Federal Register / Vol. 62, No. 227 / Tuesday, November 25, 1997 / Notices 62789

1Each Fund that intends to rely on the order has

been named as an applicant. Any other existing

Fund and any Future Fund that may rely on the

order in the future will do so only in accordance

with the terms and conditions of the application.

Meeting with Advisory Committee on

Nuclear Waste (ACNW), (Contact:

John Larkins, 301–415–7360)

ADDITIONAL INFORMATION: Affirmations of

‘‘Final Rule—Deliberate Misconduct by

Unlicensed Persons’’ and ‘‘Louisiana

Energy Services—Financial

Qualifications Aspects of Petitions for

Review of LBP–96–25’’ were postponed

from Friday, November 21. No new date

has been set.

*The schedule for Commission

meetings is subject to change on short

notice. To verify the status of meetings

call (recording)—(301) 415–1292.

CONTACT PERSON FOR MORE INFORMATION:

Bill Hill (301) 415–1661.

* * * * *

The NRC Commission Meeting

Schedule can be found on the Internet

at:

http://www.nrc.gov/SECY/smj/

schedule.htm

* * * * *

This notice is distributed by mail to

several hundred subscribers; if you no

longer wish to receive it, or would like

to be added to it, please contact the

Office of the Secretary, Attn: Operations

Branch, Washington, DC 20555 (301–

415–1661).

In addition, distribution of this

meeting notice over the Internet system

is available. If you are interested in

receiving this Commission meeting

schedule electronically, please send an

electronic message to wmh@nrc.gov or

dkw@nrc.gov.

* * * * *

Dated: November 21, 1997.

William M. Hill, Jr.,

SECY Tracking Officer, Office of the

Secretary.

[FR Doc. 97–31115 Filed 11–21–97; 2:27 pm]

BILLING CODE 7590–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Rel. No. IC–22894; 812–10630]

Cash Accumulation Trust, et al.; Notice

of Application

November 18, 1997.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of application for an

order under section 12(d)(1)(J) of the

Investment Company Act of 1940 (the

‘‘Act’’) exempting applicants from

sections 12(d)(1) (A) and (B) of the Act,

under sections 6(c) and 17(b) of the Act

exempting applicants from section 17(a)

of the Act, and under section 17(d) of

the Act and rule 17d–1 thereunder.

SUMMARY OF APPLICATION: The requested

order would permit certain registered

investment companies to invest excess

cash in affiliated money market and/or

short-term bond funds in excess of the

limits of section 12(d)(1) of the Act.

APPLICANTS: Cash Accumulation Trust

(‘‘CAT’’), PIMCO Funds: Multi-Manager

Series (‘‘PFMMS’’), and all other

registered investment companies and

series thereof that currently or in the

future are part of a ‘‘group of investment

companies’’ that includes either CAT or

PFMMS (together with CAT and

PFMMS, the ‘‘Funds’’), PIMCO

Advisors, L.P. (‘‘PALP’’), and PIMCO

Funds Distribution Company

(‘‘PFDCO’’).

FILING DATES: The application was filed

on April 25, 1997 and amended on July

31, 1997, and September 30, 1997.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested person 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 December 15, 1997, 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 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 Newton B. Schott, Jr.,

Esq., 2187 Atlantic Street, Stamford, CT

06902.

FOR FURTHER INFORMATION CONTACT:

Annmarie Zell, Law Clerk, at (202) 942–

0532 or Mercer E. Bullard, 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. CAT and PFMMS are open-end

investment companies organized as

Massachusetts business trusts and

registered under the Act. CAT has a

money market portfolio and a short-term

bond portfolio. PFMMS has 22 separate

portfolios.

2. PALP, a Delaware limited

partnership, is registered as an

investment adviser under the

Investment Advisers Act of 1940. PALP

serves as investment adviser to CAT and

PFMMS and has retained a number of

PALP’s subpartnerships to act as

subadvisers for most of the Funds’

portfolios (collectively with PALP, the

‘‘Advisers’’). PFDCO, a subsidiary of

PALP, is registered as a broker-dealer

under the Securities Exchange Act of

1934 and acts or will act as each Fund’s

principal underwriter.

3. Applicants request an order that

would permit certain Funds

(‘‘Participating Funds’’) to invest their

excess cash in one or more Funds that

are money market or short-term bond

Funds (‘‘Central Funds’’), and the

Adviser to effect such transactions.1

Central Funds that are money market

funds will be subject to rule 2a–7 under

the Act. Central Funds that are shortterm bond funds will seek current

income consistent with the preservation

of capital by investing in fixed-income

securities while maintaining a dollarweighted average maturity of three years

or less.

4. Each Participating Fund has, or

may have, uninvested cash held by its

custodian bank. Uninvested cash may

result from a variety of sources,

including dividends or interest received

from portfolio securities, unsettled

securities transactions, reserves held for

investment strategy purposes, scheduled

maturity of investments, liquidation of

investment securities to meet

anticipated redemptions and dividend

payments, and new cash received from

investors. Currently, the Funds can

invest uninvested cash directly in

money market instruments or other

short-term debt obligations.

5. The Participating Funds wish to

have the option to use the Central Funds

as an additional cash management

device for their uninvested cash.

Applicants believe that the proposed

transactions may reduce aggregate

counterparty risk on repurchase

agreements, protect liquidity, reduce

credit exposure to custodian banks,

reduce custodian transaction costs, and

diversify risk across a wide range of

short-term investments.

6. To provide the Participating Funds

with a wider selection of short-term

investment vehicles, the Central Funds

may include one or more short-term

bond funds. Applicants note that an

investment in a Central Fund that is a
62790 Federal Register / Vol. 62, No. 227 / Tuesday, November 25, 1997 / Notices

short-term bond fund would be

available only to those Participating

Funds for which a direct investment in

short-term bonds would be consistent

with their investment objectives,

policies, and restrictions. By investing

in a short-term bond fund, a

Participating Fund could gain exposure

to different points on the yield curve

without the need to buy the underlying

securities. A Participating Fund could

achieve this exposure through a Central

Fund while obtaining greater liquidity

and diversification than otherwise

might be available. 7. If a Central Fund offers more than

one class of shares, each Participating

Fund will invest only in the class with

the lowest expense ratio at the time of

investment. The shares of the Central

Funds sold to and redeemed from the

Participating Funds will not be subject

to a sales load, redemption fee,

distribution fee under a plan adopted in

accordance with rule 12b–1 under the

Act (‘‘rule 12b–1 fee’’), or service fee (as

defined in section 2830(b)(9) of the

Conduct Rules of the National

Association of Securities Dealers, Inc.).

8. Under applicants’ proposal, the

number or value of the shares of the

Central Funds held by a Participating

Fund may exceed the percentage

restrictions set forth in section 12(d)(1)

of the Act. Applicants’ review of the

historical cash positions held by the

Participating Funds indicates that,

while the Funds typically are fully

invested (e.g., cash positions of 10% of

total assets or less), cash positions

fluctuate with shareholder and

investment activity, and cash positions

in excess of 20% of total assets

occasionally may occur. For each

Participating Fund, the uninvested cash

available for investment at any

particular time may total 25% or more

of the Participating Fund’s total net

assets. Thus, each Participating Fund

seeks relief to invest up to 25% of its

total assets in the Central Funds.

Applicants’ Legal Analysis

1. Section 12(d)(1)(A) of the Act

provides that a registered investment

company may not acquire securities of

another investment company if such

securities represent more than 3% of the

acquired company’s outstanding voting

stock, more than 5% of the acquiring

company’s total assets, or if such

securities, together with the securities of

other acquired investment companies,

represent more than 10% of the

acquiring company’s total assets.

Section 12(d)(1)(B) of the Act provides

that no registered open-end investment

company may sell its securities to

another investment company if the sale

will cause the acquiring company to

own more than 3% of the acquired

company’s voting stock, or if the sale

will cause more than 10% of the

acquired company’s voting stock to be

owned by investment companies.

Section 12(d)(1)(J) of the Act provides

that the SEC may exempt any persons or

transactions from section 12(d)(1) to the

extent the exemption is consistent with

the public interest and the protection of

investors. For the following reasons,

applicants believe the proposed

transactions satisfy this standard. 2. Applicants state that section

12(d)(1) is intended to protect an

investment company’s shareholders

against (a) undue influence over

portfolio management through the threat

of large scale redemptions; (b) the

layering of fees; and (c) an overly

complex structure. Applicants believe

that none of these perceived abuses is

created by the proposed transactions. 3. Applicants submit that each of the

Central Funds will be managed

specifically to maintain a highly liquid

portfolio, and the Adviser will have

superior ability to anticipate

Participating Funds’ cash flows.

Applicants believe that no layering of

sales charges will occur because no

front-end sales charge, contingent

deferred sales charge, rule 12b–1 fee, or

other underwriting or distribution fee

will be charged in connection with the

purchase and sale of shares of the

Central Funds. The Adviser will credit

to the respective Participating Fund or

waive the investment advisory fee that

it or its affiliates earns as a result of the

Participating Fund’s investment in one

or more Central Funds to the extent

such fees are based upon the

Participating Fund’s assets invested in

shares of the Central Funds. Therefore,

applicants believe that the proposed

transactions will not result in the

layering of any sales charges or

investment advisory fees. Regarding the

complexity of the proposed structure,

applicants note that, as conditions to the

application, no Participating Fund will

invest more than 25% of its assets in the

Central Funds and no Central Fund will

acquire securities of any investment

company in excess of the limits of

section 12(d)(1)(a).

4. Section 17(a) of the Act makes it

unlawful for any affiliated person of a

registered investment company, acting

as principal, to sell or purchase any

security to or from the company.

Section 2(a)(3) of the Act defines an

affiliated person of an investment

company to include any person that

owns more than 5% of the outstanding

voting securities of that company, and

any person directly or indirectly

controlling, controlled by, or under

common control with such investment

company. Because the Funds share a

common investment adviser or have an

investment adviser that is under

common control with those of the other

Funds, and because PFMMS and CAT

share a common board of trustees,

applicants believe that each of the

Funds may be deemed to be under

common control with all the other

Funds, and, therefore, an affiliated

person of those Funds. In addition,

applicants state that a Participating

Fund may be an affiliated person of a

Central Fund by owning more than 5%

of the outstanding voting securities of

the Central Fund. Applicants request an

exemption from section 17(a) to permit

the sale of shares of the Central Funds

to the Participating Funds and the

redemption of such shares by the

Central Funds.

5. Section 17(b) of the Act authorizes

the SEC to exempt a transaction from

section 17(a) if the terms of the

proposed transaction, including the

consideration to be paid or received, are

reasonable and fair and do not involve

overreaching on the part of any person

concerned, and the proposed

transaction is consistent with the policy

of each investment company concerned

and the general purposes of the Act.

Section 6(c) authorizes the Commission

to exempt persons or transactions from

the provisions of the Act to the extent

that such exemptions are appropriate in

the public interest and consistent with

the protection of investors and the

purposes fairly intended by the policies

and provisions of the Act. Applicants

submit, for the reasons discussed below,

that their request for relief satisfies these

standards.

6. Applicants believe that section

17(a) was designed to prevent

‘‘overreaching’’ on the part of an

affiliated person and to ensure that all

transactions between an affiliated

person and an investment company are

conducted on an arm’s length basis.

Applicants submit that the proposed

transactions will not involve

overreaching because the consideration

paid and received for the sale and

redemption of shares of the Central

Funds will be based on the net asset

value per share of the Central Funds.

Applicants also assert that the proposed

transactions are appropriate because

they provide the Participating Funds

and their shareholders with a possible

means of obtaining high current rates of

return for cash investments.

7. Section 17(d) of the Act and rule

17d–1 prohibit an affiliated person of a

registered investment company, acting

as principal, from participating in any

joint arrangement with the investment
Federal Register / Vol. 62, No. 227 / Tuesday, November 25, 1997 / Notices 62791

company unless the SEC has issued an

order authorizing the arrangement.

Applicants believe that the Funds, by

participating in the proposed

transactions, and the Adviser, by

managing the proposed transactions,

could be deemed to be participating in

a joint arrangement within the meaning

of section 17(d) and rule 17d–1.

8. In determining whether to grant an

exemption under rule 17d–1, the SEC

considers whether the investment

company’s participation in the joint

enterprise is consistent with the

provisions, policies, and purposes of the

Act, and the extent to which such

participation is on a basis different from

or less advantageous than that of other

participants. Applicants assert that no

Participating Fund or Central Fund will

participate in the proposed transactions

on a basis that is different from or less

advantageous than that of any other

participant and that the transactions

will be consistent with the Act.

Applicants’ Conditions

Applicants agree that the order

granting the requested relief will be

subject to the following conditions:

1. The shares of the Central Funds

sold to and redeemed from the

Participating Funds will not be subject

to a sales load, redemption fee,

distribution fee under a plan adopted in

accordance with rule 12b–1, or service

fee (as defined in rule 2830(b)(9) of the

NASD Conduct Rules).

2. If the Adviser collects a fee from a

Central Fund for acting as its investment

adviser with respect to assets invested

by a Participating Fund, before the next

meeting of the board of trustees of a

Participating Fund that invests in the

Central Funds is held for the purpose of

voting on an advisory contract under

section 15 of the Act, the Adviser to the

Participating Fund will provide the

board of trustees with specific

information regarding the approximate

cost to the Adviser for, or portion of the

advisory fee under the existing advisory

fee attributable to, managing the assets

of the Participating Fund that can be

expected to be invested in such Central

Funds. Before approving any advisory

contract under section 15, the board of

trustees of such Participating Fund,

including a majority of the trustees who

are not ‘‘interested persons,’’ as defined

in section 2(a)(19) of the Act, shall

consider to what extent, if any, the

advisory fees charged to the

Participating Fund by the Adviser

should be reduced to account for the fee

indirectly paid by the Participating

Fund because of the advisory fee paid

by the Central Fund to the Adviser. The

minute books of the Participating Fund

will record fully the trustees’

consideration in approving the advisory

contract, including the considerations

relating to fees referred to above.

3. Each of the Participating Funds will

invest uninvested cash in, and hold

shares of, the Central Funds only to the

extent that the Participating Fund’s

aggregate investment in the Central

Funds does not exceed 25% of the

Participating Fund’s total net assets. For

purposes of this limitation, each

Participating Fund or series thereof will

be treated as a separate investment

company.

4. Investment in shares of the Central

Funds will be in accordance with each

Participating Fund’s respective

investment restrictions, if any, and will

be consistent with each Participating

Fund’s policies as set forth in its

prospectuses and statements of

additional information.

5. Each Participating Fund, the

Central Funds, and any future Fund that

may rely on the order shall be part of

a ‘‘group of investment companies,’’ as

defined in section 12(d)(1)(G)(ii) of the

Act, that includes either CAT or

PFMMS.

6. No Central Fund shall acquire

securities of any other investment

company in excess of the limits

contained in section 12(d)(1)(A) of the

Act.

For the SEC, by the Division of Investment

Management, under delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–30863 Filed 11–24–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 35–26781]

Filings Under the Public Utility Holding

Company Act of 1935, as Amended

(‘‘Act’’)

November 18, 1997.

Notice is hereby given that the

following filing(s) has/have been made

with the Commission pursuant to

provisions of the Act and rules

promulgated thereunder. All interested

persons are referred to the application(s)

and/or declaration(s) for complete

statements of the proposed

transaction(s) summarized below. The

application(s) and/or declaration(s) and

any amendments thereto is/are available

for public inspection through the

Commission’s Office of Public

Reference.

Interested persons wishing to

comment or request a hearing on the

application(s) and/or declaration(s)

should submit their views in writing by

December 12, 1997, to the Secretary,

Securities and Exchange Commission,

Washington, D.C. 20549, and serve a

copy on the relevant applicant(s) and/or

declarant(s) at the address(es) specified

below. Proof of service (by affidavit or,

in case of an attorney at law, by

certificate) should be filed with the

request. Any request for hearing shall

identify specifically the issues of fact or

law that are disputed. A person who so

requests will be notified of any hearing,

if ordered, and will receive a copy of

any notice or order issued in the matter.

After said date, the application(s) and/

or declaration(s), as filed or as amended,

may be granted and/or permitted to

become effective.

Eastern Utilities Associates (70–6583)

Eastern Utilities Associates (‘‘EUA’’),

P.O. Box 2333, Boston, Massachusetts

02107, a registered holding company,

has filed a post-effective amendment to

its application-declaration filed under

Sections 6(a) and 7 of the Act and rule

54 under the Act.

EUA is currently authorized under an

order of the Commission dated

December 19, 1994 (HCAR No. 26193)

(‘‘Prior Order’’) to sell up to 6.8 million

of its authorized common shares under

its Dividend Reinvestment and Common

Share Purchase Plan (‘‘Plan’’) through

December 31, 1997. Under the Prior

Order, EUA is authorized to issue these

shares or to purchase them on the open

market. As of November 1, 1997, EUA

has sold 6,042,088 of its authorized

common shares under the Plan.

EUA now proposes to extend its

authority to sell the remaining 757,912

shares of its common stock under the

Plan through December 31, 2000. In

addition, EUA proposes to sell up to one

million additional shares of its common

stock under the Plan from time to time

through December 31, 2000. EUA will

either issue the shares of its common

stock it sells under the Plan or purchase

them on the open market.

EUA will use the proceeds from the

sale of common shares under the Plan

for investment in its subsidiaries,

payment of its indebtedness and/or for

its general corporate purposes.

Consolidated Natural Gas Company, et

al. (70–8621)

Consolidated Natural Gas Company

(‘‘Consolidated’’), CNG Tower,

Pittsburgh, Pennsylvania 15222–3199, a

registered holding company, and its

wholly owned nonutility subsidiary,

CNG Energy Services Corporation

(‘‘Energy Services’’), One Park Ridge

Center, Pittsburgh, Pennsylvania 15244–