[Federal Register Volume 75, Number 191 (Monday, October 4, 2010)]
[Notices]
[Pages 61232-61237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-24787]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 29446; 813-358]


RIEF RMP LLC and Renaissance Technologies LLC; Notice of 
Application

September 28, 2010.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of application for an order under sections 6(b) and 6(e) 
of the Investment Company Act of 1940 (the ``Act'') granting an 
exemption from all provisions of the Act, except section 9, and 
sections 36 through 53, and the rules and regulations under the Act. 
With respect to sections 17 and 30 of the Act, and the rules and 
regulations thereunder, and rule 38a-1 under the Act, the exemption is 
limited as set forth in the application.

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    Summary of Application: Applicants request an order to exempt 
certain limited liability companies and other investment vehicles 
formed for the benefit of eligible employees of Renaissance 
Technologies LLC (``RTC'') and its affiliates from certain provisions 
of the Act. Each limited partnership or other investment vehicle will 
be an ``employees' securities company'' within the meaning of section 
2(a)(13) of the Act.
    Applicants: RIEF RMP LLC (``RMP'') and RTC.

DATES:  The application was filed on August 2, 2005 and amended on May 
3, 2007, May 14, 2008, and June 4, 2010. 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 
application will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Commission's 
Secretary and serving applicant with a copy of the request, personally 
or by mail. Hearing requests should be received by the Commission by 
5:30 p.m. on October 25, 2010, and should be accompanied by proof of 
service on applicant, in the form of an affidavit or, for lawyers, a 
certificate of service. Hearing requests should state the nature of the 
writer's interest, the reason for the request, and the issues 
contested. Persons who wish to be notified of a hearing may request 
notification by writing to the Commission's Secretary.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F 
Street, NE., Washington, DC 20549-1090; Applicants, 800 Third Avenue, 
New York, New York 10022.

FOR FURTHER INFORMATION CONTACT: Deepak T Pai, Senior Counsel, at (202) 
551-6876, or Mary Kay Frech, Branch Chief, at (202) 551-6821 (Division 
of Investment Management, Office of Investment Company Regulation).
    Supplementary Information: The following is a summary of the 
application. The complete application may be obtained via the 
Commission's Web site by searching for the file number, or an applicant 
using the Company name box, at http://www.sec.gov/search/search.htm or 
by calling (202) 551-8090.
    Applicants' Representations:
    1. RTC is registered as an investment adviser under the Investment 
Advisers Act of 1940 (the ``Advisers Act'') and as a commodity pool 
operator and commodity trading adviser with the Commodity Futures 
Trading Commission under the Commodity Exchange Act, and is a member of 
the National Futures Association. RTC provides investment management 
services primarily to institutional investors as well as its own 
employees and related parties and is the general partner, managing 
member or investment adviser to several private funds. RTC and its 
``affiliates,'' as defined in rule 12b-2 under the Securities Exchange 
Act of 1934 (the

[[Page 61233]]

``1934 Act''), are referred to collectively as ``RTC Group.''
    2. RTC has organized RMP as a Delaware limited liability company, 
and RTC may in the future organize additional private investment funds 
(``Future Pooled Investment Vehicles,'' and together with RMP, ``Pooled 
Investment Vehicles'') identical in all respects to RMP (other than 
investment objectives and strategies and form of organization) for the 
benefit of the same categories of eligible investors as those investing 
in RMP. RMP was formed to benefit Eligible Employees (as defined below) 
and other eligible investors as part of a program by RTC to (a) create 
capital building opportunities that are competitive with those at other 
investment management firms, and (b) facilitate the recruitment and 
retention by RTC of high caliber personnel and key administrative 
employees. Investing in the Pooled Investment Vehicles will be 
voluntary. RMP will operate as a non-diversified, closed-end management 
investment company. Membership interests (``Interests'') in RMP will be 
offered in two series--A and B (``Series''). Each Series will be 
identical to the other except for the fees each will pay to RTC for the 
services rendered to RMP by RTC. RMP and each Future Pooled Investment 
Vehicle will be an ``employees' securities company'' as that term is 
defined in section 2(a)(13) of the Act.
    3. RTC serves as the managing member of RMP and will serve as the 
general partner, managing member or investment adviser (``Managing 
Member'') of the Future Pooled Investment Vehicles. RTC will control 
each Pooled Investment Vehicle within the meaning of section 2(a)(9) of 
the Act, and will have the authority to make all decisions regarding 
the acquisition, management and disposition of the portfolio 
investments for Pooled Investment Vehicles. RTC will be paid an 
advisory fee for its services, which may be determined as a percentage 
of assets under management. In addition, RTC may be entitled to a 
performance-based fee or allocation based on net capital appreciation 
in addition to the fixed fee.\1\
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    \1\ Any performance fee or allocation will be charged only if 
permitted by rule 205-3 under the Advisers Act.
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    4. RTC, as Managing Member, and any other person acting for or on 
behalf of the Pooled Investment Vehicles shall act in the best interest 
of the Pooled Investment Vehicles and their Participants (as defined 
below). Whenever RTC or any other person acting for or on behalf of the 
Pooled Investment Vehicles is required or permitted to make a decision, 
take or approve an action, or omit to do any of the foregoing in such 
person's discretion, then that person shall exercise such discretion in 
accordance with reasonableness and good faith and any fiduciary duties 
owed to the Pooled Investment Vehicles and the Participants. The 
organizational documents for, and any other contractual arrangements 
regarding, a Pooled Investment Vehicle will not contain any provision 
which protects or purports to protect RTC or its delegates against any 
liability to the Pooled Investment Vehicles or the Participants to 
which such person would otherwise be subject by reason of willful 
misfeasance, bad faith, or gross negligence in the performance of such 
person's duties, or by reason of such person's reckless disregard of 
such person's obligations and duties under such contract or 
organizational documents.
    5. Interests in the Pooled Investment Vehicles will be offered to 
Eligible Investors (as defined below) without registration in reliance 
on section 4(2) of the Securities Act of 1933 (the ``1933 Act'') or 
Regulation D under the 1933 Act. RTC must reasonably believe, before 
offering an Interest to an Eligible Investor, that such person has the 
knowledge, sophistication and experience in business and financial 
matters to be capable of evaluating the merits and risks of the 
investment, is able to bear the economic risk of such investment, and 
is able to afford a complete loss of such investment.
    6. ``Eligible Investors'' who may invest in the Pooled Investment 
Vehicles are: (a) Individuals who are current or former employees, 
officers or directors of the RTC Group (``Eligible Employees''); (b) a 
spouse, child, spouse of a child, brother, sister, parent or grandchild 
of an individual who is an Eligible Employee (``Eligible Family 
Members''); (c) persons or entities whom the RTC Group has engaged on 
retainer to provide services and professional expertise on an ongoing 
basis as regular consultants in business or legal advisers to the RTC 
Group and who share a community of interest with RTC and RTC employees 
(``Consultants''); and (d) either (i) trusts or other investment 
vehicles of which the trustees or grantors are Eligible Employees or 
Eligible Employees together with their Eligible Family Members, (ii) 
trusts or other investment vehicles established solely for the benefit 
of Eligible Employees, Consultants or Eligible Family Members, or (iii) 
partnerships, corporations or other entities all of the voting power of 
which is controlled by Eligible Employees (``Qualified Investment 
Entities'') (together with Eligible Employees, Eligible Family Members 
and Consultants, ``Eligible Investors'').
    7. All Eligible Investors investing in RMP must be ``accredited 
investors'' as defined in rule 501(a)(5) or 501(a)(6) of Regulation D, 
except that up to 35 Eligible Employees who are non-accredited 
investors may invest in RMP provided they fall into one of the 
following categories: (a) Eligible Employees who (i) Have a graduate 
degree in business, law or accounting, (ii) have a minimum of five 
years of consulting, investment banking or similar business experience, 
and (iii) have had reportable income from all sources of at least 
$100,000 in each of the two most recent years and have a reasonable 
expectation of income from all sources of at least $140,000 in the 
years in which the Eligible Employee invests in a Pooled Investment 
Vehicle; or (b) Eligible Employees who are ``knowledgeable employees,'' 
as defined in rule 3c-5 under the Act, of the Pooled Investment Vehicle 
(with the Pooled Investment Vehicle treated as though it were a 
``covered company'' for purposes of the rule). In addition, an Eligible 
Employee in category (a) above will not be permitted to invest in any 
year more than 10% of his or her income from all sources for the 
immediately preceding year in the aggregate in the Pooled Investment 
Vehicle and in all other Pooled Investment Vehicles in which that 
Eligible Employee has previously invested.
    8. A Qualified Investment Entity must be either (a) an accredited 
investor as defined in rule 501(a) of Regulation D, or (b) an entity 
for which an Eligible Employee is the settlor and principal investment 
decisionmaker and is counted toward the limit on the 35 non-accredited 
investors that may invest in a Pooled Investment Vehicle.
    9. The specific investment objectives and strategies for a 
particular Pooled Investment Vehicle will be set forth in the private 
placement memorandum relating to the Interests in the Pooled Investment 
Vehicles being offered, which will be delivered to each offeree at or 
before the sale of an Interest. Each Pooled Investment Vehicle will 
furnish to those Eligible Investors who are accepted as investors 
(``Participants'') annual financial statements audited by its 
registered public accounting firm and unaudited monthly reports of the 
results

[[Page 61234]]

of its investments.\2\ In addition, RTC will cause a report to be sent 
to each Participant in a Pooled Investment Vehicle, as soon as 
practicable after the end of each fiscal year, setting forth the 
information with respect to his or her share of income, gains, losses, 
credits and other items for federal and state income tax purposes.
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    \2\ ``Audit'' shall have the meaning defined in rule 1-02(d) of 
Regulation S-X.
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    10. Interests in the Pooled Investment Vehicles will not be 
transferable except with the express consent of RTC and then only to 
Eligible Investors. No sales load or fees of any kind will be charged 
in connection with the sale of Interests. Each private placement 
memorandum of the Pooled Investment Vehicles will describe the terms by 
which a Participant may transfer an Interest or withdraw from the 
Pooled Investment Vehicle. In addition, RTC has the right to cause any 
Participant to withdraw without cause. Upon withdrawal, the Pooled 
Investment Vehicles will pay to the Participant the net asset value of 
the Interest determined at the time of withdrawal, as determined in 
good faith by RTC.
    11. RTC intends to structure an investment program in which the 
Pooled Investment Vehicles will co-invest in portfolio companies with 
RTC or other pooled investment funds organized primarily for the 
benefit of investors who are not affiliated with RTC over which RTC 
exercises investment discretion (``Third Party Funds'').\3\ Side-by-
side investments by a Third Party Fund, or by an RTC entity in a 
transaction in which the RTC investment was made pursuant to a 
contractual obligation to a Third Party Fund, will not be subject to 
the restrictions contained in condition 3. All other side-by-side 
investments will be subject to the restrictions contained in condition 
3.
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    \3\ The investment objectives and program of one such Third 
Party Fund, Renaissance Institutional Equities Fund LLC (``RIEF''), 
will be substantially similar to RMP's investment objectives and 
program.
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    12. RMP and other Pooled Investment Vehicles may borrow money from 
others. Any indebtedness of the Pooled Investment Vehicles will be the 
debt of such Pooled Investment Vehicles and without recourse to the 
Participants. The Pooled Investment Vehicles will not borrow from any 
person if the borrowing would cause any person other than an Eligible 
Investor to own securities of the Pooled Investment Vehicles (other 
than short term paper).
    13. The Pooled Investment Vehicles will not purchase or otherwise 
acquire any security issued by any registered investment company if the 
Pooled Investment Vehicles immediately after such purchase or 
acquisition will own in the aggregate more than 3% of the total 
outstanding voting stock of such investment company.
    Applicants' Legal Analysis:
    1. Section 6(b) of the Act provides, in part, that the Commission 
will exempt employees' securities companies from the provisions of the 
Act to the extent that the exemption is consistent with the protection 
of investors. Section 6(b) provides that the Commission will consider, 
in determining the provisions of the Act from which the company should 
be exempt, the company's form of organization and capital structure, 
the persons owning and controlling its securities, the price of the 
company's securities and the amount of any sales load, how the 
company's funds are invested, and the relationship between the company 
and the issuers of the securities in which it invests. Section 2(a)(13) 
defines an employees' securities company, in relevant part, as any 
investment company all of whose securities (other than short-term 
paper) are beneficially owned (a) by current or former employees, or 
persons on retainer, of one or more affiliated employers, (b) by 
immediate family members of such persons, or (c) by such employer or 
employers together with any of the persons in (a) or (b).
    2. Section 7 of the Act generally prohibits investment companies 
that are not registered under section 8 of the Act from selling or 
redeeming their securities. Section 6(e) of the Act provides that, in 
connection with any order exempting an investment company from any 
provision of section 7, certain provisions of the Act, as specified by 
the Commission, will be applicable to the company and other persons 
dealing with the company as though the company were registered under 
the Act. Applicants request an order under sections 6(b) and 6(e) of 
the Act exempting RMP and each Future Pooled Investment Vehicle from 
all provisions of the Act, except section 9 and sections 36 through 53 
of the Act, and the rules and regulations under the Act. With respect 
to sections 17 and 30 of the Act, and the rules and regulations 
thereunder, and rule 38a-1 under the Act, the exemption is limited as 
set forth in the application.
    3. Section 17(a) of the Act generally prohibits any affiliated 
person of a registered investment company, or any affiliated person of 
an affiliated person, acting as principal, from knowingly selling or 
purchasing any security or other property to or from the company. 
Applicants request an exemption from section 17(a) to permit: (a) RTC 
or a Third Party Fund (or any affiliated person of RTC or a Third Party 
Fund), acting as principal, to engage in any transaction directly or 
indirectly with a Pooled Investment Vehicle or any company controlled 
by a Pooled Investment Vehicle; and (b) the Pooled Investment Vehicles 
to invest in or engage in any transaction with any RTC entity (or any 
affiliated person of such entity), acting as principal, (i) in which 
the Pooled Investment Vehicles, any company controlled by a Pooled 
Investment Vehicle, or any RTC entity or Third Party Fund has invested 
or will invest, or (ii) with which the Pooled Investment Vehicles, any 
company controlled by a Pooled Investment Vehicle or any RTC entity or 
Third Party Fund is or will become affiliated.
    4. Applicants submit that an exemption from section 17(a) is 
consistent with the purposes of the Pooled Investment Vehicles and the 
protection of investors. Applicants state that Participants in the 
Pooled Investment Vehicles will be fully informed of the possible 
extent of the Pooled Investment Vehicles' co-investing with RTC and 
Third Party Funds. Applicants also state that, as professionals 
employed in the investment management business, or in administrative, 
financial, accounting, legal or operational activities related thereto, 
or otherwise familiar with RTC, Eligible Investors will be able to 
understand and evaluate the attendant risks. Applicants assert that the 
community of interest among the Eligible Investors investing in the 
Pooled Investment Vehicles, on the one hand, and RTC, on the other 
hand, will protect Participants against any risk of abuse.
    5. Section 17(d) of the Act and rule 17d-1 under the Act prohibit 
any affiliated person of a registered investment company, or any 
affiliated person of such person, acting as principal, from 
participating in any joint arrangement with the registered investment 
company unless authorized by the Commission. Applicants request an 
order pursuant to section 17(d) and rule 17d-1 to the extent necessary 
to permit affiliated persons of RMP and the Future Pooled Investment 
Vehicles (including, without limitation, RTC, affiliated persons of RTC 
and a Third Party Fund), or affiliated persons of any of these persons 
to participate in, or effect any transaction in connection with, any 
joint enterprise or other joint arrangement or profit-sharing plan in 
which any Pooled Investment Vehicle or a company controlled by any 
Pooled Investment Vehicle is a participant.

[[Page 61235]]

    6. Applicants assert that compliance with section 17(d) would 
prevent RMP and the Future Pooled Investment Vehicles from achieving 
their principal purpose, which is to provide Eligible Employees a 
vehicle through which they may invest in the same securities as RIEF or 
another Third Party Fund. Applicants believe that if RMP's or any 
Future Pooled Investment Vehicle's co-investments with RTC and its 
affiliated persons and affiliated persons of its affiliated persons are 
prohibited, the appeal of RMP and Future Pooled Investment Vehicles for 
the Eligible Investors would be significantly diminished. Eligible 
Investors have indicated a desire to participate in such co-investment 
opportunities because they believe that: (a) RTC can analyze investment 
opportunities to an extent that individual employees would have neither 
the time nor resources to duplicate; (b) investments made by Third 
Party Funds managed by RTC may not be generally available to or 
available on the same terms and conditions to investors even of the 
financial status of the Eligible Investors; and (c) Eligible Investors 
will be able to pool their investment resources, thus achieving greater 
diversification of their individual investment portfolios. Applicants 
further believe that the flexibility to structure co-investments and 
joint investments will not involve abuses of the type section 17(d) and 
rule 17d-1 were designed to prevent.
    7. Applicants believe that the interests of the Eligible Employees 
participating in the Pooled Investment Vehicles will be adequately 
protected even in situations where condition 3 does not apply. In 
structuring a Third Party Fund, it is common for the unaffiliated 
investors of such fund to require that RTC invest its own capital in 
fund investments, either through the fund or on a side-by-side basis, 
and that RTC investments be subject to substantially the same terms as 
those applicable to the fund's investments. Applicants believe it is 
important that the interests of the Third Party Fund take priority over 
the interests of the Pooled Investment Vehicles, and that the 
activities of the Third Party Fund not be burdened or otherwise 
affected by activities of the Pooled Investment Vehicles. If condition 
3 were to apply to RTC's investment in these situations, the effect of 
such a requirement would be to indirectly burden the Third Party Fund 
with the requirements of condition 3. In addition, applicants state 
that the relationship of RMP to RIEF or another Pooled Investment 
Vehicle to another Third Party Fund is fundamentally different from 
RMP's and the other Pooled Investment Vehicles' relationship to RTC. 
The focus of, and the rationale for, the protections contained in the 
requested relief are to protect the Pooled Investment Vehicles from any 
overreaching by RTC in the employer/employee context, whereas the same 
concerns are not present with respect to RMP and the other Pooled 
Investment Vehicles vis-[agrave]-vis the investors in RIEF or other 
Third Party Funds.
    8. Section 17(f) of the Act designates the entities that may act as 
investment company custodians, and rule 17f-1 under the Act imposes 
certain requirements when the custodian is a member of a national 
securities exchange. Applicants request an exemption from section 17(f) 
and rule 17f-1 to permit the following exceptions from the requirements 
of rule 17f-1: (a) In lieu of compliance with rule 17f-1(b)(1), RMP and 
each Future Pooled Investment Vehicle will enter into a written 
customer and prime broker agreement with one or more broker-dealers 
each of whom is a member of the New York Stock Exchange LLC in 
substantially similar form to the form used by the subject prime 
broker(s); \4\ (b) in lieu of compliance with rule 17f-1(b)(4), the 
Pooled Investment Vehicles' registered public accountant shall semi-
annually reconcile the prime broker's statement of each Pooled 
Investment Vehicle's account with each Pooled Investment Vehicle's 
records of its holdings of cash and securities and issue to each Pooled 
Investment Vehicle a report on such reconciliation; (c) the Pooled 
Investment Vehicles will not comply with rule 17f-1(c), which requires 
transmitting to the Commission a copy of any contract executed pursuant 
to rule 17f-1; and (d) RTC as the Managing Member will approve the 
contracts required to be ratified by the board of directors in rule 
17f-1(d). Applicants will comply with all other requirements of rule 
17f-1.
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    \4\ Almost all of the securities in which RMP and the Future 
Pooled Investment Vehicles will invest will be eligible for deposit 
in a securities depository registered as a clearing agency under the 
1934 Act. There will be no physical segregation, and segregation 
will be accomplished by entries on the books and records of the 
prime broker and periodic account statements issued by the prime 
broker to RMP and each Future Pooled Investment Vehicle will reflect 
such recordation.
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    9. Section 17(g) of the Act and rule 17g-1 under the Act generally 
require the bonding of officers and employees of a registered 
investment company who have access to its securities or funds. Rule 
17g-1 requires that a majority of directors who are not interested 
persons take certain actions and give certain approvals relating to 
fidelity bonding. Applicants request instead that such actions and 
approvals be taken by RTC, regardless of whether it is deemed to be an 
interested person of such Pooled Investment Vehicles. Applicants state 
that because RTC will be considered an interested person of each Pooled 
Investment Vehicle, the Pooled Investment Vehicles could not comply 
with rule 17g-1 without the requested relief. Applicants also request 
an exemption from the requirements of paragraphs (g) and (h) of rule 
17g-1 relating to the filing of copies of fidelity bonds and related 
information with the Commission and the provision of notices to the 
board of directors, and from the requirements of rule 17g-1(j)(3) that 
the board of directors of an investment company satisfy the fund 
governance standards defined in rule 0-1(a)(7). The Pooled Investment 
Vehicles will comply with all other requirements of rule 17g-1.
    10. Section 17(j) of the Act and paragraph (b) of rule 17j-1 under 
the Act make it unlawful for certain enumerated persons to engage in 
fraudulent or deceptive practices in connection with the purchase or 
sale of a security held or to be acquired by a registered investment 
company. Rule 17j-1 also requires that every registered investment 
company adopt a written code of ethics and that every access person of 
a registered investment company report personal securities 
transactions. Applicants request an exemption from the provisions of 
rule 17j-1, except for the anti-fraud provisions of paragraph (b), 
because they are unnecessarily burdensome as applied to the Pooled 
Investment Vehicles and would serve little purpose in light of the 
community of interest among the Participants by virtue of their common 
association with RTC.
    11. Applicants request an exemption from the requirements in 
sections 30(a), 30(b), and 30(e) of the Act, and the rules under those 
sections, that registered investment companies prepare and file with 
the Commission and mail to their shareholders certain periodic reports 
and financial statements. Applicants contend that the forms prescribed 
by the Commission for periodic reports have little relevance to the 
Pooled Investment Vehicles and would entail administrative and legal 
costs that outweigh any benefit to the Participants in the Pooled 
Investment Vehicles. Applicants request exemptive relief to the extent 
necessary to permit the Pooled Investment Vehicles to report annually 
to their Participants. Applicants also request an exemption from 
section 30(h) of the Act to the

[[Page 61236]]

extent necessary to exempt RTC, directors and officers of RTC and any 
other persons who may be deemed members of an advisory board of the 
Pooled Investment Vehicles from filing Forms 3, 4 and 5 under section 
16 of the 1934 Act with respect to their ownership of Interests in the 
Pooled Investment Vehicles. Applicants assert that, because there would 
be no trading market and the transfers of Interests are severely 
restricted, these filings are unnecessary for the protection of 
investors and burdensome to those required to make them.
    12. Rule 38a-1 requires investment companies to adopt, implement 
and periodically review written policies reasonably designed to prevent 
violation of the federal securities laws and to appoint a chief 
compliance officer. RMP and Future Pooled Investment Vehicles will 
comply will rule 38a-1(a), (c) and (d), except that the board of 
directors of RTC, the Managing Member, will fulfill the 
responsibilities assigned to a fund's board of directors under the rule 
and, since all the members of RTC's board of directors would be 
considered interested persons, approval by a majority of the 
disinterested directors required by rule 38a-1 will not be obtained. In 
addition, because the board of directors of RTC does not have any 
disinterested directors, RMP and the Future Pooled Investment Vehicles 
will comply with the requirement in rule 38a-1(a)(4)(iv) that the chief 
compliance officer meet with the disinterested directors by having the 
chief compliance officer meet with the board of directors of RTC as 
constituted.
    Applicants' Conditions:
    Applicants agree that any order granting the requested relief will 
be subject to the following conditions:
    1. Each proposed transaction otherwise prohibited by section 17(a) 
or section 17(d) of the Act and rule 17d-1 thereunder to which RMP or a 
Future Pooled Investment Vehicle is a party (the ``Section 17 
Transactions'') will be effected only if RTC determines that:
    (a) The terms of the Section 17 Transaction, including the 
consideration to be paid or received, are fair and reasonable to the 
Participants in the Pooled Investment Vehicle and do not involve 
overreaching of the Pooled Investment Vehicle or its Participants on 
the part of any person concerned; and
    (b) The Section 17 Transaction is consistent with the interests of 
the Participants, the organizational documents of the Pooled Investment 
Vehicle, and the Pooled Investment Vehicle's reports to its 
Participants.
    In addition, RTC will record and preserve a description of the 
Section 17 Transactions, the findings of RTC, the information or 
materials upon which the findings of RTC are based, and the basis for 
those findings. All such records will be maintained for the life of the 
Pooled Investment Vehicles and at least six years thereafter, and will 
be subject to examination by the Commission and its staff. The Pooled 
Investment Vehicles will preserve the accounts, books and other 
documents required to be maintained in an easily accessible place for 
the first two years.
    2. In connection with the Section 17 Transactions, RTC will adopt, 
and periodically review and update, procedures designed to ensure that 
reasonable inquiry is made, prior to the consummation of any Section 17 
Transaction, with respect to the possible involvement in the 
transaction of any Affiliated Person or promoter of or principal 
underwriter for the Pooled Investment Vehicles, or any affiliated 
person of any such person, promoter or principal underwriter.
    3. RTC will not invest the funds of a Pooled Investment Vehicle in 
any investment in which a ``Co-Investor'' (as defined below) has 
acquired or proposes to acquire the same class of securities of the 
same issuer, where the investment involves a joint enterprise or other 
joint arrangement within the meaning of rule 17d-1 in which a Pooled 
Investment Vehicle and the Co-Investor are participants, unless any 
such Co-Investor, prior to disposing of all or part of its investment: 
(a) Gives RTC sufficient, but not less than one day's notice of its 
intent to dispose of its investment; and (b) refrains from disposing of 
its investment unless any Pooled Investment Vehicle has the opportunity 
to dispose of its investment prior to or concurrently with, and on the 
same terms as, and pro rata with the Co-Investor. The term ``Co-
Investor'' with respect to RMP or a Future Pooled Investment Vehicle 
means any person who is: (a) An affiliated person (as defined in 
section 2(a)(3) of the Act) of the Pooled Investment Vehicle (other 
than a Third Party Fund); (b) RTC; (c) an officer or director of RTC; 
or (d) an entity (other than a Third Party Fund) in which RTC acts as a 
general partner, managing member, trustee or has a similar capacity to 
control the sale or other disposition of the entity's securities.
    The restrictions contained in this condition, however, will not be 
deemed to limit or prevent the disposition of an investment by a Co-
Investor: (a) To its direct or indirect wholly-owned subsidiary, to any 
company (a ``Parent'') of which the Co-Investor is a direct or indirect 
wholly-owned subsidiary, or to a direct or indirect wholly-owned 
subsidiary of its Parent; (b) to immediate family members of the Co-
Investor or to a trust or other investment vehicle established for any 
Co-Investor or any such family member; (c) when the investment is 
comprised of securities that are listed on any exchange registered as a 
national securities exchange under section 6 of the 1934 Act; (d) when 
the investment is comprised of securities that are national market 
system securities pursuant to section 11A(a)(2) of the 1934 Act and 
rule 600(a) of Regulation NMS thereunder; (e) when the securities are 
government securities as defined in section 2(a)(16) of the Act; and 
(f) when the investment is comprised of securities that are listed on 
or traded on any foreign securities exchange or board of trade that 
satisfies regulatory requirements under the law of the jurisdiction in 
which such foreign securities exchange or board of trade is organized 
similar to those that apply to a national securities exchange or a 
national market system for securities.
    4. The Pooled Investment Vehicles and RTC will maintain and 
preserve, for the life of each Pooled Investment Vehicle and at least 
six years thereafter, such accounts, books, and other documents as 
constitute the record forming the basis for the audited financial 
statements that are to be provided to the Participants in the Pooled 
Investment Vehicles, and each annual report of each Pooled Investment 
Vehicle required to be sent to such Participants, and agree that all 
such records will be subject to examination by the Commission and its 
staff.\5\
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    \5\ RMP and the Pooled Investment Vehicles will preserve the 
accounts, books and other documents required to be maintained in an 
easily accessible place for the first two years.
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    5. Each Pooled Investment Vehicle will send to each Participant in 
such Pooled Investment Vehicle who had an interest in the Pooled 
Investment Vehicle at any time during the fiscal year then ended 
financial statements of the Pooled Investment Vehicle audited by the 
Pooled Investment Vehicle's independent public accountants. At the end 
of each fiscal year, RTC will make a valuation or have a valuation made 
of all of the assets of the Pooled Investment Vehicle as of such fiscal 
year end in a manner consistent with customary practice with respect to 
the valuation of assets of the kind held by the Pooled Investment 
Vehicle. In addition, within 120 days after the end of each Pooled 
Investment Vehicle's

[[Page 61237]]

fiscal year or as soon as practicable thereafter, RTC will send a 
report to each person who was a Participant in a Pooled Investment 
Vehicle at any time during the fiscal year then ended, setting forth 
such tax information as shall be necessary for the preparation by the 
Participant of that Participant's federal and state income tax returns 
and a report of the investment activities of the Pooled Investment 
Vehicle during that fiscal year.
    6. If any Pooled Investment Vehicle makes purchases or sales from 
or to an entity affiliated with such Pooled Investment Vehicle by 
reason of an officer, director or employee of RTC (a) serving as an 
officer, director, general partner or investment adviser of the entity, 
or (b) having a 5% or more investment in the entity, such individual 
will not participate in the Pooled Investment Vehicle's determination 
of whether or not to effect the purchase or sale.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Florence E. Harmon,
 Deputy Secretary.
[FR Doc. 2010-24787 Filed 10-1-10; 8:45 am]
BILLING CODE 8010-01-P