17718 Federal Register / Vol. 76, No. 61 / Wednesday, March 30, 2011 / Notices 

1Applicants also request relief with respect to 

existing and future series of the Company and any 

other existing or future registered open-end 

management investment company or series thereof 

that: (a) Is advised by Simple Alternatives or any 

entity controlling, controlled by or under common 

control with Simple Alternatives (each, an 

‘‘Adviser’’); (b) uses the manager of managers 

structure described in the application (the ‘‘Manager 

of Managers Structure’’) and (c) complies with the 

terms and conditions of this application (together 

with the S1 Fund, the ‘‘Funds’’ and each, 

individually, a ‘‘Fund’’). The only existing registered 

open-end management investment company that 

currently intends to rely on the requested order is 

named as an applicant. If the name of any Fund 

contains the name of a Subadviser (as defined 

below), the name of the Adviser that serves as the 

primary adviser to the Fund will precede the name 

of the Subadviser. 

PROCEDURAL SCHEDULE—Continued 

April 26, 2011 .......................................... Deadline for Petitioner’s Form 61 or initial brief in support of petition (see 39 CFR 3001.115(a) and 

(b)). 

May 16, 2011 .......................................... Deadline for answering brief in support of Postal Service (see 39 CFR 3001.115(c)). 

May 31, 2011 .......................................... Deadline for reply briefs in response to answering briefs (see 39 CFR 3001.115(d)). 

June 7, 2011 ........................................... Deadline for motions by any party requesting oral argument; the Commission will schedule oral argument only when it is a necessary addition to the written filings (see 39 CFR 3001.116). 

July 14, 2011 ........................................... Expiration of the Commission’s 120-day decisional schedule (see 39 U.S.C. 404(d)(5)). 

By the Commission. 

Shoshana M. Grove, 

Secretary. 

[FR Doc. 2011–7396 Filed 3–29–11; 8:45 am] 

BILLING CODE 7710–FW–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

29616; 812–13801] 

Simple Alternatives, LLC and The RBB 

Fund, Inc.; Notice of Application 

Date: March 24, 2011. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice of an application under 

section 6(c) of the Investment Company 

Act of 1940 (‘‘Act’’) for an exemption 

from section 15(a) of the Act and rule 

18f–2 under the Act, as well as from 

certain disclosure requirements. 

SUMMARY OF APPLICATION: Applicants 

request an order that would permit them 

to enter into and materially amend 

subadvisory agreements without 

shareholder approval and would grant 

relief from certain disclosure 

requirements. 

APPLICANTS: Simple Alternatives, LLC 

(‘‘Simple Alternatives’’) and The RBB 

Fund, Inc. (the ‘‘Company’’). 

FILING DATES: The application was filed 

on July 23, 2010, and amended on 

December 22, 2010 and March 11, 2011. 

HEARING OR NOTIFICATION OF HEARING: 

An order granting the application will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by writing to the 

Commission’s Secretary and serving 

applicants with a copy of the request, 

personally or by mail. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on April 18, 2011, and 

should be accompanied by proof of 

service on the applicants, in the form of 

an affidavit or, for lawyers, a certificate 

of service. Hearing requests should state 

the nature of the writer’s interest, the 

reason for the request, and the issues 

contested. Persons who wish to be 

notified of a hearing may request 

notification by writing to the 

Commission’s Secretary. 

ADDRESSES: Secretary, U.S. Securities 

and Exchange Commission, 100 F 

Street, NE., Washington, DC 20549– 

1090. Applicants: c\o Gilbert H. Davis, 

Esq., Sims Moss Kline & Davis LLP, 

Suite 1700, Three Ravinia Drive, 

Atlanta, Georgia 30346. 

FOR FURTHER INFORMATION CONTACT: 

Emerson S. Davis, Sr., Senior Counsel, 

at (202) 551–6868, or Janet M. 

Grossnickle, Assistant Director, at (202) 

551–6821 (Division of Investment 

Management, Office of Investment 

Company Regulation). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

Web site by searching for the file 

number, or an applicant using the 

Company name box, at http:// 

www.sec.gov/search/search.htm or by 

calling (202) 551–8090. 

Applicants’ Representations 

1. The Company, a Maryland 

corporation, is registered under the Act 

as an open-end management investment 

company and offers eighteen series, 

including the S1 Fund (‘‘S1 Fund’’).1

Simple Alternatives is registered as an 

investment adviser under the 

Investment Advisers Act of 1940 

(‘‘Advisers Act’’) and serves as the 

investment adviser to the S1 Fund. An 

Adviser will serve as the investment 

adviser to each Fund pursuant to an 

investment advisory agreement 

(‘‘Advisory Agreement’’) with the Fund. 

Each Advisory Agreement will be 

approved by the Company’s board of 

directors (‘‘Board’’), including a majority 

of the directors who are not ‘‘interested 

persons,’’ as defined in section 2(a)(19) 

of the Act, of the Company or the 

Adviser (‘‘Independent Directors’’) and 

by the initial shareholder of the Fund. 

2. Under the terms of each Advisory 

Agreement, the Adviser will be 

responsible for the overall management 

of the Fund’s business affairs and 

selecting the Funds’ investments in 

accordance with its investment 

objectives, policies and restrictions. For 

the investment management services 

that it provides to the Fund, the Adviser 

will receive the fee specified in the 

Advisory Agreement. The Advisory 

Agreement also permits the Adviser to 

retain one or more subadvisers, at its 

own cost and expense, for the purpose 

of managing the investments of the 

Funds. Pursuant to this authority, the 

Adviser will enter into investment 

subadvisory agreements (‘‘Subadvisory 

Agreements’’) with certain unaffiliated 

subadvisers (each, a ‘‘Subadviser’’) to 

provide investment advisory services to 

the Funds. Simple Alternatives 

currently employs eight Subadvisers for 

the S1 Fund. Each Subadviser is and 

each future Subadviser will be 

registered as an investment adviser 

under the Advisers Act. The Adviser 

will supervise, evaluate and allocate 

assets to the Subadvisers, and make 

recommendations to the Board about 

their hiring, retention or termination, at 

all times subject to the authority of the 

Board. 

3. Applicants request an order to 

permit the Adviser, subject to Board 

approval, to enter into and materially 

amend Subadvisory Agreements 

without obtaining shareholder approval. 

The requested relief will not extend to 

any subadviser that is an affiliated 

person, as defined in section 2(a)(3) of 

the Act, of the Company, a Fund or the 

Adviser, other than by reason of serving 

as a subadviser to the Fund (‘‘Affiliated 

Subadviser’’). 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

Federal Register / Vol. 76, No. 61 / Wednesday, March 30, 2011 / Notices 17719 

4. Applicants also request an 

exemption from the various disclosure 

provisions described below that may 

require the Funds to disclose fees paid 

by the Adviser to the Subadvisers. An 

exemption is requested to permit the 

each Fund to disclose (as both a dollar 

amount and as a percentage of the 

respective Fund’s net assets): (a) The 

aggregate fees paid to the Adviser and 

any Affiliated Subadvisers; and (b) the 

aggregate fees paid to Subadvisers 

(collectively, ‘‘Aggregate Fee 

Disclosure’’). Any Fund that employs an 

Affiliated Subadviser also will provide 

separate disclosure of any fees paid to 

any Affiliated Subadviser. 

Applicants’ Legal Analysis 

1. Section 15(a) of the Act provides, 

in relevant part, that it is unlawful for 

any person to act as an investment 

adviser to a registered investment 

company except pursuant to a written 

contract that has been approved by the 

vote of a majority of the company’s 

outstanding voting securities. Rule 

18f–2 under the Act provides that each 

series or class of stock in a series 

investment company affected by a 

matter must approve that matter if the 

Act requires shareholder approval. 

2. Form N–1A is the registration 

statement used by open-end investment 

companies. Item 19(a)(3) of Form N–1A 

requires disclosure of the method and 

amount of the investment adviser’s 

compensation. 

3. Rule 20a–1 under the Act requires 

proxies solicited with respect to an 

investment company to comply with 

Schedule 14A under the Securities 

Exchange Act of 1934 (‘‘1934 Act’’). 

Items 22(c)(1)(ii), 22(c)(1)(iii), 22(c)(8) 

and 22(c)(9) of Schedule 14A, taken 

together, require a proxy statement for a 

shareholder meeting at which the 

advisory contract will be voted upon to 

include the ‘‘rate of compensation of the 

investment adviser,’’ the ‘‘aggregate 

amount of the investment adviser’s 

fees,’’ a description of the ‘‘terms of the 

contract to be acted upon,’’ and, if a 

change in the advisory fee is proposed, 

the existing and proposed fees and the 

difference between the two fees. 

4. Regulation S–X sets forth the 

requirements for financial statements 

required to be included as part of 

investment company registration 

statements and shareholder reports filed 

with the Commission. Sections 

6–07(2)(a), (b) and (c) of Regulation S– 

X require that investment companies 

include in their financial statements 

information about investment advisory 

fees. 

5. Section 6(c) of the Act provides that 

the Commission may exempt any 

person, security, or transaction or any 

class or classes of persons, securities, or 

transactions from any provisions of the 

Act, or from any rule thereunder, if such 

exemption is necessary or appropriate 

in the public interest and consistent 

with the protection of investors and the 

purposes fairly intended by the policy 

and provisions of the Act. Applicants 

state that the requested relief meets this 

standard for the reasons discussed 

below. 

6. Applicants assert that the 

shareholders are relying on the 

Adviser’s expertise to select one or more 

Subadvisers best suited to achieve a 

Fund’s investment objectives. 

Applicants assert that, from the 

perspective of the shareholder, the role 

of the Subadvisers is substantially 

equivalent to that of the individual 

portfolio managers employed by 

traditional advisory firms. Applicants 

state that requiring shareholder 

approval of each Subadvisory 

Agreement would subject a Fund to 

expenses and delays and may preclude 

the Adviser from acting promptly. 

Applicants note that the Advisory 

Agreement and any subadvisory 

agreement with an Affiliated Subadviser 

will remain subject to section 15(a) of 

the Act and rule 18f–2 under the Act. 

7. Applicants assert that Subadvisers 

use a ‘‘posted’’ rate schedule to set their 

fees. Applicants state that, while 

Subadvisers are willing to negotiate fees 

lower than those posted in the schedule, 

they are reluctant to do so where the 

fees are disclosed to the public and 

other Subadvisers. Applicants submit 

that the requested relief will allow the 

Adviser to negotiate more effectively 

with Subadvisers. 

Applicants’ Conditions 

Applicants agree that any order 

granting the requested relief will be 

subject to the following conditions: 

1. Before a Fund may rely on the 

requested order, the operation of the 

Fund in the manner described in the 

application will be approved by a 

majority of the Fund’s outstanding 

voting securities, as defined in the Act, 

or in the case of a Fund whose public 

shareholders purchase shares on the 

basis of a prospectus containing the 

disclosure contemplated by condition 

2 below, by the initial shareholder(s) 

before offering shares of that Fund to the 

public. 

2. Each Fund relying on the requested 

order will disclose in its prospectus the 

existence, substance, and effect of any 

order granted pursuant to this 

application. Each Fund will hold itself 

out to the public as utilizing the 

Manager of Managers Structure. The 

prospectus will prominently disclose 

that the Adviser has ultimate 

responsibility (subject to oversight by 

the Board) to oversee the Subadvisers 

and recommend their hiring, 

termination, and replacement. 

3. Within 90 days of the hiring of a 

new Subadviser, Fund shareholders will 

be furnished all information about the 

new Subadviser that would be included 

in a proxy statement, except as modified 

to permit Aggregate Fee Disclosure. This 

information will include Aggregate Fee 

Disclosure and any change in disclosure 

caused by the addition of the new 

Subadviser. To meet this obligation, 

each Fund will provide shareholders, 

within 90 days of the hiring of a new 

Subadviser, an information statement 

meeting the requirements of Regulation 

14C, Schedule 14C and Item 22 of 

Schedule 14A under the 1934 Act, 

except as modified by the order to 

permit Aggregate Fee Disclosure. 

4. An Adviser will not enter into a 

Subadvisory Agreement with any 

Affiliated Subadviser without such 

agreement, including the compensation 

to be paid thereunder, being approved 

by the shareholders of the applicable 

Fund. 

5. At all times, at least a majority of 

the Board will be Independent 

Directors, and the nomination of new or 

additional Independent Directors will 

be placed within the discretion of the 

then-existing Independent Directors. 

6. Whenever a subadviser change is 

proposed for a Fund with an Affiliated 

Subadviser, the Board, including a 

majority of the Independent Directors, 

will make a separate finding, reflected 

in the applicable Board minutes, that 

such change is in the best interests of 

the Fund and its shareholders, and does 

not involve a conflict of interest from 

which the Adviser or the Affiliated 

Subadviser derives an inappropriate 

advantage. 

7. Independent legal counsel, as 

defined in rule 0–1(a)(6) under the Act, 

will be engaged to represent the 

Independent Directors. The selection of 

such counsel will be within the 

discretion of the then-existing 

Independent Directors. 

8. Each Adviser will provide the 

Board, no less frequently than quarterly, 

with information about the profitability 

of the Adviser on a per-Fund basis. The 

information will reflect the impact on 

profitability of the hiring or termination 

of any Subadviser during the applicable 

quarter. 

9. Whenever a Subadviser is hired or 

terminated, the Adviser will provide the 

Board with information showing the 

expected impact on the profitability of 

the Adviser. 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

17720 Federal Register / Vol. 76, No. 61 / Wednesday, March 30, 2011 / Notices 

1File No. 811–10097 (the Life Account); File No. 

811–10121 (the Annuity Account). 

10. An Adviser will provide general 

management services to each Fund, 

including overall supervisory 

responsibility for the general 

management and investment of each 

Fund’s assets and, subject to review and 

approval of the Board, will: (a) Set each 

Fund’s overall investment strategies; (b) 

evaluate, select and recommend 

Subadvisers to manage all or a part of 

each Fund’s assets; (c) allocate and, 

when appropriate, reallocate each 

Fund’s assets among one or more 

Subadvisers; (d) monitor and evaluate 

the performance of Subadvisers; and (e) 

implement procedures reasonably 

designed to ensure that the Subadvisers 

comply with each Fund’s investment 

objective, policies and restrictions. 

11. No Director or officer of the 

Company or a Fund, or director, 

manager, or officer of an Adviser, will 

own directly or indirectly (other than 

through a pooled investment vehicle 

that is not controlled by such person), 

any interest in a Subadviser, except for 

(a) ownership of interests in the Adviser 

or any entity that controls, is controlled 

by, or is under common control with the 

Adviser or (b) ownership of less than 

1% of the outstanding securities of any 

class of equity or debt of any publicly 

traded company that is either a 

Subadviser or an entity that controls, is 

controlled by, or is under common 

control with a Subadviser. 

12. Each Fund will disclose in its 

registration statement the Aggregate Fee 

Disclosure. 

13. In the event the Commission 

adopts a rule under the Act providing 

substantially similar relief to that in the 

order requested in the application, the 

requested order will expire on the 

effective date of that rule. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–7417 Filed 3–29–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Rel. No. IC–29617; File No. 812–13842] 

American Family Life Insurance 

Company, et al. 

March 24, 2011. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice of application for an 

order under Section 26(c) of the 

Investment Company Act of 1940, as 

amended (the ‘‘1940 Act’’). 

APPLICANTS: American Family Life 

Insurance Company (the ‘‘Company’’), 

American Family Variable Account I 

(the ‘‘Life Account’’), and American 

Family Variable Account II (the 

‘‘Annuity Account’’) (together, the 

‘‘Applicants’’). 

SUMMARY OF APPLICATION: Applicants 

request an order of the Commission, 

pursuant to Section 26(c) of the 1940 

Act, approving the substitution of shares 

of the Vanguard Capital Growth 

Portfolio (‘‘Replacement Portfolio’’) of 

the Vanguard Variable Insurance Fund 

(‘‘Vanguard Fund’’) for Service Class 2 

Shares of the Fidelity Variable 

Insurance Products Growth Portfolio 

(‘‘Replaced Portfolio’’) of the Fidelity 

Variable Insurance Products Fund 

(‘‘Fidelity Fund’’), currently held by the 

Life Account and the Annuity Account 

(each an ‘‘Account,’’ together, the 

‘‘Accounts’’) to support variable life 

insurance and annuity contracts issued 

by the Company (collectively, the 

‘‘Contracts’’). 

DATES: Filing Date: The application was 

filed on November 10, 2010 and 

amended and restated on February 28, 

2011. 

HEARING OR NOTIFICATION OF HEARING: An 

order granting the application will be 

issued unless the Commission orders a 

hearing. Interested persons may request 

a hearing by writing to the Secretary of 

the Commission and serving Applicants 

with a copy of the request, personally or 

by mail. Hearing requests must be 

received by the Commission by 5:30 

p.m. on April 20, 2011, and should be 

accompanied by proof of service on 

Applicants in the form of an affidavit or, 

for lawyers, a certificate of service. 

Hearing requests should state the nature 

of the requester’s interest, the reason for 

the request, and the issues contested. 

Persons who wish to be notified of a 

hearing may request notification by 

writing to the Secretary of the 

Commission. 

ADDRESSES: Secretary, Securities and 

Exchange Commission, 100 F Street, 

NE., Washington, DC 20549–1090. 

Applicants, c/o David C. Holman, Esq., 

American Family Life Insurance 

Company, 6000 American Parkway, 

Madison, Wisconsin 53783–0001. Copy 

to Thomas E. Bisset, Esq., Sutherland 

Asbill & Brennan LLP, 1275 

Pennsylvania Ave., NW., Washington, 

DC 20004–2415. 

FOR FURTHER INFORMATION CONTACT: 

Michael L. Kosoff, Branch Chief, at (202) 

551–6754 or Harry Eisenstein, Senior 

Special Counsel, Office of Insurance 

Products, Division of Investment 

Management, at (202) 551–6795. 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

Web site by searching for the file 

number, or for an applicant using the 

Company name box, at http:// 

www.sec.gov/search/search.htm, or by 

calling (202) 551–8090. 

Applicants’ Representation 

1. The Company is a stock life 

insurance company organized under 

Wisconsin law. The Company conducts 

a conventional life insurance business 

and is authorized to transact the 

business of life insurance, including 

annuities, in nineteen States. For 

purposes of the 1940 Act, the Company 

is the depositor and sponsor of each of 

the Accounts as those terms have been 

interpreted by the Commission with 

respect to variable life insurance and 

variable annuity separate accounts. 

2. Under the insurance law of 

Wisconsin, the assets of each Account 

attributable to the Contracts issued 

through that Account are owned by the 

Company, but are held separately from 

the other assets of the Company for the 

benefit of the owners of, and the persons 

entitled to payment under, those 

Contracts. Each Account is a ‘‘separate 

account’’ as defined by Rule 0–1(e) 

under the 1940 Act, and is registered 

with the Commission as a unit 

investment trust.1 Each Account is 

comprised of a number of subaccounts 

and each subaccount invests exclusively 

in one of the insurance dedicated 

mutual fund portfolios made available 

as investment vehicles underlying the 

Contracts. Currently, the Replaced 

Portfolio is available as an investment 

option under the Company’s variable 

life insurance and variable annuity 

Contracts. 

3. The Life Account is currently 

divided into nine (9) subaccounts. The 

assets of the Life Account support 

variable life insurance contracts and 

interests in the Account offered through 

such contracts have been registered 

under the Securities Act of 1933, as 

amended (the ‘‘1933 Act’’), on Form N– 

6 (File Nos. 333–44956 and 333– 

147408). 

4. The Annuity Account is currently 

divided into nine (9) subaccounts. The 

assets of the Annuity Account support 

variable annuity contracts and interests 

in the Account offered through such 

contracts have been registered under the 

1933 Act on Form N–4 (File No. 333– 

45592). 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES