10922 Federal Register / Vol. 66, No. 34 / Tuesday, February 20, 2001 / Notices

10601, beginning at 9:30 a.m. and

extending until 6 p.m. To the extent

necessary, the hearing will continue at

the same location from 9:30 a.m. to 12

noon on Wednesday, March 14, 2001.

Issues to be considered at the hearing

are:

1. (Issue 2)—Whether the transfer

Applicants’ plan for handling

decommissioning funds for the FitzPatrick

and Indian Point nuclear plants—whereby

control of the decommissioning funds will

remain with PASNY but responsibility for

decommissioning the plants will reside with

the Entergy companies—provides reasonable

assurance of adequate decommissioning

funding, within the meaning of 10 CFR

50.75(b) and 50.75(e)(1)(vi). [See CLI–00–22,

52 NRC at 319.]

2. (Issue 3)—Whether the license transfer

applications provide adequate financial

assurance for the safe operation of FitzPatrick

and Indian Point 3 because the applications

do not demonstrate an appropriate margin

between anticipated operating costs and

revenue projections, and the Entergy

applicants do not provide evidence of access

to sufficient reserve funding, specifically

with respect to the subparts or bases pproved

in LBP–00–04 (corrected version dated

February 5, 2001), [See LBP–00–04 (corrected

version), 53 NRC ll, ll (2001) (slip op.

at 20).]

Issue 2 (essentially a legal issue) will

be the first issue considered, on

Tuesday morning, March 13, 2001. CAN

will present its position initially,

followed by the Licensees and the NRC

Staff and rebuttal by CAN. Issue 3 will

follow, with the Licensees presenting

their witnesses first, followed by CAN

and the NRC Staff and rebuttal by the

Licensees.

The names and addresses of

participants are as follows:

1. Entergy Companies and PASNY:

Jay E. Silberg, Esq., Shaw Pittman, 2300

N Street, NW., Washington, DC

20037–1128

Gerald C. Goldstein, Esq., Assistant

General Counsel, New York Power

Authority, 123 Main Street, White

Plains, NY 10601

Douglas E. Levanway, Esq., Wise Carter

Child & Caraway, 401 E. Capitol St.,

Suite 600, P.O. Box 651, Jackson, MS

39205

John M. Fulton, Esq., Entergy, 600

Rocky Hill Road, Plymouth, MA

02360

2. CAN:

Timothy L. Judson, Organizer, CNY—

Citizens Awareness Network, 140

Bassett St., Syracuse, NY 13210

Deborah Katz, Executive Director,

Citizens Awareness Network, PO Box

83, Shelburne Falls, MA 01370

3. Westchester County:

Stewart M. Glass, Esq., Senior Assistant

County Attorney, County of

Westchester, Department of Law,

Room 600, 148 Martine Ave., White

Plains, NY 10601

4. NRC Staff (not a party, but presenting

the Safety Evaluation Report (SER)

and responding to questions posed by

the Presiding Officer)

Steven R. Hom, Esq., Office of the

General Counsel, 0–15D21, U.S.

Nuclear Regulatory Commission,

Washington, DC 20555

Presiding at the oral hearing will be

Administrative Judge Charles

Bechhoefer, whose jurisdiction

commenced with his designation as

Presiding Officer on November 28, 2000,

see 65 Fed. Reg. 75,976 (December 5,

2000), and will terminate with his

certification of the record to the

Commission, following his receipt of the

parties’ final statements of position. The

designated Presiding Officer has no

authority to render a final or

recommended decision with respect

either to the license transfer itself or the

issues admitted for hearing. See 10 CFR

2.1309(b)(3).

The following filing schedules have

been adopted with respect to each

issue:

1. Initial Statements of Position and

Written Direct Testimony (together

with supporting affidavits)

Issue 2: January 12, 2001 (11:59 p.m.)—

papers already filed.

Issue 3: February 26, 2001 (11:59 p.m.)

2. Written responses to direct testimony,

and rebuttal testimony (with

supporting affidavits); Proposed

questions on written direct testimony

Issue 2: February 1, 2001 (11:59 p.m.)—

papers already filed.

Issue 3: March 5, 2001 (11:59 p.m.)

3. Proposed questions directed to

written rebuttal testimony

Issue 2: February 12, 2001 (11:59

p.m.)—papers already filed.

Issue 3: March 8, 2001 (11:59 p.m.)

The oral hearing will be open to

members of the public, except that,

where necessary to consider proprietary

data (Issue 3), the hearing will be open

only to those authorized access to such

data.

Dated: February 13, 2001, Rockville,

Maryland.

Charles Bechhoefer,

Administrative Judge.

[FR Doc. 01–4103 Filed 2–16–01; 8:45 am]

BILLING CODE 7590–01–P

SECURITIES AND EXCHANGE

COMMISSION

[Release No. IC–24857; 813–258]

GFInet inc. and Magnetic Holdings

International (DE) LLC; Notice of

Application

February 13, 2001.

AGENCY: Securities and Exchange

Commission (‘‘Commission’’).

ACTION: Notice of application for an

order under sections 6(b) and 6(e) of the

Investment Company Act of 1940 (the

‘‘Act’’) exempting the applicants from

all provisions of the Act, except section

9, section 17 (other than certain

provisions of paragraphs (a), (d), (f), (g)

and (j)), section 30 (other than certain

provisions of paragraphs (a), (b), (e), and

(h)), sections 36 through 53, and the

rules and regulations under the Act.

SUMMARY OF APPLICATION: Applicants

request an order to exempt an

employees’ securities company formed

for the benefit of key employees of

GFInet inc. (together with any entity

that results from a reorganization of

GFInet inc. into a different type of entity

or into an entity organized under the

laws of another jurisdiction (‘‘GFInet’’))

from certain provisions of the Act.

FILING DATE: The application was filed

on April 3, 2000, and amended on

November 20, 2000 and February 7,

2001.

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 12, 2001, 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

Commission’s Secretary.

ADDRESSES: Secretary, Commission, 450

Fifth Street, NW., Washington, DC

20549–0609. Applicants, 100 Wall

Street, New York, NY 10005.

FOR FURTHER INFORMATION CONTACT: Sara

P. Crovitz, Senior Counsel, at (202) 942–

0667, or Nadya Roytblat, Assistant

Director, at (202) 942–0564 (Division of

Investment Management, Office of

Investment Company Regulation).

Federal Register / Vol. 66, No. 34 / Tuesday, February 20, 2001 / Notices 10923

1The Company will not acquire any security

issued by a registered investment company, if,

immediately after such acquisition, (a) the

Company (and any investment company or

investment companies controlled by it) would own

more than 3% of the outstanding voting stock of

such company, or (b) securities issued by the

registered investment company and all other

registered investment companies have an aggregate

value in excess of 10% of the value of the total

assets of the Company.

2Units will be offered and sold by the Company

in reliance upon the exemption from registration

under the Securities Act of 1933 (‘‘1933 Act’’)

contained in section 4(2) or pursuant to Regulation

D under the 1933 Act. No fee of any kind will be

charged in connection with the sale of Units of the

Company.

SUPPLEMENTARY INFORMATION: The

following is a summary of the

application. The complete application

may be obtained for a fee at the

Commission’s Public Reference Branch,

450 Fifth Street, NW., Washington, DC

20549–0101, (202) 942–8090.

Applicants’ Representations

1. GFInet is a business-to-business

neutral electronic marketplace

providing a fully interactive, Internet

accessible, screen-based platform for

trading corporate assets. GFInet is a

wholly owned subsidiary of GFI Group,

a New York corporation. GFI Group

operates as a wholesale broker, through

its wholly owned broker-dealer

subsidiaries, providing brokerage

services for securities, commodities,

currency and derivative contracts to

broker-dealers and other financial

institutions.

2. Magnetic Holdings International

(DE) LLC (‘‘Company’’) is a Delaware

limited liability company formed

pursuant to a limited liabi8lity company

agreement (‘‘Investment Company

Agreement’’). Magnetic Holdings

Management, LLC, a wholly owned

subsidiary of GFI Group will be the

manager of the Company (‘‘Manager’’).

Applicants state that the Manager is not

currently registered under the

Investment Advisers Act of 1940

(‘‘Investment Advisers Act’’) but will so

register if required to do so by the

Investment Advisers Act or the rules

thereunder.

3. Applicants intend to establish the

Company for the benefit of certain key

employees to enable them to invest in

a private offering of GFInet securities.

The Company will be an ‘‘employees’

security company’’ within the meaning

of section 2(a)(13) of the Act and will

operate as a closed-end management

investment company. Participation in

the Company will be voluntary.

4. Applicants state that the Company

will subscribe for a specified number of

shares (‘‘Subscription’’) in a private

offering of GFInet shares. The Company

will invest solely in securities issued by

GFInet, except that, pending complete

investment of all capital contributions

in GFInet securities, the Company may

make certain investments in order to

maintain the value of the received

capital (‘‘Temporary Investments’’).

Temporary Investments may include: (a)

United States Government obligations

with maturities of not longer than one

year and one day, (b) commercial paper

with maturities no longer than six

months and one day and having a

rating, assigned to such commercial

paper by a nationally recognized

statistical rating organization, equal to

one of the two highest ratings categories

assigned by such organization; or (c)

shares of a money market mutual fund.1

5. Units of interest in the Company

(‘‘Units’’) 2 will be offered only to

eligible investors (‘‘Eligible Investors’’),

which will consist of: (a) ‘‘Eligible

Employees’’ (as defined below), (b) a

trust of which all of the trustees,

grantors, and/or beneficiaries are

Eligible Employees or of which the

beneficiaries are spouses or children

and/or step-children residing in the

same household as the Eligible

Employees, including self-directed

retirement plan trusts (‘‘Eligible

Trusts’’), (c) partnership, corporations or

other entities, all of the voting power of

which is controlled by Eligible

Employees (‘‘Eligible Entities’’), (d) the

spouse and children and step-children

over the age of 21 of an Eligible

Employee if they reside in the same

household as the Eligible Employee

(‘‘Immediate Family Members’’), and (e)

GFInet or an entity that directly or

indirectly controls, is controlled by, or

is under common control with GFInet

(‘‘Affiliated Companies’’). Each Eligible

Investor must be an ‘‘accredited

investor’’ as defined in rule 501(a) of

Regulation D under the 1933 Act, and,

in the case of an Eligible Employee or

Immediate Family Member, must meet

the income requirements set forth in

rule 501(a)(6) of Regulation D

(‘‘Accredited Investor’’). The terms of

the Company will be fully disclosed to

each Eligible Investor and a copy of the

Investment Company Agreement and

any other organization documents will

be provided to each Eligible Investor at

the time the Eligible Investor is invited

to participate in the Company.

6. Eligible Employees include only

such persons who at the time the

Company offers Units are (a) current or

former employees, officers, or directors

of GFInet or an Affiliated Company; (b)

principals or other professionals

employed by GFInet or an Affiliated

Company who provide certain

consulting or other services to clients of

GFInet or of such Affiliated Company,

(c) key administrative employees of

GFInet, or (d) a small number of other

employees of GFInet who are involved

in managing the day-to-day affairs of the

Company. Applicants state that Eligible

Employees have sufficient knowledge,

education, training, sophistication and

experience in the financial services

businesses, or in administrative,

financial, accounting or operational

activities related thereto, to be capable

of evaluating the risk of an investment

in the Company.

7. A separate account will be

established and maintained for each

Eligible Investor who invests in the

Company (‘‘Member’’). A Member’s

capital account is equal initially to the

initial capital contribution made by the

Member. Net income or net loss of the

Company will be determined and

credited at least annually to the

respective capital accounts and subaccounts of the Members in proportion

to their respective contributed capital in

the Company. Members will not be

entitled to redeem their Units in the

Company. Under the terms of the

Investment Company Agreement, a

Member will have only limited rights to

transfer Units to Immediate Family

Members or other Eligible Investors,

with the consent of the Manager. In no

event will any person become a Member

unless that person is an Eligible

Investor.

8. The Investment Company

Agreement provides that the Manager

may require a member to withdraw from

the Company: (a) If the Member fails to

make all or any portion of one of the

contributions required under the

Investment Company Agreement; (b) if a

Member ceases to be an Accredited

Investor; (c) if the Company were to be

subject to possible adverse tax

consequences were a particular Member

to remain a Member; (d) if the continued

membership of the Member would

violate applicable law or regulations or

require the Company to register as an

investment company under the federal

securities laws; (e) a Member is

convicted or pleads nolo contendere to

a crime, or commits a fraud or

defalcation, against the Company,

GFInet or any Affiliated Company; (f) a

Member competes with, solicits the

employees, customers or accounts of, or

misappropriates the trade secrets of

GFInet or any Affiliated Company; (g)

the Member’s employment is terminated

for cause or the Member terminates

employment prior to the end of the term

of any employment agreement with

GFInet or any Affiliated Company; (h) a

Member becomes disabled for specific

periods of time; (i) a Member becomes

10924 Federal Register / Vol. 66, No. 34 / Tuesday, February 20, 2001 / Notices

subject to certain insolvency events as

described in the Investment Company

Agreement; (j) a Member dies or a

Member’s Units are held by an entity

that liquidates, dissolves, or otherwise

ceases operations without transferring

the Units to Eligible Investors.

9. If a Member is required to

withdraw, the Company may, in its sole

discretion, require such Member to sell

his Units to any person or entity

designated by the Company who is

eligible to participate in the Company.

The value of the withdrawing Member’s

Units will be at least the lesser of (a) the

amount actually paid by the Member to

acquire the Units (plus interest, as

determined by the Manager); or (b) the

fair market value of the Units as

determined at the time of repurchase by

the Manager.

10. The terms of the withdrawals will

be fully disclosed to each Eligible

Investor at the time the Eligible Investor

is invited to participate in the Company.

The Company will send its Members an

annual report regarding its operations,

containing financial statements audited

by independent accountants. The

Company will maintain a file containing

any financial statements and other

information received from GFInet or

issuers of Temporary Investments, if

any, held by the Company, and will

make such file available for inspection

by Members. In addition, within 90 days

after the end of each fiscal year, or as

soon as practicable thereafter, the

Company will transmit to each Member

a report indicating his share of the

income or losses of the Company for

federal income tax purposes.

11. The Company expects to liquidate

upon the initial public offering of

GFInet securities or upon the end of any

lock-up period that may be imposed

upon the Company in connection with

any public, firm commitment,

underwritten, initial public offering

pursuant to an effective registration

statement under the 1933 Act. The

Company may be dissolved upon such

other circumstances as shall be fully

disclosed in the Investment Company

Agreement.

12. No sales load will be charged in

connection with investment in the

Company, no fees will inure to the

benefit of GFInet or the Manager, and

the Company will not be promoted by

persons seeking to profit from

investment in the Company. No

compensation will be paid by the

Company to the directors or officers of

GFInet or the Manager for their services

to the Company other than

reimbursement for reasonable and

necessary out-of-pocket expenses

incurred during the course of

conducting the business of the

Company.

Applicants’ Legal Analysis

1. Section 6(b) of the Act provides, in

part, that the Commission will exempt

employees’ securities companies from

the provisions of the Act to the extent

that the exemption is consistent with

the protection of investors. Section 6(b)

provides that the Commission will

consider, in determining the provisions

of the Act from which the company

should be exempt, the company’s form

of organization and capital structure, the

persons owning and controlling its

securities, the price of the company’s

securities and the amount of any sales

load, how the company’s funds are

invested and the relationship between

the company and the issuers of the

securities in which it invests. Section

2(a)(13) defines an employees’ securities

company, in relevant part, as any

investment company all of whose

securities are beneficially owned (a) by

current or former employees, or persons

on retainer, of one or more affiliated

employers, (b) by immediate family

members of such persons, or (c) by such

employer or employers together with

any of the persons in (a) or (b).

2. Section 7 of the Act generally

prohibits an investment company that is

not registered under section 8 of the Act

from selling or redeeming its securities.

Section 6(e) provides that, in connection

with any order exempting an investment

company from any provision of section

7, certain provisions of the Act, as

specified by the Commission, will be

applicable to the company and other

persons dealing with the company as

though the company were registered

under the Act. Applicants request an

order under sections 6(b) and 6(e) of the

Act for an exemption from all

provisions of the Act except section 9,

section 17 (other than certain provisions

of paragraphs (a), (d), (f), (g) and (j)),

section 30 (other than certain provisions

of paragraphs (a), (b), (e), and (h)),

sections 36 through 53, and the rules

and regulations thereunder.

3. Section 17(a) generally prohibits

any affiliated person of a registered

investment company, or any affiliated

person of an affiliated person, acting as

principal, from knowingly selling or

purchasing any security or other

property to or from the company.

Applicants requests an exemption from

section 17(a) to permit the Company (a)

to purchase from GFInet securities to be

issued by GFInet; (b) to sell to GFInet,

or any affiliated person thereof (or any

affiliated person of such an affiliated

person) GFInet securities or Temporary

Investments previously acquired by the

Company; and (c) to participate as a

selling security-holder in a public

offering of GFInet securities or in which

GFInet or any affiliated person thereof

(or any affiliated person or an affiliated

person) acts as or represents a member

of the selling group.

4. Applicants state that an exemption

from section 17(a) is consistent with the

protection of investors and the purposes

of the Act. Applicants state that

Company will ultimately be entirely

invested in securities of GFInet.

Applicants state that Members will be

informed of the risks inherent in

investing in the Company, the extent of

the Company’s dealings with GFInet,

and the details of such investment.

Applicants also state that, as financially

sophisticated professionals, the Eligible

Investors will be able to evaluate the

attendant risks. Applicants assert that

the community of interest among the

Members and GFInet will provide the

best protection against any risk of abuse.

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

17d–1 prohibit any affiliated person or

principal underwriter of a registered

investment company, or any affiliated

person of an affiliated person or

principal underwriter, acting as

principal, from participating in any joint

arrangement with the company unless

authorized by the Commission.

Applicants request approval to permit

the Company to make investments in

which GFInet, or any affiliated person of

the Company or GFInet, or an affiliated

person of such person, is a participant

or plans concurrently or otherwise

directly or indirectly to become a

participant.

6. Applicants submit that any joint

investments will not involve abuses of

the type section 17(d) and rule 17d–1

were designed to prevent. Applicants

state that the Company will participate

in the purchase of GFInet shares on the

same terms as those offered to any

affiliated person or unrelated party.

Applicants note that the Company will

primarily be organized for the benefit of

the Eligible Investors, as an incentive for

them to remain with GFInet and for the

generation and maintenance of

goodwill.

7. Section 17(f) designates the entities

that may act as investment company

custodians, and rule 17f–1 imposes

certain requirements when the

custodian is a member of a national

securities exchange. Rule 17f–2 under

the Act specifies the requirements that

must be satisfied for a registered

management investment company to act

as a custodian of its own investments.

Applicants request an exemption from

section 17(f) and rule 17f–2 to permit

the following exceptions from the

Federal Register / Vol. 66, No. 34 / Tuesday, February 20, 2001 / Notices 10925

requirements of rule 17f–2: (a)

compliance with paragraph (b) of the

rule may be achieved through

safekeeping in the locked files of the

Manager or GFInet; (b) for purposes of

paragraph (d) of the rule: (i) employees,

the Manager or GFInet will be deemed

employees of the Company, (ii) officers

of the Company or the Manager or

GFInet will be deemed to be officers of

such Company; and (iii) the Manager or

the directors of the Manager or GFInet

will be deemed to be the board of

directors of the Company; and (c)

instead of the verification procedure

under paragraph (f) of the rule,

verification will be effected quarterly by

two employees of GFInet or the

Manager. Applicants expect that the

Company’s investments in GFInet

securities will be evidenced only by

non-negotiable share certificates and the

Company’s Temporary Investments, if

any, will be evidenced only by bookentry, rather than negotiable certificates.

Applicants assert that these instruments

are most suitably kept in the Company’s

files, where they can be referred to as

necessary.

8. Section 17(g) and rule 17g–1

generally require the bonding of officers

and employees of a registered

investment company who have access to

its securities or funds. Rule 17g–1

requires that a majority of directors who

are not interested persons take certain

actions and give certain approvals

relating to fidelity bonding. Applicants

request relief to permit the Manager’s

officers and directors, who may be

deemed interested persons, to take

actions and make determinations as set

forth in the rule. Applicants state that,

because it is likely that all of the officers

and directors of the Manager will be

affiliated persons, the Company could

not comply with rule 17g–1 without the

requested relief. Applicants also state

that the Company will comply with all

other requirements of rule 17g–1.

9. Section 17(j) and rule 17j–1 make

it unlawful for certain enumerated

persons to engage in fraudulent or

deceptive practices in connection with

the purchase or sale of a security held

or to be acquired by a registered

investment company. Rule 17j–1 also

requires that every registered

investment company adopt a written

code of ethics requiring that every

person of the investment company

report personal securities transactions.

Applicants request an exemption from

the provisions of rule 17j–1, except for

the anti-fraud provisions of rule 17j–

1(b), because they are unnecessarily

burdensome as applied to the Company.

10. Applicants request an exemption

from the requirements in sections 30(a),

30(b) and 30(e), and the rules under

those sections, that registered

investment companies prepare and file

with the Commission and mail to their

shareholders certain periodic reports

and financial statements. Applicants

contend that the forms prescribed by the

Commission for periodic reports have

little relevance to the Company and

would entail administrative and legal

costs that outweigh any benefit to the

Members. Applicants request exemptive

relief to the extent necessary to permit

the Company to report annually to its

Members in the manner prescribed for

the Company in the Investment

Company Agreement. Applicants also

request an exemption from section 30(h)

to the extent necessary to exempt the

officers and directors of the Manager or

others who may be deemed members of

an advisory board of the Company from

filing Forms 3, 4 and 5 under section

16(a) of the Securities Exchange Act of

1934 (‘‘1934 Act’’) with respect to their

ownership of Units in the Company.

Applicants assert that, because there

will be no trading market and the

transfer of Units is severely restricted,

these filings are unnecessary for the

protection of investors and burdensome

to those required to make them.

Applicants’ Conditions

Applicants agree that any order

granting the requested relief will be

subject to the following conditions:

1. Each proposed transaction

otherwise prohibited by section 17(a) or

section 17(d) and rule 17d–1 to which

the Company is a party (the ‘‘Section 17

Transactions’’) will be effected only if

the Manager determines that: (a) the

terms of the transaction, including the

consideration to be paid or received, are

fair and reasonable to the Members of

the Company and do not involve

overreaching of the Company or its

Members on the part of any person

concerned; and (b) the transaction is

consistent with the interests of the

Members of the Company, the

Company’s organizational documents

and the Company’s reports to its

Members.

In addition, the Manager of the

Company will record and preserve a

description of Section 17 Transactions,

its findings, the information or materials

upon which its findings are based and

the basis for the findings. All such

records will be maintained for the life

of the Company and at least two years

thereafter, and will be subject to

examination by the Commission and its

staff. All such records will be

maintained in an easily accessible place

for at least the first two years.

2. If purchases or sales are made from

or to an entity affiliated with the

Company by reason of a 5% or more

investment in such entity by the

officers, directors or employees of the

Manager, such officers, directors, or

employees will not participate in the

determination of whether or not to make

such investment available to the

Members of the Company.

3. In connection with the Section 17

Transactions, the Manager will adopt,

and periodically review and update,

procedures designed to ensure that

reasonable inquiry is made, prior to the

consummation of any Section 17

Transaction, with respect to the possible

involvement in the transaction of any

affiliated person or promoter of or

principal underwriter for the Company,

or any affiliated person of such a

person, promoter or principal

underwriter.

4. The Manager of the Company will

not make available to Members of the

Company any investment in which a

‘‘Coinvestor’’ (as defined below) has

acquired or proposes to acquire the

same class of securities of the same

issuer, if the investment involves a joint

enterprise or other joint arrangement

within the meaning of rule 17d–1 in

which the Company and the Coinvestor

are participants, unless any such

Coinvestor, prior to disposing of all or

part of its investment (a) gives the

Members of the Company holding such

investment sufficient, but not less than

one day’s, notice of its intent to dispose

of its investment; and (b) refrains from

disposing of its investment unless the

Members of the Company holding such

investment have the opportunity to

dispose of their investment prior to or

concurrently with, and on the same

terms as, and pro rata with, the

Coinvestor. The term ‘‘Coinvestor’’

means any person who is: (a) an

‘‘affiliated person’’ (as such term is

defined in section 2(a)(3) of the Act) of

the Company; (b) the Manager and any

entities controlled by the Manager; (c) a

current or former officer, director or

employee of the Manager; (d) an

investment vehicle offered, sponsored,

or managed by the Manager or an

affiliated person of the Manager; or (e)

a company in which the Manager or an

officer or director of the Manager acts as

an officer, director, or general partner,

or has a similar capacity to control the

sale or other disposition of the

company’s securities. The restrictions

contained in this condition, however,

will not be deemed to limit or prevent

the disposition of an investment by a

Coinvestor: (a) to its direct or indirect

wholly owned subsidiary, to any

company (a ‘‘parent’’) of which such

10926 Federal Register / Vol. 66, No. 34 / Tuesday, February 20, 2001 / Notices

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

2 17 CFR 240.19b-4.

Coinvestor is a direct or indirect wholly

owned subsidiary, or to a direct or

indirect wholly owned subsidiary of its

parent; (b) to immediate family

members of such Coinvestor or a trust

or other investment vehicle established

for any such family member; (c) when

the investment is comprised of

securities that are listed on any

exchange registered as a national

securities exchange under section 6 of

the 1934 Act; or (d) when the

investment is comprised of securities

that are national market system

securities pursuant to section 11A(a)(2)

of the 1934 Act and rule 11Aa2–1 under

the 1934 Act.

5. The Company will send to each

Member who had an interest in the

Company at any time during the fiscal

year then ended, Company financial

statements audited by independent

accountants. At the end of each fiscal

year, the Manager will make a valuation

or have a valuation made of all of the

assets of the Company as of such fiscal

year end in a manner consistent with

customary practice with respect to the

valuation of assets of the kind held by

the Company. In addition, within 90

days after the end of each fiscal year of

the Company or as soon as practicable

thereafter, the Manager will send a

report to each person who was a

Member at any time during the fiscal

year then ended, setting forth such tax

information as shall be necessary for the

preparation by the Member of his or its

federal and state income tax returns and

a report of the investment activities of

the Company during such year.

6. The Company will maintain and

preserve, for the life of the Company

and at least two years thereafter, such

accounts, books, and other documents

as constitute the record forming the

basis for the financial statements and

annual reports of the Company to be

provided to the Members, and agree that

all such records will be subject to

examination by the Commission and its

staff. All such records will be

maintained in an easily accessible place

for at least the first two years.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–4115 Filed 2–16–01; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–43915; File No. SR–NASD–

00–82]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the National Association of Securities

Dealers, Inc. Relating to the

Assessment of Fees for Unit

Investment Trusts Included in

Nasdaq’s Mutual Fund Quotation

Service

February 1, 2001.

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

Securities Exchange Act of 1934

(‘‘Act’’),1 and Rule 19b–4

thereunder,2notice is hereby given that

on December 26, 2000, the National

Association Securities Dealers, Inc.

(‘‘NASD’’ or ‘‘Association’’), through its

subsidiary, the Nasdaq Stock Market,

Inc. (‘‘Nasdaq’’) 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 Nasdaq.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

Nasdaq is proposing to amend NASD

Rule 7090 pertaining to the fees

assessed for Unit Investments Trusts

(‘‘UITS’’) included in the Mutual Fund

Quotation Service (‘‘MFQS’’). Proposed

new language is underlined; proposed

deletions are in brackets.

* * * * *

7090. Mutual Fund Quotation Service

(a) Funds and Unit Investment Trusts

included in the Mutual Fund Quotation

Service (‘‘MFQS’’) shall be assessed an

annual fee of $400 per fund or trust

authorized for the News Media Lists and

$275 per fund or trust authorized for the

Supplemental List. Funds or trusts

authorized during the course of an

annual billing period shall receive a

proration of these fees but no credit or

refund shall accrue to funds or trusts

terminated during an annual billing

period. In addition, there shall be a onetime application processing fee of $250

for each new fund or trust authorized.

(b) If a Unit Investment Trust expires

by its own terms during an annual

billing period and is replaced within

three months by a trust that is

materially similar is share class and

trust objective, the replacing trust shall

not be charged a one-time application

fee. In addition, the replacing trust shall

not be charged an annual fee if the

expiring trust has already paid an

annual fee for that annual billing

period.

(c) [(b)] Funds included in the MFQS

and pricing agents designated by such

funds (‘‘Subscriber’’), shall be assessed

a monthly fee of $75 for each logon

identification obtained by the

Subscriber. A Subscriber may use a

logon identification to transmit to

Nasdaq pricing and other information

that the Subscriber agrees to provide to

Nasdaq.

* * * * *

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

NASD 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. Nasdaq 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

Nasdaq’s MFQS collects and

disseminates data pertaining to the

value of open-end and closed-end

mutual funds and UITs. Currently, the

MFQS disseminates the valuation data

for over 11,000 funds. The MFQS

facilitates this process by permitting

funds included in the MFQS (or pricing

agents designated by such funds) to use

the browser-based technology to

transmit directly to Nasdaq a multitude

of pricing information, including

information about a fund’s net asset

value, offer price, and closing market

price.

NASD Rule 7090 sets forth the fees

assessed for the inclusion of mutual

funds in the MFQS. NASD Rule 7090

currently provides for the assessment of

an annual fee of $400 per fund

authorized for the News Media Lists,

$275 per fund authorized for the

Supplemental List, and a one-time

application processing fee of $250 for

each new fund authorized for either list.

Funds authorized during the course of

an annual billing period are assessed

prorated fees, but no credit or refund

accrues to funds terminated during an

annual billing period. The application

fee partially offsets the costs Nasdaq