[Federal Register Volume 85, Number 142 (Thursday, July 23, 2020)]
[Notices]
[Pages 44559-44561]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-15903]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33929, File No. 812-15122]


Spinnaker ETF Series, et al.

July 17, 2020.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice.

-----------------------------------------------------------------------

    Notice of an application for an order under section 6(c) of the 
Investment

[[Page 44560]]

Company Act of 1940 (``Act'') for an exemption from sections 2(a)(32), 
5(a)(1), 22(d) and 22(e) of the Act and rule 22c-1 under the Act, under 
sections 6(c) and 17(b) of the Act for an exemption from sections 
17(a)(1) and 17(a)(2) of the Act, and under section 12(d)(1)(J) of the 
Act for an exemption from sections 12(d)(1)(A) and 12(d)(1)(B) of the 
Act.
    Applicants: Spinnaker ETF Series (the ``Trust''), OBP Capital LLC 
(the ``Adviser'') and Capital Investment Group, Inc. (the 
``Distributor'').
    Summary of Application: Applicants request an order (``Order'') 
that permits: (a) Shielded Alpha ETFs (as described in the Reference 
Order (defined below)) to issue shares (``Shares'') redeemable in large 
aggregations only (``creation units''); (b) secondary market 
transactions in Shares to occur at negotiated market prices rather than 
at net asset value; (c) certain Shielded Alpha ETFs to pay redemption 
proceeds, under certain circumstances, more than seven days after the 
tender of Shares for redemption; (d) certain affiliated persons of a 
Shielded Alpha ETF to deposit securities into, and receive securities 
from, the Shielded Alpha ETF in connection with the purchase and 
redemption of creation units; and (e) certain registered management 
investment companies and unit investment trusts outside of the same 
group of investment companies as the Shielded Alpha ETFs to acquire 
Shares of the Shielded Alpha ETFs. The Order would incorporate by 
reference terms and conditions of a previous order granting the same 
relief sought by applicants, as that order may be amended from time to 
time (``Reference Order'').\1\
---------------------------------------------------------------------------

    \1\ Blue Tractor ETF Trust and Blue Tractor Group, LLC, 
Investment Company Act Rel. Nos. 33682 (Nov. 14, 2019) (notice) and 
33710 (Dec. 10, 2019) (order).
---------------------------------------------------------------------------

    Filing Date: The application was filed on April 16, 2020.
    Hearing or Notification of Hearing: An order granting the requested 
relief will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by emailing the Commission's 
Secretary at Secretarys-Office@sec.gov and serving applicants with a 
copy of the request by email. Hearing requests should be received by 
the Commission by 5:30 p.m. on August 11, 2020, and should be 
accompanied by proof of service on applicants, in the form of an 
affidavit or, for lawyers, a certificate of service. Pursuant to rule 
0-5 under the Act, hearing requests should state the nature of the 
writer's interest, any facts bearing upon the desirability of a hearing 
on the matter, the reason for the request, and the issues contested. 
Persons who wish to be notified of a hearing may request notification 
by emailing the Commission's Secretary at Secretarys-Office@sec.gov.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 
Secretarys-Office@sec.gov. Applicants: c/o Tracie Coop, Secretary, 
Spinnaker ETF Series, tracie.coop@ncfunds.com.

FOR FURTHER INFORMATION CONTACT: Kay M. Vobis, Senior Counsel, at (202) 
551-6728 or Trace W. Rakestraw, Branch Chief, at (202) 551-6825 
(Division of Investment Management, Chief Counsel's Office).

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained via the 
Commission's website by searching for the file number, or for an 
applicant using the Company name box, at http://www.sec.gov/search/search.htm or by calling (202) 551-8090.

Applicants

    1. The Trust is a statutory trust organized under the laws of 
Delaware and will consist of one or more series operating as a Shielded 
Alpha ETFs. The Trust is registered as an open-end management 
investment company under the Act. Applicants seek relief with respect 
to Funds (as defined below), including an initial Fund (the ``Initial 
Fund''). The Funds will operate as Shielded Alpha ETFs as described in 
the Reference Order.\2\
---------------------------------------------------------------------------

    \2\ To facilitate arbitrage, among other things, each day a Fund 
would publish a basket of securities and cash that, while different 
from the Fund's portfolio, is designed to closely track its daily 
performance.
---------------------------------------------------------------------------

    2. The Adviser, a North Carolina limited liability company, will be 
the investment adviser to the Initial Fund. Subject to approval by the 
Fund's board of trustees, the Adviser (as defined below) will serve as 
investment adviser to each Fund. The Adviser is, and any other Adviser 
will be, registered as an investment adviser under the Investment 
Advisers Act of 1940 (``Advisers Act''). The Adviser may enter into 
sub-advisory agreements with other investment advisers to act as sub-
advisers with respect to the Funds (each a ``Sub-Adviser''). Any Sub-
Adviser to a Fund will be registered under the Advisers Act.
    3. The Distributor is a North Carolina corporation and a broker-
dealer registered under the Securities Exchange Act of 1934, as 
amended, and will act as the principal underwriter of Shares of the 
Funds. Applicants request that the requested relief apply to any 
distributor of Shares, whether affiliated or unaffiliated with the 
Adviser and/or Sub-Adviser (included in the term ``Distributor''). Any 
Distributor will comply with the terms and conditions of the Order.

Applicants' Requested Exemptive Relief

    4. Applicants seek the requested Order under section 6(c) of the 
Act for an exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) 
of the Act and rule 22c-1 under the Act, under sections 6(c) and 17(b) 
of the Act for an exemption from sections 17(a)(1) and 17(a)(2) of the 
Act, and under section 12(d)(1)(J) of the Act for an exemption from 
sections 12(d)(1)(A) and 12(d)(1)(B) of the Act. The requested Order 
would permit applicants to offer Funds that operate as Shielded Alpha 
ETFs. Because the relief requested is the same as the relief granted by 
the Commission under the Reference Order and because the Adviser has 
entered into a licensing agreement with Blue Tractor Group LLC, or an 
affiliate thereof, in order to offer Funds that operate as Shielded 
Alpha ETFs, the Order would incorporate by reference the terms and 
conditions of the Reference Order.
    5. Applicants request that the Order apply to the Initial Fund and 
to any other existing or future registered open-end management 
investment company or series thereof that: (a) Is advised by the 
Adviser or any entity controlling, controlled by, or under common 
control with the Adviser (any such entity included in the term 
``Adviser''); (b) operates as a Shielded Alpha ETF as described by the 
Reference Order; and (c) complies with the terms and conditions of the 
Order and of the Reference Order, which is incorporated by reference 
into the Order (each such company or series and the Initial Fund, a 
``Fund'').\3\
---------------------------------------------------------------------------

    \3\ All entities that currently intend to rely on the Order are 
named as applicants. Any other entity that relies on the Order in 
the future will comply with the terms and conditions of the Order 
and of the Reference Order, which is incorporated by reference into 
the Order.
---------------------------------------------------------------------------

    6. Section 6(c) of the Act provides that the Commission may exempt 
any person, security or transaction, or any class of persons, 
securities or transactions, from any provisions of the Act, if and to 
the extent that such 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) of the Act authorizes the Commission to exempt a proposed 
transaction from section 17(a) of the Act if evidence

[[Page 44561]]

establishes that the terms of the transaction, including the 
consideration to be paid or received, are reasonable and fair and do 
not involve overreaching on the part of any person concerned, and the 
transaction is consistent with the policies of the registered 
investment company and the general purposes of the Act. Section 
12(d)(1)(J) of the Act provides that the Commission may exempt any 
person, security, or transaction, or any class of persons, securities 
or transactions, from any provision of section 12(d)(1) if the 
exemption is consistent with the public interest and the protection of 
investors. Applicants submit that for the reasons stated in the 
Reference Order the requested relief meets the exemptive standards 
---------------------------------------------------------------------------
under sections 6(c), 17(b) and 12(d)(1)(J) of the Act.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-15903 Filed 7-22-20; 8:45 am]
BILLING CODE 8011-01-P


