1006 Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices

1Rule 17a–8 provides an exemption from section

17(a) of the Act for certain reorganizations among

registered investment companies that may be

affiliated persons, or affiliated persons of an

affiliated person, solely by reason of having a

common investment adviser, common directors,

and/or common officers.

facts. According to the adopting release,

the concern was that a company may be

considered a non-investment company

for the purposes of the Act under

section 3(c) and still be engaged

primarily in investment company

activities. Applicant states that none of

the CIBC Entities to which applicant

may loan money are engaged primarily

in investment company activities. In

addition, if CIBC issued the securities

that are to be issued by applicant and

use the proceeds, none of the CIBC

Entities would be subject to regulation

under the Act. While CIBC has chosen

instead to use applicant as a financing

vehicle, the Guarantee ensures that

holders of applicant’s securities will

have direct access to CIBC’s credit.

4. Under rule 3a–5(a)(6), a finance

subsidiary may only invest in

government securities, securities of its

parent company or a company

controlled by its parent company, or

debt securities exempt under section

3(a)(3) of the Securities Act. Applicant

intends to invest in equity securities of

unaffiliated companies in an amount

that does not exceed 4% of its assets.

Applicant will hold such securities due

to non-U.S. tax constraints applicable to

CIBC. Applicant’s primary purpose,

however, will continue to be the

financing of the business operations of

CIBC and companies controlled by

CIBC. In addition, purchasers of

applicant’s debt securities will receive

disclosure documents that make clear

that such purchasers should ultimately

look to CIBC for repayment pursuant to

CIBC’s guarantee. Thus, applicant

asserts that, because neither its structure

nor its mode of operation will resemble

that of an investment company, the

holders of applicant’s securities will not

rely on applicant’s management of

securities issued by unaffiliated

companies.

5. Section 6(c) provides, in relevant

part, that the SEC may, conditionally or

unconditionally, by order, exempt any

person or class of persons from any

provision of the Act or from any rule

thereunder, if such exemption is

necessary or appropriate in the public

interest, consistent with the protection

of investors, and consistent with the

purposes fairly intended by the policy

and provisions of the Act. Applicant

submits that the relief requested

satisfies the section 6(c) standard.

Applicant’s Condition

Applicant agrees that any order issued

on this application shall be subject to

the following condition:

Applicant will comply with all of the

provisions of rule 3a–5 under the Act,

except: (a) applicant will be permitted

to invest in or make loans to

corporations, partnerships, and joint

ventures that do not meet the portion of

the definition of ‘‘company controlled

by the parent company’’ in rule 3a–

5(b)(3)(i) solely because they are

excluded from the definition of

investment company by section 3(c) (1),

(3), (4), (6), or (7), provided that any

such entity excluded from the definition

of investment company pursuant to

section 3(c)(1) will only engage in

lending, leasing or related activities

(such as entering into credit derivatives

to manage that credit risk exposures of

its lending and leasing activities) and

will not be structured solely as a means

of avoiding regulation under the Act,

and provided further, that any such

entity excluded from the definition of

investment company pursuant to

section 3(c)(6) of the Act will not be

engaged primarily, directly or

indirectly, in one or more of the

businesses described in section 3(c)(5)

of the Act; and (b) applicant will be

permitted to invest in, reinvest in, own,

hold, or trade in equity securities of

unaffiliated companies with a purchase

price not in excess of $200 million (or

any higher amount not in excess of 4%

of applicant’s assets).

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–239 Filed 1–6–97; 8:45 am]

BILLING CODE 8010–01–M

[Investment Company Act Release No.

22421; 811–7069]

Senior High Income Portfolio II, Inc.;

Notice of Application

December 30, 1996.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Deregistration under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANT: Senior High Income Portfolio

II, Inc.

RELEVANT ACT SECTION: Order requested

under section 8(f) of the Act.

SUMMARY OF APPLICATION: Applicant

requests an order declaring that it has

ceased to be an investment company.

FILING DATE: The application was filed

on October 8, 1996 and amended on

December 13, 1996.

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 applicant with a

copy of the request, personally or by

mail. Hearing requests should be

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

January 24, 1997, and should be

accompanied by proof of service on the

applicant, 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 may request notification of a

hearing by writing to the SEC’s

Secretary.

ADDRESSES: Secretary, SEC, 450 Fifth

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

Applicant, 800 Scudders Mill Road,

Plainsboro, New Jersey 08536.

FOR FURTHER INFORMATION CONTACT:

Kathleen L. Knisely, Staff Attorney, at

(202) 942–0517, or Alison E. Baur,

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.

Applicant’s Representations

1. Applicant is a closed-end, nondiversified management investment

company organized as a Maryland

corporation. On July 19, 1993, applicant

filed a Notification of Registration on

Form N–8A pursuant to section 8(a) of

the Act and a registration statement on

Form N–2 under the Act and the

Securities Act of 1933. The registration

statement became effective on

September 17, 1993, and applicant

commenced the initial public offering

the same day.

2. On December 6, 1995, applicant’s

board of directors approved an

Agreement and Plan of Merger (the

‘‘Plan’’) whereby applicant would

transfer its assets to Senior High Income

Portfolio, Inc. (‘‘SHIP I’’), a registered

closed-end management investment

company, in exchange for shares of

SHIP I. Pursuant to rule 17a–8 under the

Act,1 applicant’s board of directors

determined that the proposed

reorganization was in the best interest of

applicant and that the interests of the

existing shareholders would not be
Federal Register / Vol. 62, No. 4 / Tuesday, January 7, 1997 / Notices 1007

1Rule 17a–8 provides an exemption from section

17(a) of the Act for certain reorganizations among

registered investment companies that may be

affiliated persons, or affiliated persons of an

affiliated person, solely by reason of having a

common investment adviser, common directors,

and/or common officers.

diluted as a result of the proposed

reorganization.

3. In approving the Plan, the directors

identified certain benefits which were

likely to result from the reorganization.

It was anticipated that the applicant’s

shareholders would remain invested in

a closed-end fund with investment

objectives and policies virtually

identical to those of applicant, and

applicant’s shareholders would also

benefit from a reduced overall operating

expense ratio based on the combined

assets of the surviving fund and from

greater efficiency and flexibility in

portfolio management.

4. On December 29, 1995, applicant

filed a proxy statement with the SEC

that was declared effective on February

5, 1996 and distributed to shareholders

on or about February 5, 1996. In

addition to solicitation by mail, certain

agents of applicant solicited shareholder

proxies by telephone. Applicant’s

shareholders approved the Plan at a

special meeting held on March 14, 1996.

5. Pursuant to the Plan, on April 15,

1996, applicant transferred all of its

assets and liabilities to SHIP I. Upon

transfer, each share of applicant’s

common stock converted into the right

to receive an equivalent dollar amount

(to the nearest one ten-thousandth of

one cent) of full shares of SHIP I

common stock plus cash in lieu of any

fractional shares, computed based on

the net asset value per share of each of

applicant and SHIP I.

6. Expenses incurred in connection

with the reorganization included proxy

solicitation expenses, filing fees, legal

and audit fees and printing and stock

exchange fees. All expenses applicant

incurred in connection with the

reorganization were paid by SHIP I after

the reorganization.

7. As of the date of the application,

applicant had no shareholders and no

securities outstanding, and has no debts

or other liabilities outstanding.

Applicant is not a party to any litigation

or administrative proceeding. Applicant

is neither engaged, nor proposes to

engage, in any business activities other

than those necessary for the winding up

on its affairs.

9. Applicant filed articles of merger

with the State of Maryland on April 12,

1996, which became effective on April

15, 1996.

For the Commission, by the Division of

Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–243 Filed 1–6–97; 8:45 am]

BILLING CODE 8010–01–M

[Investment Company Act Release No.

22422; 811–7131]

Senior Strategic Income Fund, Inc.;

Notice of Application

December 30, 1996.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Deregistration under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANT: Senior Strategic Income

Fund, Inc.

RELEVANT ACT SECTION: Order requested

under section 8(f) of the Act.

SUMMARY OF APPLICATION: Applicant

requests an order declaring that it has

ceased to be an investment company.

FILING DATE: The application was filed

on October 8, 1996 and amended on

December 13, 1996.

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 applicant with a

copy of the request, personally or by

mail. Hearing requests should be

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

January 27, 1997, and should be

accompanied by proof of service on the

applicant, 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 may request notification of a

hearing by writing to the SEC’s

Secretary.

ADDRESSES: Secretary, SEC, 450 Fifth

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

Applicant, 800 Scudders Mill Road,

Plainsboro, New Jersey 08536.

FOR FURTHER INFORMATION CONTACT:

Kathleen L. Knisely, Staff Attorney, at

(202) 942–0517, or Alison E. Baur,

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.

Applicant’s Representations

1. Applicant is a closed-end, nondiversified management investment

company organized as a Maryland

corporation. On July 19, 1993, applicant

filed a Notification of Registration on

Form N–8A pursuant to section 8(a) of

the Act and a registration statement on

Form N–2 under the Act and the

Securities Act of 1933. The registration

statement became effective on

September 17, 1993, and applicant

commenced the initial public offering

the same day.

2. On December 6, 1995, applicant’s

board of directors approved an

Agreement and Plan of Merger (the

‘‘Plan’’) whereby applicant would

transfer its assets to Senior High Income

Portfolio, Inc. (‘‘SHIP I’’), a registered

closed-end management investment

company, in exchange for shares of

SHIP I. Pursuant to rule 17a–8 under the

Act,1 applicant’s board of directors

determined that the proposed

reorganization was in the best interest of

applicant and that the interests of the

existing shareholders would not be

diluted as a result of the proposed

reorganization.

3. In approving the Plan, the directors

identified certain benefits which were

likely to result from the reorganization.

It was anticipated that the applicant’s

shareholders would remain invested in

a closed-end fund with investment

objectives and policies virtually

identical to those of applicant, and

applicant’s shareholders would also

benefit from a reduced overall operating

expense ratio based on the combined

assets of the surviving fund and from

greater efficiency and flexibility in

portfolio management.

4. On December 29, 1995, applicant

filed a proxy statement with the SEC

that was declared effective on February

5, 1996 and distributed to shareholders

on or about February 5, 1996. In

addition to solicitation by mail, certain

agents of applicant solicited shareholder

proxies by telephone. Applicant’s

shareholders approved the Plan at a

special meeting held on March 14, 1996.

5. Pursuant to the Plan, on April 15,

1996, applicant transferred all of its

assets and liabilities to SHIP I. Upon

transfer, each share of applicant’s

common stock converted into the right

to receive an equivalent dollar amount

(to the nearest one ten-thousandth of

one cent) of full shares of SHIP I

common stock plus cash in lieu of any

fractional shares, computed based on

the net asset value per share of each of

applicant and SHIP I.

6. Expenses incurred in connection

with the reorganization included proxy

solicitation expenses, filing fees, legal

and audit fees and printing and stock

exchange fees. All expenses applicant