The Mexico Fund, Inc., et al.; Notice of Application, 43270-43274 [E8-16867]
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Federal Register / Vol. 73, No. 143 / Thursday, July 24, 2008 / Notices
Agent on pay comparison methods,
locality pay rates, and locality pay area
boundaries for 2010 at the September 30
meeting. Both meetings are open to the
public. Please contact the Office of
Personnel Management at the address
shown below if you wish to submit
testimony or present material to the
Council at the meetings.
DATES: September 5, 2008, at 10 a.m.
and September 30, 2008, at 10 a.m.
Location: Office of Personnel
Management, 1900 E Street, NW., Room
1350, Washington, DC.
FOR FURTHER INFORMATION CONTACT:
Charles D. Grimes III, Deputy Associate
Director for Performance and Pay
Systems, Office of Personnel
Management, 1900 E Street, NW., Room
7H31, Washington, DC 20415–8200.
Phone (202) 606–2838; FAX (202) 606–
4264; or e-mail at pay-performancepolicy@opm.gov.
For the President’s Pay Agent:
Linda M. Springer,
Director.
[FR Doc. E8–16940 Filed 7–23–08; 8:45 am]
BILLING CODE 6325–39–P
SECURITIES AND EXCHANGE
COMMISSION
Submission for OMB Review;
Comment Request
Upon written request, copies available
from: Securities and Exchange
Commission, Office of Investor
Education and Advocacy,
Washington, DC 20549–0213.
ebenthall on PRODPC60 with NOTICES
Extension: Rule 17a–22; SEC File No. 270–
202; OMB Control No. 3235–0196.
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget a
request for approval of extension of the
existing collection of information
provided for in the following rule: Rule
17a–22 (17 CFR 240.17a–22).
Rule 17a–22 under the Securities
Exchange Act of 1934 (‘‘Exchange
Act’’) 1 requires all registered clearing
agencies to file with the Commission
three copies of all materials they issue
or make generally available to their
participants or other entities with whom
they have a significant relationship,
such as pledges, transfer agents, or selfregulatory organizations. Such materials
include manuals, notices, circulars,
bulletins, lists, and periodicals. The
1 15
U.S.C. 78a et seq.
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filings with the Commission must be
made within ten days after the materials
are issued or made generally available.
When the Commission is not the
clearing agency’s appropriate regulatory
agency, the clearing agency must file
one copy of the material with its
appropriate regulatory agency. The
Commission is responsible for
overseeing clearing agencies and uses
the information filed pursuant to Rule
17a–22 to determine whether a clearing
agency is implementing procedural or
policy changes. The information filed
aids the Commission in determining
whether such changes are consistent
with the purposes of section 17A of the
Exchange Act. Also, the Commission
uses the information to determine
whether a clearing agency has changed
its rules without reporting the actual or
prospective change to the Commission
as required under section 19(b) of the
Exchange Act.
The respondents to Rule 17a–22 are
registered clearing agencies. The
frequency of filings made by clearing
agencies pursuant to Rule 17a–22 varies
but on average there are approximately
200 filings per year per active clearing
agency. The Commission staff estimates
that each response requires
approximately .25 hour (fifteen
minutes), which represents the time it
takes for a staff person at the clearing
agency to properly identify a document
subject to the rule, print and make
copies, and mail that document to the
Commission. Thus, the total annual
burden for all active clearing agencies is
300 hours (1,200 multiplied by .25 hour)
and a total of 50 hours (1,200 responses
multiplied by .25 hour, divided by 6
active clearing agencies) per year are
expended by each respondent to comply
with the rule.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
Comments should be directed to (i)
Desk Officer for the Securities and
Exchange Commission, Office of
Information and Regulatory Affairs,
Office of Management and Budget,
Room 10102, New Executive Office
Building, Washington, DC 20503, or
send an e-mail to:
Alexander_T._Hunt@omb.eop.gov; and
(ii) Lewis W. Walker, Acting Director/
Chief Information Officer, Securities
and Exchange Commission, c/o Shirley
Martinson, 6432 General Green Way,
Alexandria, VA 22312, or send an email to: PRA_Mailbox@sec.gov.
Comments must be submitted within 30
days of this notice.
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Dated: July 17, 2008.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–16931 Filed 7–23–08; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
28332; 812–13454]
The Mexico Fund, Inc., et al.; Notice of
Application
July 17, 2008.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice of application under
section 6(c) of the Investment Company
Act of 1940 (‘‘Act’’) for an exemption
from section 19(b) of the Act and rule
19b–1 under the Act.
AGENCY:
Summary of Application: Applicants
request an order to permit The Mexico
Fund, Inc., a closed-end investment
company, to make periodic distributions
of long-term capital gains with respect
to its outstanding common stock as
frequently as twelve times each year.
Applicants: The Mexico Fund, Inc.
(‘‘Fund’’) and Impulsora del Fondo
Mexico, S.C. (‘‘Adviser’’).
Filing Dates: November 21, 2007, June
26, 2008, and July 14, 2008. Applicants
have agreed to file an amendment
during the notice period, the substance
of which is reflected in the notice.
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 August 11, 2008, 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, Securities and
Exchange Commission, 100 F Street,
NE., Washington, DC 20549–1090;
Applicants, Sander Bieber, Esq., Dechert
LLP, 1775 I Street, NW., Washington,
DC 20006.
FOR FURTHER INFORMATION CONTACT:
Wendy Friedlander, Senior Counsel, at
(202) 551–6837, or James M. Curtis,
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Branch Chief, at (202) 551–6825
(Division of Investment Management,
Office of Chief Counsel).
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 Room,
100 F Street, NE., Washington, DC
20549–1520 (telephone (202) 551–5850).
Applicants’ Representations
Applicants represent that they will
comply with the representations and
conditions in this Application before
they rely on the order requested.
1. Applicants represent that the Fund
is a registered closed-end investment
company registered under the Act. The
Fund’s investment objective is longterm capital appreciation. The common
stock issued by the Fund is listed on the
New York Stock Exchange. The Fund
has not issued preferred stock.
Applicants believe that the Fund’s
stockholders include investors who
desire steady distributions of cash and
who will appreciate that the Fund
wishes to implement a practice of
providing regular distributions pursuant
to a plan of distribution as described
below.
2. Applicants represent that the
Adviser, which is organized as a
Mexican ‘‘sociedad civil’’ governed by
the Federal Civil Code of Mexico, is
registered under the Investment
Advisers Act of 1940. The Adviser is
responsible for the overall management
of the Fund and currently has no
investment advisory clients other than
the Fund.
3. Applicants represent that the
Fund’s Board of Directors (‘‘Board’’),
including a majority of the directors
who are not interested persons, as
defined in section 2(a)(19) of the Act
(each an ‘‘Independent Director’’), will
adopt a plan (‘‘Plan’’) to make periodic
level distributions with respect to its
common stock, based upon a fixed
percentage of the Fund’s net asset value
(‘‘NAV’’) or market price per share of its
common stock or at least a minimum
fixed dollar amount per year.
Applicants represent that the Board will
request, and the Adviser will provide,
such information as is reasonably
necessary to an informed determination
of whether the Board should adopt the
Plan. In particular, the Board and the
Independent Directors will review
information regarding the purpose and
terms of the Plan, the likely effects of
the Plan on the Fund’s long-term total
return (in relation to market price and
NAV per common share) and the
relationship between the Fund’s
distribution rate on its common stock
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under the Plan and the Fund’s total
return (in relation to NAV per share);
whether the rate of distribution would
exceed the Fund’s expected total return
in relation to its NAV per share; and any
foreseeable material effects of such Plan
on the Fund’s long-term total return (in
relation to market price and NAV per
share). The Independent Directors also
will consider what conflicts of interest
the Adviser and the affiliated persons of
the Adviser and the Fund might have
with respect to the adoption or
implementation of such Plan.
Applicants represent that after
considering such information the Board,
including the Independent Directors,
will approve the Plan with respect to
the Fund’s common stock provided that
the Board, including the Independent
Directors, determine that the Plan is
consistent with the Fund’s investment
objectives and in the best interests of the
Fund’s common stockholders.
4. Applicants represent that the
purpose of the Plan would be to permit
the Fund to provide its stockholders
with a level, periodic distribution.
Applicants represent that under the
Plan, the Fund would distribute to its
common stockholders a fixed
percentage of the market price of the
Fund’s common stock or a fixed
percentage of NAV per share or a fixed
amount per share which percentage or
amount may be adjusted from time to
time. Applicants state that the minimum
annual distribution rate with respect to
the Fund’s common stock under the
Plan would be independent of the
Fund’s performance during any
particular period but would be expected
to correlate with the Fund’s
performance over time. Applicants
explain that each distribution on the
common stock would be at the stated
rate then in effect, except for
extraordinary distributions and
potential increases or decreases in the
final dividend periods in light of the
Fund’s performance for the entire
calendar year and to enable the Fund to
comply with the distribution
requirements of subchapter M of the
Internal Revenue Code of 1986 (the
‘‘Code’’) for the calendar year.
Applicants expect that over time the
NAV distribution rate with respect to
the Fund’s common stock will
approximately equal the Fund’s total
return on NAV.
5. Applicants state that the Board also
will adopt policies and procedures
under rule 38a–1 under the Act that are
reasonably designed to ensure that all
notices sent to Fund stockholders with
distributions under the Plan (‘‘Notices’’)
comply with condition II below, and
that all other written communications
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by the Fund or its agents regarding
distributions under the Plan will
include the disclosure required by
condition III below. Applicants state
that the Board also will adopt policies
and procedures that will require the
Fund to keep records that demonstrate
the Fund’s compliance with all of the
conditions of the requested order and
that are necessary for the Fund to form
the basis for, or demonstrate the
calculation of, the amounts disclosed in
its Notice.
Applicants’ Legal Analysis
1. Section 19(b) generally makes it
unlawful for any registered investment
company to make long-term capital
gains distributions more than once each
year. Rule 19b–1 limits the number of
capital gains dividends, as defined in
section 852(b)(3)(C) of the Code
(‘‘distributions’’), that a fund may make
with respect to any one taxable year to
one, plus a supplemental ‘‘clean up’’
distribution made pursuant to section
855 of the Code not exceeding 10% of
the total amount distributed for the year,
plus one additional capital gain
dividend made in whole or in part to
avoid the excise tax under section 4982
of the Code.
2. Section 6(c) provides that the
Commission may, by order upon
application, conditionally or
unconditionally exempt any person,
security, or transaction, or any class or
classes of persons, securities or
transactions, from any provision of the
Act, if and to the extent that 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.
3. Applicants state that the one of the
concerns underlying section 19(b) and
rule 19b–1 is that stockholders might be
unable to differentiate between regular
distributions of capital gains and
distributions of investment income.
Applicants state, however, that rule
19a–1 effectively addresses this concern
by requiring that a separate statement
showing the sources of a distribution
(e.g., estimated net income, net shortterm capital gains, net long-term capital
gains and/or return of capital)
accompany any distributions (or the
confirmation of the reinvestment of
distributions) estimated to be sourced in
part from capital gains or capital.
Applicants state that the same
information also is included in the
Fund’s annual reports to stockholders
and on its IRS Form 1099–DIV, which
is sent to each stockholder who received
distributions during the year.
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4. Applicants further state that the
Fund will make the additional
disclosures required by the conditions
set forth below, and the Fund will adopt
compliance policies and procedures in
accordance with rule 38a–1 to ensure
that all required Notices and disclosures
are sent to stockholders. Applicants
argue that by providing the information
required by section 19(a) and rule 19a–
1, and by complying with the
procedures adopted under the Plan and
the conditions listed below, the Fund
would ensure that its stockholders are
provided sufficient information to
understand that their periodic
distributions are not tied to the Fund’s
net investment income (which for this
purpose is the Fund’s taxable income
other than from capital gains) and
realized capital gains to date, and may
not represent yield or investment return.
Applicants also state that compliance
with the Fund’s compliance procedures
and condition III set forth below will
ensure that prospective stockholders
and third parties are provided with the
same information. Accordingly,
applicants assert that continuing to
subject the Fund to section 19(b) and
rule 19b–1 would afford stockholders no
extra protection.
5. Applicants note that section 19(b)
and rule 19b–1 also were intended to
prevent certain improper sales practices,
including, in particular, the practice of
urging an investor to purchase shares of
a fund on the basis of an upcoming
capital gains dividend (‘‘selling the
dividend’’), where the dividend would
result in an immediate corresponding
reduction in NAV and would be in
effect a taxable return of the investor’s
capital. Applicants assert that the
‘‘selling the dividend’’ concern should
not apply to closed-end investment
companies, such as the Fund, which do
not continuously distribute shares.
According to Applicants, if the
underlying concern extends to
secondary market purchases of stock of
closed-end funds that are subject to a
large upcoming capital gains dividend,
adoption of a plan actually helps
minimize the concern by avoiding,
through periodic distributions, any
buildup of large end-of-the-year
distributions.
6. Applicants assert that the
application of rule 19b–1 to a Plan
actually could have an undesirable
influence on portfolio management
decisions. Applicants state that, in the
absence of an exemption from rule 19b–
1, the implementation of a Plan imposes
pressure on management (i) not to
realize any net long-term capital gains
until the point in the year that the fund
can pay all of its remaining distributions
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in accordance with rule 19b–1, and (ii)
not to realize any long-term capital
gains during any particular year in
excess of the amount of the aggregate
pay-out for the year (since as a practical
matter excess gains must be distributed
and accordingly would not be available
to satisfy pay-out requirements in
following years), notwithstanding that
purely investment considerations might
favor realization of long-term gains at
different times or in different amounts.
Applicants thus assert that the
limitation on the number of capital gain
distributions that a fund may make with
respect to any one year imposed by rule
19b–1, may prevent the efficient
operation of a Plan whenever that fund’s
realized net long-term capital gains in
any year exceed the total of the periodic
distributions that may include such
capital gains under the rule.
7. In addition, Applicants assert that
rule 19b–1 may cause fixed regular
periodic distributions under the Plan to
be funded with returns of capital 1 (to
the extent net investment income and
realized short-term capital gains are
insufficient to fund the distribution),
even though realized net long-term
capital gains otherwise could be
available. To distribute all of a fund’s
long-term capital gains within the limits
in rule 19b–1, a fund may be required
to make total distributions in excess of
the annual amount called for by its Plan,
or to retain and pay taxes on the excess
amount. Applicants thus assert that the
requested order would minimize these
effects of rule 19b–1 by enabling the
Fund to realize long-term capital gains
as often as investment considerations
dictate without fear of violating rule
19b–1.
8. Applicants request an order under
section 6(c) granting an exemption from
the provisions of section 19(b) and rule
19b–1 to permit each fund’s common
stock to distribute periodic capital gains
dividends (as defined in section
852(b)(3)(C) of the Code) as often as
monthly in any one taxable year in
respect of its common stock.
Applicants’ Conditions
Applicants agree that the order will be
subject to the following conditions:
I. Compliance Review and Reporting.
The Fund’s chief compliance officer
will: (a) Report to the Fund’s Board, no
less frequently than once every three
months or at the next regularly
scheduled quarterly board meeting,
whether (i) the Fund and the Adviser
have complied with the conditions to
1 Returns of capital as used in the application
means return of capital for financial accounting
purposes and not for tax accounting purposes.
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the requested order, and (ii) a Material
Compliance Matter, as defined in rule
38a–1(e)(2), has occurred with respect to
compliance with such conditions; and
(b) review the adequacy of the policies
and procedures adopted by the Fund no
less frequently than annually.
II. Disclosures to Fund Stockholders:
A. Each Notice to the holders of the
Fund’s common stock, in addition to the
information required by section 19(a)
and rule 19a–1:
1. Will provide, in a tabular or
graphical format:
(a) The amount of the distribution, on
a per common share basis, together with
the amounts of such distribution
amount, on a per common share basis
and as a percentage of such distribution
amount, from estimated: (A) Net
investment income; (B) net realized
short-term capital gains; (C) net realized
long-term capital gains; and (D) return
of capital or other capital source;
(b) The fiscal year-to-date cumulative
amount of distributions, on a per
common share basis, together with the
amounts of such cumulative amount, on
a per common share basis and as a
percentage of such cumulative amount
of distributions, from estimated: (A) Net
investment income; (B) net realized
short-term capital gains; (C) net realized
long-term capital gains; and (D) return
of capital or other capital source;
(c) The average annual total return in
relation to the change in NAV for the 5year period ending on the last day of the
month prior to the most recent
distribution declaration date compared
to the current fiscal period’s annualized
distribution rate expressed as a
percentage of NAV as of the last day of
the month prior to the most recent
distribution declaration date; and
(d) The cumulative total return in
relation to the change in NAV from the
last completed fiscal year to the last day
of the month prior to the most recent
distribution declaration date compared
to the fiscal year-to-date cumulative
distribution rate expressed as a
percentage of NAV as of the last day of
the month prior to the most recent
distribution declaration date. Such
disclosure shall be made in a type size
at least as large and as prominent as the
estimate of the sources of the current
distribution; and
2. will include the following
disclosure:
(a) ‘‘You should not draw any
conclusions about the fund’s investment
performance from the amount of this
distribution or from the terms of the
Fund’s Plan’’;
(b) ‘‘The Fund estimates that it has
distributed more than its income and
net realized capital gains; therefore, a
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portion of your distribution may be a
return of capital. A return of capital may
occur for example, when some or all of
the money that you invested in the
Fund is paid back to you. A return of
capital distribution does not necessarily
reflect the Fund’s investment
performance and should not be
confused with ‘yield’ or ‘income’ ’’; and
(c) ‘‘The amounts and sources of
distributions reported in this Notice are
only estimates and are not being
provided for tax reporting purposes. The
actual amounts and sources of the
amounts for [accounting and] tax
reporting purposes will depend upon
the Fund’s investment experience
during the remainder of its fiscal year
and may be subject to changes based on
tax regulations. The Fund will send you
a Form 1099–DIV for the calendar year
that will tell you how to report these
distributions for federal income tax
purposes.’’ Such disclosure shall be
made in a type size at least as large as
and as prominent as any other
information in the Notice and placed on
the same page in close proximity to the
amount and the sources of the
distribution.
B. On the inside front cover of each
report to stockholders under rule 30e–
1 under the Act, the Fund will:
1. describe the terms of the Plan
(including the fixed amount or fixed
percentage of the distributions and the
frequency of the distributions);
2. include the disclosure required by
condition II.A.2.a above;
3. state, if applicable, that the Plan
provides that the Board may amend or
terminate the Plan at any time without
prior notice to Fund stockholders; and
4. describe any reasonably foreseeable
circumstances that might cause the
Fund to terminate the Plan and any
reasonably foreseeable consequences of
such termination.
C. Each report provided to
stockholders under rule 30e–1 and in
each prospectus filed with the
Commission on Form N–2 under the
Act, will provide the Fund’s total return
in relation to changes in NAV in the
financial highlights table and in any
discussion about the Fund’s total return.
III. Disclosure to Stockholders,
Prospective Stockholders and Third
Parties:
A. The Fund will include the
information contained in the relevant
Notice, including the disclosure
required by condition II.A.2 above, in
any written communication (other than
a Form 1099) about the Plan or
distributions under the Plan by the
Fund, or agents that the Fund has
authorized to make such
communication on the Fund’s behalf, to
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any Fund common stockholder,
prospective common stockholder or
third-party information provider;
B. The Fund will issue,
contemporaneously with the issuance of
any Notice, a press release containing
the information in the Notice and will
file with the Commission the
information contained in such Notice,
including the disclosure required by
condition II.A.2 above, as an exhibit to
its next filed Form N–CSR; and
C. The fund will post prominently a
statement on its Web site containing the
information in each Notice, including
the disclosure required by condition
II.A.2 above, and will maintain such
information on such Web site for at least
24 months.
IV. Delivery of 19(a) Notices to
Beneficial Owners: If a broker, dealer,
bank or other person (‘‘financial
intermediary’’) holds common stock
issued by the Fund in nominee name, or
otherwise, on behalf of a beneficial
owner, the Fund: (a) Will request that
the financial intermediary, or its agent,
forward the Notice to all beneficial
owners of the Fund’s shares held
through such financial intermediary; (b)
will provide, in a timely manner, to the
financial intermediary, or its agent,
enough copies of the Notice assembled
in the form and at the place that the
financial intermediary, or its agent,
reasonably requests to facilitate the
financial intermediary’s sending of the
Notice to each beneficial owner of the
fund’s stock; and (c) upon the request of
any financial intermediary, or its agent,
that receives copies of the Notice, will
pay the financial intermediary, or its
agent, the reasonable expenses of
sending the Notice to such beneficial
owners.
V. Additional Board Determinations if
the Fund’s Common Stock Trades at a
Premium:
If:
A. The Fund’s common stock has
traded on the exchange it primarily
trades on at the time in question at an
average premium to NAV equal to or
greater than 10%, as determined on the
basis of the average of the discount or
premium to NAV of the Fund’s common
shares as of the close of each trading day
over a 12-week rolling period (each such
12-week rolling period ending on the
last trading day of each week); and
B. The Fund’s annualized distribution
rate for such 12-week rolling period,
expressed as a percentage of NAV as of
the ending date of such 12-week rolling
period, is greater than the Fund’s
average annual total return in relation to
the change in NAV over the 2-year
period ending on the last day of such
12-week rolling period; then:
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1. At the earlier of the next regularly
scheduled meeting or within four
months of the last day of such 12-week
rolling period, the Board including a
majority of the Independent Directors:
(a) Will request and evaluate, and the
Adviser will furnish, such information
as may be reasonably necessary to make
an informed determination of whether
the Plan should be continued or
continued after amendment;
(b) Will determine whether
continuation, or continuation after
amendment, of the Plan is consistent
with the Fund’s investment objective(s)
and policies and in the best interests of
the Fund and its stockholders, after
considering the information in
condition V.B.1.a above; including,
without limitation:
(1) Whether the Plan is accomplishing
its purpose(s);
(2) The reasonably foreseeable effects
of the Plan on the Fund’s long-term total
return in relation to the market price
and NAV of the Fund’s common shares;
and
(3) The Fund’s current distribution
rate, as described in condition V.B
above, compared to with the Fund’s
average annual total return over the 2year period, as described in condition
V.B, or such longer period as the Board
deems appropriate; and
(c) Based upon that determination,
will approve or disapprove the
continuation, or continuation after
amendment, of the Plan; and
2. The Board will record the
information considered by it and the
basis for its approval or disapproval of
the continuation, or continuation after
amendment, of the Plan in its meeting
minutes, which must be made and
preserved for a period of not less than
six years from the date of such meeting,
the first two years in an easily accessible
place.
VI. Public Offerings: The Fund will
not make a public offering of the Fund’s
common stock other than:
A. A rights offering below net asset
value to holders of the Fund’s common
stock;
B. An offering in connection with a
dividend reinvestment plan, merger,
consolidation, acquisition, spin-off or
reorganization of the Fund; or
C. An offering other than an offering
described in conditions VI.A and VI.B
above, unless, with respect to such other
offering:
1. The fund’s average annual
distribution rate for the six months
ending on the last day of the month
ended immediately prior to the most
recent distribution declaration date,
expressed as a percentage of NAV per
share as of such date, is no more than
E:\FR\FM\24JYN1.SGM
24JYN1
43274
Federal Register / Vol. 73, No. 143 / Thursday, July 24, 2008 / Notices
1 percentage point greater than the
fund’s average annual total return for
the 5-year period ending on such date;
and
2. The transmittal letter
accompanying any registration
statement filed with the Commission in
connection with such offering discloses
that the Fund has received an order
under section 19(b) to permit it to make
periodic distributions of long-term
capital gains with respect to its common
stock as frequently as twelve times each
year.
VII. Amendments to Rule 19b–1: The
requested relief will expire on the
effective date of any amendment to rule
19b–1 that provides relief permitting
certain closed-end investment
companies to make periodic
distributions of long-term capital gains
with respect to their outstanding
common stock as frequently as twelve
times each year.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–16867 Filed 7–23–08; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58189; File No. SR–CBOE–
2008–75]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to Sponsored
User Fees
July 18, 2008.
ebenthall on PRODPC60 with NOTICES
Pursuant to section 19(b)(1) of the
Securities Exchange Act of 1934,1 notice
is hereby given that on July 15, 2008,
the Chicago Board Options Exchange,
Incorporated filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I, II and III
below, which Items have been prepared
by CBOE. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
Chicago Board Options Exchange,
Incorporated (‘‘CBOE’’ or ‘‘Exchange’’)
proposes to establish fees applicable to
Sponsored Users. The text of the
1 15
U.S.C. 78s(b)(1).
VerDate Aug<31>2005
15:14 Jul 23, 2008
Jkt 214001
proposed rule change is available on the
Exchange’s Web site (https://
www.cboe.org/legal), at the Exchange’s
principal office, and at the
Commission’s Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
CBOE 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. CBOE 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
CBOE Rule 6.20A, Sponsored Users,
governs electronic access for the entry
and execution of orders by Sponsored
Users 2 with authorized access to
Exchange Systems 3 and the applicable
requirements that Sponsored Users and
Sponsoring Members 4 are required to
satisfy in order to engage in a
Sponsoring Member/Sponsored User
relationship. The Exchange proposes to
establish fees specifically applicable to
Sponsored Users. The fees are (1) a
Sponsored User Inactivity Fee, (2) a
Sponsored User Registration Fee, (3)
CBOEdirect connectivity fees, and (4) a
co-location fee. The proposed fees
would be billed to Sponsoring Members
through their clearing firms.
Sponsored User Inactivity Fee. The
Exchange recently expanded the
Sponsored User program, which had
previously only applied to CBOE’s
FLEX and CBSX facilities, to permit
electronic access for the entry and
execution of orders by Sponsored Users
to all other products traded on CBOE.5
However, the number of Sponsored
Users with electronic access to all other
products traded on CBOE has been
2 A ‘‘Sponsored User’’ is defined in Rule
6.20(A)(a) as a person or entity that has entered into
a sponsorship arrangement with a Sponsoring
Member for purposes of receiving electronic access
to the Exchange System(s).
3 ‘‘Exchange Systems’’ is defined in Rule 6.20A.01
as the FLEX Hybrid Trading System (‘‘FLEX’’),
CBOE Stock Exchange (‘‘CBSX’’) and CBOE.
4 ‘‘Sponsoring Member’’ is defined in Rule
6.20A(b) as a member organization that agrees to
sponsor the Sponsored User’s access to the
Exchange System(s).
5 See Securities Exchange Act Release No. 58051
(June 27, 2008), 73 FR 38260 (July 3, 2008).
PO 00000
Frm 00074
Fmt 4703
Sfmt 4703
limited to a total of 15 persons or
entities (referred to as the 15
‘‘Sponsored User Slots’’).6 The
Exchange proposes to charge an
inactivity fee of $5,000 per month that
would be charged only if a CBOE
Sponsored User (one of the 15
Sponsored User Slots) is not software
certified by the Exchange and has not
established a production network
connection and passed a login test
within 90 days of CBOE’s acceptance of
its Sponsored User registration status.
The fee would continue to apply until
the Sponsored User has completed all of
the foregoing requirements or the
Sponsored User’s registration status is
withdrawn.
Without the fee, a Sponsored User
could obtain one of the Sponsored User
Slots and choose not to connect to the
Exchange. The Exchange believes the
proposed fee should provide an
appropriate incentive to Sponsored
Users to connect to the Exchange and
trade. A Sponsored User very easily may
avoid assessment of the fee simply by
becoming software certified and
establishing a network connection to the
Exchange as described above.
Sponsored User Registration Fee. The
Exchange proposes to charge a one-time
fee of $2,500 for each registration of a
Sponsored User.
CBOEdirect connectivity fees. The
Exchange currently charges members
the following monthly fees related to
connectivity to CBOEdirect: a $40 per
month ‘‘CMI Application Server’’ fee for
providing member firms with server
hardware that enable the firms to
connect to CBOE’s two Application
Protocol Interfaces: CMI (CBOE Market
Interface) and Financial Information
Exchange (‘‘FIX’’), and a $40 per month
‘‘network access port’’ fee and a $40 per
month ‘‘FIX port’’ fee for network
hardware the Exchange provides to
members for access to the Exchange’s
network. The Exchange proposes to
charge Sponsored Users an $80 per
month CMI Application Server fee, $80
per month network access port fee and
$80 per month FIX port fee.
Co-location fee. The Exchange
provides cabinet space in the CBOE data
center for co-locating member firm
network and quoting engine hardware,
to help members meet their need for
high performance processing and low
latency. The Exchange currently charges
members a co-location fee of $10 per
‘‘U’’ of shelf space (which is equal to
1.75 inches). The Exchange proposes to
charge Sponsored Users a co-location
fee of $20 per ‘‘U’’ of shelf space.
6 See
E:\FR\FM\24JYN1.SGM
Rule 6.20A.01.
24JYN1
]]>Agencies
[Federal Register Volume 73, Number 143 (Thursday, July 24, 2008)]
[Notices]
[Pages 43270-43274]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-16867]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 28332; 812-13454]
The Mexico Fund, Inc., et al.; Notice of Application
July 17, 2008.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice of application under section 6(c) of the Investment
Company Act of 1940 (``Act'') for an exemption from section 19(b) of
the Act and rule 19b-1 under the Act.
-----------------------------------------------------------------------
Summary of Application: Applicants request an order to permit The
Mexico Fund, Inc., a closed-end investment company, to make periodic
distributions of long-term capital gains with respect to its
outstanding common stock as frequently as twelve times each year.
Applicants: The Mexico Fund, Inc. (``Fund'') and Impulsora del
Fondo Mexico, S.C. (``Adviser'').
Filing Dates: November 21, 2007, June 26, 2008, and July 14, 2008.
Applicants have agreed to file an amendment during the notice period,
the substance of which is reflected in the notice.
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 August 11, 2008, 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, Securities and Exchange Commission, 100 F Street,
NE., Washington, DC 20549-1090; Applicants, Sander Bieber, Esq.,
Dechert LLP, 1775 I Street, NW., Washington, DC 20006.
FOR FURTHER INFORMATION CONTACT: Wendy Friedlander, Senior Counsel, at
(202) 551-6837, or James M. Curtis,
[[Page 43271]]
Branch Chief, at (202) 551-6825 (Division of Investment Management,
Office of Chief Counsel).
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 Room, 100 F Street, NE., Washington, DC
20549-1520 (telephone (202) 551-5850).
Applicants' Representations
Applicants represent that they will comply with the representations
and conditions in this Application before they rely on the order
requested.
1. Applicants represent that the Fund is a registered closed-end
investment company registered under the Act. The Fund's investment
objective is long-term capital appreciation. The common stock issued by
the Fund is listed on the New York Stock Exchange. The Fund has not
issued preferred stock. Applicants believe that the Fund's stockholders
include investors who desire steady distributions of cash and who will
appreciate that the Fund wishes to implement a practice of providing
regular distributions pursuant to a plan of distribution as described
below.
2. Applicants represent that the Adviser, which is organized as a
Mexican ``sociedad civil'' governed by the Federal Civil Code of
Mexico, is registered under the Investment Advisers Act of 1940. The
Adviser is responsible for the overall management of the Fund and
currently has no investment advisory clients other than the Fund.
3. Applicants represent that the Fund's Board of Directors
(``Board''), including a majority of the directors who are not
interested persons, as defined in section 2(a)(19) of the Act (each an
``Independent Director''), will adopt a plan (``Plan'') to make
periodic level distributions with respect to its common stock, based
upon a fixed percentage of the Fund's net asset value (``NAV'') or
market price per share of its common stock or at least a minimum fixed
dollar amount per year. Applicants represent that the Board will
request, and the Adviser will provide, such information as is
reasonably necessary to an informed determination of whether the Board
should adopt the Plan. In particular, the Board and the Independent
Directors will review information regarding the purpose and terms of
the Plan, the likely effects of the Plan on the Fund's long-term total
return (in relation to market price and NAV per common share) and the
relationship between the Fund's distribution rate on its common stock
under the Plan and the Fund's total return (in relation to NAV per
share); whether the rate of distribution would exceed the Fund's
expected total return in relation to its NAV per share; and any
foreseeable material effects of such Plan on the Fund's long-term total
return (in relation to market price and NAV per share). The Independent
Directors also will consider what conflicts of interest the Adviser and
the affiliated persons of the Adviser and the Fund might have with
respect to the adoption or implementation of such Plan. Applicants
represent that after considering such information the Board, including
the Independent Directors, will approve the Plan with respect to the
Fund's common stock provided that the Board, including the Independent
Directors, determine that the Plan is consistent with the Fund's
investment objectives and in the best interests of the Fund's common
stockholders.
4. Applicants represent that the purpose of the Plan would be to
permit the Fund to provide its stockholders with a level, periodic
distribution. Applicants represent that under the Plan, the Fund would
distribute to its common stockholders a fixed percentage of the market
price of the Fund's common stock or a fixed percentage of NAV per share
or a fixed amount per share which percentage or amount may be adjusted
from time to time. Applicants state that the minimum annual
distribution rate with respect to the Fund's common stock under the
Plan would be independent of the Fund's performance during any
particular period but would be expected to correlate with the Fund's
performance over time. Applicants explain that each distribution on the
common stock would be at the stated rate then in effect, except for
extraordinary distributions and potential increases or decreases in the
final dividend periods in light of the Fund's performance for the
entire calendar year and to enable the Fund to comply with the
distribution requirements of subchapter M of the Internal Revenue Code
of 1986 (the ``Code'') for the calendar year. Applicants expect that
over time the NAV distribution rate with respect to the Fund's common
stock will approximately equal the Fund's total return on NAV.
5. Applicants state that the Board also will adopt policies and
procedures under rule 38a-1 under the Act that are reasonably designed
to ensure that all notices sent to Fund stockholders with distributions
under the Plan (``Notices'') comply with condition II below, and that
all other written communications by the Fund or its agents regarding
distributions under the Plan will include the disclosure required by
condition III below. Applicants state that the Board also will adopt
policies and procedures that will require the Fund to keep records that
demonstrate the Fund's compliance with all of the conditions of the
requested order and that are necessary for the Fund to form the basis
for, or demonstrate the calculation of, the amounts disclosed in its
Notice.
Applicants' Legal Analysis
1. Section 19(b) generally makes it unlawful for any registered
investment company to make long-term capital gains distributions more
than once each year. Rule 19b-1 limits the number of capital gains
dividends, as defined in section 852(b)(3)(C) of the Code
(``distributions''), that a fund may make with respect to any one
taxable year to one, plus a supplemental ``clean up'' distribution made
pursuant to section 855 of the Code not exceeding 10% of the total
amount distributed for the year, plus one additional capital gain
dividend made in whole or in part to avoid the excise tax under section
4982 of the Code.
2. Section 6(c) provides that the Commission may, by order upon
application, conditionally or unconditionally exempt any person,
security, or transaction, or any class or classes of persons,
securities or transactions, from any provision of the Act, if and to
the extent that 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.
3. Applicants state that the one of the concerns underlying section
19(b) and rule 19b-1 is that stockholders might be unable to
differentiate between regular distributions of capital gains and
distributions of investment income. Applicants state, however, that
rule 19a-1 effectively addresses this concern by requiring that a
separate statement showing the sources of a distribution (e.g.,
estimated net income, net short-term capital gains, net long-term
capital gains and/or return of capital) accompany any distributions (or
the confirmation of the reinvestment of distributions) estimated to be
sourced in part from capital gains or capital. Applicants state that
the same information also is included in the Fund's annual reports to
stockholders and on its IRS Form 1099-DIV, which is sent to each
stockholder who received distributions during the year.
[[Page 43272]]
4. Applicants further state that the Fund will make the additional
disclosures required by the conditions set forth below, and the Fund
will adopt compliance policies and procedures in accordance with rule
38a-1 to ensure that all required Notices and disclosures are sent to
stockholders. Applicants argue that by providing the information
required by section 19(a) and rule 19a-1, and by complying with the
procedures adopted under the Plan and the conditions listed below, the
Fund would ensure that its stockholders are provided sufficient
information to understand that their periodic distributions are not
tied to the Fund's net investment income (which for this purpose is the
Fund's taxable income other than from capital gains) and realized
capital gains to date, and may not represent yield or investment
return. Applicants also state that compliance with the Fund's
compliance procedures and condition III set forth below will ensure
that prospective stockholders and third parties are provided with the
same information. Accordingly, applicants assert that continuing to
subject the Fund to section 19(b) and rule 19b-1 would afford
stockholders no extra protection.
5. Applicants note that section 19(b) and rule 19b-1 also were
intended to prevent certain improper sales practices, including, in
particular, the practice of urging an investor to purchase shares of a
fund on the basis of an upcoming capital gains dividend (``selling the
dividend''), where the dividend would result in an immediate
corresponding reduction in NAV and would be in effect a taxable return
of the investor's capital. Applicants assert that the ``selling the
dividend'' concern should not apply to closed-end investment companies,
such as the Fund, which do not continuously distribute shares.
According to Applicants, if the underlying concern extends to secondary
market purchases of stock of closed-end funds that are subject to a
large upcoming capital gains dividend, adoption of a plan actually
helps minimize the concern by avoiding, through periodic distributions,
any buildup of large end-of-the-year distributions.
6. Applicants assert that the application of rule 19b-1 to a Plan
actually could have an undesirable influence on portfolio management
decisions. Applicants state that, in the absence of an exemption from
rule 19b-1, the implementation of a Plan imposes pressure on management
(i) not to realize any net long-term capital gains until the point in
the year that the fund can pay all of its remaining distributions in
accordance with rule 19b-1, and (ii) not to realize any long-term
capital gains during any particular year in excess of the amount of the
aggregate pay-out for the year (since as a practical matter excess
gains must be distributed and accordingly would not be available to
satisfy pay-out requirements in following years), notwithstanding that
purely investment considerations might favor realization of long-term
gains at different times or in different amounts. Applicants thus
assert that the limitation on the number of capital gain distributions
that a fund may make with respect to any one year imposed by rule 19b-
1, may prevent the efficient operation of a Plan whenever that fund's
realized net long-term capital gains in any year exceed the total of
the periodic distributions that may include such capital gains under
the rule.
7. In addition, Applicants assert that rule 19b-1 may cause fixed
regular periodic distributions under the Plan to be funded with returns
of capital \1\ (to the extent net investment income and realized short-
term capital gains are insufficient to fund the distribution), even
though realized net long-term capital gains otherwise could be
available. To distribute all of a fund's long-term capital gains within
the limits in rule 19b-1, a fund may be required to make total
distributions in excess of the annual amount called for by its Plan, or
to retain and pay taxes on the excess amount. Applicants thus assert
that the requested order would minimize these effects of rule 19b-1 by
enabling the Fund to realize long-term capital gains as often as
investment considerations dictate without fear of violating rule 19b-1.
---------------------------------------------------------------------------
\1\ Returns of capital as used in the application means return
of capital for financial accounting purposes and not for tax
accounting purposes.
---------------------------------------------------------------------------
8. Applicants request an order under section 6(c) granting an
exemption from the provisions of section 19(b) and rule 19b-1 to permit
each fund's common stock to distribute periodic capital gains dividends
(as defined in section 852(b)(3)(C) of the Code) as often as monthly in
any one taxable year in respect of its common stock.
Applicants' Conditions
Applicants agree that the order will be subject to the following
conditions:
I. Compliance Review and Reporting. The Fund's chief compliance
officer will: (a) Report to the Fund's Board, no less frequently than
once every three months or at the next regularly scheduled quarterly
board meeting, whether (i) the Fund and the Adviser have complied with
the conditions to the requested order, and (ii) a Material Compliance
Matter, as defined in rule 38a-1(e)(2), has occurred with respect to
compliance with such conditions; and (b) review the adequacy of the
policies and procedures adopted by the Fund no less frequently than
annually.
II. Disclosures to Fund Stockholders:
A. Each Notice to the holders of the Fund's common stock, in
addition to the information required by section 19(a) and rule 19a-1:
1. Will provide, in a tabular or graphical format:
(a) The amount of the distribution, on a per common share basis,
together with the amounts of such distribution amount, on a per common
share basis and as a percentage of such distribution amount, from
estimated: (A) Net investment income; (B) net realized short-term
capital gains; (C) net realized long-term capital gains; and (D) return
of capital or other capital source;
(b) The fiscal year-to-date cumulative amount of distributions, on
a per common share basis, together with the amounts of such cumulative
amount, on a per common share basis and as a percentage of such
cumulative amount of distributions, from estimated: (A) Net investment
income; (B) net realized short-term capital gains; (C) net realized
long-term capital gains; and (D) return of capital or other capital
source;
(c) The average annual total return in relation to the change in
NAV for the 5-year period ending on the last day of the month prior to
the most recent distribution declaration date compared to the current
fiscal period's annualized distribution rate expressed as a percentage
of NAV as of the last day of the month prior to the most recent
distribution declaration date; and
(d) The cumulative total return in relation to the change in NAV
from the last completed fiscal year to the last day of the month prior
to the most recent distribution declaration date compared to the fiscal
year-to-date cumulative distribution rate expressed as a percentage of
NAV as of the last day of the month prior to the most recent
distribution declaration date. Such disclosure shall be made in a type
size at least as large and as prominent as the estimate of the sources
of the current distribution; and
2. will include the following disclosure:
(a) ``You should not draw any conclusions about the fund's
investment performance from the amount of this distribution or from the
terms of the Fund's Plan'';
(b) ``The Fund estimates that it has distributed more than its
income and net realized capital gains; therefore, a
[[Page 43273]]
portion of your distribution may be a return of capital. A return of
capital may occur for example, when some or all of the money that you
invested in the Fund is paid back to you. A return of capital
distribution does not necessarily reflect the Fund's investment
performance and should not be confused with `yield' or `income' ''; and
(c) ``The amounts and sources of distributions reported in this
Notice are only estimates and are not being provided for tax reporting
purposes. The actual amounts and sources of the amounts for [accounting
and] tax reporting purposes will depend upon the Fund's investment
experience during the remainder of its fiscal year and may be subject
to changes based on tax regulations. The Fund will send you a Form
1099-DIV for the calendar year that will tell you how to report these
distributions for federal income tax purposes.'' Such disclosure shall
be made in a type size at least as large as and as prominent as any
other information in the Notice and placed on the same page in close
proximity to the amount and the sources of the distribution.
B. On the inside front cover of each report to stockholders under
rule 30e-1 under the Act, the Fund will:
1. describe the terms of the Plan (including the fixed amount or
fixed percentage of the distributions and the frequency of the
distributions);
2. include the disclosure required by condition II.A.2.a above;
3. state, if applicable, that the Plan provides that the Board may
amend or terminate the Plan at any time without prior notice to Fund
stockholders; and
4. describe any reasonably foreseeable circumstances that might
cause the Fund to terminate the Plan and any reasonably foreseeable
consequences of such termination.
C. Each report provided to stockholders under rule 30e-1 and in
each prospectus filed with the Commission on Form N-2 under the Act,
will provide the Fund's total return in relation to changes in NAV in
the financial highlights table and in any discussion about the Fund's
total return.
III. Disclosure to Stockholders, Prospective Stockholders and Third
Parties:
A. The Fund will include the information contained in the relevant
Notice, including the disclosure required by condition II.A.2 above, in
any written communication (other than a Form 1099) about the Plan or
distributions under the Plan by the Fund, or agents that the Fund has
authorized to make such communication on the Fund's behalf, to any Fund
common stockholder, prospective common stockholder or third-party
information provider;
B. The Fund will issue, contemporaneously with the issuance of any
Notice, a press release containing the information in the Notice and
will file with the Commission the information contained in such Notice,
including the disclosure required by condition II.A.2 above, as an
exhibit to its next filed Form N-CSR; and
C. The fund will post prominently a statement on its Web site
containing the information in each Notice, including the disclosure
required by condition II.A.2 above, and will maintain such information
on such Web site for at least 24 months.
IV. Delivery of 19(a) Notices to Beneficial Owners: If a broker,
dealer, bank or other person (``financial intermediary'') holds common
stock issued by the Fund in nominee name, or otherwise, on behalf of a
beneficial owner, the Fund: (a) Will request that the financial
intermediary, or its agent, forward the Notice to all beneficial owners
of the Fund's shares held through such financial intermediary; (b) will
provide, in a timely manner, to the financial intermediary, or its
agent, enough copies of the Notice assembled in the form and at the
place that the financial intermediary, or its agent, reasonably
requests to facilitate the financial intermediary's sending of the
Notice to each beneficial owner of the fund's stock; and (c) upon the
request of any financial intermediary, or its agent, that receives
copies of the Notice, will pay the financial intermediary, or its
agent, the reasonable expenses of sending the Notice to such beneficial
owners.
V. Additional Board Determinations if the Fund's Common Stock
Trades at a Premium:
If:
A. The Fund's common stock has traded on the exchange it primarily
trades on at the time in question at an average premium to NAV equal to
or greater than 10%, as determined on the basis of the average of the
discount or premium to NAV of the Fund's common shares as of the close
of each trading day over a 12-week rolling period (each such 12-week
rolling period ending on the last trading day of each week); and
B. The Fund's annualized distribution rate for such 12-week rolling
period, expressed as a percentage of NAV as of the ending date of such
12-week rolling period, is greater than the Fund's average annual total
return in relation to the change in NAV over the 2-year period ending
on the last day of such 12-week rolling period; then:
1. At the earlier of the next regularly scheduled meeting or within
four months of the last day of such 12-week rolling period, the Board
including a majority of the Independent Directors:
(a) Will request and evaluate, and the Adviser will furnish, such
information as may be reasonably necessary to make an informed
determination of whether the Plan should be continued or continued
after amendment;
(b) Will determine whether continuation, or continuation after
amendment, of the Plan is consistent with the Fund's investment
objective(s) and policies and in the best interests of the Fund and its
stockholders, after considering the information in condition V.B.1.a
above; including, without limitation:
(1) Whether the Plan is accomplishing its purpose(s);
(2) The reasonably foreseeable effects of the Plan on the Fund's
long-term total return in relation to the market price and NAV of the
Fund's common shares; and
(3) The Fund's current distribution rate, as described in condition
V.B above, compared to with the Fund's average annual total return over
the 2-year period, as described in condition V.B, or such longer period
as the Board deems appropriate; and
(c) Based upon that determination, will approve or disapprove the
continuation, or continuation after amendment, of the Plan; and
2. The Board will record the information considered by it and the
basis for its approval or disapproval of the continuation, or
continuation after amendment, of the Plan in its meeting minutes, which
must be made and preserved for a period of not less than six years from
the date of such meeting, the first two years in an easily accessible
place.
VI. Public Offerings: The Fund will not make a public offering of
the Fund's common stock other than:
A. A rights offering below net asset value to holders of the Fund's
common stock;
B. An offering in connection with a dividend reinvestment plan,
merger, consolidation, acquisition, spin-off or reorganization of the
Fund; or
C. An offering other than an offering described in conditions VI.A
and VI.B above, unless, with respect to such other offering:
1. The fund's average annual distribution rate for the six months
ending on the last day of the month ended immediately prior to the most
recent distribution declaration date, expressed as a percentage of NAV
per share as of such date, is no more than
[[Page 43274]]
1 percentage point greater than the fund's average annual total return
for the 5-year period ending on such date; and
2. The transmittal letter accompanying any registration statement
filed with the Commission in connection with such offering discloses
that the Fund has received an order under section 19(b) to permit it to
make periodic distributions of long-term capital gains with respect to
its common stock as frequently as twelve times each year.
VII. Amendments to Rule 19b-1: The requested relief will expire on
the effective date of any amendment to rule 19b-1 that provides relief
permitting certain closed-end investment companies to make periodic
distributions of long-term capital gains with respect to their
outstanding common stock as frequently as twelve times each year.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-16867 Filed 7-23-08; 8:45 am]
BILLING CODE 8010-01-P
