Federal Register / Vol. 63, No. 117 /Thursday, June 18, 1998 / Notices 33421

if any, should be imposed by the

Commission for the protection of

investors. The Commission, based on

the information submitted to it, will

issue an order granting the application

after the date mentioned above, unless

the Commission determines to order a

hearing on the matter.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16246 Filed 6–17–98; 8:45 am]

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[Release No. IC–23249; 812–10904]

New York Life Capital Corporation;

Notice of Application

June 12, 1998.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of application under

section 6(c) of the Investment Company

Act of 1940 (the ‘‘Act’’) for an

exemption from all provisions of the

Act.

SUMMARY OF APPLICATION: Applicant,

New York Life Capital Corporation,

requests an order that would permit it

to sell certain debt securities and use

the proceeds to finance the business

activities of its parent company and

certain companies controlled by the

parent company.

FILING DATES: The application was filed

on December 18, 1997, and amended on

April 28, 1998, and June 4, 1998.

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 July

8, 1998 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, 51 Madison Avenue, New

York, New York 10010.

FOR FURTHER INFORMATION CONTACT:

Edward P. Macdonald, 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, 450 Fifth St.,

N.W., Washington, D.C. 20549 (tel. 202–

942–8090).

Applicant’s Representations

1. Applicant is a Delaware

corporation and a wholly-owned

indirect subsidiary of New York Life

Insurance Company (‘‘New York Life’’).

New York Life is a mutual insurance

company organized under the laws of

the State of New York. New York Life,

directly and through its subsidiaries,

provides various financial services

including the sale of group pension

products, health insurance, annuities,

brokerage services, investment advisory

services, mutual funds, and variable life

and annuity insurance products. New

York Life is exempt from regulation

under the Act by section 3(c)(3) of the

Act.

2. Applicant was formed in 1995 for

the purpose of financing the business

operations of New York Life and its

subsidiaries (‘‘Controlled Companies’’).

Applicant’s primary function to borrow

funds through the sale of short-term,

medium-term, and long-term debt

securities as well as non-voting

preferred stock, and to lend the

proceeds from these offerings to New

York Life and its Controlled Companies

to help finance their operations. Certain

of the Controlled Companies are exempt

from regulations under the Act by

certain provisions of section 3(c) of the

Act. None of the Controlled Companies

to which applicant may lend will be

relying on sections 3(c)(1) or 3(c)(7) of

the Act.

3. All of applicant’s debt securities

and non-voting preferred stock issued to

or held by the public will be

unconditionally guaranteed by New

York Life as to the payment of, as

applicable, principal, interest, premium,

dividends, liquidation preference and

sinking fund payments. In the event of

any default in payment of these

amounts, the public holders of the

securities may institute legal

proceedings directly against New York

Life without first proceeding against

applicant. Furthermore, any convertible

or exchangeable securities issued by

applicant shall be convertible or

exchangeable only for securities issued

by New York Life or for applicant’s debt

securities or non-voting preferred stock.

4. Applicant will invest in or loan at

least 85% of any cash or cash

equivalents raised by applicant to New

York Life and its Controlled Companies

as soon as practicable, but in no event

later than six months after applicant

receives the cash or cash equivalents. If

applicant borrows amounts in excess of

the amounts required by New York Life

and its Controlled Companies, applicant

will invest this excess in certain

temporary investments pursuant to rule

3a–5 under the Act discussed below.

Applicant’s Legal Analysis

1. Applicant requests an order under

section 6(c) of the Act exempting it from

all provisions of the Act. Applicant

states that rule 3a–5 under the Act

provides an exemption from the

definition of investment company for

certain companies organized primarily

to finance the business operations of

their parent companies or companies

controlled by their parent companies.

2. Rule 3a–5(b)(2) provides that a

‘‘parent company’’ is a company that

derives its non-investment company

status from section 3(a) of the Act, the

rules under section 3(a) of the Act, or

section 3(b) of the Act. Rule 3a–5(b)(3)(i)

in relevant part defines a ‘‘company

controlled by the parent company’’ to be

a corporation, partnership, or joint

venture that is not considered an

investment company under section 3(a)

of the Act, the rules under section 3(a)

of the Act, or section 3(b) of the Act.

3. Applicant states that New York Life

may not qualify as a ‘‘parent company’’

under rule 3a–5(b)(2) because it derives

its non-investment company status from

section 3(c)(3) of the Act. Applicant also

states that certain Controlled Companies

that may receive loans from applicant,

may not qualify as a ‘‘company

controlled by the parent company’’

under rule 3a–5(b)(3)(i) because these

Companies derive their non-investment

company status from sections 3(c)(2),

3(c)(3), 3(c)(5), or 3(c)(6) of the Act.

4. Applicant asserts that neither New

York Life nor these Controlled

Companies engage primarily in

investment company activities. If New

York Life, or any of its Controlled

Companies, were itself to issue the debt

obligations that are to be issued by

applicant and use the proceeds for its

own purposes or advance them to its

subsidiaries, neither New York Life nor

any of its Controlled Companies would

be subject to regulation under the Act.

New York Life has chosen instead to use

applicant as a vehicle for this borrowing

for reasons unrelated to the regulatory

purposes of the Act.

5. Section 6(c) of the Act provides that

the SEC may exempt any person,
33422 Federal Register / Vol. 63, No. 117 /Thursday, June 18, 1998 / Notices

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

2 17 CFR 240.19b–4.

security or transaction, or any class or

classes of persons, securities or

transactions, from any provision or

provisions of the Act when the

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. Applicant

states that for the reasons given above

its request for exemptive relief meets the

standards of section 6(c).

Applicant’s Condition

Applicant agrees that the order

granting the requested relief will be

subject to the following condition:

1. Applicant will comply with all of

the provisions of rule 3a–5 under the

Act, except: (a) New York Life will not

meet the portion of the definition of

parent company in rule 3a–5(b)(2)(i)

solely because it is excluded from the

definition of investment company under

section 3(c)(3) of the Act; and (b)

Controlled Companies will 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 sections 3(c)(2),

3(c)(3), 3(c)(5), or 3(c)(6) of the Act,

provided that any such entity excluded

from the definition of investment

company under section 3(c)(5) of the

Act will fall within section 3(c)(5)(A) or

section 3(c)(5)(B) solely by reason of its

holdings of accounts receivable of either

their own customers or of the customers

of other New York Life Controlled

Companies, or by reason of loans made

by it to such New York Life Controlled

Companies or customers, 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 through majority-owned

subsidiaries, in one or more of the

businesses described in section 3(c)(5)

of the Act (except as permitted in this

condition).

For the SEC, by the Division of Investment

Management, pursuant to delegated

authority.

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16259 Filed 6–17–98; 8:45 am]

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Sunshine Act Meeting

Notice is hereby given, pursuant to

the provisions of the Government in the

Sunshine Act, Pub. L. 94–409, that the

Securities and Exchange Commission

will hold the following meetings during

the week of June 22, 1998.

An open meeting will be held on

Monday, June 22, 1998, at 11:00 a.m.

A closed meeting will be held on

Monday, June 22, 1998, following the

11:00 a.m. closed meeting. A closed

meeting will be held on Tuesday, June

23, 1998, at 10:00 a.m.

Commissioners, Counsel to the

Commissioners, the Secretary to the

Commission, and recording secretaries

will attend the closed meeting. Certain

staff members who have an interest in

the matters may also be present.

The General Counsel of the

Commission, or his designee, has

certified that, in his opinion, one or

more of the exemptions set forth in 5

U.S.C. 552b(c)(4), (8), (9)(A) and (10)

and 17 CFR 200.402(a)(4), (8), (9)(i) and

(10), permit consideration of the

scheduled matters at the closed meeting.

Commissioner Unger, as duty officer,

voted to consider the items listed for the

closed meeting in a closed session.

The open meeting scheduled for

Monday, June 22, 1998, at 11:00 a.m.,

will be:

The Commission will hear oral

argument on an appeal by Laurie Jones

Canady, formerly a salesperson with

Merrill Lynch, Pierce, Fenner & Smith

Incorporated, from an administrative

law judge’s initial decision. For further

information, contact Kermit B. Kennedy

at (202) 942–0879.

The closed meeting scheduled for

Monday, June 22, 1998, following the

11:00 a.m. open meeting, will be:

Post argument discussion.

The subject matter of the closed

meeting scheduled for Tuesday, June 23,

1998, at 10:00 a.m., will be:

Institution and settlement of

injunctive actions.

Institution and settlement of

administrative proceedings of an

enforcement nature.

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 at (202) 942–7070.

Dated: June 16, 1998.

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16344 Filed 6–16–98; 11:46 am]

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Sunshine Act Meeting

FEDERAL REGISTER CITATION OF PREVIOUS

ANNOUNCEMENT: [63 FR 32273, June 12,

1998].

STATUS: Closed Meeting.

PLACE: 450 Fifth Street, N.W.,

Washington, D.C.

DATE PREVIOUSLY ANNOUNCED: June 12,

1998.

CHANGE IN THE MEETING: Correction.

The Commission considered the

following item at a closed meeting held

on Tuesday, June 16, 1998, at 10:00 a.m.

The item was inadvertently omitted

from the notice announced in the

Federal Register on June 12, 1998 (63

FR 32273).

Post argument discussion.

Commissioner Unger, 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: June 16, 1998.

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16345 Filed 6–16–98; 11:46 am]

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[Release No. 34–40080; File No. SR–CBOE–

98–24]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Chicago Board Options Exchange,

Inc., Relating to ILX Fees

June 9, 1998.

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

Securities Exchange Act of 1934

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

notice is hereby given that on June 2,

1998, the Chicago Board Options

Exchange, Inc. (‘‘CBOE’’ or

‘‘Exchange’’), filed with the Securities

and Exchange Commission (‘‘SEC’’ or

‘‘Commission’’) the proposed rule

change as described in Items I, II, and

III below, which Items have been

prepared by the CBOE. The Commission