Notice of Applications for Deregistration under Section 8(f) of the Investment Company Act of 1940
Applicant seeks an order declaring that it has ceased to be an investment company. On May 31, 2007, applicant made its final liquidating distribution to its shareholders, based on net asset value. Applicant incurred no expenses in connection with the liquidation. Filing Dates: The application was filed on June 6, 2007, and amended on June 25, 2007. Applicant's Address: 1401 Woodsong Dr., Hendersonville, NC 28791.
Revisions to Rule 144 and Rule 145 to Shorten Holding Period for Affiliates and Non-Affiliates
Rule 144 under the Securities Act of 1933 creates a safe harbor for the sale of securities under the exemption set forth in Section 4(1) of the Securities Act. We are proposing a six-month holding period requirement under Rule 144 for ``restricted securities'' of companies that are subject to the reporting requirements of the Securities Exchange Act of 1934. The proposed six-month holding period for restricted securities of reporting companies would be extended, for up to an additional six months, by the amount of time during which the security holder has engaged in hedging transactions. Restricted securities of companies that are not subject to the Exchange Act reporting requirements would continue to be subject to a one-year holding period prior to any public resale. We also propose to substantially reduce the restrictions on the resale of securities by non-affiliates. In addition, we propose to simplify the Preliminary Note to Rule 144, eliminate the manner of sale restrictions with respect to debt securities, increase the Form 144 filing thresholds, and codify several staff interpretive positions that relate to Rule 144. We also solicit comment on how best to coordinate Form 144 and Form 4 filing requirements. Finally, we propose amendments to Securities Act Rule 145, which establishes resale limitations on certain persons who acquire securities in business combination transactions, to eliminate the presumptive underwriter position in Rule 145(c), except for transactions involving a shell company, and to revise the resale requirements in Rule 145(d). We believe that the proposed changes will increase the liquidity of privately sold securities and decrease the cost of capital for all companies without compromising investor protection.
Regulation SHO and Rule 10a-1
The Securities and Exchange Commission (``Commission'') is amending the short sale price test under the Securities Exchange Act of 1934 (``Exchange Act''). The amendments are intended to provide a more consistent regulatory environment for short selling by removing restrictions on the execution prices of short sales (``price tests'' or ``price test restrictions''), as well as prohibiting any self- regulatory organization (``SRO'') from having a price test. In addition, the Commission is amending Regulation SHO to remove the requirement that a broker-dealer mark a sell order of an equity security as ``short exempt,'' if the seller is relying on an exception from a price test.
Advisory Committee on Improvements to Financial Reporting
The Chairman of the Securities and Exchange Commission (``Commission'') intends to establish the Securities and Exchange Commission Advisory Committee on Improvements to Financial Reporting (``Committee''). The first meeting of the Committee will be held on August 2, 2007 in the Auditorium, Room L-002, at the Commission's main offices, 100 F Street, NE., Washington, DC beginning at 10 a.m. The meeting will be open to the public. The public is invited to submit written statements with the Committee.
Definition of a Significant Deficiency
We are requesting additional comment on the definition of the term ``significant deficiency.'' Because this term is used in the Commission's rules implementing Section 302 and Section 404 of the Sarbanes-Oxley Act, we believe that a definition of this term should also be in the Commission's rules, in addition to being in the auditing standards.
Commission Guidance Regarding Management's Report on Internal Control Over Financial Reporting Under Section 13(a) or 15(d) of the Securities Exchange Act of 1934
The SEC is publishing this interpretive release to provide guidance for management regarding its evaluation and assessment of internal control over financial reporting. The guidance sets forth an approach by which management can conduct a top-down, risk-based evaluation of internal control over financial reporting. An evaluation that complies with this interpretive guidance is one way to satisfy the evaluation requirements of Rules 13a-15(c) and 15d-15(c) under the Securities Exchange Act of 1934.