Riverside Casualty, Inc.; Notice of Application, 8788-8791 [2011-3272]
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8788
Federal Register / Vol. 76, No. 31 / Tuesday, February 15, 2011 / Notices
NUCLEAR REGULATORY
COMMISSION
[NRC–2011–0006]
Sunshine Federal Register Notice
Nuclear
Regulatory Commission.
DATE: Weeks of February 14, 21, 28,
March 7, 14, 21, 2011.
PLACE: Commissioners’ Conference
Room, 11555 Rockville Pike, Rockville,
Maryland.
STATUS: Public and Closed.
AGENCY HOLDING THE MEETINGS:
Week of February 14, 2011
There are no meetings scheduled for
the week of February 14, 2011.
Week of February 21, 2011—Tentative
Thursday, February 24, 2011
9 a.m. Briefing on Groundwater Task
Force (Public Meeting); (Contact:
Margie Kotzalas, 301–415–1727).
This meeting will be Webcast live at
the Web address—https://www.nrc.gov.
Week of February 28, 2011—Tentative
Tuesday, March 1, 2011
9 a.m. Briefing on Reactor Materials
Aging Management Issues (Public
Meeting); (Contact: Allen Hiser,
301–415–5650)
This meeting will be Webcast live at
the Web address—https://www.nrc.gov.
Week of March 7, 2011—Tentative
Week of March 14, 2011—Tentative
There are no meetings scheduled for
the week of March 14, 2011.
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Week of March 21, 2011—Tentative
There are no meetings scheduled for
the week of March 21, 2011.
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*The schedule for Commission
meetings is subject to change on short
notice. To verify the status of meetings,
call (recording)—(301) 415–1292.
Contact person for more information:
Rochelle Bavol, (301) 415–1651.
*
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The NRC Commission Meeting
Schedule can be found on the Internet
at: https://www.nrc.gov/about-nrc/policymaking/schedule.html.
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The NRC provides reasonable
accommodation to individuals with
disabilities where appropriate. If you
need a reasonable accommodation to
participate in these public meetings, or
need this meeting notice or the
transcript or other information from the
15:51 Feb 14, 2011
Jkt 223001
Dated: February 10, 2011.
Rochelle C. Bavol,
Policy Coordinator, Office of the Secretary.
[FR Doc. 2011–3491 Filed 2–11–11; 4:15 pm]
BILLING CODE 7590–01–P
OFFICE OF SCIENCE AND
TECHNOLOGY POLICY
National Nanotechnology Coordination
Office; Bridging NanoEHS Research
Efforts: A Joint US–EU Workshop:
Public Meeting
National Nanotechnology
Coordination Office, STPO.
ACTION: Notice of public meeting.
AGENCY:
The National Nanotechnology
Coordination Office (NNCO), on behalf
of the Nanoscale Science, Engineering,
and Technology (NSET) Subcommittee
of the Committee on Technology,
National Science and Technology
Council (NSTC), will hold a workshop
on March 10–11, 2011, to provide an
open forum and engage in an active
scientific discussion about
environmental health and safety
questions for nanomaterials and
nanotechnology-enabled products, to
encourage joint US–EU programs of
work that would leverage resources, and
to establish communities of research
practice, including identification of key
points of contact/interest groups/themes
between key US and EU researchers for
near-term and future collaborations.
This request will be active from
February 10, 2011, to March 10, 2011.
DATES: The public meeting will be held
on Thursday, March 10, 2011 from
8:30 a.m. until 5:30 p.m. and on
Wednesday, March 11, 2011 from 8:30
a.m. until 4 p.m.
ADDRESSES: The first day of the public
meeting will be held at The George
Washington University, Elliott School of
International Affairs, 1957 E Street,
SUMMARY:
There are no meetings scheduled for
the week of March 7, 2011.
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public meetings in another format (e.g.
braille, large print), please notify Angela
Bolduc, Chief, Employee/Labor
Relations and Work Life Branch, at 301–
492–2230, TDD: 301–415–2100, or by email at angela.bolduc@nrc.gov.
Determinations on requests for
reasonable accommodation will be
made on a case-by-case basis.
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This notice is distributed
electronically to subscribers. If you no
longer wish to receive it, or would like
to be added to the distribution, please
contact the Office of the Secretary,
Washington, DC 20555 (301–415–1969),
or send an e-mail to
darlene.wright@nrc.gov.
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NW., Washington, DC 20052 (Metro
Stops: Farragut West or Foggy Bottom).
For directions, please see https://
www.gwu.edu. The second day will be
held at American Association for the
Advancement of Science (AAAS), 1200
New York Avenue, Washington, DC
20005 (Metro Stops: Metro Center or
McPherson Square). For directions,
please see https://www.aaas.org.
Registration: Due to space limitations,
pre-registration for the workshop is
required. People interested in attending
the workshop should register online at
https://www.nano.gov/html/meetings/useu/register.html. Written notices of
participation by e-mail should be sent to
useu@nnco.nano.gov. Written notices
may be mailed to the US–EU Workshop,
c/o NNCO, 4201 Wilson Blvd., Stafford
II, Suite 405, Arlington, VA 22230.
Registration is on a first-come, firstserved basis until the location space
limits are reached. Otherwise
registration will close on March 9, 2010
at 4 p.m. EDT.
Those interested in presenting 3–5
minutes of public comments at the
meeting should also register at https://
www.nano.gov/html/meetings/us-eu/
register.html. Written or electronic
comments should be submitted by email
to useu@nnco.nano.gov until April 11,
2011. Information about the meeting,
including the agenda, is posted at
https://www.nano.gov.
Meeting Accommodations:
Individuals requiring special
accommodation to access this public
meeting should contact Diana Petreski,
telephone (703) 292–8626 at least ten
business days prior to the meeting so
that appropriate arrangements can be
made.
FOR FURTHER INFORMATION CONTACT: For
information regarding this Notice,
please contact Diana Petreski, telephone
(703) 292–8626, National
Nanotechnology Coordination Office. Email:
useu@nnco.nano.gov.
Ted Wackler,
Deputy Chief of Staff.
[FR Doc. 2011–3365 Filed 2–14–11; 8:45 am]
BILLING CODE 3170–W0–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
29576; File No. 813–00361]
Riverside Casualty, Inc.; Notice of
Application
February 8, 2011.
Securities and Exchange
Commission (‘‘Commission’’).
AGENCY:
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Federal Register / Vol. 76, No. 31 / Tuesday, February 15, 2011 / Notices
Notice of application for an
order under sections 6(b) and 6(e) of the
Investment Company Act of 1940 (the
‘‘Act’’) granting an exemption from all
provisions of the Act, except section 9,
and sections 36 through 53, and the
rules and regulations under the Act
(other than rule 38a–1). With respect to
sections 17 and 30 of the Act, and the
rules and regulations thereunder, the
exemption is limited as set forth in the
application.
ACTION:
Applicant, a
single purpose holding company,
requests an order to exempt it and its
affiliates from certain provisions of the
Act. Applicant will be an ‘‘employees’
securities company’’ within the meaning
of section 2(a)(13) of the Act.
APPLICANT: Riverside Casualty, Inc.
(‘‘RCI’’).
FILING DATES: The application was filed
on March 9, 2006, and amended on
September 21, 2010, and February 4,
2011.
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
applicant 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 7, 2011 and
should be accompanied by proof of
service on applicant, 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, U.S. Securities
and Exchange Commission, 100 F
Street, NE., Washington, DC 20549–
1090; Applicant, Riverside Casualty,
Inc., 111 Riverside Avenue,
Jacksonville, FL 32202.
FOR FURTHER INFORMATION CONTACT:
Laura L. Solomon, Senior Counsel, at
(202) 551–6915, or Janet M. Grossnickle,
Assistant Director, at (202) 551–6821
(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 via the Commission’s
Web site by searching for the file
number, or an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm or by
calling (202) 551–8090.
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SUMMARY OF APPLICATION:
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Applicant’s Representations
1. The Haskell Company (‘‘THC’’), a
Delaware corporation, is a design-build
company that provides architectural,
engineering, construction, real estate
and facility management services. All of
the outstanding shares of THC’s
common stock are owned by The
Haskell Company Employee Stock
Ownership Trust (‘‘THC ESOP’’); Preston
H. Haskell III, Chairman and current
employee of THC; and Eligible
Employees and Eligible Family
Members, both as defined below. THC
purchased insurance policies from
insurance subsidiaries of American
Contractors Insurance Group, Ltd.
(‘‘Captive’’). Captive is an insurance
company exempt from the provisions of
the Act under section 3(c)(3) or 3(c)(6)
of the Act.
2. RCI, a Florida corporation, was
formed by THC solely to acquire and
hold an equity interest in Captive in
order to take advantage of favorable
federal income tax treatment of the
insurance premiums paid to Captive
and the retroactive rate reductions
received from the insurance subsidiaries
of Captive. RCI will be an ‘‘employees
securities company’’ within the meaning
of section 2(a)(13) of the Act. RCI’s
shareholders will have no opportunity
for profit or loss from their RCI shares.
In March 2006, shareholders of THC
common stock became the initial
shareholders of RCI through a share-forshare-dividend from THC whereby
holders of THC common stock received
shares of RCI common stock. The initial
grant of RCI’s common stock to Eligible
Persons (defined below) was not
registered under the Securities Act of
1933, as amended (‘‘Securities Act’’) as
the Eligible Persons did not invest their
own funds and did not have discretion
over whether or not they received RCI
common stock. After the initial grant,
RCI common stock will only be offered
through purchases of equity packages
under the Amended and Restated The
Haskell Company Employee Equity
Plan, as amended (the ‘‘Plan’’) to Eligible
Employees in one or more transactions
pursuant to rule 701 of the Securities
Act.1 Applicant contemplates that at all
times the ownership of RCI common
stock will be as nearly identical as
possible to that of THC common stock,
excepting the THC ESOP.
3. ‘‘Eligible Persons’’ consist of: (a)
Preston H. Haskel III, Chairman and
current employee of THC, and THC
administrative employees and
1 Applicant is not asking for and the Commission
is not making any determination with respect to,
the Applicant’s ability to rely on the no-sale
doctrine or rule 701 of the Securities Act.
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permanent craft employees who are
currently and actively employed by
THC and who are not part-time workers
or full-time workers hired temporarily
to work at any of THC’s jobsites
(‘‘Eligible Employees’’); and (b) a spouse,
child, spouse of a child, brother, sister,
parent or grandchild of Mr. Haskell, or
of any individual who is an Eligible
Employee (‘‘Eligible Family Member’’).
Participants in the Plan 2 will be
informed that: (a) RCI common stock
will be sold in a transaction at the par
value of $0.001 per share exempt from
registration under rule 701 of the
Securities Act; (b) the protections
afforded by the Securities Act, other
than the anti-fraud provisions will not
be applicable; (c) RCI will be exempt
from most of the provisions of the Act;
and (d) resale or hypothecation of shares
of RCI common stock are highly
restricted under the Securities Act and
the articles of incorporation and bylaws
of RCI and the Plan. Shares of RCI
common stock will be offered and sold
at their par value ($0.001 per share), and
will be automatically redeemed at the
same price upon redemption. No sales
load (front end or upon redemption)
will be charged to a Participant in the
Plan.
4. Applicant states that RCI’s
activities will be limited to owning an
equity interest in Captive, meeting
capital assessments requested by
Captive and receiving distributions from
Captive with respect to RCI’s equity
interest. Applicant anticipates that RCI
will fund any assessments from Captive
with loans and advances from THC. In
the event Captive makes a distribution
to RCI, RCI will use such distribution
for repayment of the total loans and
advances from THC to RCI. THC paid all
of RCI’s start up costs and has agreed to
pay RCI’s ongoing administrative costs.
5. RCI will be managed by the Board
of Directors of RCI (‘‘RCI Board’’). Each
member of the RCI Board will be a
member of the Board of Directors and/
or an officer of THC. RCI holds its
annual meeting once a year at which
time the shareholders are provided with
an annual report of RCI and audited
financial statements presented on a
combined basis with THC’s financial
statements. Except for advances from
THC, RCI will not borrow money,
guarantee or secure the obligations of
any third party by any person, or extend
credit to any person or third party
including for purposes of purchasing
shares of RCI common stock.
6. RCI common stock will be nontransferable. Pursuant to the Plan,
2 ‘‘Participants’’ means those Eligible Persons who
have acquired RCI common stock.
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transfers, distributions or withdrawals
of RCI common stock are not permitted.
Redemptions of RCI common stock held
by Eligible Employees participating in
the Plan will be at par value and will
be conducted as part of the redemption
of a holder’s equity package, which will
occur at termination of employment
with THC. If a holder of RCI common
stock ceases to be an Eligible Person,
such holder’s shares will be
automatically redeemed for an amount
in cash equal to the par value of the
shares redeemed.
Applicant’s 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 (other than short-term paper)
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 investment companies that are
not registered under section 8 of the Act
from selling or redeeming their
securities. Section 6(e) of the Act
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. Applicant requests an
order under sections 6(b) and 6(e) of the
Act exempting applicant from all
provisions of the Act, except section 9
and sections 36 through 53 of the Act,
and the rules and regulations under the
Act (other than rule 38a–1). With
respect to sections 17 and 30 of the Act,
and the rules and regulations
thereunder, the exemption is limited as
set forth in the application.
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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. Since
some of the shareholders who hold RCI
common stock and THC common stock
could be deemed to be controlling
shareholders of both companies, THC
may be deemed to be under common
control with RCI and thus, an affiliated
person of RCI pursuant to section
2(a)(3)(C) of the Act. Applicant requests
an exemption from section 17(a) to
permit: (a) THC to issue loans to RCI
which could be viewed as a purchase,
by RCI, of securities issued by THC that
are not part of a general offering to the
holders of a class of THC’s securities; 3
and (b) RCI to repay THC’s loans
through any distributions that Captive
may make to its shareholders.
4. Applicant states that an exemption
from section 17(a) is consistent with the
protection of investors and is necessary
to promote the purpose of RCI.
Applicant states that the Participants in
RCI will be fully informed of the extent
of RCI’s dealings with THC.
Additionally, the community of interest
between the Participants and THC will
serve to address the concerns under the
Act.
5. Section 17(d) of the Act and rule
17d–1 under the Act prohibit any
affiliated person of a registered
investment company, or any affiliated
person of such person, acting as
principal, from participating in any joint
arrangement with the company unless
authorized by the Commission.
Applicant requests relief to permit THC
to participate in or effect any transaction
in connection with, any joint enterprise
or other joint arrangement or profit
sharing plan in which RCI is a
participant. Applicant submits that the
joint arrangement between THC and
RCI, which was designed to create and
maintain a structure that enables THC
and its affiliated shareholders to take
advantage of favorable federal income
tax treatment of the transaction whereby
THC may deduct insurance premiums
paid to Captive when paid and
recognize income for federal income tax
purposes when and if it receives
retroactive rate reductions from the
insurance subsidiaries, may be deemed
a joint transaction for purposes of
section 17(d) and rule 17d–1 under the
Act.
3 THC will make loans to RCI to fund RCI’s
purchase of Captive’s equity securities and any
subsequent capital assessment that Captive may
require.
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6. Applicant asserts that compliance
with section 17(d) would cause RCI to
forego investment in the Captive simply
because RCI is part of such joint
arrangement with affiliated persons.
Applicant asserts that the flexibility to
structure joint transactions or joint
arrangements will not involve abuses of
the type section 17(d) and rule 17d–1
were designed to prevent.
7. Section 17(f) of the Act designates
the entities that may act as investment
company custodians, and rule 17f–2
under the Act imposes certain
requirements when the custodian is a
registered management investment
company. Applicant requests an
exemption from section 17(f) and rule
17f–2 to permit the following exceptions
from the requirements of rule 17f–2: (a)
Compliance with paragraph (b) of the
rule may be achieved through
safekeeping in the locked files of THC;
(b) for purposes of paragraph (d) of the
rule, (i) employees of THC will be
deemed to be employees of RCI, and (ii)
officers of THC will be deemed to be
officers of RCI, and (c) instead of the
verification procedure under paragraph
(f) of the rule, verification will be
effected quarterly by two senior level
employees of THC. RCI’s only
investment will be its investment in the
Captive and will either not be evidenced
by negotiable certificates which could
be misappropriated or will be
represented by a certificate or
certificates registered in RCI’s name.
Applicant asserts that the evidence of
RCI’s investment in the Captive is most
suitably kept in the files of THC, where
it can be referred to as necessary.
8. Section 17(g) of the Act and rule
17g–1 under the Act 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.
Applicant requests exemptive relief to
permit the directors of RCI, who may be
deemed interested persons, to take
actions and make determinations set
forth in the rule. Applicant states that,
because all of the directors of RCI will
likely be affiliated persons, RCI could
not comply with rule 17g–1 without the
requested relief. Applicant also states
that RCI will comply with all other
requirements of rule 17g–1, except
requirements relating to the provision of
notices to the board of directors, the
filing of copies of fidelity bonds and
related information with the
Commission, that RCI have a majority of
other disinterested directors, that those
disinterested directors select and
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nominate any other disinterested
director, and that legal counsel for those
disinterested directors be independent
legal counsel.
9. Section 17(j) of the Act and
paragraph (b) of rule 17j–1 under the
Act 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 and that every access
person of a registered investment
company report personal securities
transactions. Applicant requests an
exemption from the provisions of rule
17j–1, except for the anti-fraud
provisions of paragraph (b), because
they are unnecessarily burdensome as
applied to RCI.
10. Applicant requests an exemption
from the requirements in sections 30(a),
30(b), and 30(e) of the Act, 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. Applicant
contends that the forms prescribed by
the Commission for periodic reports
have little relevance to RCI and would
entail administrative and legal costs that
outweigh any benefit to the Participants
in RCI. Applicant also requests an
exemption from section 30(h) of the Act
to the extent necessary to exempt THC,
directors and any officer or other
persons who may be deemed to be
members of an advisory board of RCI
from filing Forms 3, 4, and 5 under
section 16(a) of the Securities Exchange
Act of 1934 with respect to their
ownership of RCI common stock.
Applicant asserts that, because there
will be no trading market and the
transfers of RCI common stock will be
severely restricted, these filings are
unnecessary for the protection of
investors and burdensome to those
required to make them.
11. Rule 38a–1 requires investment
companies to adopt, implement and
periodically review written policies
reasonably designed to prevent violation
of the federal securities laws and to
appoint a chief compliance officer.
Applicant requests an exemption from
the requirements of rule 38a-1 on the
basis that they are burdensome and
unnecessary and such exemption would
be consistent with the policies of the
Act. Applicant asserts compliance with
the rule would serve little purpose given
the limited nature of RCI’s operations
and since the sole purpose of RCI is to
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create a structure to provide favorable
tax treatment to THC.
Applicant’s Conditions
Applicant agrees that any order
granting the requested relief will be
subject to the following conditions:
1. Transactions otherwise prohibited
by section 17(a) or section 17(d) and
rule 17d–1 in which RCI is a party (the
‘‘Section 17 Transactions’’) will be
effected only if the RCI Board
determines that:
(a) The terms of the Section 17
Transaction, including the
consideration to be paid or received, are
fair and reasonable to the Participants of
RCI and do not involve overreaching of
RCI or its Participants on the part of any
person concerned; and
(b) The Section 17 Transactions are
consistent with the interests of the
Participants and with RCI’s
organizational and offering documents.
2. RCI and RCI’s Board will maintain
and preserve, for the life of RCI and at
least six years thereafter, all accounts,
books, and other documents as
constitute the record forming the basis
for the audited financial statements that
are to be provided to the Participants,
and agree that all such records will be
subject to examination by the
Commission and its staff. RCI will
preserve the accounts, books and other
documents required to be maintained in
an easily accessible place for the first
two years.
3. RCI’s Board will send to each
Participant who held RCI common stock
at any time during the fiscal year then
ended, RCI’s audited financial
statements, which audited financial
statements may be presented on a
combined basis with THC’s financial
statements.
For the Commission, by the Division of
Investment Management, under delegated
authority.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011–3272 Filed 2–14–11; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
Sunshine Act Meeting
Notice is hereby given, pursuant to
the provisions of the Government in the
Sunshine Act, Public Law 94–409, that
the Securities and Exchange
Commission will hold a Closed Meeting
on Thursday, February 17, 2011 at 1:30
p.m.
Commissioners, Counsel to the
Commissioners, the Secretary to the
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8791
Commission, and recording secretaries
will attend the Closed Meeting. Certain
staff members who have an interest in
the matters also may be present.
The General Counsel of the
Commission, or his designee, has
certified that, in his opinion, one or
more of the exemptions set forth in 5
U.S.C. 552b(c)(3), (5), (7), 9(B) and (10)
and 17 CFR 200.402(a)(3), (5), (7), 9(ii)
and (10), permit consideration of the
scheduled matters at the Closed
Meeting.
Commissioner Paredes, as duty
officer, voted to consider the items
listed for the Closed Meeting in a closed
session.
The subject matter of the Closed
Meeting scheduled for Thursday,
February 17, 2011 will be:
A litigation matter;
Institution and settlement of
injunctive actions;
Institution and settlement of
administrative proceedings; and
Other matters relating to enforcement
proceedings.
At times, changes in Commission
priorities require alterations in the
scheduling of meeting items.
For further information and to
ascertain what, if any, matters have been
added, deleted or postponed, please
contact:
The Office of the Secretary at (202)
551–5400.
Dated: February 10, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–3451 Filed 2–11–11; 11:15 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63852; File No. SR–
NASDAQ–2011–017]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Modify Fees
for Members Using the NASDAQ
Market Center
February 7, 2011.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that, on January
27, 2011, The NASDAQ Stock Market
LLC (‘‘NASDAQ’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
change as described in Items I, II, and
1 15
2 17
E:\FR\FM\15FEN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
15FEN1
Agencies
[Federal Register Volume 76, Number 31 (Tuesday, February 15, 2011)]
[Notices]
[Pages 8788-8791]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-3272]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 29576; File No. 813-00361]
Riverside Casualty, Inc.; Notice of Application
February 8, 2011.
AGENCY: Securities and Exchange Commission (``Commission'').
[[Page 8789]]
ACTION: Notice of application for an order under sections 6(b) and 6(e)
of the Investment Company Act of 1940 (the ``Act'') granting an
exemption from all provisions of the Act, except section 9, and
sections 36 through 53, and the rules and regulations under the Act
(other than rule 38a-1). With respect to sections 17 and 30 of the Act,
and the rules and regulations thereunder, the exemption is limited as
set forth in the application.
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SUMMARY OF APPLICATION: Applicant, a single purpose holding company,
requests an order to exempt it and its affiliates from certain
provisions of the Act. Applicant will be an ``employees' securities
company'' within the meaning of section 2(a)(13) of the Act.
APPLICANT: Riverside Casualty, Inc. (``RCI'').
FILING DATES: The application was filed on March 9, 2006, and amended
on September 21, 2010, and February 4, 2011.
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 applicant 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 7, 2011 and should be accompanied by proof of service on
applicant, 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, U.S. Securities and Exchange Commission, 100 F
Street, NE., Washington, DC 20549-1090; Applicant, Riverside Casualty,
Inc., 111 Riverside Avenue, Jacksonville, FL 32202.
FOR FURTHER INFORMATION CONTACT: Laura L. Solomon, Senior Counsel, at
(202) 551-6915, or Janet M. Grossnickle, Assistant Director, at (202)
551-6821 (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 via the
Commission's Web site by searching for the file number, or an applicant
using the Company name box, at https://www.sec.gov/search/search.htm or
by calling (202) 551-8090.
Applicant's Representations
1. The Haskell Company (``THC''), a Delaware corporation, is a
design-build company that provides architectural, engineering,
construction, real estate and facility management services. All of the
outstanding shares of THC's common stock are owned by The Haskell
Company Employee Stock Ownership Trust (``THC ESOP''); Preston H.
Haskell III, Chairman and current employee of THC; and Eligible
Employees and Eligible Family Members, both as defined below. THC
purchased insurance policies from insurance subsidiaries of American
Contractors Insurance Group, Ltd. (``Captive''). Captive is an
insurance company exempt from the provisions of the Act under section
3(c)(3) or 3(c)(6) of the Act.
2. RCI, a Florida corporation, was formed by THC solely to acquire
and hold an equity interest in Captive in order to take advantage of
favorable federal income tax treatment of the insurance premiums paid
to Captive and the retroactive rate reductions received from the
insurance subsidiaries of Captive. RCI will be an ``employees
securities company'' within the meaning of section 2(a)(13) of the Act.
RCI's shareholders will have no opportunity for profit or loss from
their RCI shares. In March 2006, shareholders of THC common stock
became the initial shareholders of RCI through a share-for-share-
dividend from THC whereby holders of THC common stock received shares
of RCI common stock. The initial grant of RCI's common stock to
Eligible Persons (defined below) was not registered under the
Securities Act of 1933, as amended (``Securities Act'') as the Eligible
Persons did not invest their own funds and did not have discretion over
whether or not they received RCI common stock. After the initial grant,
RCI common stock will only be offered through purchases of equity
packages under the Amended and Restated The Haskell Company Employee
Equity Plan, as amended (the ``Plan'') to Eligible Employees in one or
more transactions pursuant to rule 701 of the Securities Act.\1\
Applicant contemplates that at all times the ownership of RCI common
stock will be as nearly identical as possible to that of THC common
stock, excepting the THC ESOP.
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\1\ Applicant is not asking for and the Commission is not making
any determination with respect to, the Applicant's ability to rely
on the no-sale doctrine or rule 701 of the Securities Act.
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3. ``Eligible Persons'' consist of: (a) Preston H. Haskel III,
Chairman and current employee of THC, and THC administrative employees
and permanent craft employees who are currently and actively employed
by THC and who are not part-time workers or full-time workers hired
temporarily to work at any of THC's jobsites (``Eligible Employees'');
and (b) a spouse, child, spouse of a child, brother, sister, parent or
grandchild of Mr. Haskell, or of any individual who is an Eligible
Employee (``Eligible Family Member''). Participants in the Plan \2\
will be informed that: (a) RCI common stock will be sold in a
transaction at the par value of $0.001 per share exempt from
registration under rule 701 of the Securities Act; (b) the protections
afforded by the Securities Act, other than the anti-fraud provisions
will not be applicable; (c) RCI will be exempt from most of the
provisions of the Act; and (d) resale or hypothecation of shares of RCI
common stock are highly restricted under the Securities Act and the
articles of incorporation and bylaws of RCI and the Plan. Shares of RCI
common stock will be offered and sold at their par value ($0.001 per
share), and will be automatically redeemed at the same price upon
redemption. No sales load (front end or upon redemption) will be
charged to a Participant in the Plan.
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\2\ ``Participants'' means those Eligible Persons who have
acquired RCI common stock.
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4. Applicant states that RCI's activities will be limited to owning
an equity interest in Captive, meeting capital assessments requested by
Captive and receiving distributions from Captive with respect to RCI's
equity interest. Applicant anticipates that RCI will fund any
assessments from Captive with loans and advances from THC. In the event
Captive makes a distribution to RCI, RCI will use such distribution for
repayment of the total loans and advances from THC to RCI. THC paid all
of RCI's start up costs and has agreed to pay RCI's ongoing
administrative costs.
5. RCI will be managed by the Board of Directors of RCI (``RCI
Board''). Each member of the RCI Board will be a member of the Board of
Directors and/or an officer of THC. RCI holds its annual meeting once a
year at which time the shareholders are provided with an annual report
of RCI and audited financial statements presented on a combined basis
with THC's financial statements. Except for advances from THC, RCI will
not borrow money, guarantee or secure the obligations of any third
party by any person, or extend credit to any person or third party
including for purposes of purchasing shares of RCI common stock.
6. RCI common stock will be non-transferable. Pursuant to the Plan,
[[Page 8790]]
transfers, distributions or withdrawals of RCI common stock are not
permitted. Redemptions of RCI common stock held by Eligible Employees
participating in the Plan will be at par value and will be conducted as
part of the redemption of a holder's equity package, which will occur
at termination of employment with THC. If a holder of RCI common stock
ceases to be an Eligible Person, such holder's shares will be
automatically redeemed for an amount in cash equal to the par value of
the shares redeemed.
Applicant's 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 (other than short-term
paper) 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 investment companies
that are not registered under section 8 of the Act from selling or
redeeming their securities. Section 6(e) of the Act 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. Applicant requests an order under sections 6(b) and 6(e) of
the Act exempting applicant from all provisions of the Act, except
section 9 and sections 36 through 53 of the Act, and the rules and
regulations under the Act (other than rule 38a-1). With respect to
sections 17 and 30 of the Act, and the rules and regulations
thereunder, the exemption is limited as set forth in the application.
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. Since
some of the shareholders who hold RCI common stock and THC common stock
could be deemed to be controlling shareholders of both companies, THC
may be deemed to be under common control with RCI and thus, an
affiliated person of RCI pursuant to section 2(a)(3)(C) of the Act.
Applicant requests an exemption from section 17(a) to permit: (a) THC
to issue loans to RCI which could be viewed as a purchase, by RCI, of
securities issued by THC that are not part of a general offering to the
holders of a class of THC's securities; \3\ and (b) RCI to repay THC's
loans through any distributions that Captive may make to its
shareholders.
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\3\ THC will make loans to RCI to fund RCI's purchase of
Captive's equity securities and any subsequent capital assessment
that Captive may require.
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4. Applicant states that an exemption from section 17(a) is
consistent with the protection of investors and is necessary to promote
the purpose of RCI. Applicant states that the Participants in RCI will
be fully informed of the extent of RCI's dealings with THC.
Additionally, the community of interest between the Participants and
THC will serve to address the concerns under the Act.
5. Section 17(d) of the Act and rule 17d-1 under the Act prohibit
any affiliated person of a registered investment company, or any
affiliated person of such person, acting as principal, from
participating in any joint arrangement with the company unless
authorized by the Commission. Applicant requests relief to permit THC
to participate in or effect any transaction in connection with, any
joint enterprise or other joint arrangement or profit sharing plan in
which RCI is a participant. Applicant submits that the joint
arrangement between THC and RCI, which was designed to create and
maintain a structure that enables THC and its affiliated shareholders
to take advantage of favorable federal income tax treatment of the
transaction whereby THC may deduct insurance premiums paid to Captive
when paid and recognize income for federal income tax purposes when and
if it receives retroactive rate reductions from the insurance
subsidiaries, may be deemed a joint transaction for purposes of section
17(d) and rule 17d-1 under the Act.
6. Applicant asserts that compliance with section 17(d) would cause
RCI to forego investment in the Captive simply because RCI is part of
such joint arrangement with affiliated persons. Applicant asserts that
the flexibility to structure joint transactions or joint arrangements
will not involve abuses of the type section 17(d) and rule 17d-1 were
designed to prevent.
7. Section 17(f) of the Act designates the entities that may act as
investment company custodians, and rule 17f-2 under the Act imposes
certain requirements when the custodian is a registered management
investment company. Applicant requests an exemption from section 17(f)
and rule 17f-2 to permit the following exceptions from the requirements
of rule 17f-2: (a) Compliance with paragraph (b) of the rule may be
achieved through safekeeping in the locked files of THC; (b) for
purposes of paragraph (d) of the rule, (i) employees of THC will be
deemed to be employees of RCI, and (ii) officers of THC will be deemed
to be officers of RCI, and (c) instead of the verification procedure
under paragraph (f) of the rule, verification will be effected
quarterly by two senior level employees of THC. RCI's only investment
will be its investment in the Captive and will either not be evidenced
by negotiable certificates which could be misappropriated or will be
represented by a certificate or certificates registered in RCI's name.
Applicant asserts that the evidence of RCI's investment in the Captive
is most suitably kept in the files of THC, where it can be referred to
as necessary.
8. Section 17(g) of the Act and rule 17g-1 under the Act 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. Applicant requests exemptive relief to permit the
directors of RCI, who may be deemed interested persons, to take actions
and make determinations set forth in the rule. Applicant states that,
because all of the directors of RCI will likely be affiliated persons,
RCI could not comply with rule 17g-1 without the requested relief.
Applicant also states that RCI will comply with all other requirements
of rule 17g-1, except requirements relating to the provision of notices
to the board of directors, the filing of copies of fidelity bonds and
related information with the Commission, that RCI have a majority of
other disinterested directors, that those disinterested directors
select and
[[Page 8791]]
nominate any other disinterested director, and that legal counsel for
those disinterested directors be independent legal counsel.
9. Section 17(j) of the Act and paragraph (b) of rule 17j-1 under
the Act 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 and that every access person of
a registered investment company report personal securities
transactions. Applicant requests an exemption from the provisions of
rule 17j-1, except for the anti-fraud provisions of paragraph (b),
because they are unnecessarily burdensome as applied to RCI.
10. Applicant requests an exemption from the requirements in
sections 30(a), 30(b), and 30(e) of the Act, 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. Applicant contends that the forms prescribed
by the Commission for periodic reports have little relevance to RCI and
would entail administrative and legal costs that outweigh any benefit
to the Participants in RCI. Applicant also requests an exemption from
section 30(h) of the Act to the extent necessary to exempt THC,
directors and any officer or other persons who may be deemed to be
members of an advisory board of RCI from filing Forms 3, 4, and 5 under
section 16(a) of the Securities Exchange Act of 1934 with respect to
their ownership of RCI common stock. Applicant asserts that, because
there will be no trading market and the transfers of RCI common stock
will be severely restricted, these filings are unnecessary for the
protection of investors and burdensome to those required to make them.
11. Rule 38a-1 requires investment companies to adopt, implement
and periodically review written policies reasonably designed to prevent
violation of the federal securities laws and to appoint a chief
compliance officer. Applicant requests an exemption from the
requirements of rule 38a-1 on the basis that they are burdensome and
unnecessary and such exemption would be consistent with the policies of
the Act. Applicant asserts compliance with the rule would serve little
purpose given the limited nature of RCI's operations and since the sole
purpose of RCI is to create a structure to provide favorable tax
treatment to THC.
Applicant's Conditions
Applicant agrees that any order granting the requested relief will
be subject to the following conditions:
1. Transactions otherwise prohibited by section 17(a) or section
17(d) and rule 17d-1 in which RCI is a party (the ``Section 17
Transactions'') will be effected only if the RCI Board determines that:
(a) The terms of the Section 17 Transaction, including the
consideration to be paid or received, are fair and reasonable to the
Participants of RCI and do not involve overreaching of RCI or its
Participants on the part of any person concerned; and
(b) The Section 17 Transactions are consistent with the interests
of the Participants and with RCI's organizational and offering
documents.
2. RCI and RCI's Board will maintain and preserve, for the life of
RCI and at least six years thereafter, all accounts, books, and other
documents as constitute the record forming the basis for the audited
financial statements that are to be provided to the Participants, and
agree that all such records will be subject to examination by the
Commission and its staff. RCI will preserve the accounts, books and
other documents required to be maintained in an easily accessible place
for the first two years.
3. RCI's Board will send to each Participant who held RCI common
stock at any time during the fiscal year then ended, RCI's audited
financial statements, which audited financial statements may be
presented on a combined basis with THC's financial statements.
For the Commission, by the Division of Investment Management,
under delegated authority.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-3272 Filed 2-14-11; 8:45 am]
BILLING CODE 8011-01-P