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ROPES & GRAY LLP PRUDENTIAL TOWER 800 BOYLSTON STREET BOSTON, MA 02199-3600 WWW.ROPESGRAY.COM |
July 18, 2019 |
Sarah Clinton T +1 617 951 7375 sarah.clinton@ropesgray.com |
VIA EDGAR
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Attn: Jay Williamson and Lauren Hamilton
Re: | Blackstone Alternative Alpha Fund (BAAF) (File Nos. 811-22634 and 333-231842) and Blackstone Alternative Alpha Fund II (BAAF II) (File Nos. 811-22792 and 333-231843) (each, a Fund, and collectively, the Funds) |
Ladies and Gentlemen:
On July 1, 2019, Mr. Jay Williamson (the Staff Reviewer) of the staff (the Staff) of the Securities and Exchange Commission (the SEC) provided oral comments to Sarah Clinton and Shirin Baradaran of Ropes & Gray LLP, the Funds counsel, in connection with the Staffs review of (i) BAAFs Registration Statement under the Securities Act of 1933, as amended (the Securities Act), and Amendment No. 16 under the Investment Company Act of 1940, as amended (the 1940 Act), on Form N-2, filed on May 31, 2019; and (ii) BAAF IIs Registration Statement under the Securities Act and Amendment No. 12 under the 1940 Act on Form N-2, filed on May 31, 2019.
The Staff Reviewer requested that the Funds responses be provided in writing via EDGAR correspondence. Accordingly, the Staffs comments, together with the Funds responses thereto, are set forth below. Each of the comments and responses apply to each of BAAF and BAAF II, unless otherwise indicated.
Accounting Comments
1. | Comment: Please incorporate by reference each Funds audited financial statements, specify the name of the Funds independent registered public accounting firm, and file the consents of the Funds independent registered public accounting firm. |
Response: The requested changes have been made. In the amendment to each Funds registration statement, each Fund has incorporated by reference its audited financial statements, specified the name of its independent registered public accounting firm, and filed the consents of the independent registered public accounting firm.
July 18, 2019
General Comments
2. | Comment: The Staff notes that the disclosure for each Fund describing the risks associated with the master/feeder structure includes a statement that the Funds ability to maintain a stable net asset value and meet redemption requests is dependent on the Master Funds continued ability to do the same. Given the nature of each Funds investments and strategies, please revise the disclosure to replace the phrase stable net asset value. |
Response: The requested change has been made. Each Fund has revised the referenced disclosure as follows: The Funds ability to achieve its investment objective and meet redemption requests is dependent on the Master Funds continued ability to do the same.
3. | Comment: The Staff notes that BAAFs Class I Shares will be subject to a front-end sales load of 3.00% and an asset based distribution and service fee of 0.85%. Please supplementally confirm that the current fee structure of BAAFs Class I Shares is in compliance with the conditions of the multi-class exemptive order granted by the SEC on December 26, 2012. Order, Rel. No. IC-30317 (Dec. 26, 2012) (the Order). |
Response: BAAF currently offers a single class of shares, Class I Shares. As such, BAAF is not currently relying on the Order, which would permit the Fund to offer multiple classes of shares. BAAF notes that the fee structure of its Class I Shares remains as described in the application for the Order. See Notice, Rel. No. IC-30280, para. 4 (Nov. 26, 2012); Amendment No. 1 to the Application, File No. 812-14026, Section II.B. (Sept. 19, 2012). BAAF further notes that it has determined not to register additional share classes at this time and it has removed references to the additional share classes from the Registration Statement. BAAF confirms, however, that if it were to register one or more additional share classes in the future, it would expect to comply with the conditions of the Order once it began to issue shares from multiple share classes.
4. | Comment: Please relocate the GDPR Privacy Statement to a location further towards the back of each Funds prospectus or explain why the privacy statements current location is appropriate. |
Response: The requested change has been made. Each Fund has moved the GDPR Privacy Statement to the General Information section in the back of its prospectus.
5. | Comment: The Staff notes that the disclosure included in Appendix A to BAAFs prospectus entitled Financial Intermediary Specific Sales Load Waiver Information states, So long as the Fund issues only Class I Shares, Selling Agents may reduce or waive the sales load in their sole discretion. Once the Fund issues Shares from an additional share class (i.e., Class II, Advisor Class III, Advisor Class IV, or Advisor Class V Shares), the variations in sales load reductions and waivers described below will apply. Please supplementally explain the purpose of this disclosure. |
July 18, 2019
Response: BAAF currently offers a single class of shares, Class I Shares. As such, BAAF is not currently relying on the Order. If BAAF were to begin to issue shares from additional share classes in the future, it would do so in compliance with the Order, which would require it to comply with the provisions of Rule 22d-1 under the 1940 Act, among other rules, as if that rule applied to closed-end management investment companies. Rule 22d-1 permits a fund to offer variations in, or elimination of, the sales load for a particular class of investors so long as each variation is disclosed in the registration statement and is applied uniformly to all offerees in the class. In considering the registration of additional share classes, BAAF created Appendix A to disclose such variations. Until BAAF begins to issue shares from multiple share classes, however, it does not intend to rely on the Order and Selling Agents for the Fund may reduce or waive the sales load for Class I Shares at their discretion. The referenced disclosure was intended to explain to investors the circumstances under which the variations described in the Appendix would apply. In light of the fact that BAAF has determined not to register additional share classes at this time, BAAF has removed Appendix A from the Registration Statement.
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If you have any questions or require any clarification concerning the foregoing, please call me at 617-951-7375.
Sincerely, |
/s/ Sarah Clinton |
Sarah Clinton |
cc: | Kevin Michel, Blackstone Alternative Asset Management L.P. |
James E. Thomas, Ropes & Gray LLP