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EBSA Notices

Grant of Individual Exemption Involving Renaissance Technologies, LLC (Renaissance, or the Applicant) Located in New York, NY   [4/20/2012]
[PDF]
Federal Register, Volume 77 Issue 77 (Friday, April 20, 2012)
[Federal Register Volume 77, Number 77 (Friday, April 20, 2012)]
[Notices]
[Pages 23756-23764]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-9496]


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DEPARTMENT OF LABOR

Employee Benefits Security Administration

[Prohibited Transaction Exemption 2012-10; Exemption Application No. D-
11655]


Grant of Individual Exemption Involving Renaissance Technologies, 
LLC (Renaissance, or the Applicant) Located in New York, NY

AGENCY: Employee Benefits Security Administration, U.S. Department of 
Labor.

ACTION: Grant of individual exemption.

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SUMMARY: This document contains an individual exemption from certain 
prohibited transaction restrictions of the Employee Retirement Income 
Security Act of 1974, as amended (ERISA or the Act) and the Internal 
Revenue Code of 1986, as amended (the Code). The transactions involve 
Renaissance and certain of Renaissance's privately offered collective 
investment vehicles managed by Renaissance, comprised almost 
exclusively of proprietary funds. The individual exemption affects the 
individual retirement accounts beneficially owned by Renaissance's 
employees, certain of Renaissance's owners, and the spouses of such 
employees and owners.

DATES: Effective Date: The individual exemption is effective as of 
January 1, 2012.

FOR FURTHER INFORMATION CONTACT: Warren Blinder of the Department, 
telephone (202) 693-8553. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: On January 20, 2012, the Department of Labor 
(the Department) published a notice of proposed individual exemption in 
the Federal Register at 77 FR 3038 from the restrictions of section 
406(a)(1)(A) and (D) of the Act and the sanctions resulting from the 
application of section 4975 of the Code, by reason

[[Page 23757]]

of section 4975(c)(1)(A) and (D) of the Code.\1\ The proposed exemption 
was requested by Renaissance pursuant to section 408(a) of the Act and 
section 4975(c)(2) of the Code, and in accordance with the procedures 
set forth in 29 CFR Part 2570, Subpart B (76 FR 66637, October 27, 
2011). Effective December 31, 1978, section 102 of the Reorganization 
Plan No. 4 of 1978, (5 USC App. 1 (1996)) transferred the authority of 
the Secretary of the Treasury to issue exemptions of the type requested 
to the Secretary of Labor. Accordingly, this final individual exemption 
is being issued solely by the Department.
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    \1\ For purposes of this exemption, references to the provisions 
of Title I of the Act, unless otherwise specified, refer also to the 
corresponding provisions of the Code.
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Written Comments

    The Department invited all interested persons to submit written 
comments with respect to the proposed exemption on or before February 
24, 2012. During the comment period, the Department received no 
comments or inquiries from Participants. However, the Department 
received a written comment from the Applicant, which supported the 
exemption and requested certain modifications and/or clarifications to 
the General Conditions and the Definitions sections of the proposed 
exemption and to the Summary of Facts and Representations (the Summary) 
of the proposed exemption.
    Following is a discussion of the Applicant's comments, including 
the responses made by the Department to address the issues raised 
therein. Any capitalized terms herein not otherwise defined have the 
meanings ascribed to them in the Summary.

A. Clarifications Concerning Certain Conditions of Relief

    The Applicant requested modifications and/or corrections to certain 
General Conditions of the proposed exemption relating to: (1) The 
descriptions of the investor restrictions for individuals investing in 
the New Medallion Funds; (2) New Kaleidoscope's redemption policy; (3) 
the description of the valuation policy for the Funds' investment 
holdings; (4) the operation of a Participant's Investment Allocation; 
(5) the disclosures required to be given by Renaissance to Participants 
in connection with their investment in the New Medallion Vehicles; and 
(6) the legal, jurisdictional, venue, and service requirements 
attributable to Renaissance in connection with a Participant's 
investment in the New Medallion Vehicles.
    1. Descriptions of Investor Restrictions. Section III(c) of the 
proposed exemption provides that ``[a]n interest in a New Medallion 
Vehicle is only available to IRA Holders who satisfy the securities 
law-based investor qualifications applicable to all investors in such 
New Medallion Vehicle.'' However, in its comment, the Applicant 
suggested a modification of Section III(c) to clarify that some 
relevant investor restrictions come from other sources, such as the 
Commodity Futures Trading Act, in order to be more precise. Therefore, 
the Applicant suggests that the phrase ``and other regulatory'' should 
be inserted after ``securities law.'' In addition, the Applicant 
suggests a corresponding change to the last sentence of Representation 
61 of the Summary, in order to reflect the foregoing modification made 
to Section III(c) of the proposed exemption.
    The Department has revised Section III(c) of the final exemption to 
reflect the Applicant's suggested revision, to read as follows: ``An 
interest in a New Medallion Vehicle is only available to IRA Holders 
who satisfy the securities law and other regulatory-based investor 
qualifications applicable to all investors in such New Medallion 
Vehicle.'' Furthermore, the Department takes note of the Applicant's 
suggested corresponding change to Representation 61 of the Summary.
    2. Redemption Policy for New Kaleidoscope. Section III(f) of the 
proposed exemption provides that, ``[a]n IRA's interest in a New 
Medallion Vehicle is redeemable, in whole or in part, without the 
payment of any redemption fee or penalty, no less frequently than on a 
quarterly basis upon no less than 10 days advance written notice.'' 
However, the Applicant notes that such condition, as written, does not 
reflect the actual operation of New Kaleidoscope, which requires 45 
days' notice. Therefore, the Applicant's comment requested that the 
following phrase be appended to the end of the sentence: ``Except in 
the case of New Kaleidoscope, where 45 days' notice is required.'' In 
addition, the Applicant's comment suggested a corresponding change to 
Representation 76(f) in order to conform the Summary to the foregoing 
modification made to Section III(f) of the proposed exemption.
    The Department has modified Section III(f) of the final exemption 
to reflect the Applicant's suggested revision, to read as follows: ``An 
IRA's interest in a New Medallion Vehicle is redeemable, in whole or in 
part, without the payment of any redemption fee or penalty, no less 
frequently than on a quarterly basis upon no less than 10 days advance 
written notice, except in the case of New Kaleidoscope, for which 45 
days' notice is required.'' Furthermore, the Department takes note of 
the Applicant's suggested corresponding modification to Representation 
76(f) of the Summary.
    3. Funds' Valuation Policy. Section III(g) of the proposed 
exemption provides that ``[a]n acquisition or redemption of an IRA's 
interest in a New Medallion Vehicle is made for fair market value,'' 
and Subparagraphs (1) through (4) of Section III(g) further describe 
how fair market value is to be determined for each of equity 
securities, fixed-income securities, options, and investments for which 
current market quotations are not readily available, respectively. In 
its comment, the Applicant requested modifications to Section III(g) 
relating to the determination of ``fair market value'' for equity 
securities and fixed-income securities.
    The Applicant states that, with respect to equity securities, there 
was a change to the Applicant's valuation policy that occurred in June 
2011 that corrected a flaw for the valuation of illiquid equity 
securities. According to the Applicant, although Renaissance seldom 
holds illiquid equity securities for the Medallion Funds, immediately 
prior to making this change, a few securities became illiquid, and did 
not generate any bids or offers on days when valuations were needed; so 
that the methodology described in Section III(g) of the proposed 
exemption was difficult to apply.\2\
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    \2\ The Applicant notes that a security may become illiquid, for 
example, if trading in it is suspended.
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    The Applicant states that the valuation policy described in Section 
III(g) of the proposed exemption contemplates the potential need to 
value an illiquid security, and provides for the use of the last bid or 
ask price for the security on the day of the valuation. However, the 
Applicant notes that the standard is flawed in that it does not work if 
there is no bid or ask on the valuation date. The Applicant represents 
that, after Renaissance encountered this flaw in 2011, it adopted a 
policy of using the last price at which the security traded, discounted 
depending on the time between the trade date and the valuation date.\3\
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    \3\ The Applicant states that Renaissance solicited the opinion 
of two major independent audit firms, which advised that this was an 
appropriate solution to the issue.
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    Accordingly, the Applicant's comment suggested that Section 
III(g)(1) pertaining to equity securities, should

[[Page 23758]]

be modified as follows in order to describe Renaissance's current 
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valuation policy more accurately:

    Equity securities are valued at their last reported sale price 
or official closing price on the market on which such securities 
primarily trade using sources independent of Renaissance and the 
issuer. If no sale of such equity security was reported on that 
date, the market value will be the last reported sale price on the 
most recent date for which a price is available, and will reflect a 
discount if such date occurred more than 30 days before.

    According to the Applicant, since Renaissance generally does not 
invest in illiquid securities, the modification of the valuation policy 
for illiquid equity securities is, as a practical matter, a de minimis 
change with an immaterial effect on the operation of Medallion and the 
valuation of any of its investments.\4\ The Applicant notes that the 
change to the valuation policy simply solves a minor problem that had 
come to light through actual experience. Furthermore, the Applicant 
maintains that the change is wholly to the benefit of investors, since 
it provides a methodology which can always be applied to illiquid 
equity securities. Since bid and ask prices are generally not available 
for these securities, they could not have been valued at all but for 
this change in policy.
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    \4\ The Applicant represents that, on a monthly basis, from the 
implementation of the above policy in June 2011 through the end of 
2011, illiquid securities in the Medallion Funds, at the most, 
represented less than 8/100ths of one percent of the number of 
positions (December) and slightly over 5/100ths of one percent of 
the value of the portfolio (June).
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    The Applicant represents that the language describing the valuation 
of fixed income securities in Section III(g)(2) of the proposed 
exemption is a more general description of the valuation policy, and 
its comment suggested changes that are intended to clarify certain 
aspects concerning the determination of the prices of such securities. 
The Applicant notes that this suggested modification does not reflect a 
change in the substance of this policy.
    The Applicant explains that Renaissance's valuation policy that is 
applicable to fixed income securities has been in effect since August 
2008. According to the Applicant, this policy provides more specificity 
concerning the determination of ``bid'' prices in various circumstances 
than that which the proposed exemption describes. In this regard, the 
Applicant notes that the valuation policy prioritizes the use of 
independent pricing services, where possible, as distinguished from the 
use of independent providers. The Applicant maintains that its 
suggested modification is intended to illuminate this prioritization. 
Accordingly, in order to clarify the prioritization of the sources of 
bid prices and avoid creating the impression that there is no 
prioritization between the use of independent pricing services and 
providers, the Applicant suggests a clarifying modification to Section 
III(g)(2), as follows:

    Fixed income securities are valued at the ``bid'' price of such 
securities at the close of business on the relevant valuation date. 
These prices are determined (i) where available, on the basis of 
prices provided by independent pricing services that determine 
valuations based on market transactions for comparable securities; 
and (ii) if independent pricing services are not available, on the 
basis of quotes obtained from multiple independent providers that 
are either U.S.-registered or foreign broker-dealers, which are 
registered and subject to the laws of their respective jurisdiction, 
or banks.

    The Applicant states that this suggested modification is a 
clarification of methodology but not a change from the valuation policy 
as described in the proposed exemption, i.e., fixed income securities 
are valued on the basis of their bid prices where possible.\5\ The 
Applicant explains that the use of ``bids'' in pricing fixed income 
instruments is the relevant point being made in its description of how 
fixed income securities are valued and that the methodology by which 
those bids are determined is secondary. Further, the Applicant asserts 
that these changes would make the description of the valuation policy 
clearer.
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    \5\ The Applicant notes that, in the context of fixed income 
securities, a ``firm quote'' or the ``price'' of a security given by 
a dealer or pricing service is equivalent to the ``bid price'' of 
such security.
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    In addition, the Applicant's comment suggested an additional, 
corresponding change to Representation 67 in the Summary, in order to 
conform the Summary to the foregoing modifications made to Section 
III(g) of the proposed exemption.
    The Department has modified the final exemption to reflect the 
Applicant's suggested revisions to Section III(g)(1) and (2), to read 
as described above. Furthermore, the Department takes note of the 
Applicant's suggested corresponding changes to Representation 67 of the 
Summary.
    4. Participant's Investment Allocation. Section III(i) of the 
proposed exemption provides that ``[i]n the event that a redemption of 
any portion of an IRA Holder's interest in any of the Medallion Funds 
becomes necessary as the result of a reduction of the Investment 
Allocation applicable to an IRA Holder, then, at such IRA Holder's 
election, a redemption is first made of the IRA Holder's taxable 
investments (if any) prior to his or her IRA's interest in a New 
Medallion Vehicle.'' The Applicant's comment requested a change to 
Section III(i) in order to clarify that only Participants (i.e., 
employees and certain former employees who remain owners of 
Renaissance) have Investment Allocations, which can be shared with 
their spouses. In this regard, the Applicant's comment suggested that 
Section III(i) should read as follows:

    In the event that a redemption of any portion of an interest in 
a New Medallion Vehicle held by an IRA becomes necessary as the 
result of a reduction of the Investment Allocation applicable to a 
Participant, then, at an IRA Holder's election, a redemption may 
first be made of the IRA Holder's taxable investments (if any) prior 
to his or her IRA's interest in a New Medallion Vehicle.

    The Department has modified the final exemption to reflect the 
Applicant's suggested revision, to read as described above.
    5. Participant Disclosures. Section III(l) of the proposed 
exemption provides that, in advance of the initial investment by an IRA 
in a New Medallion Vehicle, IRA Holders will generally receive (1) a 
copy of the proposed exemption and the final exemption, (2) a private 
offering memorandum (and the same disclosures and information provided 
to other investors in such Funds), and (3) all reasonably available 
relevant information as such IRA Holder may request. In its comment, 
the Applicant explained that it is concerned about the operation of 
subparagraph (3) of Section III(l), as it could be read to require 
Renaissance to solicit requests for additional information from IRA 
Holders, and to distribute such information with the materials 
described in subparagraphs (1) and (2) of Section III(l). Therefore, 
the Applicant's comment requested that subparagraph (3) of Section 
III(l) should be revised to read as follows:

    Following receipt of the information in (1) and (2), an IRA 
Holder will receive all reasonably available relevant information as 
such IRA Holder may request.

    The Department has modified the final exemption to reflect the 
Applicant's suggested revision to Section III(l)(3) of the proposed 
exemption, to read as described above.
    6. Legal and Other Requirements. Section III(n) of the proposed 
exemption provides that Renaissance, the New Medallion Vehicles, and 
each Fund or

[[Page 23759]]

vehicle in which, or through which, a New Medallion Vehicle invests, 
will agree to certain legal, jurisdictional, service of process, and 
venue requirements. The Applicant's comment suggested that the language 
of Section III(n) of the proposed exemption should be modified in order 
to reflect requested modifications to the definitions of the New 
Medallion Vehicles in Sections IV(j) through (m) of the proposed 
exemption.
    Furthermore, the Applicant notes that the definition of ``Funds'' 
in Section IV(d) includes the existing collective investment vehicles 
managed by Renaissance, but not the New Medallion Vehicles or New RIEF/
RIFF. The Applicant explains that two of the New Medallion Vehicles, 
New Medallion FF and New Medallion FF RMPRF, will invest in the 
Medallion Master Funds, and the other, New Kaleidoscope, will invest in 
New Medallion FF RMPRF, and New RIEF/RIFF. Accordingly, the Applicant 
suggests that the consent described in Section III(n) of the proposed 
exemption should be given by those Funds managed by Renaissance in 
which IRAs may invest, directly or indirectly, under the proposed 
exemption. Thus, to avoid obtaining consents from collective investment 
vehicles managed by Renaissance that are not involved in the covered 
transactions, the Applicant suggests that the introductory language of 
Section III(n) should be revised to read as follows:

    Prior to the acquisition by an IRA of an interest in a New 
Medallion Vehicle or each Medallion Master Fund, another New 
Medallion Vehicle, or New RIEF/RIFF in which, or through which, a 
New Medallion Vehicle invests, Renaissance or the applicable New 
Medallion Vehicle manager (the New Medallion Vehicle Manager), with 
respect to any such acquisition by an IRA * * *.

    In addition, the Applicant's comment suggested additional, 
corresponding changes to the last sentence of Representation 75 and 
Representation 76(m) of the Summary, in order to conform the Summary to 
the foregoing modification made to Section III(n) of the proposed 
exemption.
    The Department has revised the final exemption to reflect the 
Applicant's suggested revisions to Section III(n) of the proposed 
exemption. The Department also notes the suggested corresponding change 
to Representation 75 of the Summary.

B. Clarifications Relating to Certain Definitions in the Proposed 
Exemption

    The Applicant's requested clarifications and/or corrections to the 
Definitions section of the proposed exemption related to: (1) An update 
in the number of Funds managed by Renaissance; (2) the description of 
the Participants' Investment Allocation; (3) an update to the 
definition of ``Kaleidoscope Fund'' to conform to its offering 
documents; (4) an update to the definitions of the ``New Medallion 
Vehicles'' to conform to their offering documents and the addition of a 
defined term for another new Medallion investment vehicle; (5) the 
inclusion of any current employee of Renaissance in the definition of 
``Participant;'' (6) the inclusion of an additional individual in the 
definition of ``Permitted Owners;'' and (7) the composition of the 
Renaissance Valuation Committee.
    1. Funds' Update. Section IV(d) of the proposed exemption provides 
that the term ``Fund'' or ``Funds'' means, ``* * * the nine privately 
offered U.S. and non-U.S. collective investment vehicles managed by 
Renaissance * * * and the five privately offered U.S. and non-U.S. 
collective investment vehicles * * *.'' The Applicant's comment stated 
that Renaissance currently manages six, not five, non-Proprietary 
Funds, and further requested that the definition of ``Fund'' or 
``Funds'' should be modified to reflect such change.
    The Department notes the Applicant's suggested revision to Section 
IV(d) of the proposed exemption and has modified the final exemption to 
read as follows:

    The term ``Fund'' or ``Funds'' means, individually or 
collectively, the nine privately offered U.S. and non-U.S. 
collective investment vehicles managed by Renaissance, comprised 
almost exclusively of assets of Renaissance and its owners and 
employees (the Proprietary Funds) and the six privately offered U.S. 
and non-U.S. collective investment vehicles, consisting primarily of 
assets of clients of Renaissance (the non-Proprietary Funds).

Furthermore, the Department notes a corresponding change to 
Representation 3 of the Summary, wherein the Applicant represented that 
Renaissance is the investment manager of fourteen privately offered 
U.S. and non-U.S. collective investment vehicles, comprised of 9 
Proprietary Funds and 5 non-Proprietary Funds.
    2. Participant's Investment Allocation Description. Section IV(e) 
of the proposed exemption provides that the term ``Investment 
Allocation'' means ``the permitted investment allocation in the 
Medallion Funds applicable to a Renaissance employee, which such 
employee and his or her Spouse may utilize to make investments in a 
Medallion FF or Kaleidoscope, or in an applicable New Medallion Vehicle 
investing in such Funds, subject to each such employee's overall 
Investment Allocation limit.'' The Applicant's comment stated that the 
definition of Investment Allocation is not clear, and suggested that 
the definition of ``Investment Allocation'' should be revised to read 
as follows:

    The term ``Investment Allocation'' means the permitted 
investment allocation limit in the Medallion Funds applicable to a 
Renaissance employee, which such employee and his or her Spouse may 
utilize to make investments in a Medallion FF or Kaleidoscope, or in 
an applicable New Medallion Vehicle.

    In addition, the Applicant's comment suggested a corresponding 
change to Representations 63 and 64 of the Summary in order to conform 
the Summary to the foregoing modification made to Section IV(e) of the 
proposed exemption.
    The Department has modified the final exemption as described above, 
to reflect the Applicant's suggested revisions to Section IV(e) of the 
proposed exemption. In addition, the Department notes the suggested 
corresponding change to Representation 64 of the Summary.
    3. Kaleidoscope Fund Update. Section IV(h) of the proposed 
exemption provides that the term ``Kaleidoscope'' means ``Kaleidoscope 
Fund LLC, a Delaware limited liability company established by 
Renaissance to facilitate the investment by certain employees of 
Renaissance in the other Proprietary Funds.'' The Applicant's comment 
suggested that the definition of ``Kaleidoscope'' in Section IV(h) 
should be revised as follows, to describe more accurately the name of 
the Fund and the eligible employees for whom such Fund is established:

    The term ``Kaleidoscope'' means Renaissance Kaleidoscope Fund 
LLC, a Delaware limited liability company established by Renaissance 
to facilitate the investment by employees of Renaissance who are not 
Accredited Investors under the Securities Act of 1933, as amended 
(the 1933 Act) or otherwise do not meet the financial requirements 
in the other Proprietary Funds.

    In addition, the Applicant suggests a corresponding change to 
Representation 14 in the Summary in order to conform the Summary to the 
foregoing modification made to Section IV(h) of the proposed exemption.
    The Department has modified the final exemption as described above 
to reflect the Applicant's suggested revisions to Section IV(h) of the 
proposed exemption. In addition, the Department notes the suggested 
corresponding change to Representation 14 of the Summary.

[[Page 23760]]

    4. New Medallion Vehicles Update. Sections IV(j), (k), and (m) of 
the proposed exemption provide definitions of the terms ``New Medallion 
Vehicle,'' ``New Kaleidoscope,'' and ``New Medallion FF.'' The 
Applicant's comment suggests modifications to these definitions, in 
order to conform the definitions of the New Medallion Vehicles more 
closely to their respective offering documents, and to more fully 
describe their characteristics, including the eligible employees for 
whom such Funds are established.
    Moreover, the Applicant explains that the New Medallion Conduit 
(New Medallion FF RMPRF), defined in Section IV(l) of the proposed 
exemption, is designed to permit IRA Holders who do not meet the 
eligibility requirements of New Medallion FF to invest in the Medallion 
Master Funds, and thus will accept investment by IRA Holders in 
addition to investment by New Kaleidoscope. The Applicant explains that 
New Medallion FF RMPRF is organized under section 3(c)(1) of the 1940 
Act and has a 100 investor limit thereunder, and New Kaleidoscope will 
itself be an Accredited Investor for purposes of investing in New 
Medallion FF RMPRF. Therefore, the Applicant suggests that the 
definition of ``New Medallion Conduit'' in Section IV(l) of the 
proposed exemption be stricken and replaced with the definition of 
``New Medallion FF RMPRF,'' which more accurately describes such Fund.
    Accordingly, the Applicant suggests that Sections IV(j), (k), (l), 
and (m) of should be revised, respectively, to read as follows:

    The term ``New Medallion Vehicle'' or ``New Medallion Vehicles'' 
means, individually or collectively, New Medallion FF, New Medallion 
FF RMPRF, and New Kaleidoscope.
    The term ``New Kaleidoscope'' means Renaissance Kaleidoscope RF 
Fund LLC, the Delaware limited liability company established by 
Renaissance in order to facilitate an investment by IRA Holders who 
are not ``Accredited Investors'' under the 1933 Act in New Medallion 
FF RMPRF and New RIEF/RIFF, through their IRAs.
    The term ``New Medallion FF'' means Medallion Fund RF LP, the 
Bermuda Limited Partnership that is treated as a corporation for US 
Federal Income Tax purposes, established by Renaissance in order to 
facilitate an investment by an IRA Holder who is a ``Qualified 
Purchaser'' or ``Knowledgeable Employee'' under the Investment 
Company Act of 1940, as amended (the 1940 Act) in the Medallion 
Master Funds, through his or her IRA.
    The term ``New Medallion FF RMPRF'' means Medallion RMPRF Fund 
LP, the Bermuda Limited Partnership that is treated as a corporation 
for US Federal Income Tax purposes established by Renaissance in 
order to facilitate the investment by IRA Holders who are neither 
Qualified Purchasers nor ``Knowledgeable Employees'' as defined in 
the 1940 Act, but who are Accredited Investors, in the Medallion 
Master Funds, through their IRAs.

    In addition, in order to more fully describe New Kaleidoscope, and 
to provide additional context for its investments, the Applicant in its 
comment letter suggests the addition of a definition for ``New RIEF/
RIFF.'' Accordingly, the Applicant suggests that new Section IV(n) be 
added to the proposed exemption as follows:

    The term ``New RIEF/RIFF'' means a newly organized series of 
RIEF RMP LLC and a newly created Bermuda limited partnership to be 
known as RIFF RF Fund LP, respectively, each of which has been 
established to facilitate investments of IRAs in RIEF RMP LLC and 
RIFF RMP LLC.

    Finally, the Applicant suggests that Sections IV(n)-(q) of the 
proposed exemption should be re-designated in the final exemption as 
Sections IV(o)-(r), to accommodate the addition of the definition of 
``New RIEF/RIFF.''
    The Department has modified Sections IV(j), (k), (l), and (m), and 
added new Section IV(n) in the final exemption, as described above, to 
reflect the Applicant's suggested revisions. Furthermore, Sections 
IV(n)-(q) of the proposed exemption have been re-designated in the 
final exemption as Sections IV(o)-(r).
    5. Participant Update. Section IV(n) of the proposed exemption 
defines the term ``Participant,'' as ``a former participant in the 
Renaissance Technologies, LLC 401(k) Plan (the 401(k) Plan) who 
received a distribution of their entire account balance in the 401(k) 
Plan prior to December 31, 2010 as a result of the termination of such 
plan, and is either an employee or a Permitted Owner of Renaissance at 
the time of such individual's investment in the New Medallion 
Vehicles.'' However, the Applicant's comment requested that the 
definition of ``Participant'' be expanded to cover all employees of 
Renaissance, not just those who received Proceeds prior to December 31, 
2010.
    The Applicant explains that, since the termination of the 401(k) 
Plan, several new employees who were not participants in that plan have 
joined (and left) Renaissance, through the normal process of employee 
turnover. As a result, according to the Applicant, the definition of 
``Participant'' provided in the proposed exemption would cause 
Renaissance to have ``two classes'' of employees--those who have the 
opportunity to make IRA investments in New Vehicles and those who do 
not, a result that the Applicant desires to avoid. The Applicant 
represents that it does not foresee any substantive changes in the size 
or educational characteristics of its employee group, as a result of 
the normal employee turnover process.
    Accordingly, the Applicant requested that the definition of 
Participant be revised to read as follows:

    The term ``Participant'' means a person who is either an 
employee or a Permitted Owner of Renaissance at the time of such 
individual's investment in the New Medallion Vehicles.

    The Department has modified the final exemption as described above 
in order to reflect the Applicant's suggested revisions to Section 
IV(n) of the proposed exemption and has re-lettered Section IV(n) as 
Section IV(o).
    6. Permitted Owners Update. Section IV(o) of the proposed exemption 
defines the term ``Permitted Owner'' to mean ``the seven individuals 
permitted to invest in the Medallion Funds following the termination of 
their Renaissance employment, comprised of three Renaissance 
``founders,'' and four former employees who are owners of 
Renaissance.'' The Applicant's comment explained that, although 
Renaissance had previously indicated that there are seven persons 
constituting ``Permitted Owners,'' in reality there are eight such 
individuals. Therefore, the Applicant's comment suggested that the 
definition of ``Permitted Owner'' be revised to read as follows:

    The term ``Permitted Owners'' means the eight individuals 
permitted to invest in the Medallion Funds following the termination 
of their Renaissance employment, comprised of three Renaissance 
``founders'' each of whom is a current owner of Renaissance and one 
of whom is a current employee, and five former employees who are 
current owners of Renaissance.

    In addition, the Applicant suggests an additional, corresponding 
change to Footnote 41 in the Summary, in order to conform the Summary 
to the foregoing modification made to Section IV(o) of the proposed 
exemption.
    The Department has modified the final exemption as described above 
to reflect the Applicant's suggested revisions to Section IV(o) of the 
proposed exemption and has re-lettered Section IV(o) as Section IV(p). 
In addition, the Department notes the Applicant's suggested 
corresponding revision to Footnote 41 in the Summary.
    7. Renaissance Valuation Committee Update. Section IV(p) of the 
proposed exemption provides that the term ``Renaissance Valuation 
Committee,'' or ``RVC'' means ``the committee,

[[Page 23761]]

established by Renaissance in 2008, that oversees and monitors the 
valuation process, and establishes the methods of, and procedures for, 
valuing various instruments traded by Renaissance (e.g., the 
Proprietary Funds), composed of high-level Renaissance employees who 
also are Fund investors.'' The Applicant's comment suggested certain 
modifications to Section IV(p) in order to more accurately describe the 
RVC.
    In this regard, the Applicant requests that the parenthetical 
``(e.g., the Proprietary Funds)'' be deleted, because, as the Applicant 
explains, a Proprietary Fund is not an instrument that is traded by 
Renaissance. Furthermore, the Applicant suggests that the word ``are'' 
before ``Fund investors'' at the end of the definition should be 
changed to ``may be,'' because, as the Applicant explains, 
classification as a Fund investor is not a requirement for membership 
in the RVC. Thus, Section IV(p) would read as follows:

    The term ``Renaissance Valuation Committee,'' or ``RVC,'' means 
the committee, established by Renaissance in 2008, that oversees and 
monitors the valuation process, and establishes the methods of, and 
procedures for, valuing various instruments traded by Renaissance, 
composed of high-level Renaissance employees who also may be Fund 
investors.

    The Department has modified Section IV(p) of the proposed exemption 
to read as described above, to reflect the Applicant's suggested 
revision. Furthermore, Section IV(p) has been re-designated as Section 
IV(q) in the final exemption.

C. Clarifications and/or Corrections of Representations Made in the 
Summary

    The Applicant's requested modifications to the Summary generally 
relate to: (1) The description of Renaissance and the Funds; (2) the 
description of the Medallion Funds master/feeder structure; (3) 
Renaissance's ownership and investment structure; (4) the timing of the 
termination of the 401(k) Plan; (5) the avoidance of a performance 
guarantee implication; (6) the suggested modifications to Sections III 
and IV of the proposed exemption, relating to the descriptions of the 
New Medallion Vehicles and investors' qualifications required to invest 
therein; and (7) the lack of investment advice or employment-related 
incentives concerning an IRA Holder's investment in the New Medallion 
Vehicles.
    1. Description of Renaissance and the Funds. The Applicant notes 
that the paragraph captioned SUMMARY that is found on page 3038 of the 
proposed exemption contains an erroneous description of the Applicant. 
In this regard, the Applicant explains that it is incorrectly referred 
to as ``Renaissance Technologies, Inc.'' rather than as ``Renaissance 
Technologies LLC.'' The Department notes this correction to the 
SUMMARY.
    2. Medallion Funds Structure. Representation 17 of the Summary 
explains that, ``Renaissance is the general partner of the Medallion 
FFs and Medallion Master Funds that are organized as limited 
partnerships, and certain of Renaissance's owners serve as directors of 
the Medallion FFs and Medallion Master Funds that are organized as non-
U.S. corporations.'' The Applicant notes in its comment letter that 
some of the Medallion FFs and Medallion Master Funds are organized as 
limited liability companies. Accordingly, the Applicant suggests that 
the first sentence of Representation 17 of the Summary should read as 
follows:

    Renaissance is the general partner or managing member of the 
Medallion FFs and Medallion Master Funds that are organized as 
limited partnerships or limited liability companies, respectively, 
and certain of Renaissance's owners serve as directors of the 
Medallion FFs and Medallion Master Funds that are organized as non-
U.S. corporations.

    The Department takes note of the Applicant's requested 
clarification of Representation 17.
    3. Renaissance's Ownership and Investment Structure. In 
Representation 19 of the Summary, Footnote 9 states that ``Renaissance 
directly owns 28.41% of the combined Medallion FFs, but Kaleidoscope, 
which invests directly in the Medallion FFs, is owned approximately 
94.6% by Renaissance and 5.4% by its owners, directors, and 
employees.'' The Applicant notes that Kaleidoscope invests directly in 
only one of the Medallion FFs, and suggests that, for the sake of 
accuracy, Footnote 9 of the Summary be modified, accordingly. The 
Department takes note of the Applicant's requested clarification of 
Footnote 9.
    4. Timing of 401(k) Plan Termination. In Representation 30 of the 
Summary, describing the Applicant's termination of the 401(k) Plan, the 
Applicant notes that Renaissance terminated the 401(k) Plan in October 
2010, so that Participants could receive distributions of their 
Proceeds prior to the end of that year. However, in its comment letter, 
the Applicant notes that the 401(k) Plan was actually terminated in 
December 2010, not October 2010. The Department takes note of the 
Applicant's requested clarification.
    5. Performance Guarantee Implication. In Representation 26 of the 
Summary, Footnote 13 reads, ``[a]s the New Medallion Vehicles will not 
charge fees or profit participations in the form of performance 
allocations, Renaissance anticipates that their returns to IRA 
investors will exceed the historical net returns of the existing 
Proprietary Funds.'' The Applicant, in its comment letter, suggests 
that, in order to avoid any implication of a performance guarantee, 
Footnote 13 should be modified to read as follows:

    As the New Medallion Vehicles will not charge management fees or 
profit participations in the form of performance allocations, 
Renaissance expects the returns to IRA investors in the New 
Medallion Vehicles will exceed the returns of the parallel 
Proprietary Funds for the same periods in which they invest and 
trade on a going forward basis.

    The Department takes note of the Applicant's requested modification 
of Footnote 13.
    6. New Medallion Vehicles' Descriptions/Investors' Qualifications. 
Representations 33 through 41 of the Summary describe in detail the New 
Medallion Vehicles and the IRA Holders' qualifications required to 
invest in such Funds. The Applicant, in its comment letter, suggests 
that such Representations and their accompanying footnotes should be 
modified to reflect the corresponding revisions to the definitions of 
the New Medallion Vehicles, as well as the existence of an additional 
Permitted Owner, as were requested in the comment letter. Furthermore, 
the Applicant suggests modifications to the descriptions of the New 
Medallion Vehicles and New RIEF/RIFF where they are discussed in 
Footnotes 26 and 30, in Representations 58 and 59, and in 
Representations 63 through 65, corresponding to the requested revisions 
of such terms' definitions in Section IV of the proposed exemption. The 
Department takes note of the Applicant's requested clarifications of 
Representations 33 through 41, 58, 59, and 63 through 65, and of 
Footnotes 26 and 30.
    7. Lack of Investment Advice/Employment-Related Incentives/Funds 
References. In Representation 54 of the Summary, the Applicant 
represents that ``it has not provided, nor will it at any time provide, 
investment advice concerning an IRA Holder's investment of their IRA in 
the New Medallion Vehicles or offer any financial or employment-related 
incentives to invest in the Funds.'' Furthermore, the Applicant notes 
that ``there have been no official communications with

[[Page 23762]]

Participants regarding the opportunity to invest in the Funds through 
IRAs since the termination of the 401(k) Plan * * *.''
    In its comment letter, the Applicant also states that it would be 
appropriate for the Department to clarify that the two references to 
``Funds'' in the Representation above should more appropriately refer 
to the ``New Medallion Vehicles.'' The Applicant explains that, in 
Section IV(d) of the proposed exemption, ``Funds'' is defined to 
include a total of fifteen existing collective investment vehicles 
managed by Renaissance, comprised of both Proprietary and non-
Proprietary funds. Furthermore, in Section IV(i) of the proposed 
exemption, the term ``Medallion Funds'' is defined to include a subset 
of the Funds, specifically, the Medallion FFs and Medallion Master 
Funds. The Applicant notes that the proposed exemption only addresses 
investments by IRA Holders in Medallion Funds, as that is where the 
prohibited transaction occurs. Therefore, according to the Applicant, 
it is appropriate to limit the statement in Representation 54 to the 
New Medallion Vehicles, so that it is consistent with the scope of the 
relief granted. The Department takes note of the Applicant's requested 
clarifications of Representation 54.
    After giving full consideration to the entire record, including the 
Applicant's written comment, the Department has decided to grant the 
exemption, subject to the terms and conditions, as described above. For 
further information regarding the individual exemption, interested 
persons are encouraged to obtain copies of the exemption application 
file (Application No. D-11655) that the Department maintains with 
respect to the individual exemption. The complete application file, as 
well as supplemental submissions received by the Department, is made 
available for public inspection in the Public Documents Room of the 
Employee Benefits Security Administration, Room N-1513, U.S. Department 
of Labor, 200 Constitution Ave. NW., Washington, DC 20210.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption refer to 
the proposed exemption published in the Federal Register on January 20, 
2012 at 77 FR 3038.

General Information

    The attention of interested persons is directed to the following:
    (1) The fact that a transaction is the subject of an exemption 
under section 408(a) of ERISA does not relieve a fiduciary or other 
party in interest from certain other provisions of ERISA, including any 
prohibited transaction provisions to which the exemption does not apply 
and the general fiduciary responsibility provisions of section 404 of 
ERISA, which, among other things, require a fiduciary to discharge his 
duties respecting the plan solely in the interest of the participants 
and beneficiaries of the plan and in a prudent fashion in accordance 
with section 404(a)(1)(B) of ERISA;
    (2) In accordance with section 408(a) of ERISA and/or section 
4975(c)(2) of the Code, the Department makes the following 
determinations:
    (a) The exemption is administratively feasible;
    (b) The exemption is in the interests of a Participant's or 
Spouse's IRA; and
    (c) The exemption is protective of the rights of a Participant's or 
Spouse's IRA;
    (3) The exemption is supplemental to, and not in derogation of, any 
other provisions of ERISA, including statutory or administrative 
exemptions and transitional rules. Furthermore, the fact that a 
transaction is subject to an administrative or statutory exemption is 
not dispositive of whether the transaction is in fact a prohibited 
transaction; and
    (4) The availability of this exemption is subject to the express 
condition that the material facts and representations contained in the 
application accurately describe all material terms of the transaction 
which is the subject of the exemption.
    Accordingly, the following exemption is granted under the authority 
of section 408(a) of ERISA and section 4975(c)(2) of the Code and in 
accordance with the procedures set forth in 29 CFR Part 2570, Subpart B 
(55 FR 32836, 32847, August 10, 1990).

Exemption

Section I. Covered Transactions Involving IRAS Subject to Title I and 
Title II of ERISA

    The restrictions of section 406(a)(1)(A) and (D) of the Act and the 
sanctions resulting from the application of section 4975 of the Code, 
by reason of section 4975(c)(1)(A) and (D) of the Code,\6\ shall not 
apply, effective January 1, 2012, to:
---------------------------------------------------------------------------

    \6\ For purposes of this exemption, references to the provisions 
of Title I of the Act, unless otherwise specified, refer also to the 
corresponding provisions of the Code.
---------------------------------------------------------------------------

    (a) The direct or indirect acquisition by a Participant's IRA of an 
interest in a Medallion Fund through such IRA's acquisition of an 
interest in a New Medallion Vehicle;
    (b) The acquisition of an additional interest by a Participant's 
IRA in a New Medallion Vehicle; and
    (c) The redemption of all or a portion of a Participant's IRA's 
interest in a New Medallion Vehicle.
    This exemption is subject to the general conditions set forth below 
in Section III.

Section II. Covered Transactions Involving IRAs Subject to Title II of 
ERISA Only

    The sanctions resulting from the application of section 4975 of the 
Code, by reason of section 4975(c)(1)(A) and (D) of the Code, shall not 
apply, effective January 1, 2012, to: \7\
---------------------------------------------------------------------------

    \7\ Pursuant to 29 CFR 2510.3-2(d), the Spouses' IRAs are not 
within the jurisdiction of Title I of the Act. However, there is 
jurisdiction under Title II of the Act pursuant to section 4975 of 
the Code.
---------------------------------------------------------------------------

    (a) The direct or indirect acquisition by a Spouse's IRA of an 
interest in a Medallion Fund through such IRA's acquisition of an 
interest in a New Medallion Vehicle;
    (b) The acquisition of an additional interest by a Spouse's IRA in 
a New Medallion Vehicle; and
    (c) The redemption of all or a portion of a Spouse's IRA's interest 
in a New Medallion Vehicle.
    This exemption is subject to the general conditions set forth below 
in Section III.

Section III. General Conditions

    (a) An IRA's acquisition of an interest in a New Medallion Vehicle 
is made at the specific direction of an IRA Holder.
    (b) Renaissance renders no investment advice (within the meaning of 
29 CFR 2510.3-21(c)) to IRA Holders concerning a potential acquisition 
of an interest in a New Medallion Vehicle and does not engage in 
marketing activities or offer employment-related incentives of any kind 
intended to cause IRA Holders to consider such acquisition.
    (c) An interest in a New Medallion Vehicle is only available to IRA 
Holders who satisfy the securities law and other regulatory-based 
investor qualifications applicable to all investors in such New 
Medallion Vehicle.
    (d) No commissions, sales charges, or other fees or profit 
participations in the form of performance allocations or otherwise, 
direct or indirect, are assessed against an IRA in connection with its 
acquisition and holding of an interest in a New Medallion Vehicle.
    (e) An IRA pays no more and receives no less for its particular 
interest in any of the New Medallion Vehicles than

[[Page 23763]]

they would in an arm's length transaction with an unrelated party.
    (f) An IRA's interest in a New Medallion Vehicle is redeemable, in 
whole or in part, without the payment of any redemption fee or penalty, 
no less frequently than on a quarterly basis upon no less than 10 days 
advance written notice, except in the case of New Kaleidoscope, for 
which 45 days' notice is required.
    (g) An acquisition or redemption of an IRA's interest in a New 
Medallion Vehicle is made for fair market value, determined as follows:
    (1) Equity securities are valued at their last reported sale price 
or official closing price on the market on which such securities 
primarily trade using sources independent of Renaissance and the 
issuer. If no sale of such equity security was reported on that date, 
the market value will be the last reported sale price on the most 
recent date for which a price is available, and will reflect a discount 
if such date occurred more than 30 days before.
    (2) Fixed income securities are valued at the ``bid'' price of such 
securities at the close of business on the relevant valuation date. 
These prices are determined (i) where available, on the basis of prices 
provided by independent pricing services that determine valuations 
based on market transactions for comparable securities; and (ii) if 
independent pricing services are not available, on the basis of quotes 
obtained from multiple independent providers that are either U.S.-
registered or foreign broker-dealers, which are registered and subject 
to the laws of their respective jurisdiction, or banks.
    (3) Options are valued at the mean between the current independent 
``bid'' price and the current independent ``asked'' price or, where 
such prices are not available, are valued at their fair value in 
accordance with Fair Value Pricing Practices by the Renaissance 
Valuation Committee, which utilizes a set of defined rules and an 
independent review process.
    (4) If current market quotations are not readily available for any 
investments, such investments are valued at their fair value by the 
Renaissance Valuation Committee in accordance with Fair Value Pricing 
Practices.
    (h) Redemption of an IRA's interest in a New Medallion Vehicle, in 
whole or in part, is made in cash.
    (i) In the event that a redemption of any portion of an interest in 
a New Medallion Vehicle held by an IRA becomes necessary as the result 
of a reduction of the Investment Allocation applicable to a 
Participant, then, at an IRA Holder's election, a redemption may first 
be made of such IRA Holder's taxable investments (if any) prior to his 
or her IRA's interest in a New Medallion Vehicle.
    (j) With respect to the investment by Participants in the New 
Medallion Vehicles through IRAs, Renaissance acknowledges that such 
investments may constitute investments by a ``pension plan'' within the 
meaning of section 3(2) of the Act, and the Applicant represents that, 
with respect to such investments, it will comply with all applicable 
requirements of Title I of the Act.
    (k) Renaissance does not use the fact of IRAs' investments in the 
Funds for any marketing activities or publicity materials for the 
Funds.
    (l) In advance of the initial investment by an IRA in a New 
Medallion Vehicle, the IRA Holder receives:
    (1) A copy of the proposed exemption and the final exemption, 
following the publication of the final exemption in the Federal 
Register;
    (2) A private offering memorandum (with all related exhibits) 
describing the relevant investment vehicles, including its investment 
objectives, risks, conflicts, operating expenses and redemption and 
valuation policies, and any IRA Holder whose IRA owns an interest in a 
New Medallion Vehicle receives the same disclosures and information 
provided to other investors with respect to the Fund in which he or she 
invests; and
    (3) Following receipt of the information described in (1) and (2), 
above, an IRA Holder will receive all reasonably available relevant 
information as such IRA Holder may request.
    (m) On an on-going basis, Renaissance provides each IRA Holder 
whose IRA owns an interest in a New Medallion Vehicle with the 
following information:
    (1) Unaudited performance reports at the end of each month; and
    (2) Audited annual financial statements following the end of each 
calendar year.
    (n) Prior to the acquisition by an IRA of an interest in a New 
Medallion Vehicle or each Medallion Master Fund, other New Medallion 
Vehicle, or New RIEF/RIFF in which, or through which, a New Medallion 
Vehicle invests, Renaissance or the applicable New Medallion Vehicle 
manager (the New Medallion Vehicle Manager), with respect to any such 
acquisition by an IRA:
    (1) Agrees to submit to the jurisdiction of the federal and state 
courts located in the State of New York;
    (2) Agrees to appoint an agent for service of process for the New 
Medallion Vehicle, and any other Fund described in this section, in the 
United States (the Process Agent);
    (3) Consents to service of process on the Process Agent; and
    (4) Agrees that any enforcement by an IRA Holder of his or her 
rights pursuant to this exemption will, at the option of the IRA 
Holder, occur exclusively in the United States courts.
    (o) Renaissance maintains or causes to be maintained for a period 
of six years from the date of any covered transaction such records as 
are necessary to enable the persons described in paragraph (p)(1) below 
to determine whether the conditions of this proposed exemption, if 
granted, have been met, provided that (1) a separate prohibited 
transaction will not be considered to have occurred if, due to 
circumstances beyond the control of Renaissance, the records are lost 
or destroyed prior to the end of the six-year period, and (2) no party 
in interest or disqualified person other than Renaissance shall be 
subject to a civil penalty under section 502(i) of the Act or the taxes 
imposed by section 4975(a) and (b) of the Code, if such records are not 
maintained, or are not available for examination as required by 
paragraph (p)(1) below; and
    (p)(1) Except as provided below in paragraph (p)(2), and 
notwithstanding any provisions of subsections (a)(2) and (b) of section 
504 of the Act, the records referred to above in paragraph (o) are 
unconditionally available at their customary location for examination 
during normal business hours by:
    (A) Any duly authorized employee or representative of the 
Department, the Internal Revenue Service, the Commodity Futures Trading 
Commission (CFTC), or the U.S. Securities and Exchange Commission 
(SEC), and
    (B) Any IRA Holder or any duly authorized representative or 
beneficiary of an IRA; and
    (2) None of the persons described above in paragraph (p)(1)(B) 
shall be authorized to examine trade secrets of Renaissance, or 
commercial or financial information which is privileged or 
confidential, and should Renaissance refuse to disclose information on 
the basis that such information is exempt from disclosure, Renaissance 
shall, by the close of the thirtieth (30th) day following the request, 
provide a written notice advising that person of the reasons for the 
refusal and that the Department may request such information.

[[Page 23764]]

Section IV. Definitions

    For purposes of this exemption:
    (a) The term ``Renaissance'' means Renaissance Technologies, LLC, 
and its affiliates.
    (b) An ``affiliate'' of a person includes--
    (1) Any person directly or indirectly through one or more 
intermediaries, controlling, controlled by, or under common control 
with such entity (for purposes of this paragraph, the term ``control'' 
means the power to exercise a controlling influence over the management 
or policies of a person other than an individual); and
    (2) Any officer of, director of, or partner in such person.
    (c) The term ``Fair Value Pricing Policies'' means the Official 
Pricing Policy established in good faith by the Renaissance Valuation 
Committee for valuing an instrument, which is subject to the approval 
of the Renaissance Technologies LLC Board of Directors.
    (d) The term ``Fund'' or ``Funds'' means, individually or 
collectively, the nine privately offered U.S. and non-U.S. collective 
investment vehicles managed by Renaissance, comprised almost 
exclusively of assets of Renaissance and its owners and employees (the 
Proprietary Funds) and the six privately offered U.S. and non-U.S. 
collective investment vehicles, consisting primarily of assets of 
clients of Renaissance (the non-Proprietary Funds).
    (e) The term ``Investment Allocation'' means the permitted 
investment allocation limit in the Medallion Funds applicable to a 
Renaissance employee, which such employee and his or her Spouse may 
utilize to make investments in a Medallion FF or Kaleidoscope, or in an 
applicable New Medallion Vehicle.
    (f) The term ``IRA'' means an ``individual retirement account'' as 
defined under section 408(a) of the Code or a ``Roth IRA'' as defined 
under section 408A of the Code that is beneficially owned by an IRA 
Holder.
    (g) The term ``IRA Holder'' means a Participant, or the Spouse of a 
Participant, who is eligible to invest in a New Medallion Vehicle 
through his or her IRA.
    (h) The term ``Kaleidoscope'' means Renaissance Kaleidoscope Fund 
LLC, a Delaware limited liability company established by Renaissance to 
facilitate the investment by employees of Renaissance who are not 
Accredited Investors under the Securities Act of 1933, as amended (the 
1933 Act) or otherwise do not meet the financial requirements to invest 
in the other Proprietary Funds.
    (i) The term ``Medallion Funds'' means six of the nine Proprietary 
Funds, organized in a ``master-feeder'' investment structure, comprised 
of six Medallion Fund feeder funds (Medallion FFs) engaging in their 
investment and trading activities only through certain master funds and 
their subsidiaries (the Medallion Master Funds).
    (j) The term ``New Medallion Vehicle'' or ``New Medallion 
Vehicles'' means, individually or collectively, New Medallion FF, New 
Medallion FF RMPRF, and New Kaleidoscope.
    (k) The term ``New Kaleidoscope'' means Renaissance Kaleidoscope RF 
Fund LLC, the Delaware limited liability company established by 
Renaissance in order to facilitate an investment by IRA Holders who are 
not ``Accredited Investors'' under the 1933 Act in New Medallion FF 
RMPRF and New RIEF/RIFF, through their IRAs.
    (l) The term ``New Medallion FF'' means Medallion Fund RF LP, the 
Bermuda Limited Partnership that is treated as a corporation for US 
Federal Income Tax purposes, established by Renaissance in order to 
facilitate an investment by an IRA Holder who is a ``Qualified 
Purchaser'' or ``Knowledgeable Employee'' under the Investment Company 
Act of 1940, as amended (the 1940 Act) in the Medallion Master Funds, 
through his or her IRA.
    (m) The term ``New Medallion FF RMPRF'' means Medallion RMPRF Fund 
LP, the Bermuda Limited Partnership that is treated as a corporation 
for US Federal Income Tax purposes established by Renaissance in order 
to facilitate the investment by IRA Holders who are neither Qualified 
Purchasers nor ``Knowledgeable Employees'' as defined in the 1940 Act, 
but who are Accredited Investors, in the Medallion Master Funds, 
through their IRAs.
    (n) The term ``New RIEF/RIFF'' means a newly organized series of 
RIEF RMP LLC and a newly created Bermuda limited partnership to be 
known as RIFF RF FUND LP, each of which has been established to 
facilitate investments of IRAs in RIEF RMP LLC and RIFF RMP LLC.
    (o) The term ``Participant'' means a person who is either an 
employee or a Permitted Owner of Renaissance at the time of such 
individual's investment in the New Medallion Vehicles.
    (p) The term ``Permitted Owners'' means the eight individuals 
permitted to invest in the Medallion Funds following the termination of 
their Renaissance employment, comprised of three Renaissance 
``founders,'' and five former employees who are current owners of 
Renaissance.
    (q) The term ``Renaissance Valuation Committee,'' or ``RVC,'' means 
the committee, established by Renaissance in 2008, that oversees and 
monitors the valuation process, and establishes the methods of, and 
procedures for, valuing various instruments traded by Renaissance, 
composed of high-level Renaissance employees who also may be Fund 
investors.
    (r) The term ``Spouse'' means a person who is (1) married to a 
Participant, or (2) to the extent not prohibited by applicable law, in 
a civil union or similar marriage-equivalent institution established 
pursuant to State law of the State where the Participant resides (or 
otherwise recognized by the State where the Participant resides) with a 
Participant.

Section IV. Effective Date

    This exemption is effective as of January 1, 2012.

    Signed at Washington, DC, this 13th day of April 2012.
Lyssa Hall,
Acting Director of Exemption Determinations, Employee Benefits Security 
Administration, U.S. Department of Labor.
[FR Doc. 2012-9496 Filed 4-19-12; 8:45 am]
BILLING CODE 4510-29-P