b'ConclusionRegulatory Developments Multiple-share Class ReliefRegulatory reforms have the potential to expand accessIn March 2025, the SEC issued exemptive relief allowing to private markets and alternative assets, particularlya private BDC to offer multiple share classes with varying for high net worth investors and also for some retailsales loads and distribution fees, even if the shares investors. Since the change in administration, its trueare not publicly offered. 1Exemptive relief is generally that we already have seen the effect of some of theserequired for permanent capital vehicles, including reforms. However, we anticipate more are on the horizon. interval funds and tender offer funds, to offer multiple share classes. This exemptive relief enables a private BDC Closed-end Fund Limitation onsponsor to tailor its capital structure in order to appeal to Investments in Private Securities a broader range of investors, offering different categories of investors a share class with a customized fee structure. The SEC Staff historically required closed-end funds that proposed to invest more than 15% of their net assets inCo-investment Reliefprivate funds to limit sales of their shares to accredited investors that made an initial investment of at leastHistorically, closed-end funds, BDCs, and their$25,000. While this policy was not codified in anyaffiliated investment vehicles were subject toformal rule or statute, it nevertheless was enforcedrestrictive and administratively burdensome co- through the registration statement review process.investment rules. Requirements included frequent,As a result, retail investors were excluded from privatein-depth board approvals by independent directors,market opportunities through registered closed-endrestrictions on the types of entities that couldfunds. In May 2025, SEC Chair Atkins noted it was timeparticipate in co-investment transactions, prohibitionsto change this two-decades-old policy. Chair Atkinson participation in co-investment transactionsexplained that he would direct the Staff to considerbased on pre-existing affiliate investments, andthis. The then-Director of the Division of Investmentextensive reporting requirements. These, someManagement confirmed that the SEC Staff would nomight say onerous, requirements resulted in delayinglonger provide comments when retail closed-endtransactions and often making transactions morefunds did not adhere to the 15% limit on private fundcostly, and occasionally, rendering them impossible. investments, and that the SEC Staff would work with filers to address disclosure issues as these productsIn April 2025, the SEC granted exemptive relief resulting became more widely available to retail investors. Inin a streamlined co-investment framework for certain August 2025, the Staff of the Division of Investmentclosed-end funds, including BDCs. 2The changes Management published guidance to assist registeredreduce the compliance and governance burdens. closed-end funds that invest in private funds byThe process reduces the board approval requirements identifying disclosures that should be addressed in theirfor co-investment transactions, clarifies the roles and filings. Following this policy change, fund sponsors haveresponsibilities of advisers and boards of directors in launched a variety of closed-end funds targeting privatethese investments, expands the types of investment market strategies. This change will continue to enableopportunities in which closed-end funds can engage, the introduction of new products, including intervaland simplifies investment allocation decisions. This funds and tender offer funds blending private andrelief also allows affiliated joint ventures of BDCs and public assets and offering varying liquidity features. insurance company separate accounts to participate 1See Ares Core Infrastructure Fund, et al., Investment Company Act Rel. No. 35523 (April 8, 2025), https://www.sec.gov/Archives/edgar/data/2031750/999999999725001786/filename1.pdf. (The final order was issued April 8, 2025 and initial notice was issued March 12, 2025).2See FS Credit Opportunities Corp., et al., Investment Company Act Rel. No. 35561 (April 29, 2025), https://www.sec.gov/files/rules/ic/2025/ic-35561.pdf. (This relief can be obtained by other closed-end funds on a similar basis).Mayer Brown|Conclusion 31'