Correspondence 0001398344-24-006237 from SKK Access Income Fund (CIK 0001830926)
SKK Access Income Fund (CIK 0001830926)
Date: March 20, 2024 · CIK: 0001830926 · Accession: 0001398344-24-006237
AI Filing Summary & Sentiment
File numbers found in text: 811-23856
Letter
VIA EDGAR TRANSMISSION United States Securities and Exchange Commission Division of Investment Management Washington, D.C. 20549 Registration Statement on Form N-2 Filing No.: 811-23856
Re: SKK Access Income Fund (the “Trust” or “Fund”)
Dear Mr. Zapata,
This correspondence responds to comments the Trust received from the Staff (the “Staff”) of the U.S. Securities and Exchange Commission with respect to the Trust’s Registration Statement on Form N-2 filed March 17, 2023 (the “Registration Statement”). For your convenience, the comments have been reproduced in bold with a response following each comment. Capitalized terms not otherwise defined have the same meaning as in the Registration Statement.
1. General Comments
a. Please advise us if you have submitted any exemptive application(s) or no-action request(s) in connection with your Registration Statement, including with respect to coinvestments.
Response: The Fund has not submitted any exemptive application(s) or no-action request(s) in connection with its Registration Statement, including with respect to coinvestments.
b. Please confirm that the Fund does not intend to issue preferred or debt securities within a year from the effective date of the Registration Statement.
Response: The Fund did not issue preferred or debt securities within a year from the effective date of the Registration Statement.
c. Please confirm in correspondence that the Fund will include all disclosures required for restricted securities in the financial statements, including cost and acquisition dates.
Response: To the extent applicable, the Fund will include all disclosures required for restricted securities in the financial statements, including cost and acquisition dates.
JOHN F. RAMÍREZ ● PARTNER
11300 Tomahawk Creek Parkway, Suite 310 ● Leawood, KS 66211 ● p: 917.805.1818
Practus, LLP ● John.Ramirez@Practus.com ● Practus.com
United States Securities and Exchange Commission
March 20, 2024
2. Cover Page
Please add the following bullets to the cover page of the prospectus in bold type:
a. The Fund’s Shares will not be listed on an exchange and it is not anticipated that a secondary market will develop. An investment in the Fund constitutes an illiquid investment that is suitable for sophisticated investors and requires the financial ability and willingness to accept the high risks and lack of liquidity inherent in an investment in Fund Shares.
b. The Fund intends to invest primarily in privately-held issuers for which very little public information exists and which may be more vulnerable to economic downturns and may experience substantial variations in operating results.
c. The Fund’s Shares may not be sold, transferred or assigned without the written consent of the Fund.
d. The amount of distributions that the Fund may pay, if any, is uncertain.
e. The Fund may pay distributions in significant part from sources that may not be available in the future and that are unrelated to the Fund’s performance, such as borrowings. Such distributions may constitute a return of capital and reduce the amount of capital available to us for investment.
Response: The Fund has added the foregoing bullets to the cover page of the prospectus in bold type.
3. Summary of Terms
a. Purchase and Repurchase of Shares (p. 1). The disclosure states that investors will be able to purchase Fund Shares quarterly at NAV, calculated as of the last business day of each quarter. Please confirm supplementally that the Fund will comply with Section 23(b) of the Act, which requires NAV to be determined within 48 hours of a sale of common stock to avoid sales below NAV.
United States Securities and Exchange Commission
March 20, 2024
Response: For such quarterly purchases, the Fund’s Shares are only sold and issued at the NAV calculated as of the last business day of each quarter (i.e., per Section 23(b) of the Act, the NAV is determined “as of a time within forty-eight hours, excluding Sundays and holidays, next preceding the time of such determination”).
b. Investment Strategy (p. 2). The staff notes that the disclosures in this section contain qualifying language such as “for illustration only”, “includ[ing] but not limited to”, “may invest in [,]” the totality of which results in overbroad disclosures that fail to describe the Fund’s principal strategy in appropriate detail.
i. The disclosure states that the “Adviser believes that complex credit markets that are under-capitalized by traditional lenders offer outsized return potential relative to those that are heavily trafficked.” Please clarify what segments of the credit markets are considered under-capitalized by the Adviser and which are considered “heavily trafficked.”
Response: The Fund has revised the disclosure to read as follows:
The Adviser believes that there may be investment opportunities in complex credit markets that are under-capitalized by traditional lenders (which will vary over time depending on market conditions) that could offer outsized return potential.
ii. The disclosure states that the Fund intends to invest in private funds “within its focus areas” and lists various credit strategies “for illustration only.” Please disclose the Fund’s particular areas of focus. Please summarize the criteria for selecting particular Underlying Managers.
Response: The Fund has revised the disclosure to read as follows:
United States Securities and Exchange Commission
March 20, 2024
The Fund intends to seek, on an ongoing basis, to identify successful Private Markets Investment Funds within the foregoing focus areas.
Response: The Fund has revised the disclosure to include the following:
The Adviser seeks to achieve the investment objectives by utilizing a rigorous due diligence and Underlying Manager selection process consisting of idea generation and sourcing, underwriting, operational due diligence, portfolio construction, and monitoring and risk management (as described under “INVESTMENT PROGRAM” below).
iii. Please provide additional detail regarding the specific types of Direct Investments that the Fund intends to make, e.g. equity investments, senior lien, unitranche, whole loans, mezzanine debt, etc.; disclose any relevant loan selection criteria or underwriting standards.
Response: The Fund has revised the disclosure to read as follows:
In addition, the Fund may invest in co-investments that are originated, serviced, and/or underwritten by the Underlying Managers (but not with other funds and accounts managed by the Adviser, unless subject to exemptive relief) (“Co-Investments”) and direct investments (“Direct Investments”) which may include, but are not limited to, private and public credit instruments, asset backed and structured credit agreements, lease agreements, other credit-related securities, originated, serviced, and/or underwritten (as described under “INVESTMENT PROGRAM” below) by the Fund itself.
iv. With respect to Co-Investments, provide additional detail regarding the types of underlying investments, any relevant criteria for selecting Underlying Managers for Co-Investments, and provide appropriate risk disclosures, as applicable.
Response: Please see response to 3.b.iii. above.
v. If part of the principal strategies, please disclose that the Fund intends to invest in regulated funds (ETFs, CEFs, mutual funds, money market funds, as applicable), disclose how such investments fit within the Fund’s principal strategies and what portion of Fund assets will be allocated to such investments, as applicable.
United States Securities and Exchange Commission
March 20, 2024
Response: Investment in regulated funds (ETFs, CEFs, mutual funds, money market funds, as applicable) is not presently part of the Fund’s principal strategies.
vi. Please disclose if the Fund intends to invest, directly or indirectly, in “junk” bonds. Please disclose if the Fund intends to invest in distressed debt and/or defaulted securities and provide appropriate risk disclosures.
Response: The Fund does not presently intend to invest, directly or indirectly, in “junk” bonds, distressed debt, and/or defaulted securities.
vii. Please disclose if the Fund intends to invest in emerging markets issuers and describe the types of investments, e.g. Direct Investments, Co-Investments, types of underlying issuers, etc.
Response: The Fund does not presently intend to invest in emerging markets issuers.
viii. Please disclose whether the Fund intends to invest through one or more wholly-owned subsidiaries (as described in accord with the wholly-owned subsidiaries comments below), including any REIT Subsidiaries (defined on S-10 of the SAI). Add related disclosure to the Summary of Terms and more detailed discussion of risks later in the Registration Statement.
Response: The Fund does not presently intend to invest through one or more wholly-owned subsidiaries, including any REIT Subsidiaries (defined on S-10 of the SAI).
c. Other Fees and Expenses (p. 3). Please add disclosure to this section concerning the possible imposition of an Early Repurchase Fee, which the Fund reserves the right to institute in the future. Provide a cross reference to the discussion of the Early Repurchase Fee on page 59.
United States Securities and Exchange Commission
March 20, 2024
Response: The Fund has added the following disclosure:
Additionally, the Fund reserves the right to impose, on a future date, an “Early Repurchase Fee,” pursuant to which any repurchase of Fund Shares from a Shareholder which were held for less than one year (on a first-in, first-out basis) will be subject to a fee equal to 2.00% of the NAV of any Shares repurchased by the Fund that were held for less than one year (as described under “REPURCHASE AND TRANSFER OF SHARES” below).
d. Risks. Please review the section to ensure that various risks associated with the Fund’s principal investments are adequately reflected in the Investment Strategy section. For example, the risks section discusses high-yield securities convertible securities, preferred securities, joint ventures, distressed and special situations and venture investments, etc. that are not mentioned in the strategy section. Conversely, various types of investments are described in the strategy section without providing specific risk disclosures related to such instruments.
Response: The Fund has reviewed the section and believes that the various risks associated with the Fund’s principal investments are adequately reflected in the Investment Strategy section.
4. Summary of Fees and Expenses
a. Please confirm the Fund will include any interest expense related to Fund borrowing in the fee table as required by General Instruction 8 to Item 3 of Form N-2.
Response: To the extent applicable, the Fund will include any interest expense related to Fund borrowing in the fee table as required by General Instruction 8 to Item 3 of Form N-2.
b. Please add disclosure to fee table footnote three providing the expiration date of the current Fee Waiver agreement.
United States Securities and Exchange Commission
March 20, 2024
Response: As part of the fund administrator transition from PPB Capital Partners, LLC to UMB Fund Services, Inc., the expense limitation and reimbursement arrangement between the Fund and PPB Capital Partners, LLC has been terminated and all references thereto have been removed.
c. Please confirm whether the fees waived by the Fund and Fund Administrator will be subject to recoupment. If so, please disclose the terms of recoupment and ensure the recoupment period is limited to three years from the date of the waiver/reimbursement. Please also disclose that any recoupments would be limited to the lesser of (1) the expense limitation in effect at the time of waiver, and (2) the expense limitation in effect at the time of recapture.
Response: Please see response to 4.b. above.
d. Please confirm whether any of the Corporate Subsidiaries or REIT Subsidiaries will be charging a management fee. If so, please confirm in correspondence that the subsidiary’s management fee (including any p
Show Raw Text
CORRESP
1
filename1.htm
March
20, 2024
VIA
EDGAR TRANSMISSION
Mr.
Alberto H. Zapata
United
States Securities and Exchange Commission
Division
of Investment Management
100
F Street, N.E.
Washington,
D.C. 20549
Re: SKK
Access Income Fund (the “Trust” or “Fund”)
Registration
Statement on Form N-2
Filing No.:
811-23856
Dear
Mr. Zapata,
This
correspondence responds to comments the Trust received from the Staff (the “Staff”) of the U.S. Securities and Exchange
Commission with respect to the Trust’s Registration Statement on Form N-2 filed March 17, 2023 (the “Registration
Statement”). For your convenience, the comments have been reproduced in bold with a response following each comment. Capitalized
terms not otherwise defined have the same meaning as in the Registration Statement.
1. General
Comments
a. Please
advise us if you have submitted any exemptive application(s) or no-action request(s)
in connection with your Registration Statement, including with respect to coinvestments.
Response: The
Fund has not submitted any exemptive application(s) or no-action request(s) in connection with its Registration Statement, including
with respect to coinvestments.
b. Please
confirm that the Fund does not intend to issue preferred or debt securities within a
year from the effective date of the Registration Statement.
Response: The
Fund did not issue preferred or debt securities within a year from the effective date of the Registration Statement.
c. Please
confirm in correspondence that the Fund will include all disclosures required for restricted
securities in the financial statements, including cost and acquisition dates.
Response: To
the extent applicable, the Fund will include all disclosures required for restricted securities in the financial statements,
including cost and acquisition dates.
JOHN
F. RAMÍREZ ● PARTNER
11300 Tomahawk Creek Parkway, Suite 310 ● Leawood, KS 66211 ● p: 917.805.1818
Practus, LLP ● John.Ramirez@Practus.com ● Practus.com
United
States Securities and Exchange Commission
March 20, 2024
2. Cover
Page
Please
add the following bullets to the cover page of the prospectus in bold type:
a. The
Fund’s Shares will not be listed on an exchange and it is not anticipated that
a secondary market will develop. An investment in the Fund constitutes an illiquid investment
that is suitable for sophisticated investors and requires the financial ability and willingness
to accept the high risks and lack of liquidity inherent in an investment in Fund Shares.
b. The
Fund intends to invest primarily in privately-held issuers for which very little public
information exists and which may be more vulnerable to economic downturns and may experience
substantial variations in operating results.
c. The
Fund’s Shares may not be sold, transferred or assigned without the written consent
of the Fund.
d. The
amount of distributions that the Fund may pay, if any, is uncertain.
e. The
Fund may pay distributions in significant part from sources that may not be available
in the future and that are unrelated to the Fund’s performance, such as borrowings.
Such distributions may constitute a return of capital and reduce the amount of capital
available to us for investment.
Response: The
Fund has added the foregoing bullets to the cover page of the prospectus in bold type.
3. Summary
of Terms
a. Purchase
and Repurchase of Shares (p. 1). The disclosure states that investors will be able to
purchase Fund Shares quarterly at NAV, calculated as of the last business day of each
quarter. Please confirm supplementally that the Fund will comply with Section 23(b) of
the Act, which requires NAV to be determined within 48 hours of a sale of common stock
to avoid sales below NAV.
2
United
States Securities and Exchange Commission
March 20, 2024
Response: For
such quarterly purchases, the Fund’s Shares are only sold and issued at the NAV calculated as of the last business day of each
quarter (i.e., per Section 23(b) of the Act, the NAV is determined “as of a time within forty-eight hours, excluding Sundays
and holidays, next preceding the time of such determination”).
b. Investment
Strategy (p. 2). The staff notes that the disclosures in this section contain qualifying
language such as “for illustration only”, “includ[ing] but not limited
to”, “may invest in [,]” the totality of which results in overbroad
disclosures that fail to describe the Fund’s principal strategy in appropriate
detail.
i. The
disclosure states that the “Adviser believes that complex credit markets that are
under-capitalized by traditional lenders offer outsized return potential relative to
those that are heavily trafficked.” Please clarify what segments of the credit
markets are considered under-capitalized by the Adviser and which are considered “heavily
trafficked.”
Response: The
Fund has revised the disclosure to read as follows:
The
Adviser believes that there may be investment opportunities in complex credit markets that are under-capitalized by traditional
lenders (which will vary over time depending on market conditions) that could offer outsized return potential.
ii. The
disclosure states that the Fund intends to invest in private funds “within its
focus areas” and lists various credit strategies “for illustration only.”
Please disclose the Fund’s particular areas of focus. Please summarize the criteria
for selecting particular Underlying Managers.
Response: The
Fund has revised the disclosure to read as follows:
3
United
States Securities and Exchange Commission
March 20, 2024
The
Fund intends to seek, on an ongoing basis, to identify successful Private Markets Investment Funds within the foregoing focus
areas.
Response: The
Fund has revised the disclosure to include the following:
The
Adviser seeks to achieve the investment objectives by utilizing a rigorous due diligence and Underlying Manager selection process
consisting of idea generation and sourcing, underwriting, operational due diligence, portfolio construction, and monitoring and
risk management (as described under “INVESTMENT PROGRAM” below).
iii. Please
provide additional detail regarding the specific types of Direct Investments that the
Fund intends to make, e.g. equity investments, senior lien, unitranche, whole loans,
mezzanine debt, etc.; disclose any relevant loan selection criteria or underwriting standards.
Response: The
Fund has revised the disclosure to read as follows:
In
addition, the Fund may invest in co-investments that are originated, serviced, and/or underwritten by the Underlying Managers
(but not with other funds and accounts managed by the Adviser, unless subject to exemptive relief) (“Co-Investments”)
and direct investments (“Direct Investments”) which may include, but are not limited to, private and public credit
instruments, asset backed and structured credit agreements, lease agreements, other credit-related securities, originated, serviced,
and/or underwritten (as described under “INVESTMENT PROGRAM” below) by the Fund itself.
iv. With
respect to Co-Investments, provide additional detail regarding the types of underlying
investments, any relevant criteria for selecting Underlying Managers for Co-Investments,
and provide appropriate risk disclosures, as applicable.
Response: Please
see response to 3.b.iii. above.
v. If
part of the principal strategies, please disclose that the Fund intends to invest in
regulated funds (ETFs, CEFs, mutual funds, money market funds, as applicable), disclose
how such investments fit within the Fund’s principal strategies and what portion
of Fund assets will be allocated to such investments, as applicable.
4
United
States Securities and Exchange Commission
March 20, 2024
Response: Investment
in regulated funds (ETFs, CEFs, mutual funds, money market funds, as applicable) is not presently part of the Fund’s principal
strategies.
vi. Please
disclose if the Fund intends to invest, directly or indirectly, in “junk”
bonds. Please disclose if the Fund intends to invest in distressed debt and/or defaulted
securities and provide appropriate risk disclosures.
Response: The
Fund does not presently intend to invest, directly or indirectly, in “junk” bonds, distressed debt, and/or defaulted
securities.
vii. Please
disclose if the Fund intends to invest in emerging markets issuers and describe the types
of investments, e.g. Direct Investments, Co-Investments, types of underlying issuers,
etc.
Response: The
Fund does not presently intend to invest in emerging markets issuers.
viii. Please
disclose whether the Fund intends to invest through one or more wholly-owned subsidiaries
(as described in accord with the wholly-owned subsidiaries comments below), including
any REIT Subsidiaries (defined on S-10 of the SAI). Add related disclosure to the Summary
of Terms and more detailed discussion of risks later in the Registration Statement.
Response: The
Fund does not presently intend to invest through one or more wholly-owned subsidiaries, including any REIT Subsidiaries (defined on
S-10 of the SAI).
c. Other
Fees and Expenses (p. 3). Please add disclosure to this section concerning the possible
imposition of an Early Repurchase Fee, which the Fund reserves the right to institute
in the future. Provide a cross reference to the discussion of the Early Repurchase Fee
on page 59.
5
United
States Securities and Exchange Commission
March 20, 2024
Response: The
Fund has added the following disclosure:
Additionally,
the Fund reserves the right to impose, on a future date, an “Early Repurchase Fee,” pursuant to which any repurchase
of Fund Shares from a Shareholder which were held for less than one year (on a first-in, first-out basis) will be subject to a
fee equal to 2.00% of the NAV of any Shares repurchased by the Fund that were held for less than one year (as described under
“REPURCHASE AND TRANSFER OF SHARES” below).
d. Risks.
Please review the section to ensure that various risks associated with the Fund’s
principal investments are adequately reflected in the Investment Strategy section. For
example, the risks section discusses high-yield securities convertible securities, preferred
securities, joint ventures, distressed and special situations and venture investments,
etc. that are not mentioned in the strategy section. Conversely, various types of investments
are described in the strategy section without providing specific risk disclosures related
to such instruments.
Response: The
Fund has reviewed the section and believes that the various risks associated with the Fund’s principal investments are
adequately reflected in the Investment Strategy section.
4. Summary
of Fees and Expenses
a. Please
confirm the Fund will include any interest expense related to Fund borrowing in the fee
table as required by General Instruction 8 to Item 3 of Form N-2.
Response: To
the extent applicable, the Fund will include any interest expense related to Fund borrowing in the fee table as required by General
Instruction 8 to Item 3 of Form N-2.
b. Please
add disclosure to fee table footnote three providing the expiration date of the current
Fee Waiver agreement.
6
United
States Securities and Exchange Commission
March 20, 2024
Response: As
part of the fund administrator transition from PPB Capital Partners, LLC to UMB Fund Services, Inc., the expense limitation and
reimbursement arrangement between the Fund and PPB Capital Partners, LLC has been terminated and all references thereto have been
removed.
c. Please
confirm whether the fees waived by the Fund and Fund Administrator will be subject to
recoupment. If so, please disclose the terms of recoupment and ensure the recoupment
period is limited to three years from the date of the waiver/reimbursement. Please also
disclose that any recoupments would be limited to the lesser of (1) the expense limitation
in effect at the time of waiver, and (2) the expense limitation in effect at the time
of recapture.
Response: Please
see response to 4.b. above.
d. Please
confirm whether any of the Corporate Subsidiaries or REIT Subsidiaries will be charging
a management fee. If so, please confirm in correspondence that the subsidiary’s
management fee (including any p