[Federal Register Volume 63, Number 69 (Friday, April 10, 1998)]
[Notices]
[Pages 17905-17906]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-9463]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 23102; 812-10992]
Harris & Harris Group, Inc.; Notice of Issuance of Certification
April 6, 1998.
AGENCY: Securities and Exchange Commission (``SEC'').
ACTION: Issuance of Certification Pursuant to Section 851(e) of the
Internal Revenue Code of 1986, as Amended (``Code'').
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SUMMARY: The SEC is issuing a certification pursuant to section 851(e)
of the Code that applicant Harris & Harris Group, Inc. (``Harris'')
was, for the fiscal year ended December 31, 1997, principally engaged
in the furnishing of capital to other corporations which are
principally engaged in the development or exploitation of inventions,
technological improvements, new processes or products not previously
generally available.
FILING DATES: The application for the certification was filed on
January 6, 1998, and amended on March 2, 1998 and April 2, 1998.
FOR FURTHER INFORMATION CONTACT:
Joseph B. McDonald, Jr., at (202) 942-0564 (Division of Investment
Management, Office of Investment Company Regulation).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application and a certification. The complete application may be
obtained for a fee from the SEC's Public Reference Branch, 450 Fifth
Street NW., Washington, DC 20549 (telephone (202) 942-8090).
Applicant's Representations
1. Harris is a New York corporation and a closed-end, non-
diversified management investment company registered under the
Investment Company Act of 1940 (``Act''). On July 26, 1995, Harris
elected to become regulated as a business development company pursuant
to section 54(a) of the Act.
2. Harris proposes to qualify as a ``regulated investment company''
under section 851(a) of the Code pursuant to section 851(e) of the
Code. Section 851(b) of the Code imposes certain portfolio
diversification requirements on investment companies that seek to
qualify as a regulated investment company. Section 851(e) of the Code
provides an exemption from these diversification requirements if the
investment company, among other things, obtains a certification from
the SEC that the investment company is principally engaged in the
furnishing of capital to other corporations which are principally
engaged in the development or exploitation of inventions, technological
improvements, new processes or products not previously generally
available (collectively, ``Development Corporations'').
3. Harris has filed an application seeking a certification pursuant
to section 851(e) of the Code for the fiscal year ended December 31,
1997. The application describes each company in Harris' portfolio
during the fiscal year ended December 31, 1997 that Harris believes to
be a Development Corporation. Harris states that, in making this
determination, it relied upon information provided by the portfolio
companies to Harris and to others, including but not limited to,
offering circulars, prospectuses, analyst reports, internal company
memoranda, patent applications and similar documents. In addition,
Harris generally is represented on the boards of directors of its
portfolio companies through member or observer status, and also has
direct access to senior management of the companies.
4. The following table shows the composition of the total assets of
Harris as of each of the calendar quarters ended March 31, June 30,
September 30, and December 31, 1997, as set forth in the Application.
[[Page 17906]]
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Assets (at value) Mar. 31, 1997 June 30, 1997 Sept. 30, 1997 Dec. 31, 1997
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Investments representing capital furnished to
corporations believed to be Development
Corporations................................... $18,746,134 $17,676,340 $16,424,441 $20,748,370
Other investments, cash and U.S. Government
securities..................................... 15,116,513 11,514,006 12,827,611 18,056,448
Other assets.................................... 2,502,630 2,510,409 3,384,327 468,966
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Total assets.............................. 36,365,277 31,700,755 32,636,379 39,273,784
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As reflected in the table above, Development Companies comprised
the following percentages of the total assets of Harris at the end of
each calendar quarter of 1997: March 31, 51.5%; June 30, 55.8%;
September 30, 50.3%; and December 31, 52.8%.
Certification
On the basis of the information set forth in the application, it
appears that Harris was principally engaged in the furnishing of
capital to Development Corporations within the meaning of section
851(e) of the Code in the fiscal year ended December 31, 1997. It is
therefore certified to the Secretary of the Treasury, or his delegate,
pursuant to section 851(e) of the Code, that Harris was, for the twelve
months ended December 31, 1997, principally engaged in the furnishing
of capital to other corporations which are principally engaged in the
development or exploitation of inventions, technological improvements,
new processes or products not previously generally available.
For the Commission, by the Division of Investment Management,
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-9463 Filed 4-9-98; 8:45 am]
BILLING CODE 8010-01-M
