[Federal Register: June 30, 2004 (Volume 69, Number 125)]
[Notices]
[Page 39525-39529]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30jn04-126]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 26487; 812-12458]
Dreyfus Founders Funds, Inc., et al.; Notice of Application
June 24, 2004.
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 sections 18(f) and
21(b) of the Act, under section 12(d)(1)(J) of the Act for an exemption
from section 12(d)(1) of the Act, under sections 6(c) and 17(b) of the
Act for an exemption from sections 17(a)(1) and 17(a)(3) of the Act,
and under section 17(d) of the Act and rule 17d-1 under the Act to
permit certain joint arrangements.
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SUMMARY: Applicants request an order that would permit certain
registered open-end management investment companies to participate in a
joint lending and borrowing facility.
Applicants: Dreyfus Founders Funds, Inc. (``Company'') and Founders
Asset Management LLC (``Founders'').
DATES: Filing Dates: The application was filed on March 1, 2001, and
amended on March 22, 2004, and June 14, 2004. Applicants have agreed to
file an amendment during the notice period, the substance of which is
reflected in this 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 July 19, 2004, 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, 450 Fifth
Street, NW., Washington, DC 20549-0609. Applicants, 210 University
Boulevard, Suite 800, Denver, Colorado 80206.
FOR FURTHER INFORMATION CONTACT: Courtney S. Thornton, Senior Counsel,
at (202) 942-0699, or Annette M. Capretta, Branch Chief, at (202) 942-
0564 (Division of Investment Management, Office of Investment Company
Regulation).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained for a fee at the
Commission's Public Reference Branch, 450 Fifth Street, NW.,
Washington, DC 20549-0102 (tel. 202-942-8090).
Applicants' Representations
1. The Company is registered under the Act as an open-end
management investment company and is organized as a Maryland
corporation. The Company is comprised of ten series (each a ``Fund'',
and together the ``Funds''). Founders is registered under the
Investment Advisers Act of 1940. The Company, on behalf of each Fund,
has entered into an investment advisory agreement with Founders under
which Founders exercises discretion to purchase and sell securities for
the Funds. Founders is an indirect wholly-owned subsidiary of Mellon
Financial Corporation (``MFC'').\1\
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\1\ Applicants request that the relief also apply to any other
existing or future registered open-end management investment
company, or series thereof, for which Founders, or any person
controlling, controlled by, or under common control with Founders
acts or may act in the future as an investment adviser (each a
``Future Fund'' and, together with the Funds, the ``Funds''). The
Company is the only investment company that presently intends to
rely on the requested relief. Any Future Funds that subsequently
rely on the order will comply with the terms and conditions in the
application.
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2. Some Funds may lend money to banks or other entities by
purchasing debt instruments. Other Funds may borrow money for temporary
purposes to satisfy redemption requests or to cover unanticipated cash
shortfalls such as a trade ``fail'' in which cash payment for a
security sold by a Fund has been delayed. Currently, the Funds have
committed lines of credit.
3. If the Funds were to borrow money under the lines of credit, the
Funds would pay interest on the borrowed cash at a rate that would be
higher than the rate that would be earned by other (non-borrowing)
Funds on investments in repurchase agreements and other short-term
instruments of the same maturity as the bank loan. In addition, the
Funds would have to pay commitment fees up front to obtain the bank's
commitment to lend money.
4. Applicants request an order that would permit the Funds to enter
into lending agreements (``Interfund Lending Agreements'') under which
the Funds would lend and borrow money for temporary purposes directly
to and from each other through a credit facility (``Interfund Loan'').
Applicants believe that the proposed credit facility would reduce the
Funds' potential borrowing costs and enhance their ability to earn
higher rates of interest on short-term lendings. Although the proposed
credit facility would reduce the Funds' need to borrow from banks, the
Funds would be free to establish and/or continue committed lines of
credit or other borrowing arrangements with banks.
5. Applicants anticipate that the proposed credit facility would
provide a borrowing Fund with savings when the cash position of the
Fund is insufficient to meet temporary cash requirements. This
situation could arise when redemptions exceed anticipated volumes and
the Funds have insufficient cash on hand to satisfy such redemptions.
When the Funds liquidate portfolio securities to meet redemption
requests, which normally are paid immediately, they often do not
receive payment in settlement for up to three days (or longer for
certain foreign transactions). The credit facility would provide a
source of immediate, short-term liquidity pending settlement of the
sale of portfolio securities.
6. Applicants also propose using the credit facility when a sale of
securities fails due to circumstances beyond a Fund's control, such as
a delay in the delivery of cash to the Fund's custodian or improper
delivery instructions by the broker effecting the transaction. Sales
fails may present a cash shortfall if the Fund has undertaken to
purchase a security with the proceeds from securities sold. When the
Fund experiences a cash shortfall due to a sales fail, the Fund
typically obtains credit to cover the shortfall and the Fund incurs
charges for such credit. Alternatively, the Fund could fail on its
intended purchase due to lack of funds from the previous sale,
resulting in additional costs to the Fund, or sell a security on a same
day settlement basis, earning a lower return on the investment. Use of
the credit facility under these circumstances would
[[Page 39526]]
enable the Fund to have access to immediate short-term liquidity
without incurring line of credit or other charges.
7. While borrowing arrangements with banks will continue to be
available to cover unanticipated redemptions and sales fails, under the
proposed credit facility a borrowing Fund would pay lower interest
rates than those offered by banks on short-term loans. In addition,
Funds making short-term cash loans directly to other Funds would earn
interest at a rate higher than they otherwise could obtain from
investing their cash in short-term debt investments. Thus, applicants
believe that the proposed credit facility would benefit both borrowing
and lending Funds.
8. The interest rate charged to the Funds on any Interfund Loan
(the ``Interfund Loan Rate'') would be the average of the ``Repo Rate''
and the ``Bank Loan Rate,'' both as defined below. The Repo Rate for
any day would be the highest rate available to the Funds from
investments in overnight repurchase agreements. The Bank Loan Rate for
any day would be calculated by Founders on each day an Interfund Loan
is made according to a formula adopted by each Fund's board of
directors (``Board'') intended to approximate the lowest interest rate
at which bank short-term loans would be available to the Funds. The
formula would be based upon a publicly available rate (e.g., Federal
funds plus 25 basis points) and would vary with this rate so as to
reflect changing bank loan rates. The Board periodically would review
the continuing appropriateness of using the publicly available rate, as
well as the relationship between the Bank Loan Rate and current bank
loan rates that would be available to the Funds. The initial formula
and any subsequent modifications to the formula would be subject to the
approval of each Fund's Board.
9. The proposed credit facility would be administered by Founders'
money market investment professionals (including the portfolio manager
of a money market Fund (the ``Money Market Manager'')) and Founders'
fund accounting department (collectively, the ``Cash Management
Team''). Under the proposed credit facility, the portfolio managers for
each participating Fund could provide standing instructions to
participate daily as a borrower or lender. Founders on each business
day would collect data on the uninvested cash and borrowing
requirements of all participating Funds from the Funds' custodian. Once
it had determined the aggregate amount of cash available for loans and
borrowing demand, the Cash Management Team would allocate loans among
borrowing Funds without any further communication from portfolio
managers (other than the Money Market Manager in his or her capacity as
the Cash Management Team member). Applicants expect far more available
uninvested cash each day than borrowing demand. All allocations will
require approval of at least one member of the Cash Management Team who
is not the Money Market Manager. After allocating cash for Interfund
Loans, Founders will invest any remaining cash in accordance with the
standing instructions of portfolio managers or return remaining amounts
for investment directly by the portfolio manager of the applicable
Fund. Money market Funds typically would not participate as borrowers
because they rarely need to borrow cash to meet redemptions.
10. The Cash Management Team would allocate borrowing demand and
cash available for lending among the Funds on what the Cash Management
Team believes to be an equitable basis, subject to certain
administrative procedures applicable to all Funds, such as the time of
filing requests to participate, minimum loan lot sizes, and the need to
minimize the number of transactions and associated administrative
costs. To reduce transaction costs, each Interfund Loan normally would
be allocated in a manner intended to minimize the number of
participants necessary to complete the loan transaction.
11. Founders would (a) monitor the interest rates charged and the
other terms and conditions of the loans, (b) limit the borrowings and
loans entered into by each Fund to ensure that they comply with the
Fund's investment policies and limitations, (c) ensure equitable
treatment of each Fund, and (d) make quarterly reports to each Fund's
Board concerning any transactions by the Funds under the credit
facility and the interest rates charged. The method of allocation and
related administrative procedures would be approved by each Fund's
Board, including a majority of directors who are not ``interested
persons'' of the Fund, as defined in section 2(a)(19) of the Act
(``Independent Directors''), to ensure that both borrowing and lending
Funds participate on an equitable basis.
12. Founders would administer the proposed credit facility as part
of its duties under its advisory contract with each Fund and would
receive no additional fee as compensation for its services.
13. No Fund may participate in the proposed credit facility unless
(a) the Fund has obtained shareholder approval for its participation,
if such approval is required by law, (b) the Fund has fully disclosed
all material information concerning the credit facility in its
prospectus and/or statement of additional information, and (c) the
Fund's participation in the credit facility is consistent with its
investment objectives, limitations, and organizational documents.
14. In connection with the proposed credit facility, applicants
request an order under (a) section 6(c) of the Act granting relief from
sections 18(f) and 21(b) of the Act; (b) section 12(d)(1)(J) of the Act
granting relief from section 12(d)(1) of the Act; (c) sections 6(c) and
17(b) of the Act granting relief from sections 17(a)(1) and 17(a)(3) of
the Act; and (d) section 17(d) of the Act and rule 17d-1 under the Act
to permit certain joint arrangements.
Applicants' Legal Analysis
1. Section 17(a)(3) of the Act generally prohibits any affiliated
person, or affiliated person of an affiliated person, from borrowing
money or other property from a registered investment company. Section
21(b) generally prohibits any registered management company from
lending money or other property to any person if that person controls
or is under common control with the company. Section 2(a)(3)(C) of the
Act defines an ``affiliated person'' of another person, in part, to be
any person directly or indirectly controlling, controlled by, or under
common control with, the other person. Applicants state that the Funds
may be under common control by virtue of having Founders as their
common investment adviser, and/or by reason of having common officers
and/or directors.
2. Section 6(c) of the Act provides that an exemptive order may be
granted where an 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.
Section 17(b) authorizes the Commission to exempt a proposed
transaction from section 17(a) provided that the terms of the
transaction, including the consideration to be paid or received, are
fair and reasonable and do not involve overreaching on the part of any
person concerned, and the transaction is consistent with the policy of
the investment company as recited in its registration statement and
with the general purposes of the Act. Applicants believe that the
proposed arrangements satisfy these standards for the reasons discussed
below.
[[Page 39527]]
3. Applicants submit that sections 17(a)(3) and 21(b) of the Act
were intended to prevent a person with strong potential adverse
interests to and some influence over the investment decisions of a
registered investment company from causing or inducing the investment
company to engage in lending transactions that unfairly inure to the
benefit of that person and that are detrimental to the best interests
of the investment company and its shareholders. Applicants assert that
the proposed credit facility transactions do not raise these concerns
because (a) Founders would administer the program as a disinterested
fiduciary; (b) all Interfund Loans would consist only of uninvested
cash reserves that a Fund otherwise would invest in short-term
repurchase agreements or other short-term instruments; (c) the
Interfund Loans would not involve a greater risk than such other
investments; (d) the lending Fund would receive interest at a rate
higher than it could obtain through such other investments; and (e) the
borrowing Fund would pay interest at a rate lower than otherwise
available to it under its bank loan agreements and avoid the up-front
commitment fees associated with committed lines of credit. Moreover,
applicants believe that the other conditions in the application would
effectively preclude the possibility of any Fund obtaining an undue
advantage over any other Fund.
4. Section 17(a)(1) of the Act generally prohibits an affiliated
person of a registered investment company, or an affiliated person of
an affiliated person, from selling any securities or other property to
the company. Section 12(d)(1) of the Act generally makes it unlawful
for a registered investment company to purchase or otherwise acquire
any security issued by any other investment company except in
accordance with the limitations set forth in that section. Applicants
state that the obligation of a borrowing Fund to repay an Interfund
Loan may constitute a security under sections 17(a)(1) and 12(d)(1) of
the Act. Section 12(d)(1)(J) of the Act provides that the Commission
may exempt persons or transactions from any provision of section
12(d)(1) if and to the extent such exemption is consistent with the
public interest and the protection of investors. Applicants contend
that the standards under sections 6(c), 17(b), and 12(d)(1) of the Act
are satisfied for all the reasons set forth above in support of their
request for relief from sections 17(a)(3) and 21(b) of the Act and for
the reasons discussed below.
5. Applicants state that section 12(d) of the Act was intended to
prevent the pyramiding of investment companies in order to avoid
duplicative costs and fees attendant upon multiple layers of investment
companies. Applicants submit that the proposed credit facility does not
involve those abuses. Applicants note that there would be no
duplicative costs or fees to the Funds or to Fund shareholders, and
that Founders would receive no additional compensation for its services
in administering the credit facility. Applicants also note that the
purpose of the proposed credit facility is to provide economic benefits
for all the participating Funds.
6. Section 18(f)(1) of the Act prohibits open-end investment
companies from issuing any senior security except that a company is
permitted to borrow from any bank, if immediately after the borrowing,
there is an asset coverage of at least 300% for all borrowings of the
company. Under section 18(g) of the Act, the term ``senior security''
includes any bond, debenture, note, or similar obligation or instrument
constituting a security and evidencing indebtedness. Applicants request
exemptive relief from section 18(f)(1) to the limited extent necessary
to implement the credit facility (because the lending Funds are not
banks).
7. Applicants believe that granting relief under section 6(c) of
the Act is appropriate because the Funds would remain subject to the
requirement of section 18(f)(1) of the Act that all borrowings of a
Fund, including combined interfund and bank borrowings, have at least
300% asset coverage. Based on the conditions and safeguards described
in the application, applicants also submit that to allow the Funds to
borrow from other Funds pursuant to the proposed credit facility is
consistent with the purposes and policies of section 18(f)(1) of the
Act.
8. Section 17(d) of the Act and rule 17d-1 under the Act generally
prohibit any affiliated person of a registered investment company, or
affiliated person of an affiliated person, when acting as principal,
from effecting any joint transaction in which the company participates
unless the transaction is approved by the Commission. Rule 17d-1
provides that in passing upon applications filed under the rule, the
Commission will consider whether the participation of a registered
investment company in a joint enterprise on the basis proposed is
consistent with the provisions, policies, and purposes of the Act and
the extent to which the company's participation is on a basis different
from or less advantageous than that of other participants.
9. Applicants submit that the purpose of section 17(d) is to avoid
overreaching by and unfair advantage to investment company insiders.
Applicants believe that the proposed credit facility is consistent with
the provisions, policies and purposes of the Act in that it offers both
reduced borrowing costs and enhanced returns on loaned funds to all
participating Funds and their shareholders. Applicants note that each
Fund would have an equal opportunity to borrow and lend on equal terms
consistent with its investment policies and fundamental investment
limitations. Applicants therefore believe that each Fund's
participation in the proposed credit facility would be on terms no
different from or less advantageous than that of other participating
Funds.
Applicants' Conditions
Applicants agree that any order granting the requested relief will
be subject to the following conditions:
1. The Interfund Loan Rate to be charged to the Funds under the
credit facility will be the average of the Repo Rate and the Bank Loan
Rate.
2. On each business day Founders will compare the Bank Loan Rate
with the Repo Rate and will make cash available for Interfund Loans
only if the Interfund Loan Rate is (a) more favorable to the lending
Fund than the Repo Rate and (b) more favorable to the borrowing Fund
than the Bank Loan Rate.
3. If a Fund has outstanding borrowings, any Interfund Loans to the
Fund (a) will be at an interest rate equal to or lower than any
outstanding bank loan, (b) will be secured at least on an equal
priority basis with at least an equivalent percentage of collateral to
loan value as any outstanding bank loan that requires collateral, (c)
will have a maturity no longer than any outstanding bank loan (and in
any event not over seven days), and (d) will provide that, if an event
of default occurs under any agreement evidencing an outstanding bank
loan to the Fund, that event of default will automatically (without
need for action or notice by the lending Fund) constitute an immediate
event of default under the Interfund Lending Agreement entitling the
lending Fund to call the Interfund Loan (and exercise all rights with
respect to any collateral) and that such call will be made if the
lending bank exercises its right to call its loan under its agreement
with the borrowing Fund.
4. A Fund may make an unsecured borrowing through the credit
facility if its outstanding borrowings from all sources immediately
after the interfund
[[Page 39528]]
borrowing total 10% or less of its total assets, provided that if the
Fund has a secured loan outstanding from any other lender, including
but not limited to another Fund, the Fund's interfund borrowing will be
secured on at least an equal priority basis with at least an equivalent
percentage of collateral to loan value as any outstanding loan that
requires collateral. If a Fund's total outstanding borrowings
immediately after an interfund borrowing would be greater than 10% of
its total assets, the Fund may borrow through the credit facility on a
secured basis only. A Fund may not borrow through the credit facility
or from any other source if its total outstanding borrowings
immediately after the interfund borrowing would be more than 33\1/3\%
of its total assets.
5. Before any Fund that has outstanding interfund borrowings may,
through additional borrowings, cause its outstanding borrowings from
all sources to exceed 10% of its total assets, the Fund must first
secure each outstanding Interfund Loan by the pledge of segregated
collateral with a market value at least equal to 102% of the
outstanding principal value of the loan. If the total outstanding
borrowings of a Fund with outstanding Interfund Loans exceeds 10% of
its total assets for any other reason (such as a decline in net asset
value or because of shareholder redemptions), the Fund will within one
business day thereafter (a) repay all its outstanding Interfund Loans,
(b) reduce its outstanding indebtedness to 10% or less of its total
assets, or (c) secure each outstanding Interfund Loan by the pledge of
segregated collateral with a market value at least equal to 102% of the
outstanding principal value of the loan until the Fund's total
outstanding borrowings cease to exceed 10% of its total assets, at
which time the collateral called for by this condition (5) shall no
longer be required. Until each Interfund Loan that is outstanding at
any time that a Fund's total outstanding borrowings exceeds 10% is
repaid or the Fund's total outstanding borrowings cease to exceed 10%
of its total assets, the Fund will mark the value of the collateral to
market each day and will pledge such additional collateral as is
necessary to maintain the market value of the collateral that secures
each outstanding Interfund Loan at least equal to 102% of the
outstanding principal value of the loan.
6. No Fund may lend to another Fund through the credit facility if
the loan would cause its aggregate outstanding loans through the credit
facility to exceed 15% of its net assets at the time of the loan.
7. A Fund's Interfund Loans to any one Fund shall not exceed 5% of
the lending Fund's net assets.
8. The duration of Interfund Loans will be limited to the time
required to receive payment for securities sold, but in no event more
than seven days. Loans effected within seven days of each other will be
treated as separate loan transactions for purposes of this condition.
9. Except as set forth in this condition, no Fund may borrow
through the credit facility unless the Fund has a policy that prevents
the Fund from borrowing for other than temporary or emergency purposes.
In the case of a Fund that does not have such a policy, the Fund's
borrowings through the credit facility, as measured on the day when the
most recent loan was made, will not exceed the greater of 125% of the
Fund's total net cash redemptions or 102% of sales fails for the
preceding seven calendar days.
10. Each Interfund Loan may be called on one business day's notice
by a lending Fund and may be repaid on any day by a borrowing Fund.
11. A Fund's participation in the credit facility must be
consistent with its investment policies and limitations and
organizational documents.
12. The Cash Management Team will calculate total Fund borrowing
and lending demand through the credit facility, and allocate loans on
an equitable basis among the Funds without the intervention of any
portfolio manager of the Funds (other than the Money Market Manager
acting in his or her capacity as a member of the Cash Management Team).
All allocations will require approval of at least one member of the
Cash Management Team who is not the Money Market Manager. The Cash
Management Team will not solicit cash for the credit facility from any
Fund or prospectively publish or disseminate loan demand data to
portfolio managers (except to the extent that the Money Market Manager
has access to loan demand data in his or her capacity as a member of
the Cash Management Team). Founders will invest any amounts remaining
after satisfaction of borrowing demand in accordance with the standing
instructions from portfolio managers or return remaining amounts for
investment directly by the portfolio manager of the applicable Fund.
13. Founders will monitor the interest rates charged and the other
terms and conditions of the Interfund Loans and will make a quarterly
report to the Board of each Fund concerning the participation of the
Fund in the credit facility and the terms and other conditions of any
extensions of credit under the facility.
14. The Board of each Fund, including a majority of the Independent
Directors: (a) Will review no less frequently than quarterly the Fund's
participation in the credit facility during the preceding quarter for
compliance with the conditions of any order permitting such
transactions; (b) will establish the Bank Loan Rate formula used to
determine the interest rate on Interfund Loans and review no less
frequently than annually the continuing appropriateness of the Bank
Loan Rate formula; and (c) will review no less frequently than annually
the continuing appropriateness of the Fund's participation in the
credit facility.
15. In the event an Interfund Loan is not paid according to its
terms and the default is not cured within two business days from its
maturity or from the time the lending Fund makes a demand for payment
under the provisions of the Interfund Lending Agreement, Founders will
promptly refer such loan for arbitration to an independent arbitrator
selected by the Board of any Fund involved in the loan who will serve
as the arbitrator of disputes concerning Interfund Loans.\2\ The
arbitrator will resolve any problem promptly, and the arbitrator's
decision will be binding on both Funds. The arbitrator will submit, at
least annually, a written report to the Board of each Fund setting
forth a description of the nature of any dispute and the actions taken
by the Funds to resolve the dispute.
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\2\ If the dispute involves Funds with different Boards, the
Board of each Fund will select an independent arbitrator that is
satisfactory to each Fund.
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16. Each Fund will maintain and preserve for a period of not less
than six years from the end of the fiscal year in which any transaction
under the credit facility occurred, the first two years in an easily
accessible place, written records of all such transactions setting
forth a description of the terms of the transaction, including the
amount, the maturity, and the rate of interest on the loan, the rate of
interest available at the time on short-term repurchase agreements and
bank borrowings, and such other information presented to the Fund's
Board in connection with the review required by conditions 13 and 14.
17. Founders will prepare and submit to the Board of each Fund for
review an initial report describing the operations of the credit
facility and the procedures to be implemented to ensure that all Funds
are treated fairly. After the commencement of operation of the
[[Page 39529]]
credit facility, Founders will report on the operations of the credit
facility at the quarterly meetings of each Fund's Board. In addition,
for two years following the commencement of the credit facility, the
independent public accountant for each Fund shall prepare an annual
report that evaluates Founders' assertion that it has established
procedures reasonably designed to achieve compliance with the
conditions of the order. The report shall be prepared in accordance
with the Statements on Standards for Attestation Engagements No. 10 and
it shall be filed pursuant to Item 77Q3 of Form N-SAR as such
Statements or Form may be revised, amended, or superseded from time to
time. In particular, the report shall address procedures designed to
achieve the following objectives: (a) That the Interfund Loan Rate will
be higher than the Repo Rate, but lower than the Bank Loan Rate; (b)
compliance with the collateral requirements as set forth in the
application; (c) compliance with the percentage limitations on
interfund borrowing and lending; (d) allocation of interfund borrowing
and lending demand in an equitable manner and in accordance with
procedures established by the Board; and (e) that the interest rate on
any Interfund Loan does not exceed the interest rate on any third party
borrowings of a borrowing Fund at the time of the Interfund Loan. After
the final report is filed, the Fund's external auditors in connection
with their Fund audit examinations, will continue to review the
operation of the credit facility for compliance with the conditions of
the application and their review will form the basis, in part, of the
auditor's report on internal accounting controls in Form N-SAR.
18. No Fund will participate in the credit facility unless it has
fully disclosed in its statement of additional information all material
facts about its intended participation.
For the Commission, by the Division of Investment Management,
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-14812 Filed 6-29-04; 8:45 am]
BILLING CODE 8010-01-U