7884 Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices 

1The Corporation’s Series include the AB MultiManager Alternative Strategies Fund series, the AB 

Multi-Manager Select Retirement Allocation Fund 

series, the AB Multi-Manager Select 2010 Fund 

series, the AB Multi-Manager Select 2015 Fund 

series, the AB Multi-Manager Select 2020 Fund 

series, the AB Multi-Manager Select 2025 Fund 

series, the AB Multi-Manager Select 2030 Fund 

series, the AB Multi-Manager Select 2035 Fund 

series, the AB Multi-Manager Select 2040 Fund 

series, the AB Multi-Manager Select 2045 Fund 

series, the AB Multi-Manager Select 2050 Fund 

series, the AB Multi-Manager Select 2055 Fund 

series and the AB Long/Short Multi-Manager Fund 

(the ‘‘Initial Funds’’). Applicants request that the 

relief sought herein apply to Applicants, as well as 

to any existing or future Series of the Corporation 

and to any other existing or future registered openend investment company or series thereof that: (a) 

Is advised by the Adviser (any such series or 

investment company, including without limitation 

the Corporation, the Initial Funds and any Series of 

the Corporation, a ‘‘Fund’’); (b) uses the manager of 

managers structure described in this application 

(‘‘Manager of Managers Structure’’); and (c) 

complies with the terms and conditions of this 

application (the ‘‘Subadvised Funds,’’ and each a 

‘‘Subadvised Fund’’). The only existing registered 

open-end management investment company that 

currently intends to rely on the requested order is 

named as an Applicant, and the Series that 

currently intend to rely on the requested order are 

identified in this application as Initial Funds. Any 

entity that relies on the requested order will do so 

only in accordance with the terms and conditions 

of this application. If the name of any Subadvised 

Fund contains the name of a subadviser, the name 

of the Adviser that serves as the primary adviser to 

that Subadvised Fund or a trademark or trade name 

that is owned by or publicly used to identify that 

Adviser will precede the name of the subadviser. 

2The term ‘‘Board’’ also includes the board of 

trustees or directors of an existing or future 

Subadvised Fund. 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

31449; 812–14235] 

AB Cap Fund, Inc., et al.; Notice of 

Application 

February 6, 2015. 

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: AP Cap Fund, Inc. (the 

‘‘Corporation’’) and AllianceBernstein 

L.P. (‘‘Adviser’’ and together with the 

Corporation, ‘‘Applicants’’). 

Filing Dates: The application was filed 

November 14, 2013, and amended on 

March 31, 2014 and January 7, 2015. 

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 March 2, 2015 and 

should be accompanied by proof of 

service on the applicants, in the form of 

an affidavit or, for lawyers, a certificate 

of service. Pursuant to rule 0–5 under 

the Act, hearing requests should state 

the nature of the writer’s interest, any 

facts bearing upon the desirability of a 

hearing on the matter, 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: Emilie D. Wrapp, Esq., 

AllianceBernstein L.P., 1345 Avenue of 

the Americas, New York, NY 10105. 

FOR FURTHER INFORMATION CONTACT: 

Emerson S. Davis, Senior Counsel, at 

(202) 551–6868, or Daniele Marchesani, 

Branch Chief, at (202) 551–6821 

(Division of Investment Management, 

Chief Counsel’s Office). 

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 Corporation, a Maryland 

corporation, is registered under the Act 

as an open-end management investment 

company that consists of several series 

(‘‘Series’’), each with its own investment 

objectives, policies and restrictions.1

2. AllianceBernstein L.P., a Delaware 

limited partnership, is and any future 

Adviser (as defined below) will be 

registered as an investment adviser 

under the Investment Advisers Act of 

1940 (‘‘Advisers Act’’). 

AllianceBernstein L.P currently serves 

as the investment adviser to the Initial 

Funds. An Adviser will serve as an 

investment adviser to each Subadvised 

Fund pursuant to an investment 

advisory agreement with the 

Corporation (each an ‘‘Investment 

Advisory Agreement’’). Each Investment 

Advisory Agreement has been, or will 

be, approved by the board of directors 

of the Corporation (the ‘‘Board’’), 

including a majority of the directors 

who are not ‘‘interested persons,’’ as 

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

the Corporation or the Adviser 

(‘‘Independent Directors’’) and by the 

shareholders of the relevant Subadvised 

Fund in the manner required by 

sections 15(a) and 15(c) of the Act and 

rule 18f–2 under the Act.2 Applicants 

are not seeking any exemption from the 

provisions of the Act with respect to the 

Advisory Agreement. 

3. Each Investment Advisory 

Agreement will permit the Adviser to 

manage the investment and 

reinvestment of the assets of each 

Subadvised Fund and to provide 

management services with respect to a 

Subadvised Fund. For the investment 

management services it provides to a 

Subadvised Fund, the Adviser will 

receive from that Subadvised Fund the 

fee specified in its Investment Advisory 

Agreement, payable monthly at an 

annual rate based on the average daily 

net assets of the Subadvised Fund. 

4. The Investment Advisory 

Agreement will permit the Adviser to 

enter into subadvisory agreements 

(‘‘Subadvisory Agreements’’) with 

certain investment subadvisers 

(‘‘Subadvisers’’). Each Subadviser will 

be an investment adviser as defined in 

section 2(a)(20) of the Act, and either 

will be registered with the Commission 

as an investment adviser under the 

Advisers Act or not subject to such 

registration. The Adviser will evaluate, 

allocate assets to and oversee the 

Subadvisers, and make 

recommendations about their hiring, 

termination and replacement to the 

Board, at all times subject to the 

authority of the Board. 

5. For the services provided under 

each Subadvisory Agreement, it is 

currently intended that the applicable 

Subadviser will receive from the 

Adviser a fee based on a percentage of 

the Subadvised Fund’s average daily 

total or net assets or allocated portion 

thereof. Where the Adviser is 

responsible for paying Subadvisory fees 

to the Subadviser, the Adviser will 

compensate each Subadviser out of its 

assets. Subadvised Funds may directly 

pay advisory fees to Subadvisers in the 

future. 

6. Applicants request an order to 

permit the Adviser, subject to Board 

approval, to select certain Subadvisers 

to manage all or a portion of the assets 

of a Subadvised Fund pursuant to a 

Sub-Advisory Agreement and materially 

amend Sub-Advisory Agreements 

without obtaining shareholder approval. 

The requested relief will not extend to 

any Subadviser that is an affiliated 


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Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices 7885 

3A ‘‘Multi-manager Notice’’ will be modeled on 

a Notice of Internet Availability as defined in rule 

14a–16 under the Exchange Act, and specifically 

will, among other things: (a) Summarize the 

relevant information regarding the new Subadviser; 

(b) inform shareholders that the Multi-manager 

Information Statement is available on a Web site; 

(c) provide the Web site address; (d) state the time 

period during which the Multi-manager Information 

Statement will remain available on that Web site; 

(e) provide instructions for accessing and printing 

the Multi-manager Information Statement; and (f) 

instruct the shareholder that a paper or email copy 

of the Multi-manager Information Statement may be 

obtained, without charge, by contacting the 

Subadvised Funds. A ‘‘Multi-manager Information 

Statement’’ will meet the requirements of 

Regulation 14C, Schedule 14C and Item 22 of 

Schedule 14A under the Exchange Act for an 

information statement, except as modified by the 

requested order to permit Aggregate Fee Disclosure. 

Multi-manager Information Statements will be filed 

electronically with the Commission via the EDGAR 

system. 

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

the Act, of the Corporation, a 

Subadvised Fund or the Adviser, other 

than by reason of serving as a 

Subadviser to a Subadvised Fund 

(‘‘Affiliated Subadviser’’). 

7. Applicants also request an order 

exempting the Subadvised Funds from 

certain disclosure provisions described 

below that may require the Applicants 

to disclose fees paid to each Subadviser 

by the Adviser or a Subadvised Fund. 

Applicants seek an order to permit each 

Subadvised Fund to disclose (as a dollar 

amount and a percentage of a 

Subadvised Fund’s total or net assets) 

only: (a) The aggregate fees paid to the 

Subadvised Fund’s Adviser and any 

Affiliated Subadvisers; and (b) the 

aggregate fees paid to Subadvisers other 

than Affiliated Subadvisers 

(collectively, the ‘‘Aggregate Fee 

Disclosure’’). All other items required 

by sections 6–07(2)(a), (b) and (c) of 

Regulation S–X will be disclosed. A 

Subadvised Fund that employs an 

Affiliated Subadviser will provide 

separate disclosure of any fees paid to 

the Affiliated Subadviser. 

8. The Subadvised Funds will inform 

shareholders of the hiring of a new 

Subadviser pursuant to the following 

procedures (‘‘Modified Notice and 

Access Procedures’’): (a) Within 90 days 

after a new Subadviser is hired for any 

Subadvised Fund, that Subadvised 

Fund will send its shareholders either a 

Multi-manager Notice or a Multimanager Notice and Multi-manager 

Information Statement; 3 and (b) the 

Subadvised Fund will make the Multimanager Information Statement 

available on the Web site identified in 

the Multi-manager Notice no later than 

when the Multi-manager Notice (or 

Multi-manager Notice and Multimanager Information Statement) is first 

sent to shareholders, and will maintain 

it on that Web site for at least 90 days. 

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 (‘‘Exchange 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. 

Regulation S–X sets forth the 

requirements for financial statements 

required to be included as part of a 

registered investment company’s 

registration statement and shareholder 

reports filed with the Commission. 

Sections 6–07(2)(a), (b) and (c) of 

Regulation S–X require a registered 

investment company to include in its 

financial statement information about 

the investment advisory fees. 

4. 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. 

5. Applicants assert that the 

shareholders expect the Adviser, subject 

to the review and approval of the Board, 

to select one or more Subadvisers who 

are well suited to achieve the 

Subadvised Fund’s investment 

objective. Applicants assert that, from 

the perspective of the shareholder, the 

role of the Subadviser is substantially 

equivalent to the role of the individual 

portfolio managers employed by an 

investment adviser to a traditional 

investment company. Applicants 

believe that without the requested relief, 

the Subadvised Funds may be (i) 

precluded from promptly and timely 

hiring Subadvisers or materially 

amending Subadvisory Agreements, or 

(ii) subject to delays and additional 

expense of proxy solicitation when 

hiring Subadvisers or materially 

amending Subadvisory Agreements 

considered appropriate by the Adviser 

and the Board. Applicants note that the 

Investment Advisory Agreement for 

each Subadvised Fund and subadvisory 

agreements with Affiliated Subadvisers 

(if any) will continue to be subject to the 

shareholder approval requirements of 

section 15(a) of the Act and rule 18f–2 

under the Act. 

6. Applicants assert that the requested 

disclosure relief would benefit 

shareholders of the Subadvised Funds 

because it would improve the Adviser’s 

ability to negotiate the fees paid to 

Subadvisers. Applicants state that the 

Adviser may be able to negotiate rates 

that are below a Subadvisers ‘‘posted’’ 

amounts, if the Adviser is not required 

to disclose the Subadvisers’ fees to the 

public. Applicants submit that the 

requested relief will also encourage 

Subadvisers to negotiate lower 

subadvisory fees with the Adviser if the 

lower fees are not required to be made 

public. 

Applicants’ Conditions 

Applicants agree that any order 

granting the requested relief will be 

subject to the following conditions: 

1. Before a Subadvised Fund may rely 

on the order requested herein, the 

operation of the Subadvised Fund in the 

manner described in the application 

will be approved by a majority of the 

Subadvised Fund’s outstanding voting 

securities as defined in the Act, or, in 

the case of a Subadvised Fund whose 

public shareholders purchase shares on 

the basis of a prospectus containing the 

disclosure contemplated by condition 2 

below, by the initial shareholder before 

such Subadvised Fund’s shares are 

offered to the public. 

2. The prospectus for each 

Subadvised Fund will disclose the 

existence, substance, and effect of any 

order granted pursuant to the 

application. In addition, each 

Subadvised Fund will hold itself out to 


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7886 Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

the public as employing the Manager of 

Managers Structure. The prospectus will 

prominently disclose that the Adviser 

has the ultimate responsibility, subject 

to oversight by the Board, to oversee the 

Subadvisers and recommend their 

hiring, termination, and replacement. 

3. Subadvised Funds will inform 

shareholders of the hiring of a new 

Subadviser within 90 days after the 

hiring of the new Subadviser pursuant 

to the Modified Notice and Access 

Procedures. 

4. The Adviser will not enter into a 

Subadvisory Agreement with any 

Affiliated Subadviser unless such 

agreement, including the compensation 

to be paid thereunder, has been 

approved by the shareholders of the 

applicable Subadvised Fund. 

5. At all times, at least a majority of 

the Board will be Independent 

Directors, and the selection and 

nomination of new or additional 

Independent Directors will be placed 

within the discretion of the thenexisting Independent Directors. 

6. 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. 

7. Whenever a subadviser change is 

proposed for a Subadvised Fund with 

an Affiliated Subadviser, the Board, 

including a majority of the Independent 

Directors, will make a separate finding, 

reflected in the Board minutes, that the 

change is in the best interests of the 

Subadvised Fund and its shareholders, 

and does not involve a conflict of 

interest from which the Adviser or the 

Affiliated Subadviser derives an 

inappropriate advantage. 

8. 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. 

9. The Adviser will provide the 

Board, no less frequently than quarterly, 

with information about the profitability 

of the Adviser on a per Subadvised 

Fund basis. The information will reflect 

the impact on profitability of the hiring 

or termination of any subadviser during 

the applicable quarter. 

10. The Adviser will provide general 

management services to each 

Subadvised Fund, including overall 

supervisory responsibility for the 

general management and investment of 

the Subadvised Fund’s assets and, 

subject to review and approval of the 

Board, will: (i) Set the Subadvised 

Fund’s overall investment strategies; (ii) 

evaluate, select, and recommend 

Subadvisers to manage all or a portion 

of the Subadvised Fund’s assets; (iii) 

allocate and, when appropriate, 

reallocate the Subadvised Fund’s assets 

among Subadvisers; (iv) monitor and 

evaluate the Subadvisers’ performance; 

and (v) implement procedures 

reasonably designed to ensure that 

Subadvisers comply with the 

Subadvised Fund’s investment 

objective, policies and restrictions. 

11. No Director or officer of a 

Subadvised Fund or director, manager 

or officer of the 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 

(i) ownership of interests in the Adviser 

or any entity that controls, is controlled 

by or is under common control with the 

Adviser; or (ii) 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 Subadvised 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. 

14. Any new Subadvisory Agreement 

or any changes to an Investment 

Advisory Agreement or to a Subadvisory 

Agreement that directly or indirectly 

results in an increase in the aggregate 

advisory rate charged to a Subadvised 

Fund will be required to be approved by 

the shareholders of the Subadvised 

Fund. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–02916 Filed 2–11–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74221; File No. SR–BOX– 

2015–11] 

Self-Regulatory Organizations; BOX 

Options Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

a Proposed Rule Change To Amend 

the Fee Schedule on the BOX Market 

LLC Options Facility 

February 6, 2015. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on January 

30, 2015, BOX Options Exchange LLC 

(the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. The 

Exchange filed the proposed rule change 

pursuant to Section 19(b)(3)(A)(ii) of the 

Act,3 and Rule 19b–4(f)(2) thereunder,4

which renders the proposal effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The Exchange is filing with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

to amend the Fee Schedule on the BOX 

Market LLC (‘‘BOX’’) options facility. 

The text of the proposed rule change is 

available from the principal office of the 

Exchange, at the Commission’s Public 

Reference Room and also on the 

Exchange’s Internet Web site at http://

boxexchange.com. 

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 

Exchange 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 IV below. The 

Exchange has prepared summaries, set 

forth in Sections A, B, and C below, of 

the most significant aspects of such 

statements. 


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