25528 Federal Register / Vol. 63, No. 89 / Friday, May 8, 1998 / Notices

the reporting of safety concerns in

violation of 10 CFR 50.7, and (2) ComEd

intentionally imposed ‘‘restrictive

confidentiality’’ aimed at prohibiting

employees from providing information

to the NRC in violation of 10 CFR 50.7.

The request is being treated pursuant

to 10 CFR 2.206 of the Commission’s

regulations. The Petition has been

referred to the Director of the Office of

Nuclear Reactor Regulation. The

Petitioners’ request for immediate action

was denied by letter dated April 29,

1998.

A copy of the Petition is available for

inspection at the Commission’s Public

Document Room at 2120 L Street, N.W.,

Washington, DC 20003–1527.

Dated at Rockville, Maryland, this 29th day

of April 1998.

For the Nuclear Regulatory Commission.

Samuel J. Collins,

Director, Office of Nuclear Reactor

Regulation.

[FR Doc. 98–12276 Filed 5–7–98; 8:45 am]

BILLING CODE 7590–01–P

NUCLEAR REGULATORY

COMMISSION

Notice of Publication of Draft

Commission Paper ‘‘Combined

License Review Process’’

The U.S. Nuclear Regulatory

Commission (NRC) has issued a draft

version of a Commission paper entitled

‘‘Combined License Review Process’’

and is requesting public comments on

this paper. Subpart C of 10 CFR part 52

presents a process for issuing combined

licenses (COLs) for nuclear power

facilities. A COL is a single license

authorizing construction and

conditional operation of a nuclear

power facility. This draft paper informs

the Commission about the NRC staff’s

positions on a number of issues relating

to the COL review process, including:

contents of a COL application; COL

inspections, tests, analyses, and

acceptance criteria (ITAAC); ITAAC for

emergency plans; verification of ITAAC;

role of the quality assurance program in

ITAAC; and emergency plans for early

site permits.

An earlier version of the draft paper

was issued in April 1993. The NRC

received comments from the nuclear

industry (NUMARC) on this paper. As a

result, several changes were made to the

draft paper. The most significant of

these changes include; removing a

proposed license condition regarding

detailed design drawings, removing any

mention of hold points in the

construction inspection process,

revising the format of the sample

license, and shortening the duration of

a combined license to conform with the

Atomic Energy Act of 1954, as amended.

An amendment to the Atomic Energy

Act has been proposed to correct the

COL duration issue.

A copy of the draft paper has been

placed in NRC’s Public Document

Room, the Gelman Building, 2120 L

Street, NW., Washington, DC. 20037, for

review by interested persons. Questions

and comments should be directed to

Jerry N. Wilson, Mail Stop O–10 D22,

U.S. Nuclear Regulatory Commission,

Washington, D.C. 20555–0001,

Email:jnw@nrc.gov or telephone: 301–

415–3145. Comments should be

submitted within 120 days of the

publication of this notice.

Dated at Rockville, MD, this 1st day of May

1998.

For the Nuclear Regulatory Commission.

Theodore R. Quay,

Director, Standardization Project Directorate,

Division of Reactor Program Management,

Office of Nuclear Reactor Regulation.

[FR Doc. 98–12279 Filed 5–7–98; 8:45 am]

BILLING CODE 7590–01–P

SECURITIES AND EXCHANGE

COMMISSION

[Rel. No. IC–23168; 812–10598]

Dean Witter Select Equity Trust, et al.;

Notice of Application

May 1, 1998.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’).

ACTION: Notice of application under

sections 6(c), 12(d)(1)(J), and 17(b) of the

Investment Company Act of 1940 (the

‘‘Act’’) for an exemption from sections

12(d)(1)(F)(ii) and 17(a) of the Act.

SUMMARY OF APPLICATION: The requested

order would permit a trust of funds

relying on section 12(d)(1)(F) to offer

units with a sales load in excess of the

1.5% limit in section 12(d)(1)(F)(ii) of

the Act. In addition, the requested order

would permit a terminating series of the

trust to sell certain fund shares and

fixed income securities issued by the

United States government

(‘‘Treasuries’’) to a new series of the

trust.

APPLICANTS: Dean Witter Reynolds Inc.

(the ‘‘Sponsor’’ or ‘‘Dean Witter’’); Dean

Witter Select Equity Trust and Dean

Witter Select Investment Trust

(collectively, the ‘‘Trusts’’); and certain

subsequent series of the Trusts

sponsored by Dean Witter (each, a

‘‘Trust Series’’).

FILING DATES: The application was filed

on March 27, 1997, and amended on

October 15, 1997. Applicants have

agreed to file an additional amendment,

the substance of which is incorporated

in this notice, during the notice period.

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

May 26, 1998, 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 may request notification of a

hearing by writing to the SEC’s

Secretary.

ADDRESSES: Secretary, SEC, 450 5th

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

Applicants, Two World Trade Center,

New York, New York 10048. Attention:

Steven M. Massoni.

FOR FURTHER INFORMATION CONTACT:

Elaine M. Boggs, Senior Counsel, at

(202) 942–0572, or Christine Y.

Greenlees, 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 5th Street,

NW, Washington, DC 20549 (telephone

(202) 942–8090).

Applicants’ Representations

1. Each Trust Series will be a series

of one of the Trusts, each a unit

investment trust (‘‘UIT’’) registered

under the Act. Dean Witter will be the

sponsor of each Trust Series.

2. The Sponsor intends to offer certain

Trust Series based on an asset allocation

model. The portfolio of each Trust

Series will contain a different asset

allocation of shares of one or more

open-end investment companies or

series thereof, none of which will be an

affiliated person of applicants (the

‘‘Funds’’), and, in some cases,

Treasuries. The shares of the Funds will

be deposited in each Trust Series at the

shares’ net asset value and the

Treasuries will be valued by an

independent evaluator (the

‘‘Independent Evaluator’’), who will be

a ‘‘qualified evaluator’’ as defined in

rule 22c–1(b)(2) under the Act, based on

the Treasuries’ offer-side valuation.
Federal Register / Vol. 63, No. 89 / Friday, May 8, 1998 / Notices 25529

3. Simultaneously with the deposit of

Fund shares and Treasuries and/or cash

with instructions to the Trust’s trustee

(the ‘‘Trustee’’) to purchase the

securities, the Trustee will deliver to the

Sponsor a certificate or receipt for units

(‘‘Units’’) representing the entire

ownership of the Trust Series. The Units

will be offered at prices based upon the

aggregate underlying value of the Fund

shares and Treasuries, plus a sales

charge. The sales charge imposed on the

Units will not, when aggregated with

any sales charge or service fees paid by

the Trust Series with respect to shares

of the underlying Funds, exceed the

limits set forth in rule 2830(d) of the

National Association of Securities

Dealers’ (‘‘NASD’’) Conduct Rules. A

Trust Series may invest in a Fund with

an asset-based sales charge, provided

that any asset-based sales charge

received by the Sponsor or the Trustee

from a Fund will be rebated to the Trust

Series. Although a Trust Series may

invest in a Fund with an asset-based

sales charge greater than .25% of the

Fund’s average net assets, if any of the

asset-based sales charge is received by

the Sponsor or the Trustee as a Fund

distribution expense, that amount will

not be retained by the Sponsor or the

Trustee but will be paid to the Trust

Series for the benefit of the Trusts’

unitholders.

4. Each Trust Series will terminate

approximately one year after it is offered

for sale (‘‘Rollover Series’’). At that time,

the Sponsor intends to create and offer

a new Trust Series (‘‘New Trust

Series’’), the portfolio of which will

reflect the then current asset allocation

model for the corresponding Trust

Series. Investors in the Rollover Series

may elect to invest in the New Trust

Series.

5. In order to minimize the potential

for overreaching, Dean Witter will

certify in writing to the Trustee, within

five days of each sale of securities from

a Rollover Series to a New Trust Series:

(a) that the transaction is consistent

with the policy of both the Rollover and

New Trust Series, as recited in their

respective registration statements and

reports filed under the Act, (b) the date

of the transaction, and (c) the price

determined by the Independent

Evaluator for the sale date of the

Treasuries. The Trustee will then

countersign the certificate, unless, in the

event that the Trustee disagrees with the

price listed on the certificate, the

Trustee immediately informs Dean

Witter orally of any such disagreement

and returns the certificate within five

days to Dean Witter with corrections

duly noted. Upon Dean Witter’s receipt

of a corrected certificate, Dean Witter

and the Trustee will jointly determine

the correct sales price by reference to a

mutually agreeable, published list of

prices for the date of the transaction.

Applicants’ Legal Analysis

A. Section 12(d)(1)

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

provides that no registered investment

company may acquire securities issued

by another investment company if such

securities represent more than 3% of the

total outstanding voting stock of the

acquired company, more than 5% of the

value of the total assets of the acquiring

company, or if securities issued by the

acquired company and all other

investment companies have an aggregate

value in excess of 10% of the value of

the total assets of the acquiring

company.

2. Section 12(d)(1)(F) provides that

section 12(d)(1) does not apply to

securities purchased or otherwise

acquired by a registered investment

company if, immediately after the

purchase or acquisition, not more than

3% of the total outstanding stock of the

acquired company is owned by the

acquiring company, and the acquiring

company does not impose a sales load

on its shares of more than 1.5%. In

addition, no acquired company may be

obligated to honor any acquiring

company’s redemption request in excess

of 1% of the acquired company’s

securities during any period of less than

30 days.

3. Section 12(d)(1)(J) provides that the

SEC may exempt persons or transactions

from any provision of section 12(d)(1) if

and to the extent such exemption is

consistent with the public interest and

the protection of investors. Applicants

request an exemption under section

12(d)(1)(J) to permit a Trust Series to

offer Units with a sales load in excess

of the 1.5% limitation. For the reasons

below, applicants believe that the

requested relief meets the standards of

section 12(d)(1)(J).

4. Applicants argue that section

12(d)(1) is intended to mitigate or

eliminate actual or potential abuses that

might arise when one investment

company acquires sharing of another

investment company, including the

excessive layering of sales charges. For

the reasons stated below, applicants do

not believe that their proposal will

result in excessive sales charges.

5. While each Trust Series will charge

a sales load, the Sponsor will deposit

the Fund shares at net asset value (i.e.,

without any sales charge). To further

limit the extent to which unitholders

may pay indirectly for distribution costs

of the underlying Funds, any assetbased sales charges received by the

Sponsor of the Trustee from a Fund

with regard to the Fund shares will be

rebated to the Trust Series. In addition,

applicants have agreed as a condition to

the relief that any sales charge assessed

with respect to the Units of a Trust

Series, when aggregated with any sales

charge or service fees paid by the Trust

Series with respect to securities of the

underlying Funds, will not exceed the

limits set forth in rule 2830(d) of the

Conduct Rules of the NASD. As a result,

the aggregate sales charges will not

exceed the limit that otherwise could be

charged at any single level.

6. Applicants believe that it is

appropriate to apply the NASD’s rules

to the proposed arrangement instead of

the sales load limitation in section

12(d)(1)(F)(ii). Applicants further

believe that the condition subjecting any

sales charges or service fees to the limits

established by the NASD will provide

ongoing regulation with the flexibility to

accommodate continuing developments

in the industry.

7. Administrative fees may be charged

at both the Trust Series and underlying

Fund levels. Applicants believe,

however, that certain expenses of the

Trusts may be reduced under the

proposed arrangement. For example,

when a Trust Series invests in Fund

shares (whose net asset value is readily

available), applicants anticipate that the

evaluator would charge a lower fee, if

any at all.

8. Applicants assert that the proposal

will benefit potential unitholders as

well as shareholders of the Funds.

Applicants believe that a Trust Series

provides a simple means through which

investors can obtain a professionally

selected and maintained mix of

investment company shares in one

package and at one sales load for a

relatively small initial investment. In

addition, applicants believe that

purchasing shares in large quantities

will enable a Fund to obtain certain

economies of scale, and will benefit

certain Funds by permitting them to

carry a Trust Series on their books as a

single shareholder account, even though

there are numerous unitholders, and by

providing them with a stable net asset

base.

B. Section 17

1. Section 17(a) of the Act generally

makes it unlawful for an affiliated

person of a registered investment

company to sell securities to or

purchase securities from the company.

Investment companies under common

control are considered affiliates of one

another. The Trust Series may be

deemed to be under common control
25530 Federal Register / Vol. 63, No. 89 / Friday, May 8, 1998 / Notices

because they have Dean Witter as a

sponsor and, therefore, unable to sell

and buy securities to and from each

other without an exemption from

section 17(a). Accordingly, applicants

request relief to permit a Rollover Series

to sell Fund shares and Treasuries to a

New Trust Series.

2. Section 17(b) permits the SEC to

grant an order permitting a transaction

otherwise prohibited by section 17(a) if

it finds that the terms of the proposed

transaction, including the consideration

to be paid or received, are fair and

reasonable and do not involve

overreaching on the part of any person

concerned and the proposed transaction

is consistent with the policy of the

registered investment company and the

general purposes of the Act. Section 6(c)

permits the SEC to exempt any person

or transaction from any provision of the

Act, 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 policies and provisions

of the Act. For the reasons stated below,

applicants believe that the terms of the

transactions meet the standards of

sections 6(c) and 17(b).

3. Rule 17a–7 under the Act p[permits

registered investment companies that

might be deemed affiliates solely by

reason of having common investment

advisers, directors, and/or officers, to

purchase securities from or sell

securities to one another at an

independently determined price,

provided certain conditions are met.

Applicants represent that they will

comply with all of the provisions of rule

17a–7, other than paragraphs (b) and (e).

4. Paragraph (e) of the rule requires an

investment company’s board of

directors to adopt and monitor

procedures for these transactions to

assure compliance with the rule. Since

a UIT does not have a board of directors,

there can be no board review of the

transaction. Applicants state, however,

that review in the context of a UIT

would serve little useful purpose in

connection with Fund shares and

Treasuries because independently

verifiable prices are readily available.

5. Paragraph (b) of rule 17a–7 requires

that the transactions be effected at the

independent current market price of the

security. The Fund shares and

Treasuries would fall within the

paragraph (b)(4) category of ‘‘all other

securities,’’ for which the current

market price under rule 17a–7(b) is the

average of the highest current

independent bid and lowest current

independent offer determined on the

basis of reasonable inquiry.

6. With respect to Fund shares,

applicants state that Fund shares do not

trade at a bid or offer price but at an

independently determined net asset

value. Applicants state that the Funds’

shares will be issued by investment

companies that will not be affiliated

with the Sponsor and that each Fund

will calculate the net asset value of its

shares daily. The net asset value would

be the price at which the Rollover Series

would sell Fund shares to the New

Trust Series.

7. With respect to Treasuries,

applicants state that the Treasuries

would be sold by a Rollover Series to a

New Trust Series at the Treasuries’

offer-side evaluation. Other Treasuries

acquired by the New Trust Series will

be acquired at the offer-side evaluation

and the New Trust Series would be

valued during the Trusts’ initial offering

period based on the Treasuries’ offerside evaluation. Applicants state that,

therefore, there will be uniformity as to

price for all of the Treasuries evaluated

(both Treasuries bought in the market

and Treasuries purchased from a

Rollover Series). In addition, all

unitholders of the New Trust Series,

both unitholders from a Rollover Series

and new unitholders, will acquire

Unites with a value based on the offerside evaluation of the Treasuries, which

applicants state is consistent with the

Trusts’ acquisition cost.

8. Applicants believe that engaging in

transactions for securities for which

market quotations are readily available

at an independently determined price

will not disadvantage either Trust

Series. Applicants state that the sales

between Trust Series will reduce

transaction costs to unitholders of the

Trust Series and will reduce costs to the

Fund. In addition, applicants state that

the purchases and sales between Trust

Series will be consistent with the policy

of each Trust Series, as only securities

that would otherwise be bought and

sold on the open market pursuant to the

policy of each Trust Series will be

involved in the proposed transactions.

Applicants’ Conditions

Applicants agree that the order

granting the requested relief will be

subject to the following conditions:

1. Each Trust Series will comply with

section 12(d)(1)(F) in all respects except

for the sales load limitation of section

12(d)(1)(F)(ii).

2. Any sales charges or service fees

charged with respect to Units of a Trust

Series, when aggregated with any sales

charges or service fees paid by the Trust

Series with respect to securities of the

underlying Funds, will not exceed the

limits set forth in rule 2830(d) of the

NASD’s Conduct Rules.

3. Each sale of Fund shares between

the Trust Series will be effected at the

net asset value of the Fund shares as

determined by the Fund on the sale

date. Each sale of Treasuries between

the Trust Series will be effected at the

Treasuries’ offer-side evaluation as

determined by an Independent

Evaluator as of the evaluation time on

the sale date. Such sales will be effected

without any brokerage charges or other

remuneration except customary transfer

fees, if any.

4. The nature and conditions of such

transactions will be fully disclosed to

investors in the appropriate prospectus

of each future Rollover Series and New

Trust Series.

5. The Trustee of each Rollover Series

and New Trust Series will (a) review the

procedures relating to the sale of

securities from a Rollover Series and the

purchase of securities for deposit in a

New Trust Series and (b) make changes

to the procedures as the Trustee deems

necessary that are reasonably designed

to comply with paragraphs (a), (c), and

(d) of rule 17a–7.

6. A written copy of these procedures

and a written record of each transaction

pursuant to the requested order will be

maintained as provided in rule 17a–7(f).

7. No Trust Series will acquire

securities of an underlying Fund which,

at the time of acquisition, owns

securities of any other investment

company in excess of the limits

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

Act.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Jonathan G. Katz,

Secretary.

[FR Doc. 98–12265 Filed 5–7–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

Issuer Delisting; Notice of Application

To Withdraw From Listing and

Registration; (Homestead Village

Incorporated, Common Stock, $.01 Par

Value) File No. 1–12269

May 4, 1998.

Homestead Village Incorporated

(‘‘Company’’) has filed an application

with the Securities and Exchange

Commission (‘‘Commission’’), pursuant

to Section 12(d) of the Securities

Exchange Act of 1934 (‘‘Act’’) and Rule

12d2–2(d) promulgated thereunder, to

withdraw the above specified security

(‘‘Security’’) from listing and