[Federal Register Volume 75, Number 66 (Wednesday, April 7, 2010)]
[Notices]
[Pages 17796-17798]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7847]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 29200; File No. 811-21873]
American Vantage Companies; Notice of Application
April 1, 2010.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice of application for deregistration under section 8(f) of
the Investment Company Act of 1940 (the ``Act'').
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Summary of Application: American Vantage Companies requests an
order declaring that it has ceased to be an investment company. A
notice of application was issued on March 11, 2010 (Investment Company
Act Release No. 29174). Applicant subsequently amended the application
to state that it had not yet filed its Semi-Annual Report for
Registered Investment Companies on Form N-SAR (``Form N-SAR'') and its
Certified Shareholder Report of Registered Management Investment
Companies on Form N-CSR (``Form N-CSR''), each for the reporting period
ended December 31, 2009. The amended application states that applicant
undertakes to make such filings by January 31, 2011, and adds certain
other conditions. This amended notice incorporates the changes in the
application made by applicant's amendment.
Applicant: American Vantage Companies (the ``Company'').
Filing Dates: The application was filed on November 25, 2008 and
amended on April 30, 2009, November 12, 2009, February 4, 2010, March
10, 2010 and March 31, 2010.
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 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 April 26, 2010 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, P.O. Box 81920, Las
Vegas, Nevada 89180.
FOR FURTHER INFORMATION CONTACT: Jaea F. Hahn, Senior Counsel, at (202)
551-6870, or Jennifer L. Sawin, Branch Chief, at (202) 551-6821 (Office
of Investment Company Regulation, Division of Investment Management).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained via the
Commission's
[[Page 17797]]
Web site by searching for the file number, or an applicant using the
Company name box, at http://www.sec.gov/search/search.htm or by calling
(202) 551-8090.
Applicant's Representations
1. The Company is a holding company that operates through its
subsidiaries primarily in the gaming and hospitality and corporate
staffing businesses. Although the Company was not engaged in the
business of investing, reinvesting, owning, holding or trading in
securities, the Company registered as a closed-end investment company
on June 21, 2006 because it held investment securities that had a value
exceeding 40% of the Company's total assets on an unconsolidated basis
from March 2005 through March 2006.\1\ The Company no longer has
investment securities having a value near or exceeding 40% of its total
assets nor does it hold itself out as being engaged primarily, nor does
it propose in the future to engage primarily, in the business of
investing, reinvesting or trading in securities. On March 27, 2008, the
Company's board of directors resolved that it would be in the best
interest of the Company to deregister from the Act. The Company's
stockholders approved a proposal to deregister the Company from the Act
on November 14, 2008. The Company seeks an order declaring that it has
ceased to be an investment company under the Act.
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\1\ These investment securities principally consisted of
7,000,000 shares of common stock, and warrants to purchase 1,400,000
shares of common stock, of Genius Products, Inc. (``Genius'')
acquired when the Company sold its subsidiary American Vantage Media
Corporation to Genius, together with a 49% interest in the Border
Grill Restaurant (``Border Grill''). The Company privately placed
most of its shares of Genius stock and used the net proceeds for
working capital and to fund its purchase in September 2007 of
Candidates on Demand Group, Inc. (``COD''), a temporary placement
agency and recruitment firm which operates as a wholly-owned
subsidiary of the Company.
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2. The Company was incorporated in Nevada in 1979 and since then
has engaged in the business of recreational and leisure time
activities, including casino gaming and hospitality. The Company
currently maintains ongoing business operations through its
subsidiaries, American Vantage Brownstone, LLC, which focuses on Native
American tribal gaming and commercial/jurisdictional gaming, and COD.
Despite its registration under the Act, the Company has never
represented or stated that it is involved in any business other than
gaming, media, restaurants and entertainment and has always emphasized
its operating results rather than investment income as a material
factor in its business. The Company has never employed an investment
advisor nor is there an employee who is specifically assigned to manage
the Company's investments.
3. As described more fully in the application, the Company's assets
primarily consist of interests in its wholly-owned and majority-owned
subsidiaries and a 49% interest in the Border Grill and the Company
derives substantially all of its revenues from operations. The Company
currently has investment securities that equal approximately 16.4% of
its total assets on an unconsolidated basis.\2\ For the six months
ended June 30, 2009, the Company derived 98.8% of its revenues from its
operating subsidiaries. The Company derived only 1.2% of its income
from investment assets for the six months ended June 30, 2009.
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\2\ The Company's investment assets consist of its 49% interest
in Border Grill, auction-rate securities, and its remaining Genius
common stock and warrants.
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4. The Company is current in all of its required filings under the
federal securities laws, with the exception of its Form N-SAR and Form
N-CSR, each for the reporting period ended December 31, 2009, which the
Company is currently unable to file as a result of a continuing working
capital shortage. The Company undertakes to make such filings by
January 31, 2011. After receipt of the requested deregistration order,
the Company intends to make all filings required by the Securities
Exchange Act of 1934 (``Exchange Act'').
Applicant's Legal Analysis
1. Section 8(f) of the Act provides that whenever the Commission,
upon application or its own motion, finds that a registered investment
company has ceased to be an investment company, the Commission shall so
declare by order and upon the taking effect of such order, the
registration of such company shall cease to be in effect.
2. Section 3(a)(1)(A) of the Act defines an investment company as
any issuer which is or holds itself out as being engaged primarily, or
proposes to engage primarily, in the business of investing,
reinvesting, or trading in securities. Section 3(a)(1)(C) of the Act
defines an investment company as any issuer which is engaged or
proposes to engage in the business of investing, reinvesting, owning,
holding, or trading in securities, and owns or proposes to acquire
investment securities having a value exceeding 40 per centum of the
value of such issuer's total assets (exclusive of Government securities
and cash items) on an unconsolidated basis. Section 3(a)(2) of the Act
defines investment securities as all securities except (A) Government
securities, (B) securities issued by employees' securities companies,
and (C) securities issued by majority-owned subsidiaries of the owner
which (i) are not investment companies, and (ii) are not relying on the
exception from the definition of investment company in paragraph (1) or
(7) of section 3(c) of the Act.
3. The Company states that it is actively engaged in ongoing
business operations in the placement agency, restaurant, gaming and
entertainment fields and that it has never been an investment company
as defined by section 3(a)(1)(A).\3\ Because the Company's investment
securities are currently only approximately 16.4% of its total assets,
the Company believes that it no longer meets the definition of
investment company as defined in section 3(a)(1)(C) of the Act. The
Company further states that it intends to manage its assets and any
future cash earnings in a manner that will cause the Company to
continue to be excluded from the definition of an investment company
under the Act. The Company states that after entry of the order
requested by the application, it will continue to be a publicly-held
company and will continue to be subject to the reporting and other
requirements of the Exchange Act. Accordingly, the Company states that
it is qualified for an order of the Commission pursuant to section 8(f)
of the Act.
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\3\ The Company also states that none of its subsidiaries can be
defined as an investment company for purposes of the Act and none of
its subsidiaries is relying on sections 3(c)(1)or 3(c)(7) of the
Act.
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Applicant's Conditions
Applicant agrees that the requested order will be subject to the
following conditions:
1. The Company will, by January 31, 2011, file Forms N-SAR, N-CSR
and any other reports required by the Act for the periods up until it
is deregistered under the Act.
2. The Company acknowledges that any order granted pursuant to this
application shall be without prejudice to, and shall not limit the
Commission's rights in any manner with respect to, any Commission
investigation of, or administrative proceedings involving or against
Applicants, and the Company may not assert this action as defense in
any proceeding initiated by the Commission or any person under the
federal securities law of the United States.
[[Page 17798]]
For the Commission, by the Division of Investment Management,
under delegated authority.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-7847 Filed 4-6-10; 8:45 am]
BILLING CODE 8011-01-P