[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