 

(within the meaning of section 2(a)(9) of 

the Act). 

(d) Allocation. If, with respect to any 

such Follow-On Investment: 

(i) The amount of the opportunity 

proposed to be made available to any 

Regulated Fund is not based on the 

Regulated Funds’ and the Affiliated 

Funds’ outstanding investments in the 

issuer or the security at issue, as 

appropriate, immediately preceding the 

Follow-On Investment; and 

(ii) the aggregate amount 

recommended by the Advisers to be 

invested in the Follow-On Investment 

by the participating Regulated Funds 

and any participating Affiliated Funds, 

collectively, exceeds the amount of the 

investment opportunity, then the 

Follow-On Investment opportunity will 

be allocated among them pro rata based 

on the size of the Internal Orders, as 

described in Section III.A.1.b. of the 

application. 

(e) Other Conditions. The acquisition 

of Follow-On Investments as permitted 

by this Condition will be considered a 

Co-Investment Transaction for all 

purposes and subject to the other 

Conditions set forth in the application. 

10. Board Reporting, Compliance and 

Annual Re-Approval. 

(a) Each Adviser to a Regulated Fund 

will present to the Board of each 

Regulated Fund, on a quarterly basis, 

and at such other times as the Board 

may request, (i) a record of all 

investments in Potential Co-Investment 

Transactions made by any of the other 

Regulated Funds or any Affiliated 

Funds during the preceding quarter that 

fell within the Regulated Fund’s thencurrent Objectives and Strategies and 

Board-Established Criteria that were not 

made available to the Regulated Fund, 

and an explanation of why such 

investment opportunities were not made 

available to the Regulated Fund; (ii) a 

record of all Follow-On Investments in 

and Dispositions of investments in any 

issuer in which the Regulated Fund 

holds any investments by any Affiliated 

Fund or other Regulated Fund during 

the prior quarter; and (iii) all 

information concerning Potential CoInvestment Transactions and CoInvestment Transactions, including 

investments made by other Regulated 

Funds or any Affiliated Funds that the 

Regulated Fund considered but declined 

to participate in, so that the 

Independent Trustees, may determine 

whether all Potential Co-Investment 

Transactions and Co-Investment 

Transactions during the preceding 

quarter, including those investments 

that the Regulated Fund considered but 

declined to participate in, comply with 

the Conditions. 

(b) All information presented to the 

Regulated Fund’s Board pursuant to this 

Condition will be kept for the life of the 

Regulated Fund and at least two years 

thereafter, and will be subject to 

examination by the Commission and its 

staff. 

(c) 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. 

(d) The Independent Trustees will 

consider at least annually whether 

continued participation in new and 

existing Co-Investment Transactions is 

in the Regulated Fund’s best interests. 

11. Record Keeping. 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). 

12. Trustee Independence. No 

Independent Trustee of a Regulated 

Fund will also be a director, general 

partner, managing member or principal, 

or otherwise be an ‘‘affiliated person’’ 

(as defined in the Act) of any Affiliated 

Fund. 

13. Expenses. The expenses, if any, 

associated with acquiring, holding or 

disposing of any securities acquired in 

a Co-Investment Transaction (including, 

without limitation, the expenses of the 

distribution of any such securities 

registered for sale under the Securities 

Act) will, to the extent not payable by 

the Advisers under their respective 

advisory agreements with the Regulated 

Funds and the Affiliated Funds, be 

shared by the Regulated Funds and any 

participating Affiliated Funds in 

proportion to the relative amounts of the 

securities held or being acquired or 

disposed of, as the case may be. 

14. Transaction Fees.27 Any 

transaction fee (including break-up, 

structuring, monitoring or commitment 

fees but excluding brokerage or 

underwriting compensation permitted 

by section 17(e)) received in connection 

with any Co-Investment Transaction 

will be distributed to the participants on 

a pro rata basis based on the amounts 

they invested or committed, as the case 

may be, in such Co-Investment 

Transaction. If any transaction fee is to 

be held by an Adviser pending 

consummation of the transaction, the 

fee will be deposited into an account 

maintained by an Adviser at a bank or 

banks having the qualifications 

prescribed in section 26(a)(1), and the 

account will earn a competitive rate of 

interest that will also be divided pro 

rata among the participants. None of the 

Adviser, the Affiliated Funds, the other 

Regulated Funds or any affiliated person 

of the Affiliated Funds or the Regulated 

Funds will receive any additional 

compensation or remuneration of any 

kind as a result of or in connection with 

a Co-Investment Transaction other than 

(i) 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)(B)(z), (ii) brokerage or 

underwriting compensation permitted 

by section 17(e), or (iii) in the case of 

the Adviser, investment advisory 

compensation paid in accordance with 

investment advisory agreements 

between the applicable Regulated 

Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Notices 52273 

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

2 17 CFR 240.19b–4. 

3The term ‘‘Customer’’ or (‘‘C’’) applies to any 

transaction that is identified by a Participant for 

clearing in the Customer range at The Options 

Clearing Corporation (‘‘OCC’’) which is not for the 

account of broker or dealer or for the account of a 

‘‘Professional’’ (as that term is defined in Options 

1, Section 1(a)(47)). 

4The term ‘‘Professional’’ or (‘‘P’’) means any 

person or entity that (i) is not a broker or dealer in 

securities, and (ii) places more than 390 orders in 

listed options per day on average during a calendar 

month for its own beneficial account(s) pursuant to 

Options 1, Section 1(a)(47). All Professional orders 

shall be appropriately marked by Participants. 

5The term ‘‘NOM Market Maker’’ or (‘‘M’’) is a 

Participant that has registered as a Market Maker on 

NOM pursuant to Options 2, Section 1, and must 

also remain in good standing pursuant to Options 

2, Section 9. In order to receive NOM Market Maker 

pricing in all securities, the Participant must be 

registered as a NOM Market Maker in at least one 

security. 

Fund(s) or Affiliated Fund(s) and its 

Adviser. 

15. Independence. 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 in the 

same percentages as the Regulated 

Fund’s other shareholders (not 

including the Holders) 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. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–20207 Filed 9–17–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92974; File No. SR– 

NASDAQ–2021–069] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend The 

Nasdaq Options Market’s Pricing 

Schedule at Options 7, Section 2(1) 

September 14, 2021. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on 

September 1, 2021, The Nasdaq Stock 

Market LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’) 

the proposed rule change as described 

in Items I, II, and III, below, which Items 

have been prepared by the Exchange. 

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 

The Exchange proposes to amend The 

Nasdaq Options Market’s (‘‘NOM’’) 

Pricing Schedule at Options 7, Section 

2(1). 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules, 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 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange 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 

statements may be examined at the 

places specified in Item IV below. The 

Exchange 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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to amend NOM’s Pricing 

Schedule at Options 7, Section 2(1) to 

amend the (i) Customer 3 and 

Professional 4 Rebates to Add Liquidity 

in Penny Symbols, and (ii) Tier 3 

Market Maker 5 Rebate to Add Liquidity 

in Penny Symbols. 

Customer and Professional Rebate To 

Add Liquidity in Penny Symbols 

Today, the Exchange pays tiered 

Customer and Professional Rebates to 

Add Liquidity in Penny Symbols that 

are $0.20 (Tier 1), $0.25 (Tier 2), $0.42 

(Tier 3), $0.43 (Tier 4), $0.45 (Tier 5), 

and $0.48 (Tier 6). These rebates are 

paid per the highest tier achieved 

below. 

Monthly volume 

Tier 1 .................................... Participant adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny 

Symbols and/or Non-Penny Symbols of up to 0.10% of total industry customer equity and ETF option average 

daily volume (‘‘ADV’’) contracts per day in a month. 

Tier 2 .................................... Participant adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny 

Symbols and/or Non-Penny Symbols above 0.10% to 0.20% of total industry customer equity and ETF option 

ADV contracts per day in a month. 

Tier 3 .................................... Participant adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny 

Symbols and/or Non-Penny Symbols above 0.20% to 0.30% of total industry customer equity and ETF option 

ADV contracts per day in a month. 

Tier 4 .................................... Participant adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny 

Symbols and/or Non-Penny Symbols above 0.30% to 0.40% of total industry customer equity and ETF option 

ADV contracts per day in a month. 

Tier 5 .................................... Participant adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny 

Symbols and/or Non-Penny Symbols above 0.40% to 0.80% of total industry customer equity and ETF option 

ADV contracts per day in a month.