45884 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Notices

Alternatives to the Proposed Action

Since the Commission has concluded

that there is no measurable

environmental impact associated with

the proposed action, any alternatives

with equal or greater environmental

impact need not be evaluated. As an

alternative to the proposed action, the

staff considered denial of the requested

exemption. Denial of the request would

result in no change in current

environmental impacts. The

environmental impacts of the proposed

action and the alternative action are

similar.

Alternative Use of Resources

This action does not involve the use

of any resources not previously

considered in the ‘‘Final Environmental

Statement Related to the Operation of

Point Beach Nuclear Plant,’’ dated May

1972.

Agencies and Persons Consulted

In accordance with its stated policy,

on July 29, 1997, the staff consulted

with the Wisconsin State official, Ms.

Sarah Jenkins of the Wisconsin Public

Service Commission, regarding the

environmental impact of the proposed

action. The State official had no

comments.

Finding of No Significant Impact

Based upon the environmental

assessment, the Commission concludes

that the proposed action will not have

a significant effect on the quality of the

human environment. Accordingly, the

Commission has determined not to

prepare an environmental impact

statement for the proposed action.

For further details with respect to the

proposed action, see the licensee’s letter

dated June 6, 1997, which is available

for public inspection at the

Commission’s Public Document Room,

which is located at The Gelman

Building, 2120 L Street NW.,

Washington, DC, and at the local public

document room located at The Lester

Public Library, 1001 Adams Street, Two

Rivers, WI 54241.

Dated at Rockville, Maryland, this 22nd

day of August 1997.

For the Nuclear Regulatory Commission.

Linda L. Gundrum,

Project Manager, Project Directorate III–1,

Division of Reactor Projects—III/IV, Office of

Nuclear Reactor Regulation.

[FR Doc. 97–23043 Filed 8–28–97; 8:45 am]

BILLING CODE 7590–01–U

SECURITIES AND EXCHANGE

COMMISSION

[Rel. No. IC–22795; 812–10718]

First American Investment Funds, Inc.,

et al.; Notice of Application

August 22, 1997.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of application for

exemption under the Investment

Company Act of 1940 (the ‘‘Act’’).

SUMMARY OF APPLICATION: Applicants

request an order under sections 6(c) and

17(b) of the Act for an exemption from

section 17(a) to permit a common trust

fund sponsored by U.S. Bank National

Association (‘‘U.S. Bank’’) to transfer

securities to a series of First American

Investment Funds, Inc. (‘‘FAIF’’), in

exchange for shares of the series.

APPLICANTS: FAIF, Large Companies

Value Trust Fund (‘‘LCVT’’), and U.S.

Bank.

FILING DATE: The application was filed

on July 11, 1997. Applicants have

agreed to file an amendment during the

notice period, the substance of which is

included in this notice.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicants with a

copy of the request, personally or by

mail. Hearing requests should be

received by the SEC by 5:30 p.m. on

September 17, 1997, 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 SEC’s Secretary.

ADDRESSES: Secretary, SEC, 450 Fifth

Street, N.W., Washington, D.C. 20549.

Applicants c/o James D. Alt, Esq.,

Dorsey & Whitney LLP, 220 South Sixth

Street, Minneapolis, Minnesota 55402.

FOR FURTHER INFORMATION CONTACT:

John K. Forst, Attorney Advisory, at

(202) 942–0569, or Mary Kay Frech,

Branch Chief, at (202) 942–0564,

(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 for a fee at the SEC’s

Public Reference Branch, 450 Fifth

Street, N.W., Washington, D.C. 20549

(tel. 202–942–8090).

Applicants’ Representations

1. U.S. Bank is a national banking

association and a wholly-owned

subsidiary of U.S. Bancorp. (‘‘USB’’), a

publicly held bank holding company.

U.S. Bank, through its First Asset

Management group, acts as investment

adviser to each series of FAIF. USB

maintains a defined benefit pension

plan (‘‘Parent Company Plan’’) for the

benefit of employees of USB and its

subsidiaries. The Parent Company Plan

owns more than 5% of the outstanding

voting shares of the Stock Fund series

of FAIF (the ‘‘Fund’’). The Fund is a

multiple class fund.

2. FAIF is a Maryland corporation

registered under the Act as an open-end

management investment company. FAIF

currently offers its shares to the public

in several series with varying

investment objectives and policies.

3. LCVT is a common trust fund as

defines in Section 584(a) of the Internal

Revenue Code of 1986, as amended.

LCVT is maintained by U.S. Bank

exclusively for the collective investment

and reinvestment of moneys contributed

by U.S. Bank in its capacity as a trustee,

executor, administrator, or guardian.

The persons and entities for which U.S.

Bank acts in such capacity are referred

to as ‘‘Participants’’ in LCVT. LCVT is

excluded from the definition of

investment company under section

3(c)(3) of the Act.

4. Applicants propose to transfer to

transfer the assets held by LCVT to the

Fund in exchange for Class C shares of

the Fund. Class C shares are offered

without a front-end or deferred sales

charge, are not subject to any

redemption fees, and do not bear any

rule 12b–1 distribution fees or any

shareholder servicing fees. LCVT assets

to be transferred to the Fund will be

valued in accordance with the

provisions of rule 71a–7(b), and the

Fund’s shares issued will have an

aggregate net asset value equal to the

value of the LCVT assets transferred.

Following the proposed transaction,

LCVT will be terminated, and the Fund

shares issued will be held by U.S. Bank

directly as trustee, executor,

administrator, or guardian. The Fund

shares held by U.S. Bank, as fiduciary,

will be credited to the benefit of each

Participant, pro rata, according to each

Participant’s interest in LCVT

immediately prior to the transfer.

5. The proposed transaction will be

carried out in accordance with

procedures previously adopted by

FAIF’s board of directors pursuant to

rule 17a–7(e), and the provisions of rule
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Notices 45885

17a–7(c), (d), and (f) will be satisfied

with respect to FAIF. FAIF’s board of

directors was advised by U.S. Bank that

the investment objectives and policies

of LCVT and the Fund, and the

securities they hold, are generally

similar. In addition, FAIF’s board of

directors, including a majority of the

directors of FAIF who are not interested

persons, has determined that

participation by the Fund in the

proposed transaction is in the best

interests of the Fund and the interests

of existing Fund shareholders will not

be diluted as a result of the transaction.

These findings, and the basis upon

which they were made, will be recorded

fully in the minute books of the Fund.

6. U.S. Bank, as LCVT’s trustee, will

determine in accordance with its

fiduciary duties that the proposed

transaction is in the best interests of

Participants in LCVT. In making this

determination, U.S. Bank will consider

the anticipated benefits which are

expected to flow to Participants,

including increased liquidity, the

availability of daily pricing, the

accessibility of performance and other

information concerning the Fund, the

similarity of LCVT’s and the Fund’s

investment objectives an policies, the

anticipated tax treatment of the

proposed transaction, and the aggregate

fee levels experienced and expected to

be experienced by Participants before

and after the proposed transaction.

7. In some instances, U.S. Bank will

be required to obtain the consent or

direction of the party having investment

discretion regarding a Participant’s

inclusion in the transaction. In those

instances where an account party of the

Participant does not exercise investment

discretion but can terminate of transfer

the fiduciary relationship with U.S.

Bank, such account party can direct U.S.

Bank to withdraw the Participant’s

investment from LCVT before the

proposed transaction takes place. In all

instances, detailed information

concerning the terms of the proposed

transaction, the Fund, applicable fee

schedules, and other related information

will be provided to Participants before

the proposed transaction takes place.

8. Applicants also request relief for

any future transactions in which a

common or collective trust fund for

which U.S. Bank, or another bank under

common control with U.S. bank, acts as

trustee, proposes to transfer all of its

assets to a registered investment

company (or series thereof) that is (a)

advised by U.S. Bank, or by any entity

controlling, controlled by, or under

common control with U.S. Bank; and (b)

5% or more owned by a defined benefit

pension plan or other employee benefit

plan sponsored by U.S. Bank or by an

entity controlling, controlled by or

under common control with U.S. bank

(the ‘‘Future Transactions’’). Applicants

state that they will rely on the requested

relief for Future Transactions only in

accordance with the terms and

conditions contained in the application.

Applicants’ Legal Analysis

1. Section 17(a) of the Act provides

that it is unlawful for any affiliated

person of a registered investment

company, or any affiliated person of

such person, acting as principal,

knowingly (a) to sell any security or

other property to such registered

company, or (b) to purchase from such

registered company any security or

other property. Section 2(a)(3) of the Act

defines the term ‘‘affiliated person’’ of

another person to include (a) any person

owning, controlling, or holding with

power to vote, 5% or more of the

outstanding voting securities of such

other person; (b) any person controlling,

controlled by, or under common control

with, such other person; and (c) if such

other person is an investment company,

any investment adviser thereof.

2. Because LCVT might be viewed as

acting as principal in the proposed

transaction, and because LCVT and the

Fund might be viewed as being under

common control of U.S. Bank within the

meaning of section 2(a)(3) of the Act, the

proposed transaction may be subject to

the prohibitions of section 17(a).

Accordingly, applicants request an

order from the SEC pursuant to sections

6(c) and 17(b) exempting them from

section 17(a) of the Act on the terms and

subject to the conditions set forth in the

application.

3. Section 17(b) provides that the SEC

shall exempt a transaction from section

17(a) if evidence establishes that (a) the

terms of the proposed transaction,

including the consideration to be paid,

are reasonable and fair and do not

involve overreaching; (b) the proposed

transaction is consistent with the policy

of each registered investment company

concerned; and (c) the proposed

transaction is consistent with the

general purposes of the Act. Rule

17a–7 exempts certain purchase and

sale transactions otherwise prohibited

by section 17(a) if, among other

requirements, the transactions are

effected at an ‘‘independent market

price’’ and the investment company’s

board of directors reviews the

transactions for fairness. Rule 17a–8

exempts certain mergers and

consolidations from section 17(a) if,

among other requirements, the

investment company’s board of

directors determines that the

transactions are fair.

4. Applicants will comply with rules

17a–7 and 17a–8 to the extent possible,

as stated in the conditions to the

requested order. The proposed

transaction contemplates in-kind

transfers from LCVT to the Fund, rather

than cash transactions. Applicants

assert that if the proposed transaction

were effected in cash instead of through

an in-kind transfer of assets, LCVT and

the Participants would have to bear

unnecessary expense and inconvenience

in transferring assets to the Fund.

5. Section 6(c) provides that the SEC

may exempt any person or transaction

from any provision of the Act or any

rule thereunder to the extent that 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.

6. Applicants submit that the

proposed transaction meets the

standards for relief under sections 6(c)

and 17(b). Applicants assert that the

terms of the transaction, including the

consideration to be paid or received, are

reasonable and fair and do not involve

overreaching on the part of any party;

the investment objectives, policies, and

restrictions of LCVT are compatible

with and substantially similar to the

Fund’s investment objectives, policies,

and restrictions; and, the transaction

and the requested exemption are in the

public interest, consistent with the

protection of investors and the purposes

fairly intended by the policies and

provisions of the Act.

Applicants’ Conditions

1. The proposed transaction will

comply with the terms of rule 17a–7 (b)

through (f).

2. The proposed transaction will not

occur unless and until the board of

directors of the Fund (including a

majority of the board’s disinterested

members) find that participation by the

Fund in the proposed transaction is in

the best interests of such Fund and that

the interests of existing shareholders of

such Fund will not be diluted as a result

of the transaction. These findings, and

the bases upon which they are made,

will be recorded fully in the minute

books of the Fund.

3. The proposed transaction will not

occur unless and until U.S. Bank, as

trustee, has determined in accordance

with its fiduciary duties as trustee for

LCVT and fiduciary for the Participants,

that the proposed transactions is in the

best interests of the Participants.
45886 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Notices

1Applicants also request relief for any Series of

the Trusts organized in the future, and any openend management investment companies in the

future advised by NEFM or TNE Advisers or by a

person controlling, controlled by, or under common

control with NEFM or TNE Advisers that operates

in substantially the same manner as the Trusts and

complies with the conditions to the requested order

as set forth in the application.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–23006 Filed 8–28–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Investment Company Act Release No.

22796; 812–10420]

New England Funds Trust I, et al.;

Notice of Application

August 22, 1997.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of application for

exemption under section 6(c) of the

Investment Company Act of 1940 (the

‘‘Act’’) from the provisions of section

15(a) of the Act and rule 18f–2 under

the Act.

SUMMARY OF APPLICATION: Applicants

request an order permitting TNE

Advisers, Inc. (‘‘TNE Advisers’’) and

New England Fund Management, L.P.

(‘‘NEFM’’), as investment advisers of

certain funds, to enter into sub-advisory

contracts on behalf of the funds without

receiving prior shareholder approval.

APPLICANTS: New England Funds Trust I,

New England Funds Trust II, New

England Funds Trust III, New England

Cash Management Trust, New England

Tax Exempt Money Market Trust

(collectively, the ‘‘New England

Funds’’), New England Zenith Fund

(collectively with the New England

Funds, the ‘‘Trusts’’), TNE Advisers,

and NEFM (together with TNE Advisers,

the ‘‘Advisers’’).

FILING DATES: The application was filed

on November 12, 1996, and amended on

July 1, 1997 and August 22, 1997.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicants with a

copy of the request, personally or by

mail. Hearing requests should be

received by the SEC by 5:30 p.m. on

September 16, 1997, 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 such notification

by writing to the SEC’s Secretary.

ADDRESSES: Secretary, SEC, 450 Fifth

Street, N.W., Washington, D.C. 20549.

New England Funds and NEFM, 399

Boylston Street, 4th Floor, Boston,

Massachusetts 02116. New England

Zenith Fund and TNE Advisers, 501

Boylston Street, Boston, Massachusetts

02116.

FOR FURTHER INFORMATION CONTACT:

Kathleen L. Knisely, Staff Attorney, at

(202) 942–0517, or Mary Kay Frech,

Branch Chief, at (202) 942–0564

(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 for a fee from the SEC’s

Public Reference Branch, 450 Fifth

Street, N.W. Washington, D.C. 20549

(tel. 202–942–8090).

Applicants’ Representations

1. Each of the New England Funds is

organized as a Massachusetts business

trust and registered under the Act as an

open-end management investment

company with one of more series.

NEFM, a limited partnership, is

registered as an investment adviser

under the Investment Advisers Act of

1940 (the ‘‘Advisers Act’’). NEFM serves

as investment adviser to each of the

New England Funds (except New

England Growth Fund Series).

2. New England Zenith Fund (the

‘‘Zenith Fund’’) is organized as a

Massachusetts business trust and

registered under the Act as an open-end

management investment company with

one or more series. The Zenith Fund

serves as a funding vehicle for certain

variable annuity and variable life

insurance products issued by

Metropolitan Life Insurance Company

(‘‘MetLife’’) and its subsidiary New

England Life Insurance Company

(‘‘NELICO’’). TNE Advisers is registered

as an investment adviser under the

Advisers Act. TNE Advisers serves as

investment adviser for each series of the

Zenith Fund (except the Capital Growth

Series).

3. Each series for the Zenith Fund

(except the Capital Growth Series) and

each series of the New England Funds

(except the New England Growth Fund

Series) (together, the ‘‘Series’’) utilizes

the adviser/subadviser management

structure.1 Under this two-tiered

structure, NEFM (in the case of the New

England Funds) or TNE Advisers (in the

case of the Zenith Fund) acts as each

Series’ investment adviser, delegating

the day-to-day portfolio management for

each Series to one or more sub-advisers.

4. The New England Funds have

entered into an advisory agreement with

NEFM, which states that NEFM will

provide both portfolio management

services and administrative services to

the New England Funds. TNE Advisers

has entered into an advisory agreement

with the Zenith Fund, which states that

TNE Advisers will provide both

portfolio management services and

administrative services for each Series

of the Zenith Fund for which TNE

Advisers is the adviser. NEFM and TNE

Advisers are responsible for: (a)

Evaluating existing and prospective subadvisers; (b) submitting

recommendations to the boards of

trustees of the Trusts concerning subadvisers to be engaged by the Series; (c)

monitoring and reporting to the Trusts’

boards concerning investment results of

the sub-advisers; (d) monitoring the subadvisers’ compliance with the Series’

investment objectives, policies, and

restrictions; and (e) when appropriate,

recommending that the trustees of the

relevant Trust terminate the services of

a Series’ sub-advisers.

5. NEFM and TNE Advisers have

entered into sub-advisory agreements

with one or more advisory firms (subadvisers) with respect to each Series,

pursuant to which the sub-advisers

provide day-to-day portfolio

management services. Each subadvisory agreement requires the relevant

sub-advisers to manage the investment

and reinvestment of the assets of the

Series, subject to the supervision of

either NEFM or TNE Advisers and

oversight by the trustees. The subadvisers’ responsibilities include

effecting portfolio transactions and

reporting periodically to NEFM or TNE

Advisers, their agents, and the trustees

of the Trusts.

6. Under their advisory agreements,

NEFM and TNE Advisers receive from

the relevant Series compensation at a

specified annual percentage of the

corresponding Series’ average daily net

assets. NEFM and TNE Advisers, in

turn, compensate the relevant subadvisers at specified annual percentage

rates of the Series’ average daily net

assets. The sub-advisory fee paid to the

sub-advisers is payable by NEFM or

TNE Advisers, and not by the Series.

7. The Advisers have contractual

rights under their applicable advisory