[Federal Register Volume 59, Number 9 (Thursday, January 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-878]
[[Page Unknown]]
[Federal Register: January 13, 1994]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. IC-20006; 812-8690]
PIC Investment Trust, et al.; Notice of Application
January 7, 1994.
AGENCY: Securities and Exchange Commission (``SEC'').
ACTION: Notice of application for exemption under the Investment
Company Act of 1940 (the ``Act'').
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applicants: PIC Investment Trust (the ``Trust''), on behalf of two of
its series, PIC Pinnacle Growth Fund and PIC Balanced Investors Fund
(each a ``Fund''); First Fund Distributors, Inc. (the ``Distributor'');
and all other open-end management investment companies, or series
thereof, which invest substantially all of their assets in a registered
investment company for which the adviser in the future serves as
investment adviser, that are in the same ``group of investment
companies,'' as defined in rule 11a-3 under the Act, as the Funds, and
whose shares will be distributed on substantially the same basis as
those of the Funds.
relevant act sections: Exemption requested under section 6(c) from
sections 2(a)(32), 2(a)(35), 22(c), and 22(d), and rule 22c-1
thereunder.
SUMMARY of application: Applicants seek an order that would permit
certain registered open-end investment companies to impose a contingent
deferred sales charge (``CDSC'') on certain redemptions of shares, and
waive the CDSC in certain specified instances.
filing date: The application was filed on November 16, 1993, and
amended on December 21, 1993. By letter dated January 6, 1994,
applicants have agreed to make certain technical changes to the
application, and to file an amendment prior to the issuance of any
order granting the requested relief. This notice reflects the
application as though such amendment had been filed.
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 February 1,
1994, 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
SEC's Secretary.
ADDRESSES: Secretary, SEC, 450 Fifth Street, NW., Washington, DC 20549.
The Trust and the Funds, 300 North Lake Avenue, Pasadena, California
91101; the Distributor, 479 West 22nd Street, New York, New York 10011.
FOR FURTHER INFORMATION CONTACT:
James J. Dwyer, Staff Attorney, at (202) 504-2920, or Elizabeth G.
Osterman, Branch Chief, at (202) 272-3016 (Division of Investment
Management, Office of Investment Company Regulation).
Supplementary Information: The following is a summary of the
application. The complete application may be obtained for a fee from
the SEC's Public Reference Branch.
Applicants' Representations:
1. The Trust is an open-end management investment company organized
as a Delaware business trust. The Trust currently is comprised of six
series, including the Funds. The Funds will be offered to the public,
upon the effectiveness of the Trust's registration statement covering
them, and if the requested order is issued.
2. Each Fund will invest substantially all of its assets in a
corresponding portfolio, PIC Pinnacle Growth Portfolio and PIC Balanced
Portfolio (the ``Portfolios''), which are registered open-end
management investment companies organized as a New York business
trusts. The Portfolios will not offer their shares to the public but
will sell their shares to other mutual funds or institutional investors
in private placement transactions. Under this arrangement, the
Portfolios would be ``master'' funds, and the Funds would be ``feeder''
funds.
3. Each Portfolio has entered into or will enter into an advisory
agreement with Provident Investment Counsel (the ``Adviser''), a
registered investment adviser, and an administration agreement with
Investment Company Administration Corporation (the ``Administrator'').
The Trust and the Funds have not retained the services of an investment
adviser because the Funds seek to achieve their investment objectives
by investing all of their assets in corresponding Portfolios.
Distribution and shareholder servicing fees and costs, and additional
administrative expenses, are paid by the Trust at the Fund level. The
Trust and each Fund have entered into or will enter into an
administration agreement with the Administrator, which will provide
administrative services, and distribution and shareholder service plans
with the Distributor.
4. The Distributor is a registered broker-dealer and will serve as
the principal underwriter for each Fund. The Distributor will enter
into selling group agreements with unaffiliated broker-dealers pursuant
to which the broker-dealers will sell Fund shares.
5. Under the ``master-feeder'' structure between the Trust and the
Portfolios, all portfolio management services are provided, and all
related costs are incurred, at the Portfolio level, although each Fund
will bear its pro rata share of the corresponding Portfolio's costs and
expenses.
6. Shares of the Funds generally will be offered for sale to the
public at net asset value plus a front-end sales load. Currently, the
proposed sales load will be 4.75 percent for purchases of less than
$50,000, with lesser sales load applying to larger purchases, and no
front-end sales load applying to purchases of $1,000,000 or more.
7. Applicants request an exemptive order that would permit them to
assess a CDSC on shares sold without a front-end sales load because of
a volume purchase of $1,000,000 or more, and that are redeemed within a
specified period (the ``CDSC period'') after their purchase date. The
CDSC will be equal to a percentage (the ``CDSC percentage'') of the
lesser of the net asset value of the shares at the time of purchase or
at the time of redemption. Currently, the CDSC period is anticipated to
be one year, and the CDSC percentage is anticipated to be one percent.
Applicants in all cases will comply with article III, section 26(d) of
the Rules of Fair Practice of the National Association of Securities
Dealers, Inc., as it relates to the maximum amount of asset-based sales
charges that may be imposed by an investment company, when and in the
form (as amended from time to time) the provisions of such Rules
relating to such charges become effective, and for as long as they
remain in effect.
8. No CDSC will be imposed on redemptions of shares acquired
through reinvestment of income dividends or capital gain distributions,
on amounts derived from increases in the value of the account above the
amount of purchase payments, or on shares held for longer than the CDSC
period. In determining whether the CDSC is payable, it will be assumed
that shares not subject to the CDSC are redeemed first and that other
shares then are redeemed in the order purchased. In addition, no CDSC
will be imposed on the redemption of shares of the Funds purchased
prior to the grant of the requested order.
9. Applicants proposes to waive the CDSC on redemptions of shares
of the Fund: (a) For distributions from qualified retirement plans and
other employee benefit plans qualified under section 401(a) of the
Internal Revenue Code of 1986, as amended (the ``Code''), (b) for
distributions from custodial accounts under section 403(b)(7) of the
Code or individual retirement accounts (``IRAs'') due to death,
disability, or attainment of age 59\1/2\, (c) for tax-free returns of
excess contributions to IRAs, (d) for any partial or complete
redemptions following death or disability (as defined in section
72(m)(7) of the Code) of a shareholder from an account in which the
deceased or disabled is named, provided the redemption is made within
one year of death or initial determination of disability, (e) pursuant
to involuntary redemptions and automatic withdrawals, as described in
each Fund's prospectus, and (f) by--(i) current or retired directors,
trustees, partners, officers, and employees of the Trust, the
Portfolios, the Distributor, the Adviser, family members of such
persons, and trusts or plans primarily for such persons (ii) the
Adviser, (iii) trustees and other fiduciaries purchasing shares for
retirement plans of organizations with retirement plan assets of
$100,000,000 or more, (iv) insurance company separate accounts, and (v)
participants in pension, profit-sharing, or employee benefit plans
sponsored by the Distributor and its affiliates.
10. The Distributor will provide a pro rata refund, out of its own
assets, of any CDSC paid in connection with a redemption of shares (by
crediting such CDSC to such shareholder's account) if, within 90 days
of such redemption, all or any portion of the redemption proceeds are
reinvested in shares of the Funds. Any such reinvestment will be made
without the imposition of a front-end sales load but will be subject to
the same CDSC to which such amount was subject prior to the redemption.
The CDSC time period will run from the original investment date but
will be extended by the number of days between the redemption and
reinvestment dates.
11. Applicants may in the future reduce the CDSC percentage, or
shorten the CDSC period. Applicants also may temporarily or permanently
discontinue the CDSC in the future. However, any future changes,
variations, discontinuations, or reinstatements of the CDSC will be
disclosed in each affected Fund's prospectus, and will not affect
shares issued prior to such disclosure.
Applicants' Condition
Applicants agree that the order granting the requested relief may
be subject to the following condition:
Applicants will comply with the provisions of proposed rule 6c-10
under the Act, Investment Company Act Release No. 16619 (Nov. 2, 1988),
as such rule is currently proposed and as it may be reproposed,
adopted, or amended.
For the SEC, by the Division of Investment Management, pursuant
to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-878 Filed 1-12-94; 8:45 am]
BILLING CODE 8010-01-M