[Federal Register Volume 72, Number 164 (Friday, August 24, 2007)]
[Notices]
[Pages 48699-48700]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-16762]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 27930]


Investment Company Act of 1940; In the Matter of Healthshares, 
Inc., Xshares Advisors LLC (Formerly, X-Shares Advisors, LLC), XShares 
Group LLC (Formerly, Ferghana-Wellspring, LLC) and TDAX Funds, Inc.; 
420 Lexington Avenue, Suite 2550, New York, NY 10170 (812-13358)

 August 20, 2007.

Order Under Sections 6(C) and 17(B) of the Investment Company Act of 
1940

    HealthShares, Inc., XShares Advisors LLC (formerly, X-Shares 
Advisors, LLC), XShares Group LLC (formerly, Ferghana-Wellspring LLC) 
and TDAX Funds, Inc., filed an application on January 19, 2007 and 
amendments to the application on June 4, 2007, July 20, 2007 and August 
3, 2007, requesting an order to amend a prior order under section 6(c) 
of the Investment Company Act of 1940 (``Act'') for an exemption from 
sections 2(a)(32), 5(a)(1), 22(d), and 24(d) of the Act and rule 22c-1 
under the Act, and under sections 6(c) and 17(b) of the Act for an 
exemption from sections 17(a)(1) and (a)(2) of the Act (``Prior 
Order'').\1\
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    \1\ HealthShares, Inc., et al., Investment Company Act Release 
Nos. 27553 (November 16, 2006) (notice) and 27594 (December 7, 2006) 
(order).
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    The Prior Order permits: (a) Open-end management investment 
companies, whose series are based on certain equity securities indices 
created by an affiliate of the investment adviser, to issue shares 
redeemable only in large aggregations; (b) secondary market 
transactions in the shares of the series to occur at negotiated prices; 
(c) dealers to sell shares to purchasers in the secondary market 
unaccompanied by a prospectus when prospectus delivery is not required 
by the Securities Act of 1933 (``Securities Act''); and (d) certain 
affiliated persons of the series to deposit securities into, and 
receive securities from, the series in connection with the purchase and 
redemption of aggregations of the series' shares. The amended order 
permits the applicants to offer additional series that would hold 
equity and fixed income securities and provides that certain 
representations and undertakings contained in the Prior Order shall not 
apply to a series where an entity that creates, compiles, sponsors, or 
maintains an underlying index is not an affiliated person, or an 
affiliated person of an affiliated person, of the series, its 
investment adviser, distributor, promoter, or any sub-adviser

[[Page 48700]]

to the series. In addition, the amended order deletes a condition 
relating to future relief in the Prior Order.
    On July 27, 2007, a notice of the filing of the application was 
issued (Investment Company Act Release No. 27916). The notice gave 
interested persons an opportunity to request a hearing and stated that 
an order disposing of the application would be issued unless a hearing 
was ordered. No request for a hearing has been filed, and the 
Commission has not ordered a hearing.
    The matter has been considered and it is found, on the basis of the 
information set forth in the application, as amended, that granting the 
requested exemptions is 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.
    In addition, it is found that the terms of the proposed 
transactions, including the consideration to be paid or received, are 
reasonable and fair and do not involve overreaching on the part of any 
person concerned, and that the proposed transactions are consistent 
with the policy of each registered investment company concerned and 
with the general purposes of the Act.
    Accordingly, in the matter of HealthShares, Inc., et al. (File No. 
812-13358),
    It is ordered, under section 6(c) of the Act, that the requested 
exemption from sections 2(a)(32), 5(a)(1), 22(d) and 24(d) of the Act 
and rule 22c-1 under the Act are granted, effective immediately, 
subject to the conditions contained in the application, as amended.
    It is further ordered, under sections 6(c) and 17(b) of the Act, 
that the requested exemption from sections 17(a)(1) and (a)(2) of the 
Act is granted, effective immediately, subject to the conditions 
contained in the application, as amended.
    The exemption from section 24(d) of the Act does not affect a 
purchaser's rights under the civil liability and anti-fraud provisions 
of the Securities Act. Thus, rights under section 11 and section 
12(a)(2) of the Securities Act extend to all purchasers who can trace 
their securities to a registration statement filed with the Commission, 
whether or not they were delivered a prospectus in connection with 
their purchase.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-16762 Filed 8-23-07; 8:45 am]
BILLING CODE 8010-01-P