Federal Register / Vol. 62, No. 33 / Wednesday, February 19, 1997 / Notices 7481

1The Fund changed its name from foreign Fund,

Inc. on January 2, 1997.

2The Adviser changed its name from BZW

Barclays Global Fund Advisors on October 15,

1996.

3Shares of the Series (‘‘World Equity Benchmark

Shares’’ or ‘‘WEBS’’) are issued only in large

aggregations of WEBS known as ‘‘Creation Units.’’

WEBS are neither offered nor redeemed by the

Series in less than Creation Unit aggregations, but

WEBS may be bought or sold in smaller

aggregations in the secondary market on the

American Stock Exchange, were WEBS are listed

and traded. Additional Series are expected to be

added from time to time, and would be subject to

the requested order.

4The Custodian is not an affiliated person of

either the Fund or the Adviser.

5The Series will engage in hold-in-custody

repurchase agreements (i.e., repurchase agreements

where the counterpart or one of its affiliated

persons may have possession of, or control over, the

collateral subject to the agreement) only when cash

is received very late in the business day and

otherwise would be unavailable for investment.

FOR FURTHER INFORMATION CONTACT:

Michael E. Kowalok, Presidential

Advisory Committee on Gulf War

Veterans’ Illnesses, 1411 K Street, NW.,

suite 1000, Washington, DC 20005,

Telephone: (202) 761–0066, Fax: (202)

761–0310.

Dated: February 13, 1997.

C.A. Bock,

Federal Register Liaison Officer, Presidential

Advisory Committee on Gulf War Veterans’

Illnesses.

[FR Doc. 97–4043 Filed 2–18–97; 8:45 am]

BILLING CODE 3610–76–M

SECURITIES AND EXCHANGE

COMMISSION

[Investment Company Act Rel. No. 22507;

812–10334]

WEBS Index Fund, Inc., et al; Notice of

Application

February 12, 1997.

AGENCY: Securities and Exchange

Commission (’’SEC’’).

ACTION: Notice of application for

exemption Under the Investment

Company Act of 1940 (‘‘Act’’).

APPLICANTS: WEBS Index Fund, Inc. (the

‘‘Fund’’) 1 and Barclays Global Fund

Advisors (the ‘‘Adviser’’) 2.

RELEVANT ACT SECTIONS: Order requested

under section 17(d) of the Act and rule

17d–1 thereunder.

SUMMARY OF APPLICATION: Applicants

seek an order that would permit the

series of the fund to pool some or all of

their uninvested cash balances and the

cash collateral they receive in

connection with securities lending

activities (‘‘Cash Collateral’’) in one or

more joint accounts (‘‘Joint Accounts’’)

that invest in certain short-term high

quality debt securities (‘‘Short-Term

Investments’’)

FILING DATES: The application was filed

on September 13, 1996, and amended

on December 27, 1996. Applicants have

agreed to file an additional amendment

during the notice period, the substance

of which is incorporated herein.

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

March 10, 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 such notification

by writing to the SEC’s Secretary.

ADDRESSES: Secretary, SEC, 450 Fifth

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

Applicants: WEBS Index Fund, Inc.,

c/o PFPC, Inc., 400 Bellevue Parkway,

Wilmington, Delaware 19809; BZW

Barclays Global Fund Advisors, 45

Fremont Street, San Francisco,

California 94105.

FOR FURTHER INFORMATION CONTACT:

Courtney S. Thornton, Senior Counsel,

at (202) 942–0583, or Mary Kay Ferch,

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.

Applicants’ Representatives

1. The Fund, a Maryland corporation,

is an open-end management investment

company that currently offers seventeen

series (the ‘‘Series’’).3 The Adviser

provides investment advisory services

for all of the Series.

2. The investment objective of each of

the Series is to provide investment

results that correspond generally to the

aggregate price and yield performance of

publicly traded securities in particular

markets, as represented by foreign

equity securities indexes compiled by

Morgan Stanley Capital International

(each, an ‘‘MSCI Index’’). Each Series

seeks to remain fully invested in a pool

of equity securities the performance of

which approximates that of the relevant

MSCI Index. In addition, each Series

may lend its portfolio securities to

approved brokers, dealers, and other

financial institutions. The Custodian

serves as the lending agent of the Fund

and, in that capacity, will share with the

respective Series any net income earned

on invested Cash Collateral in the

proportion agreed between the

Custodian and the Series from time to

time.4

3. Subject to guidelines adopted by

the board of directors of the Fund (the

‘‘Board’’) and such additional limits as

may be established by the Adviser, each

Series may invest uncommitted cash

balances and Cash Collateral

temporarily in the following Short-Term

Investments: (a) Obligations of the U.S.

Government and its agencies and

instrumentalities; (b) commercial paper

rated Prime-1 by Moody’s Investors

Services, Inc. or A–1 by Standard &

Poor’s Corporation (‘‘Commercial

Paper’’); (c) bank certificates of deposit

and bankers’ acceptances; (d)

repurchase agreements collateralized by

the foregoing securities;5 (e)

participation interests in such

securities; and (f) shares of unaffiliated

money market funds (subject to

applicable limits under the Act). The

maximum possible maturity of each

type of Short-Term Investment (other

than shares of money market funds) will

be 397 calendar days.

4. Applicants believe that the separate

purchase of Short-Term Investments by

each Series could result in certain

inefficiencies, a limitation on the return

that the Series could otherwise achieve,

and increased costs. Accordingly,

applicants propose to deposit the Series’

available cash balances in Joint

Accounts and to invest the daily balance

of the Joint Accounts in Short-Term

Investments. Applicants also propose to

deposit the Series’ Cash Collateral in a

separate Joint Account for investment in

Short-Term Investments selected by the

Adviser. The sole purpose of these Joint

Accounts would be to provide a

convenient means of aggregating what

otherwise would be daily transactions

for some or all of the Series to manage

their daily account balances.

5. The Adviser will not participate

monetarily in the Joint Accounts, nor

will it receive an additional fee for the

administration of the Accounts. The

Adviser will be responsible for directing

the investment of funds held by the

Joint Accounts, establishing accounting

and control procedures, operating the

Joint Accounts in accordance with

established procedures, and ensuring

the fair treatment of each Series. The
7482 Federal Register / Vol. 62, No. 33 / Wednesday, February 19, 1997 / Notices

Adviser will manage investments made

with the proceeds of the Joint Accounts

in essentially the same manner as if it

had made such investments on an

individual basis for each Series.

6. All purchases through the Joint

Accounts will be subject to the same

systems and standards for acquiring

investments as are applicable to the

individual Series. In addition, all

purchases through the Joint Accounts

will comply with all present and future

SEC staff positions relating to the

investment of cash collateral received in

connection with securities lending

activities.

Applicants’ Legal Analysis

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

17d-1 thereunder prohibit an affiliated

person of a registered investment

company, or an affiliated person of such

a person, from participating as a

principal in any joint enterprise or

arrangement in which such investment

company is a participant. Each Series

may be deemed an affiliated person of

each other Series under the definition

set forth in section 2(a)(3) of the Act.

Each Series, by participating in the

proposed Joint Accounts, and the

Adviser, by managing the proposed

Joint Accounts, could be deemed to be

joint participants in a transaction within

the meaning of section 17(d) of the Act.

In addition, the proposed Joint

Accounts could be deemed to be joint

arrangements within the meaning of

rule 17d-1.

2. Applicants assert that the proposed

method of operating the Joint Accounts

would not result in any conflicts of

interest among any of the Series, or

between a Series and the Adviser. Each

Series would participate in the Joint

Accounts on the same basis as every

other Series that participates therein

and in conformity with its investment

objective and fundamental policies and

restrictions. Applicants also have

determined that the operation of the

Joint Accounts would be free of any

inherent bias favoring one Series over

another and should eliminate bias due

to size or lack thereof in any Short-Term

Investment transaction, and that the

anticipated benefits flowing to each

Series would fall within an acceptable

range of fairness.

3. Applicants argue that, although the

Adviser and the Custodian would gain

some benefit through administrative

convenience and some possible

reduction in clerical costs, the primary

beneficiaries would be the Series and

their shareholders, because the Joint

Accounts would provide a more

efficient and productive way of

administering their daily investment

transactions. Specifically, applicants

believe that the proposed Joint Accounts

would have the following benefits for

the Series: (a) The Series collectively

would save fees and expenses by

reducing the number of transactions

relative to the number of transactions in

which they would engage individually;

(b) the Series may earn a higher rate of

return on Short-Term Investments

through the Joint Accounts relative to

the returns they could earn

individually; (c) the Series may realize

certain administrative efficiencies and a

reduction of the potential for errors by

reducing the number of trade tickets and

cash wires that must be processed by

the sellers of Short-Term Investments,

the Custodian, and the Adviser’s trading

departments; (d) by participating in

larger repurchase agreements, the Series

may benefit from an institution’s

willingness to increase the amount

covered by such agreement near the end

of the day; and (e) the Series may be

able to investment in a greater variety of

instruments and thereby obtain more

favorable yield as market conditions

change.

4. For the reasons set forth above,

applicants believe that granting the

requested order would be consistent

with the provisions, policies, and

purposes of the Act, and that the Series’

participation in the proposed Joint

Accounts would not be on a basis

different from or less advantageous than

that of any other participant therein.

Accordingly, applicants submit that the

proposed transactions meet the criteria

for issuance of an order under section

17(d) and rule 17d–1 thereunder.

Applicants’ Conditions

Applicants agree that any order issued

by the SEC will be subject to the

following conditions:

1. The Joint Accounts will be

established on behalf of the Series with

the Custodian as one or more separate

cash accounts into which the Series may

deposit daily all or a portion of their

uninvested cash balances and Cash

Collateral. The Joint Accounts will not

be distinguishable from any other

accounts maintained by a Series with

the Custodian except that monies from

the various Series will be deposited in

the Joint Accounts on a commingled

basis. The Joint Accounts will not have

any separate existence with indicia of a

separate legal entity. The sole function

of the Joint Accounts will be to provide

a convenient and productive way of

aggregating individual transactions that

would otherwise require daily

management and investment by each

Series of its uninvested cash balances

and Cash Collateral.

2. Cash and Cash Collateral in the

Joint Accounts will be invested in one

or more of the following Short-Term

Investments, as determined by the

Adviser: (a) Obligations of the U.S.

Government and its agencies and

instrumentalities; (b) Commercial Paper;

(c) bank certificates of deposit and

bankers’ acceptances; (d) repurchase

agreements ‘‘collateralized fully’’ (as

that tern is defined in rule 2a–7 under

the Act) by the foregoing securities; (e)

participation interests in such

securities; and (f) shares of money

market funds that are not affiliated

persons of applicants (subject to

applicable limits under the Act).

3. All assets held in the Joint

Accounts will be valued on an

amortized cost basis to the extent

permitted by applicable SEC releases,

rules, or orders.

4. In order to ensure that there will be

no opportunity for one Series to use any

part of the balance of the Joint Accounts

credited to another Series, no Series will

be allowed to create a negative balance

in any of the Joint Accounts for any

reason, although each Series will be

permitted to draw down its pro rata

share of the entire balance at any time.

Each Series’ decision to invest through

the Joint Accounts will be solely at the

option of the Series and the Adviser,

and no Series will be obligated to invest

through, or to maintain any minimum

balance in, any of the Joint Accounts. In

addition, each Series will retain the sole

rights of ownership over any of its assets

invested in the Joint Accounts,

including interest payable on such

assets.

5. Each Series will participate in the

income earned or accrued in each Joint

Account in which it is invested,

including all investments held by such

Joint Account, on the basis of the

percentage of the total amount in such

Joint Account on any day represented

by its share of such Joint Account.

6. The Adviser will (a) administer,

manage and invest, or cause any

investment of, the uninvested cash

balances, and (b) direct, supervise, and

monitor the investment of Cash

Collateral, in the Joint Accounts in

accordance with and as part of its duties

under the existing or any future

investment advisory contracts with the

Fund, and will not collect any

additional or separate fee for the

administration of the Joint Accounts.

7. The administration of the Joint

Accounts will be within the fidelity

bond coverage required by section 17(g)

of the Act and rule 17g–1 thereunder.

8. The Board will adopt procedures

pursuant to which the Joint Accounts

will operate, which will be reasonable
Federal Register / Vol. 62, No. 33 / Wednesday, February 19, 1997 / Notices 7483

1 15 U.S.C. 78s(b)(1).

2The Exchange seeks accelerated approval of the

proposed rule change in order to allow the pilot

program, which expires on February 10, 1997, to

continue with interruption.

3Securities Exchange Act Release No. 38024 (Dec.

6, 1996), 61 FR 65623 (approving File No. SR–

Amex–96–47).

4Securities Exchange Act Release No. 26445 (Jan.

10, 1989), 54 FR 2248 (approving File No. SR–

Amex–88–23).

5Securities Exchange Act Release No. 38024 (Dec.

6, 1996), 61 FR 65623 (approving File No. SR–

Amex–96–47). Prior to that release, the Commission

had extended this pilot program thirteen times. See

Securities Exchange Act Release Nos. 37462 (July

19, 1996), 61 FR 39170 (approving File No. SR–

Amex–96–25); 36821 (Feb. 8, 1996), 61 FR 6050

(approving File No. SR–Amex–96–06); 35344 (Feb.

8, 1995), 60 FR 8430 (approving File No. SR–Amex–

95–03); 34949 (Nov. 8, 1994), 59 FR 58863

(approving File No. SR–Amex–94–47); 34496 (Aug.

Continued

designed to provide that the

requirements of the application will be

met. In addition, the Board will evaluate

each Joint Account arrangement

annually and will authorize continued

participation in such Joint Account only

if it determines that there is a reasonable

likelihood that such continued

participation will benefit each Series

and its shareholders.

9. Each Series’ investment in a Joint

Account will be documented daily on

the books of the Series and the books of

the Custodian.

10. Short-Term Investments held in a

Joint Account generally will not be sold

prior to maturity unless: (a) The Adviser

believes that the investment no longer

presents minimal credit risks; (b) the

investment no longer satisfies the

investment criteria of the Series because

of a credit downgrading or otherwise; or

(c) in the case of a repurchase

agreement, the counterparty defaults.

The Adviser may, however, sell any

Short-Term Investment (or any

fractional portion thereof) on behalf of

some or all Series prior to maturity of

the investment if the cost of such

transactions will be borne soley by the

selling Series, and the transaction will

not adversely affect the other Series.

Each Series will be deemed to have

consented to such sale and partition of

the investments in the Joint Account.

11. Short-Term Investments held

through a Joint Account with a

remaining maturity of more than seven

days will be considered illiquid and

subject to the restriction that the Series

may not invest more than 15% (or such

other percentage as set forth by the SEC

from time to time) of its assets in

illiquid securities, if the Series cannot

sell its fractional interest in the

investment in such Joint Account

pursuant to the requirements described

in the preceding condition.

12. All joint repurchase transactions

will be effected in accordance with

Investment Company Act Release No.

13005 (February 2, 1983) and with other

existing and future positions taken by

the SEC or its staff by rule, interpretive

release, no-action letter, any release

adopting any new rule, or any release

adopting any amendments to any

existing rule.

13. Any investment made through a

Joint Account will satisfy the

investment policies or criteria of all

Series participating in that investment.

For the SEC, by the Division of Investment

Management, under delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–4047 Filed 2–18–97; 8:45 am]

BILLING CODE 8010–01–M

Sunshine Act; Meeting

‘‘FEDERAL REGISTER’’ CITATION OF

PREVIOUS ANNOUNCEMENT: [62 FR 6288,

February 11, 1997].

STATUS: Closed Meeting.

PLACE: 450 Fifth Street, N.W.,

Washington, D.C.

DATE PREVIOUSLY ANNOUNCED: February

11, 1997.

CHANGE IN THE MEETING: Deletion/

Rescheduling.

The following item, scheduled for

consideration on Friday, February 14,

1997, has been rescheduled for

consideration on Tuesday, February 18,

1997, following the open meeting, at

10:00 a.m.:

Regulatory matter bearing

enforcement implications.

Commissioner Wallman, as duty

officer, determined that Commission

business required the above change and

that no earlier notice thereof was

possible.

At times, changes in Commission

priorities require alterations in the

scheduling of meeting items. For further

information and to ascertain what, if

any, matters have been added, deleted

or postponed, please contact: The Office

of the Secretary (202) 942–7070.

Dated: February 14, 1997.

Jonathan G. Katz,

Secretary.

[FR Doc. 97–4242 Filed 2–14–97; 3:46 pm]

BILLING CODE 8010–01–M

[Release No. 34–38266; File No. SR–Amex–

97–08]

Self-Regulatory Organizations; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change by the American Stock

Exchange, Inc. Relating to a Pilot

Program for Execution of Odd-Lot

Orders

February 11, 1997.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

February 10, 1997, the American Stock

Exchange, Inc. (‘‘Amex’’ or ‘‘Exchange’’)

filed with the Securities and Exchange

Commission (‘‘Commission’’) the

proposed rule change as described in

Items I and II below, which Items have

been prepared by the self-regulatory

organization. The Commission

publishing this notice to solicit

comments on the proposed rule change

from interested persons and to grant

accelerated approval to the proposed

rule change.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The Exchange proposes to extend for

three months its existing pilot program

under Amex Rule 205 requiring

execution of odd-lot market orders at

the prevailing Amex quote with no

differential charge.2

The text of the proposed rule change

is available for the Office of the

Secretary, the Amex, and at the

Commission.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change.

In its filing with the Commission, the

self-regulatory organization included

statements concerning the purpose of

and basis for the proposed rule change

and discussed any comments it received

on the proposed rule change. The text

of these statements may be examined at

the places specified in item III below.

The self-regulatory organization has

prepared summaries, set forth in

Sections A, B, and C below, of the most

significant aspects of such statements.

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The Commission previously

approved, on a pilot basis extending to

February 10, 1997, amendments to

Amex Rule 205 to require execution of

odd-lot market orders at the Amex quote

with no odd-lot differential charged.3

The procedures were not initially

approved by the Commission in 19894

and were most recently extended in

December 1996.5