[Federal Register: October 17, 2006 (Volume 71, Number 200)]
[Notices]
[Page 61086-61111]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17oc06-138]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. IC-27516; File No. 812-13301]
MONY Life Insurance Company of America, et al.
October 12, 2006.
AGENCY: The Securities and Exchange Commission (``Commission'').
ACTION: Notice of application for an order pursuant to Section 26(c) of
the Investment Company Act of 1940 (the ``1940 Act'') approving certain
substitutions of securities and an order of exemption pursuant to
Section 17(b) of the 1940 Act from Section 17(a) of the 1940 Act.
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Summary of Application: The Section 26 Applicants (as defined below)
request an order approving the proposed substitution of shares of
certain series of EQ Advisors Trust (``EQAT'') and AXA Premier VIP
Trust (``VIP'', together with EQAT, the ``Trusts,'' and each, a
``Trust''), by the Separate Accounts (as defined below) for shares of
similar series of unaffiliated registered investment companies (the
``Substitutions''). In particular, the Section 26 Applicants request an
order pursuant to Section 26(c) approving the substitution of: (1)
Class IA shares of the EQ/Calvert Socially Responsible Portfolio for
Initial Class shares of The Dreyfus Socially Responsible Growth Fund,
Inc.; (2) Class IA shares of the EQ/Mercury International Value
Portfolio for Initial Class shares of the Dreyfus Variable Investment
Fund--International Value Portfolio; (3) Class IA shares of the EQ/Lord
Abbett Growth and Income Portfolio for Class VC shares of the Lord
Abbett Series Fund--Growth and Income Portfolio; (4) Class IA shares of
the EQ/Short Duration Bond Portfolio for shares of the T. Rowe Price
Fixed Income Series, Inc.--Limited-Term Bond Portfolio; (5) Class IA
shares of EQ/Money Market Portfolio for shares of the T. Rowe Price
Fixed Income Series, Inc.--Prime Reserve Portfolio; (6) Class IA shares
of the EQ/Alliance International Portfolio for shares of the T. Rowe
Price International Series, Inc.--International Stock Portfolio; (7)
Class IA shares of the EQ/Van Kampen Emerging Markets Equity Portfolio
for Class I shares of The Universal Institutional Funds, Inc.--Emerging
Markets Equity Portfolio; (8) Class IA shares of the EQ/FI Mid Cap
Portfolio for shares of the Old Mutual Insurance Series Fund--Mid-Cap
Portfolio; (9) Class IA shares of the EQ/Lord Abbett Mid Cap Value
Portfolio for Class VC shares of the Lord Abbett Series Fund--Mid-Cap
Value Portfolio; (10) Class IA shares of the EQ/JPMorgan Core Bond
Portfolio for Administrative Class shares of the PIMCO Variable
Insurance Trust--Real Return Portfolio; and (11) Class A shares of the
AXA Premier VIP High Yield Portfolio for Class VC shares of the Lord
Abbett Series Fund--Bond Debenture Portfolio. Applicants also request
an order of exemption to permit certain in-kind transactions in
connection with the proposed Substitutions (the ``In-Kind
Transactions''). Each of the portfolios involved in the Substitutions
serves as an underlying investment option for certain variable annuity
contracts and/or variable life insurance policies (``Contracts'')
issued by the Insurance Companies (as defined below). The portfolios
receiving assets in the Substitutions are referred to in this notice as
the ``Replacement Portfolios.'' The portfolios from which the assets
are transferred in connection with the Substitutions are referred to in
this notice as the ``Removed Portfolios.''
Applicants: MONY Life Insurance Company of America (``MLOA''), MONY
Life Insurance Company (``MONY'', with MLOA, each an ``Insurance
Company'' and collectively, the ``Insurance Companies''), MONY America
Variable Account A (``MLOA Separate Account A''), MONY America Variable
Account L (``MLOA Separate Account L'' and together with MLOA Separate
Account A, ``MLOA Separate Accounts''), MONY Variable Account A (``MONY
Separate Account A'') and MONY Variable Account L (``MONY Separate
Account L'' and together with MONY Separate Account A, ``MONY Separate
Accounts'') (the MONY Separate Accounts and the MLOA Separate Accounts
are referred to as the ``Separate Accounts'' and individually as a
``Separate Account'') (the Separate Accounts and the Insurance
Companies are referred to as the ``Section 26 Applicants''). EQAT is
also an applicant for purposes of the order pursuant to Section 17(b)
together with the Insurance Companies and the Separate Accounts (the
``Section 17 Applicants'').
Filing Date: The application was filed on June 1, 2006 and amended on
October 6, 2006.
[[Page 61087]]
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 Secretary of the
Commission 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 November 2, 2006 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 may request notification of a hearing by writing to the
Secretary of the Commission.
ADDRESSES: Secretary, Securities and Exchange Commission, 100 F Street,
NE, Washington, DC 20549-1090. Applicants: c/o Steven M. Joenk, Senior
Vice President, AXA Equitable Life Insurance Company, 1290 Avenue of
the Americas, New York, New York 10104.
FOR FURTHER INFORMATION CONTACT: Ellen Sazzman, Senior Counsel, at
(202) 551-6762, or Harry Eisenstein, Branch Chief, Office of Insurance
Products at (202) 551-6795, Office of Insurance Products, Division of
Investment Management.
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained for a fee from
the Public Reference Branch of the Commission, 100 F Street, NE.,
Washington, DC 20549 (tel. (202) 551-8090).
Applicants' Representations
1. MLOA is a stock life insurance company organized in 1969 under
the laws of the State of Arizona. MLOA is licensed to sell life
insurance and annuities in 49 states (not including New York), the
District of Columbia, Puerto Rico, and the U.S. Virgin Islands. MONY is
a stock life insurance company organized in 1998 under the laws of New
York. MONY is licensed to sell life insurance and annuities in 50
states, the District of Columbia, Puerto Rico, and the U.S. Virgin
Islands. Each Insurance Company is a wholly owned subsidiary of AXA
Financial, Inc., a diversified financial services company, which is a
wholly owned subsidiary of the AXA Group, the holding company for an
international group of insurance and related financial services
companies. MLOA serves as depositor for each of the MLOA Separate
Accounts; MONY serves as depositor for each of the MONY Separate
Accounts.
2. MLOA Separate Account A and MLOA Separate Account L were
established under Arizona law in 1987 and 1985, respectively, pursuant
to authority granted by MLOA's Board of Directors. Each MLOA Separate
Account is a segregated asset account of MLOA and is registered with
the Commission as a unit investment trust under the 1940 Act. The MLOA
Separate Accounts fund the respective variable benefits available under
the Contracts issued by MLOA. Units of interest in the MLOA Separate
Accounts under the Contracts are registered under the Securities Act of
1933 (``1933 Act'').\1\
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\1\ See File Nos. 333-72632, 333-91776, 333-59717, 333-92066
(MLOA Separate Account A) and 333-06071, 333-104162, 333-72596, 333-
56969, 33-82570, 333-64417, 333-72578 (MLOA Separate Account L).
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3. MONY Separate Account A and MONY Separate Account L were each
established under New York law in 1990 pursuant to authority granted by
MONY's Board of Trustees. Each MONY Separate Account is a segregated
asset account of MONY and is registered with the Commission as a unit
investment trust under the 1940 Act. The MONY Separate Accounts fund
the respective variable benefits available under the Contracts issued
by MONY. Units of interest in the MONY Separate Accounts under the
Contracts are registered under the 1933 Act.\2\
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\2\ See File No. 333-72714, 333-92320, 333-92312, 333-72259
(MONY Separate Account A) and 333-104156, 333-71417, 333-01581, 333-
72590, 333-71677, 333-72594 (MONY Separate Account L).
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4. EQAT and VIP are each organized as a Delaware statutory trust
and registered as an open-end management investment company under the
1940 Act. Each is an affiliate of the Section 26 Applicants. The shares
of each Trust are registered under the 1933 Act. Each Trust is a series
investment company. EQAT currently has 63 separate series and VIP
currently has 20 separate series (each a ``Portfolio'' and
collectively, the ``Portfolios''). AXA Equitable Life Insurance Company
currently serves as investment manager (``Manager'') of each of the
Portfolios. The Replacement Portfolios are series of the Trusts. The
Removed Portfolios are series of unaffiliated registered investment
companies.
5. Each Trust currently offers two classes of shares, Class IA and
Class IB shares for EQAT and Class A and Class B shares for VIP, which
differ only in that Class IB and Class B shares are subject to a
distribution plan adopted and administered pursuant to Rule 12b-1 under
the 1940 Act. Under that distribution plan, up to 0.50% of the average
daily net assets attributable to the Class IB or Class B shares of each
Portfolio may be used to pay for distribution and shareholder services.
The distributors for the shares of each Portfolio are AXA Advisors, LLC
(``AXA Advisors'') and AXA Distributors, LLC (``AXA Distributors'').
Under the Distribution Agreements with respect to the promotion, sale
and servicing of shares of each Portfolio, payments to AXA Advisors and
AXA Distributors, with respect to activities under the distribution
plan, are currently limited to payments at an annual rate equal to
0.25% of the average daily net assets of each Portfolio (including the
Replacement Portfolios) attributable to its Class IB or Class B shares.
6. The Manager has retained investment sub-advisers (``Advisers'')
to provide day-to-day investment advisory services for each of the 61
of the 63 current EQAT Portfolios and 11 of the 20 current VIP
Portfolios. The Trusts have received an exemptive order from the
Commission (``Multi-Manager Order'') that permits the Manager, or any
entity controlling, controlled by, or under common control (within the
meaning of Section 2(a)(9) of the 1940 Act) with the Manager, subject
to certain conditions, including approval of the Board of Trustees of
the relevant Trust, and without the approval of shareholders to: (i)
Select new or additional Advisers for each Portfolio; (ii) enter into
new Investment Advisory Agreements with Advisers (``Advisory
Agreements'') and/or materially modify the terms of any existing
Advisory Agreement; (iii) terminate any existing Adviser and replace
the Adviser; and (iv) continue the employment of an existing Adviser on
the same contract terms where the Advisory Agreement has been assigned
because of a change of control of the Adviser.
7. The variable annuity Contracts subject to this Application
include flexible premium deferred variable annuity contracts with a
variety of sales charge structures. These variable annuity Contracts
are issued to or on behalf of individuals. All variable annuity
Contracts allow the Contract owner to allocate contributions or premium
payments among the variable and any fixed investment options available
under the variable annuity Contracts. The contributions or premium
payments accumulate in the investment options. The variable life
insurance Contracts issued by the Insurance Companies include flexible
premium individual variable life, second to die and corporate variable
life policies. Premium payments under the variable life insurance
Contracts
[[Page 61088]]
accumulate in variable and any fixed investment options.
8. The Section 26 Applicants have reserved the right under the
Contracts to substitute shares of another eligible investment fund for
one of the current investment funds offered as a funding option under
the Contracts. The prospectuses for the Contracts and the Separate
Accounts contain appropriate disclosure of this right.
9. The Contracts do not restrict transfers from a variable
subaccount and there are no limits on transfers into a variable
subaccount or a guaranteed account (for those Contracts that offer a
guaranteed account investment option), although transfer charges may
apply. For those variable annuity Contracts that offer a guaranteed
account investment option, except with respect to New York variable
annuity Contracts, transfers from the guaranteed account are subject to
a market value adjustment if the transfer request is not received at
the end of the prescribed accumulation period. In addition, for New
York variable annuity Contracts, a minimum amount must be maintained in
a guaranteed account for those Contracts that have investments in such
accounts and a minimum number of free transfers are guaranteed. For
variable life insurance Contracts that offer a guaranteed account
investment option, there is a dollar limit on the amount that can be
held in, and the amount that may be transferred from, the guaranteed
account. Also with respect to variable life insurance Contracts,
transfers from a guaranteed account may only be made once a year. With
respect to certain variable life insurance Contracts, including New
York life insurance Contracts, there are a minimum number of free
transfers guaranteed. With respect to corporate-owned life insurance
Contracts, transfers are not permitted between a guaranteed account and
a fixed separate account.
10. Each Insurance Company, on its own behalf and on behalf of its
Separate Accounts, proposes to exercise its contractual right to
substitute a different eligible investment fund for one of the current
investment funds offered as a funding option under the Contracts. In
particular, the Section 26 Applicants propose the following
substitutions:
------------------------------------------------------------------------
Removed portfolios Replacement portfolios
------------------------------------------------------------------------
The Dreyfus Socially Responsible Growth EQ/Calvert Socially Responsible
Fund, Inc. (Initial Class shares). Portfolio (Class IA shares).
Dreyfus Variable Investment Fund-- EQ/Mercury International Value
International Value Portfolio (Initial Portfolio (Class IA shares).
Class shares).
Lord Abbett Series Fund--Growth and EQ/Lord Abbett Growth and
Income Portfolio (Class VC shares). Income Portfolio (Class IA
shares).
T. Rowe Price Fixed Income Series, EQ/Short Duration Bond
Inc.--Limited-Term Bond Portfolio. Portfolio (Class IA shares).
T. Rowe Price Fixed Income Series, EQ/Money Market Portfolio
Inc.--Prime Reserve Portfolio. (Class IA shares).
T. Rowe Price International Series, lEQ/Alliance International
Inc.--International Stock Portfolio. Portfolio (Class IA shares).
The Universal Institutional Funds, EQ/Van Kampen Emerging Markets
Inc.--Emerging Markets Equity Equity Portfolio (Class IA
Portfolio (Class I shares). shares).
Old Mutual Insurance Series Fund--Mid- EQ/FI Mid Cap Portfolio (Class
Cap Portfolio. IA shares).
Lord Abbett Series Fund--Mid-Cap Value EQ/Lord Abbett Mid Cap Value
Portfolio (Class VC shares). Portfolio (Class IA shares).
PIMCO Variable Insurance Trust--Real EQ/JPMorgan Core Bond Portfolio
Return Portfolio (Administrative Class (Class IA shares).
shares).
Lord Abbett Series Fund--Bond-Debenture AXA Premier VIP High Yield
Portfolio (Class VC shares). Portfolio (Class A shares).
------------------------------------------------------------------------
11. The Section 26 Applicants propose the Substitutions as part of
a continued and overall business plan by each of the Insurance
Companies to make its Contracts more attractive to existing Contract
owners or to prospective purchasers, as the case may be. Each Insurance
Company has reviewed its Contracts and each investment option offered
under its Contracts with the goal of providing a superior choice of
investment alternatives. The Substitutions are being proposed to
address the lack of Contract owner interest in the Removed Portfolios,
which generally have not attracted sufficient Contract owner interest
to support maintaining them as separate investment options under the
Contracts, particularly where they duplicate or substantially overlap
with other investment options offered through the Separate Accounts.
The Substitutions also are intended to simplify the prospectuses and
related materials with respect to the Contracts and the investment
options available through the Separate Accounts. Additionally, each
Substitution will substitute shares of the Replacement Portfolio for
shares of the Removed Portfolio, which has similar investment
objectives, policies and risks as the Replacement Portfolio. In
addition, the Insurance Companies have agreed to impose certain expense
limits with respect to the Replacement Portfolios for certain periods
after the Substitutions, as described below. Furthermore, the
Substitutions ultimately may enable the Insurance Companies to reduce
certain of the costs that they incur in administering the Contracts by
removing overlapping and unpopular Portfolios. Moreover, the proposed
Substitutions would replace an unaffiliated Portfolio with a Portfolio
for which AXA Equitable serves as Manager and, thus, would permit AXA
Equitable to appoint, dismiss and replace Advisers and amend Advisory
Agreements as necessary to seek optimal performance from the Portfolio
and its portfolio managers. Finally, the Substitutions are designed to
provide Contract owners with an opportunity to continue their
investment in a similar Portfolio without interruption and without any
cost to them.
12. The Insurance Companies have agreed to bear all expenses
incurred in connection with the Substitutions and related filings and
notices, including legal, accounting, brokerage and other fees and
expenses. On the effective date of the Substitutions (``Substitution
Date''), the amount of any Contract owner's Contract value or the
dollar value of a Contract owner's investment in the relevant Contract
will not change as a result of the Substitutions.
13. The following is a description and comparison of the investment
objectives, policies and risks of each Removed Portfolio and its
corresponding Replacement Portfolio:
[[Page 61089]]
(1)
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Removed Portfolio Replacement Portfolio
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The Dreyfus Socially Responsible Growth EQ/Calvert Socially
Fund, Inc. (Initial Class shares): The Responsible Portfolio
Portfolio seeks to provide capital (Class IA shares): The
growth, with current income as a Portfolio seeks long-term
secondary goal. Under normal capital appreciation. Under
circumstances, the Portfolio invests at normal circumstances, the
least 80% of its assets in common stocks Portfolio invests at least
of companies that the manager believes 80% of its net assets in
meet traditional investment standards and large-cap companies that
conduct their business in a manner that meet both investment and
contributes to the enhancement of the social criteria. The
quality of life in America. The Portfolio Adviser utilizes multiple
normally focuses on large-cap growth investment styles in
stocks. The Portfolio may also invest in selecting securities
value-oriented stocks, mid-cap stocks and including growth, growth at
small-cap stocks. The Portfolio may a reasonable price, value
invest in foreign securities. The and momentum models. The
Portfolio may invest in securities of Portfolio may invest up to
companies in initial public offerings 10% of its total assets in
(``IPOs'') and derivatives. The Portfolio foreign securities and up
may invest up to 15% of the value of its to 15% of its net assets in
net assets in illiquid securities. illiquid securities. The
Portfolio also may invest
in derivatives and in
securities issued in an
IPO.
Principal Risks: Principal Risks:
Market Risk Market Risk
Issuer Risk Asset Class Risk
Market Sector Risk Equity Risk
Social Investment Risk Adviser
Selection Risk
Small and Midsize Company Security
Risk Selection Risk
Growth Stock Risk Derivatives Risk
Value Stock Risk 3 Foreign Securities
Risk
Foreign Investment Risk 3 Security Risk
Liquidity Risk
Mid-Cap Company
Risk
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The Section 26 Applicants believe that The Dreyfus Socially
Responsible Growth Fund, Inc. and the EQ/Calvert Socially Responsible
Portfolio have substantially similar investment objectives, policies
and risks and that the essential objectives and expectations of
Contract owners will continue to be met after the Substitution. In this
connection, the Section 26 Applicants note that each Portfolio invests
virtually all of its assets in securities of companies that satisfy
both social and investment criteria. Each Portfolio invests mostly in
large-cap companies, but also may invest in small- and mid-cap
companies. In addition, the Section 26 Applicants believe that the
Portfolios' advisers use comparable investment styles in managing each
Portfolio's assets and that, while the principal risks are stated
somewhat differently, the Portfolios have substantially similar risk
profiles. Each Portfolio is subject to general investment risks, such
as market risk, asset class risk and security risk, and to very similar
portfolio risks, such as equity risk, social investing risk and foreign
securities risk.
[[Page 61090]]
(2)
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Removed Portfolio Replacement Portfolio
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Dreyfus Variable Investment Fund-- EQ/Mercury International
International Value Portfolio (Initial Value Portfolio (Class IA
Class shares): The Portfolio seeks long shares): The Portfolio
term capital growth. The Portfolio seeks to provide current
normally invests at least 80% of its income and long-term growth
assets in stocks. The Portfolio invests of income, accompanied by
most of its assets in securities of growth of capital. Under
foreign companies which the adviser normal circumstances, the
considers to be value companies. The Portfolio invests at least
Portfolio may invest in securities of 80% of its net assets, plus
companies of any size and may invest in borrowings for investment
companies located in emerging markets. purposes, in stocks that
The Portfolio also may invest in stocks pay dividends. Stocks may
issued in an IPO, it may invest in include common stocks,
derivatives and it may make short sales. preferred stocks,
securities convertible into
common or preferred stocks
and warrants. The Portfolio
invests primarily in
securities of companies
located in developed
foreign markets, but may
invest in securities issued
by companies located in
emerging markets. In
investing the Portfolio's
assets, the Adviser follows
a value investment style.
The Portfolio may invest in
companies of any size,
although it generally will
invest in large cap
companies. The Portfolio
also may invest in
derivatives and in
securities issued in an
IPO.
Principal Risks: Principal Risks:
Market Risk Market Risk
Issuer Risk Asset Class Risk
Market Sector Risk Equity Risk
Small and Midsize Company Adviser
Risk Selection Risk
Value Stock Risk Security
Selection Risk
Foreign Investment Risk Convertible
Securities Risk
Foreign Currency Risk Derivatives Risk
Emerging Market Risk Liquidity Risk
Derivatives Risk Small-Cap and
Mid-Cap Company Risk
Short Sale Risk Value Investing
Risk
IPO Risk Security Risk
Foreign
Securities Risk
Currency Risk
Depositary
Receipts Risk
Emerging Market
Risk
Settlement Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the Dreyfus Variable
Investment Fund--International Value Portfolio and the EQ/Mercury
International Value Portfolio have similar investment objectives and
substantially similar investment policies and risks. The Section 26
Applicants also believe that the essential objectives and expectations
of Contract owners will continue to be met after the Substitution. In
this connection, the Section 26 Applicants note that each Portfolio
invests virtually all of its assets in foreign stocks. In addition, the
Section 26 Applicants believe that the Portfolios' advisers use a value
investment style in managing each Portfolio's assets. Each Portfolio
may invest in companies of any size and in companies located in
emerging markets. Moreover, the Section 26 Applicants believe that
while the principal risks are stated somewhat differently, the
Portfolios have substantially similar risk profiles. The Section 26
Applicants note that each Portfolio is subject to general investment
risks, such as market risk, asset class risk and security risk, and to
very similar portfolio risks, such as equity risk, foreign securities
and emerging markets risk and value investing risk.
[[Page 61091]]
(3)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
Lord Abbett Series Fund--Growth and EQ/Lord Abbett Growth and
Income Portfolio (Class VC shares): Income Portfolio (Class IA
The Portfolio seeks long term growth shares): The Portfolio seeks
of capital and income without capital appreciation and
excessive fluctuations in market growth of income without
value. Under normal circumstances, the excessive fluctuation in
Portfolio will invest at least 80% of market value. Under normal
its net assets in equity securities of circumstances, the Portfolio
large companies. The Portfolio invests at least 80% of its
primarily purchases equity securities net assets in equity
of large, seasoned U.S. and multi- securities of large companies.
national companies that the adviser The Portfolio primarily
believes are undervalued. Equity purchases equity securities of
securities in which the Portfolio may large, seasoned U.S. and multi-
invest may include common stocks, national companies that the
preferred stocks, convertible Adviser believes are
securities, warrants, and similar undervalued. Equity securities
instruments. The Portfolio may in which the Portfolio may
purchase and write national securities invest include common stocks,
exchange-listed put and call options preferred stocks, convertible
on securities or securities indices securities, warrants, and
and it may use options for hedging or similar instruments. The
cross-hedging purposes or to seek to Portfolio may purchase and
increase total return. write exchange-listed put and
call options on securities or
securities indices for hedging
or cross-hedging purposes or
to seek to increase total
return.
Principal Risks: Principal Risks:
Market Risk Convertible Securities
Asset Class Risk Risk
Equity Risk Derivatives Risk
Security Selection Risk Futures and Options
Liquidity Risk Risk
Foreign Securities Risk Security Selection
Security Risk Risk
Value Investing Risk Equity Risk
Foreign Securities
Risk
Value Investing Risk
Adviser Selection Risk
Asset Class Risk
Market Risk
Security Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the Lord Abbett Series
Fund--Growth and Income Portfolio and the EQ/Lord Abbett Growth and
Income Portfolio have substantially identical investment objectives,
policies and risks and that the essential objectives and expectations
of Contract owners will continue to be met after the Substitution. In
this connection, the Section 26 Applicants note that each Portfolio
invests virtually all of its assets in equity securities of large
companies. Each Portfolio also may invest in foreign securities and
derivatives for hedging and non-hedging purposes to the same extent. In
addition, the Section 26 Applicants believe that the adviser to each
Portfolio, which is the same for both Portfolios, uses an identical
investment style in managing each Portfolio's assets and that, while
the principal risks are stated somewhat differently, the Portfolios
have substantially identical risk profiles. Each Portfolio is subject
to general investment risks, such as market risk, asset class risk and
security risk, and to substantially identical portfolio risks, such as
equity risk, foreign securities risk and value investing risk.
(4)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
T. Rowe Price Fixed Income Series, EQ/Short Duration Bond
Inc.--Limited-Term Bond Portfolio: The Portfolio (Class IA shares):
Portfolio seeks a high level of The Portfolio seeks current
current income consistent with income and reduced volatility
moderate fluctuations in principal of principal. Under normal
value. Normally, the Portfolio invests circumstances, the Portfolio
at least 80% of its net assets in invests at least 80% of its
bonds and 65% of total assets in short- net assets, plus borrowings
and intermediate-term bonds. There for investment purposes, in
are no maturity limitations on bonds and other debt
individual securities purchased, but securities. These securities
the Portfolio's average effective include U.S. Government bonds
maturity will not exceed five years. and notes, corporate bonds,
At least 90% of the Portfolio's assets municipal bonds, asset-backed
will consist of investment grade bonds, mortgage-related bonds,
securities and up to 10% of its assets convertible securities and
can be invested in below investment preferred stocks. The
grade securities. The Portfolio's Portfolio intends to invest
holdings may include mortgage-backed only in investment grade fixed
securities, derivatives and foreign income securities and seeks to
securities. There is no limit on the maintain a minimum average
Portfolio's investments in U.S. dollar- credit quality rating of
denominated debt securities issued by ``A.'' The Portfolio may
foreign issuers, foreign branches of invest in securities with
U.S. banks, and U.S. branches of effective or final maturities
foreign banks, however, the Portfolio of any length at the time of
may only invest up to 10% of its total purchase, but it is
assets (excluding reserves) in non- anticipated that the average
U.S. dollar-denominated fixed-income effective maturity of the
securities. Portfolio will range from one
to four years. The average
duration of the overall
Portfolio will be between one
and three years. The Portfolio
also may invest in derivatives
and up to 20% of its total
assets in U.S. dollar
denominated fixed income
securities of foreign issuers.
Principal Risks: Principal Risks:
Interest Rate Risk Market Risk
Credit Risk Asset Class Risk
Prepayment and Extension Adviser Selection Risk
Risk
Derivatives Risk Security Selection
Risk
Foreign Investing Risk Derivatives Risk
Fixed Income Risk
Asset-Backed
Securities Risk
Credit Risk
Interest Rate Risk
Investment Grade
Securities Risk
[[Page 61092]]
Mortgage-Backed
Securities Risk
Foreign Securities
Risk
Security Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the T. Rowe Price Fixed
Income Series, Inc.--Limited-Term Bond Portfolio and the EQ/Short
Duration Bond Portfolio have substantially similar investment
objectives, policies and risks and that the essential objectives and
expectations of Contract owners will continue to be met after the
Substitution. In this connection, the Section 26 Applicants note that
each Portfolio invests virtually all of its assets in investment grade
bonds and seeks to maintain an average effective maturity that is
generally within the same range. Each Portfolio may invest in the same
types of debt securities, such as asset-backed and mortgage-backed
securities. Each Portfolio also may invest in U.S. dollar-denominated
debt securities of foreign issuers and derivatives. Moreover, the
Section 26 Applicants believe that while the principal risks are stated
somewhat differently, the Portfolios have substantially similar risk
profiles. Each Portfolio is subject to general investment risks, such
as asset class risk and security risk, and to very similar portfolio
risks, such as fixed income risk, including credit risk and interest
rate risk, foreign securities risk and derivatives risk.
(5)
------------------------------------------------------------------------
Removed Portfolio Replacement Portfolio
------------------------------------------------------------------------
T. Rowe Price Fixed Income Series, EQ/Money Market Portfolio
Inc.--Prime Reserve Portfolio: The (Class IA shares): The
Portfolio seeks to preserve capital, Portfolio seeks to obtain a
liquidity and, consistent with these, high level of current income,
the highest possible current income. preserve its assets and
The Portfolio is a money market fund, maintain liquidity. The
which is managed to provide a stable Portfolio invests primarily in
share price of $1.00 and invests in a diversified portfolio of
high-quality U.S. dollar-denominated high-quality U.S. dollar
money market securities. The fund's denominated money market
average weighed maturity will not instruments. The Portfolio
exceed 90 days and it will not will maintain a dollar-
purchase any security with a maturity weighted average portfolio
longer than 13 months. maturity of 90 days or less
and will invest only in
instruments with a remaining
maturity of 397 calendar days
or less. The Portfolio may
invest in mortgaged-backed and
asset-backed securities and
normally invests at least 25%
of its net assets in bank
obligations. The Portfolio may
also invest up to 20% of its
total assets in U.S. dollar
denominated money market
instruments of foreign
branches of foreign banks.
Principal Risks: Principal Risks:
Credit Risk Market Risk
Interest Rate Risk Asset Class Risk
Money Market Risk Adviser Selection Risk
Security Selection
Risk
Banking Industry
Sector Risk
Foreign Securities
Risk
Security Risk
Money Market Risk
Fixed Income Risk
Credit Risk
Interest Rate Risk
Asset-Backed
Securities Risk
Mortgage-Backed
Securities Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the T. Rowe Price Fixed
Income Series, Inc.--Prime Reserve Portfolio and the EQ/Money Market
Portfolio have substantially identical investment objectives, policies
and risks and that the essential objectives and expectations of
Contract owners will continue to be met after the Substitution. In this
connection, the Section 26 Applicants note that each Portfolio is a
money market fund and invests all of its assets in high-quality U.S.
dollar denominated money market instruments permitted under Rule 2a-7
under the 1940 Act. In addition, each Portfolio is managed to maintain
a stable share price of $1.00 and has an average weighted maturity that
will not exceed 90 days. The Section 26 Applicants believe that the
Portfolios also have substantially identical risk profiles. Each
Portfolio is subject to general investment risks, such as asset class
risk and security risk, and to very similar portfolio risks, such as
money market risk and fixed income risk, including credit risk and
interest rate risk.
[[Page 61093]]
(6)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
T. Rowe Price International Series, EQ/Alliance International
Inc.--International Stock Portfolio: Portfolio (Class IA shares):
The Portfolio seeks long-term growth The Portfolio seeks to achieve
of capital through investments long-term growth of capital.
primarily in common stocks of The Portfolio intends, under
established, non-U.S. companies. normal market conditions, to
Normally, at least 80% of the invest primarily in equity
Portfolio's net assets will be securities. The Portfolio
invested in stocks. The Portfolio invests in both growth-
expects to invest substantially all of oriented and value-oriented
its assets in stocks outside the U.S. stocks of non-U.S. companies.
and to diversify broadly among The growth portion of the
developed and emerging countries Portfolio invests primarily in
throughout the world. The Portfolio a diversified portfolio of
utilizes an investment style that equity securities of non-U.S.
incorporates growth and value companies or foreign
investing components. The Portfolio governmental enterprises from
may purchase securities of any size, anywhere in the world
but focuses on large and, to a lesser (including in emerging
extent, medium-sized companies. The markets). The value portion of
Portfolio may invest in derivatives. the Portfolio invests
primarily in equity securities
of issuers in countries that
comprise the MSCI EAFE Index
and Canada. The Portfolio also
may invest in any investment
grade fixed income security
and in derivatives.
Principal Risks: Principal Risks:
Currency Risk Market Risk
Geographic Risk Asset Class Risk
Emerging Market Risk Adviser Selection Risk
Foreign Investing Risk Security Selection
Risk
Futures/Options Risk Security Risk
Convertible Securities
Risk
Derivatives Risk
Equity Risk
Fixed Income Risk
Investment Grade
Securities Risk
Interest Rate Risk
Foreign Securities
Risk
Currency Risk
Emerging Markets Risk
Value Investing Risk
Growth Investing Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the T. Rowe Price
International Series, Inc.--International Stock Portfolio and the EQ/
Alliance International Portfolio have substantially similar investment
objectives, policies and risks and that the essential objectives and
expectations of Contract owners will continue to be met after the
Substitution. In this connection, the Section 26 Applicants note that
each Portfolio invests virtually all of its assets in equity securities
of foreign companies. Each Portfolio may invest companies in developed
and emerging markets. Each Portfolio also invests mostly in large-cap
companies, but may invest in smaller companies as well. In addition,
the Section 26 Applicants believe that the adviser to each Portfolio
uses comparable investment styles in managing each Portfolio's assets
and that, while the principal risks are stated somewhat differently,
the Portfolios have substantially similar risk profiles. Each Portfolio
is subject to general investment risks, such as market risk, asset
class risk and security risk, and to very similar portfolio risks, such
as equity risk, foreign securities and emerging markets risk and growth
investing risk.
(7)
------------------------------------------------------------------------
Removed Portfolio Replacement Portfolio
------------------------------------------------------------------------
The Universal Institutional Funds, EQ/Van Kampen Emerging Markets
Inc.--Emerging Markets Equity Equity Portfolio (Class IA
Portfolio (Class I shares): The shares): The Portfolio seeks
Portfolio seeks long-term capital long-term capital
appreciation by investing primarily in appreciation. Under normal
growth-oriented equity securities of circumstances, the Portfolio
issuers in emerging market countries. invests at least 80% of its
Under normal circumstances, at least net assets, plus borrowings
80% of the Portfolio's assets will be for investment purposes, in
invested in equity securities located equity securities of companies
in emerging market countries. The located in emerging market
Portfolio combines top-down country countries or other equity
allocation with bottom-up stock investments that are tied
selection. The Portfolio also may economically to emerging
invest in derivatives and, to a market countries. Such equity
limited extent, in U.S. Government securities may include common
securities and debt securities rated stocks, securities convertible
below investment grade (also known as into common stocks, preferred
``junk bonds''). stocks, depositary receipts,
rights and warrants. The
Portfolio combines top-down
country allocation with bottom-
up stock selection. The
Portfolio also may invest, to
a limited extent, in debt
securities rated below
investment grade (also known
as ``junk bonds''). The
Portfolio currently is non-
diversified, however, it is
expected that the Portfolio's
subclassification will be
changed from non-diversified
to diversified prior to the
Substitution. The Portfolio
may also invest in derivatives
to a limited extent.
Principal Risks: Principal Risks:
Market Risk Market Risk
Emerging Markets Risk Asset Class Risk
Foreign Securities Risk Adviser Selection Risk
Currency Risk Security Selection
Risk
Security Risk Convertible Securities
Risk
Derivatives Risk Derivatives Risk
[[Page 61094]]
Equity Risk Equity Risk
Fixed Income Risk
Junk Bonds and Lower
Rated Securities Risk
Foreign Securities
Risk
Currency Risk
Emerging Markets Risk
Security Risk
Growth Investing Risk
Liquidity Risk
Portfolio Turnover
Risk
Focused Portfolio Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that The Universal Institutional
Funds, Inc.--Emerging Markets Equity Portfolio and the EQ/Van Kampen
Emerging Markets Equity Portfolio have substantially identical
investment objectives, policies and risks and that the essential
objectives and expectations of Contract owners will continue to be met
after the Substitution. In this connection, the Section 26 Applicants
note that each Portfolio invests virtually all of its assets in equity
securities of companies located in emerging markets countries. In
addition, the Portfolios' advisers are affiliated companies. The
Section 26 Applicants believe that the Portfolios' advisers use a
substantially identical investment style in managing each Portfolio's
assets and that, while the principal risks are stated somewhat
differently, the Portfolios have substantially identical risk profiles.
Each Portfolio is subject to general investment risks, such as market
risk, asset class risk and security risk, and to substantially
identical portfolio risks, such as equity risk, foreign securities and
emerging markets risk and growth investing risk.
(8)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
Old Mutual Insurance Series Fund--Mid- EQ/FI Mid Cap Portfolio (Class
Cap Portfolio: The Portfolio seeks to IA shares): The Portfolio
provide above-average total return seeks long-term growth of
over a 3 to 5 year market cycle, capital. The Portfolio
consistent with reasonable risk. The normally invests at least 80%
Portfolio normally invests at least of its net assets, plus any
80% of its net assets, plus any borrowings for investment
borrowings for investment purposes, in purposes, in common stocks of
equity securities of mid-cap companies with medium market
companies. The Portfolios also may capitalizations. The Portfolio
invest in small-cap companies. The may also invest in companies
Portfolio invests in companies with smaller or larger market
believed to have attractive valuations capitalization and securities
relative to the sector and the market, of foreign issuers. The
near-term business dynamics and long- Portfolio is not constrained
term earnings growth. The Portfolio by any particular investment
may invest up to 20% of its net assets style and may buy growth-
in foreign-traded securities and oriented or value-oriented
derivatives.. stock or a combination of
both. The Portfolio may invest
up to 20% of its net assets in
derivatives and, while the
Portfolio does not have a
stated limit with respect to
investments in securities of
foreign issuers, from January
1, 2004 through June 30, 2006,
the Portfolio generally has
invested between 10-20% of its
net assets in such securities.
Principal Risks: Principal Risks:
Market Risk Market Risk
Small and Mid-Size Company Asset Class Risk
Risk
Industry and Sector Risk Adviser Selection Risk
Security Selection
Risk
Equity Risk
Derivatives Risk
Foreign Securities
Risk
Security Risk
Portfolio Turnover
Risk
Small-Cap and Mid-Cap
Company Risk
Growth Investing Risk
Value Investing Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the Old Mutual Insurance
Series Fund--Mid-Cap Portfolio and the EQ/FI Mid Cap Portfolio have
very similar investment objectives and substantially similar investment
policies and risks and that the essential objectives and expectations
of Contract owners will continue to be met after the Substitution. The
Section 26 Applicants believe that the Portfolios are substantially
similar given their focus on investments in equity securities of mid-
cap companies. The Section 26 Applicants do not believe that the income
component of the Removed Portfolio's investment objective is a
significant difference between the Portfolios given that, as a general
matter, mid-cap companies do not pay significant, if any, dividends. In
this connection, the Section 26 Applicants note that, for the fiscal
year ended December 31, 2005, the Removed Portfolio's net investment
income (including dividend income) was only approximately $122,000 on
an asset base of about $55 million. The Section 26 Applicants also note
that each Portfolio may also invest, to a limited extent, in securities
of small-cap companies, foreign securities and derivatives. The Section
26 Applicants believe that the Portfolios' advisers also use comparable
investment styles in managing each Portfolio's assets and
[[Page 61095]]
that, while the principal risks are stated somewhat differently, the
Portfolios have substantially similar risk profiles. Each Portfolio is
subject to general investment risks, such as market risk, asset class
risk and security risk, and to very similar portfolio risks, such as
equity risk, mid-cap company risk and foreign securities risk.
(9)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
Lord Abbett Series Fund--Mid-Cap Value EQ/Lord Abbett Mid Cap Value
Portfolio (Class VC shares): The Portfolio (Class IA shares):
Portfolio seeks capital appreciation The Portfolio seeks capital
through investments, primarily in appreciation. Under normal
equity securities, which are believed circumstances, the Portfolio
to be undervalued in the marketplace. invests at least 80% of its
The Portfolio normally invests at net assets, plus any
least 80% of its net assets, plus any borrowings for investment
borrowings for investment purposes, in purposes, in equity securities
equity securities of mid-sized of mid-sized companies. The
companies. The Portfolio may invest in Portfolio uses a value
convertible bonds, convertible approach that seeks to
preferred stocks, warrants and similar identify stocks of companies
instruments. The Portfolio uses a that have the potential for
value approach. The Portfolio may significant market
invest up to 10% of its net assets in appreciation due to growing
foreign securities that are primarily recognitions of improvement
traded outside the United States and (or anticipated improvement)
may also invest in ADRs (which are not in their financial results.
included in the 10% limitation). The The Portfolio may invest: (1)
Portfolio may also purchase and write Without limit in ADRs and
national securities exchange-listed similar depositary receipts;
put and call options on securities or (2) up to 10% of its assets in
securities indices and it may use other foreign securities; and
options for hedging or cross-hedging (3) in convertible securities.
purposes or to seek to increase total The Portfolio may also
return. purchase and write exchange-
listed put and call options on
securities or securities
indices for hedging or cross-
hedging purposes or to seek to
increase total return.
Principal Risks: Principal Risks:
Market Risk Market Risk
Security Selection Risk Asset Class Risk
Equity Risk Adviser Selection Risk
Value Investing Risk Security Selection
Risk
Mid-Cap Company Risk Security Risk
Security Risk Convertible Securities
Risk
Derivatives Risk
Futures and Options
Risk
Equity Risk
Mid-Cap Company Risk
Value Investing Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the Lord Abbett Series
Fund--Mid Cap Value Portfolio and the EQ/Lord Abbett Mid Cap Value
Portfolio have substantially identical investment objectives, policies
and risks and that the essential objectives and expectations of
Contract owners will continue to be met after the Substitution. In this
connection, the Section 26 Applicants note that each Portfolio invests
virtually all of its assets in equity securities of mid-sized
companies. Each Portfolio also may invest in foreign securities and
derivatives for hedging and non-hedging purposes to the same extent. In
addition, the Section 26 Applicants believe that the adviser to each
Portfolio, which is the same for both Portfolios, uses an identical
investment style in managing each Portfolio's assets and that, while
the principal risks are stated somewhat differently, the Portfolios
have substantially identical risk profiles. Each Portfolio is subject
to general investment risks, such as market risk, asset class risk and
security risk, and to substantially similar portfolio risks, such as
equity risk, mid-cap company risk and value investing risk.
(10)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
PIMCO Variable Insurance Trust--Real EQ/JPMorgan Core Bond Portfolio
Return Portfolio (Administrative Class (Class IA shares): The
shares): The Portfolio seeks maximum Portfolio seeks a high total
real return consistent with return consistent with
preservation of real capital and moderate risk to capital and
prudent investment management. Under maintenance of liquidity.
normal circumstances, the Portfolio Under normal circumstances,
invests at least 80% of its net assets the Portfolio invests at least
in inflation-indexed bonds of varying 80% of its net assets, plus
maturities issued by United States and borrowings for investment
non-U.S. issuers, their agencies or purposes, in investment grade
government-sponsored enterprises and debt securities. These
corporations. The Portfolio invests securities principally include
primarily in investment grade U.S. Government and agency
securities, but also may invest up to securities, corporate
10% in high yield bonds. The average securities, private
duration varies within 3 years (plus placements, asset-backed
or minus) of the Lehman Brothers U.S. securities, mortgage-related
TIPS Index (as of March 31, 2006, 6.9 securities and direct mortgage
years). The Portfolio may invest up to obligations. The overall
30% in securities denominated in duration generally will be
foreign currencies and beyond this within one year of the
limit in U.S. dollar denominated Portfolio's benchmark, the
securities of foreign issuers. The Lehman Brothers Aggregate Bond
Portfolio also may invest in Index (as of March 31, 2006,
derivatives. The Portfolio is non- 4.68 years). The Portfolio may
diversified. invest up to 25% of assets in
foreign issuers, including up
to 20% in debt securities
denominated in currencies of
developed foreign countries.
The Portfolio may invest in
derivatives.
Principal Risks: Principal Risks:
Market Risk Market Risk
Issuer Risk Asset Class Risk
Interest Rate Risk Adviser Selection
Risk
Credit Risk Security Selection
Risk
High Yield Risk Derivatives Risk
Liquidity Risk Fixed Income Risk
Derivatives Risk Mortgage-Backed
Securities Risk
[[Page 61096]]
Mortgage Risk Asset-Backed
Securities Risk
Foreign Investment Risk Credit Risk
Currency Risk Interest Rate Risk
Issuer Non-Diversification Investment Grade
Risk Securities Risk
Leveraging Risk Foreign Securities
Risk
Management Risk Security Risk
Liquidity Risk
Portfolio Turnover
Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the PIMCO Variable Insurance
Trust--Real Return Portfolio and the EQ/JPMorgan Core Bond Portfolio
have substantially similar investment objectives, policies and risks
and that the essential objectives and expectations of Contract owners
will continue to be met after the Substitution. In this connection, the
Section 26 Applicants note that each Portfolio invests primarily in
investment grade debt securities and seeks to maintain a duration that
is generally within the same range. Each Portfolio also may invest, to
a limited extent, in foreign securities and derivatives. Moreover, the
Section 26 Applicants believe that while the principal risks are stated
somewhat differently, the Portfolios have substantially similar risk
profiles. Each Portfolio is subject to general investment risks, such
as asset class risk and security risk, and to substantially similar
portfolio risks, such as fixed income risk, including investment grade
securities risk, credit risk and interest rate risk, and foreign
securities risk.
(11)
------------------------------------------------------------------------
Removed portfolio Replacement portfolio
------------------------------------------------------------------------
Lord Abbett Series Fund--Bond-Debenture AXA Premier VIP High Yield
Portfolio (Class VC shares): The Portfolio (Class A shares):
Portfolio seeks high current income The Portfolio seeks high total
and the opportunity for capital return through a combination
appreciation to produce a high total of current income and capital
return. Under normal circumstances, appreciation. Under normal
the Portfolio invests at least 80% of circumstances, the Portfolio
its net assets, plus the amount of any intends to invest at least 80%
borrowings for investment purposes, in of its net assets, plus
fixed income securities of various borrowings for investment
types. The Portfolio may invest in purposes, in a diversified mix
high-yield debt securities and of bonds that are rated below
mortgage- and asset-backed securities. investment grade. The Advisers
The Portfolio has found good value in select bonds from several
high-yield securities and has invested sectors, including commercial
more than half of its assets in these and residential mortgage-
securities. At least 20% of the backed securities, asset-
Portfolio's net assets must be backed securities, corporate
invested in any combination of bonds and bonds of foreign
investment grade debt securities, U.S. issuers. The Portfolio also
Government securities and cash may invest in equity
equivalents. The Portfolio may also securities, derivatives and,
invest up to 20% of its net assets in to a limited extent, illiquid
equity securities and up to 20% of its securities. In addition, the
net assets in foreign securities. Portfolio may invest up to 20%
of its net assets in
investment grade debt
securities.
Principal Risks: Principal Risks:
Market Risk Adviser Selection
Risk
Issuer Risk Credit/Default Risk
Debt Securities Risk Currency Risk
Interest Rate Risk Derivatives Risk
High-Yield Debt Securities Foreign Investing
Risk and Emerging Markets Risk
Mortgage-Related Interest Rate Risk
Securities Risk
Credit Risk Liquidity Risk
Equity Risk Lower-Rated
Securities Risk
Foreign Securities Risk Loan Participation
Risk
Mortgage-Backed and
Asset-Backed Securities
Risk
Portfolio
Management Risk
Issuer-Specific
Risk
------------------------------------------------------------------------
The Section 26 Applicants believe that the Lord Abbett Series
Fund--Bond Debenture Portfolio and the AXA Premier VIP High Yield
Portfolio have substantially similar investment objectives, policies
and risks and that the essential objectives and expectations of
Contract owners will continue to be met after the Substitution. In this
connection, the Section 26 Applicants note that each Portfolio invests
virtually all of its assets in fixed income securities. In addition,
each Portfolio invests largely in high-yield securities and also may
invest in investment grade debt securities. Applicants note that the
Removed Portfolio generally invests at least 20% of its net assets in
investment grade debt securities, while the Replacement Portfolio
generally invests no more than 20% of its net assets in such
securities. Applicants believe, however, that this is neither a
significant difference in the investment policies of the Portfolios nor
a difference that significantly alters the overall risk profile of
either Portfolio. In this connection, Applicants note that the Removed
Portfolio has only invested approximately 23% of its assets in
investment grade debt securities over the past three fiscal years,
while the Replacement Portfolio has invested approximately 8% of its
assets in such securities over the same period. Thus, each Portfolio
has invested the substantial majority (indeed, more than three quarters
of the Portfolio) in high-yield debt securities over the last three
[[Page 61097]]
fiscal years. Each Portfolio also may invest, to a limited extent, in
equity securities and foreign securities. Moreover, the Section 26
Applicants believe that while the principal risks are stated somewhat
differently, as noted above, the Portfolios have substantially similar
risk profiles. Each Portfolio is subject to general investment risks,
such as asset class risk and security risk, and to substantially
similar portfolio risks, such as fixed income risk, including high-
yield securities risk, investment grade securities risk, credit risk
and interest rate risk, and foreign securities risk.
14. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Initial Class shares of The Dreyfus Socially Responsible Growth
Fund, Inc. (the ``Removed Portfolio'' for purposes of this discussion)
and the Class IA shares of the EQ/Calvert Socially Responsible
Portfolio (the ``Replacement Portfolio'' for purposes of this
discussion). The total annual operating expenses of the Replacement
Portfolio have been restated to reflect recent changes to the
administration fees charged with respect to that Portfolio.\3\ Class IA
shares of the Replacement Portfolio and the Initial Class shares of the
Removed Portfolio have not adopted plans pursuant to Rule 12b-1 under
the 1940 Act.
---------------------------------------------------------------------------
\3\ Effective May 1, 2006, each EQAT Portfolio pays an
administration fee equal to $30,000 per year, plus its pro rata
portion of the Trust's asset-based administration fee, which is
equal to an annual rate of 0.12% of the first $3 billion of total
EQAT average daily net assets, 0.11% of the next $3 billion, 0.105%
of the next $4 billion, 0.10% of the next $20 billion of total EQAT
average daily net assets and 0.975% of the total EQAT average daily
net assets in excess of $30 billion. Prior to that date, the
administration fee for each EQAT Portfolio was equal to $30,000 per
year, plus its pro rata portion of the Trust's asset-based
administration fee, which was equal to an annual rate of 0.04% of
the first $3 billion of total EQAT average daily net assets, 0.03%
of the next $3 billion, 0.025% of the next $4 billion, and 0.0225%
of the total EQAT average daily net assets in excess of $10 billion.
------------------------------------------------------------------------
The Dreyfus
Socially EQ/Calvert
Responsible Socially
Growth Fund, Responsible
Inc. Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \4\..................... 0.75 0.65
Rule 12b-1 Fee......................... None None
Other Expenses......................... 0.06 0.27
Total Annual Operating Expenses........ 0.81 0.92
Less Fee Waiver/Expense Reimbursement N/A (0.12)
\5\...................................
Net Annual Operating Expenses.......... 0.81 0.80
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the net annual
operating expense ratio of the Replacement Portfolio was lower than the
Removed Portfolio's net annual operating expense ratio due primarily to
the Replacement Portfolio's lower management fee rate and an expense
limitation arrangement in effect for the Replacement Portfolio.
---------------------------------------------------------------------------
\4\ The management fee schedule for the Replacement Portfolio on
an annual basis is equal to 0.650% of the first $1 billion; 0.600%
on the next $1 billion; 0.575% on the next $3 billion; 0.550% on the
next $5 billion; and 0.525% thereafter. The management fee schedule
for the Removed Portfolio, as well as the management fee schedule
for each Removed Portfolio in Substitutions 2, 4, 5, 6 and 10
discussed herein, does not include breakpoints.
\5\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.80%.
---------------------------------------------------------------------------
As of December 31, 2005, the assets of the Replacement Portfolio
were approximately $72.5 million, while the assets of the Removed
Portfolio were approximately $431.2 million. Although the Replacement
Portfolio is smaller than the Removed Portfolio, it is anticipated that
the Replacement Portfolio's net annual operating expense ratio will be
lower than the Removed Portfolio's annual operating expense ratio
immediately after the Substitution due to the expense limitation
arrangement in effect. The Section 26 Applicants assert that the
proposed Substitution of the Replacement Portfolio for the Removed
Portfolio will therefore benefit the Contract owners by lowering the
annual operating expense ratio. To ensure that Contract owners with
amounts allocated to the Removed Portfolio on the date of the
Substitution do not incur higher expenses with respect to such amounts
for a period of two years after the Substitution, MLOA and MONY also
have agreed to impose a two-year expense limitation with respect to
such amounts, as summarized below.
15. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Initial Class shares of the Dreyfus Variable Investment Fund--
International Value Portfolio (the ``Removed Portfolio'' for purposes
of this discussion) and the Class IA shares of the EQ/Mercury
International Value Portfolio (the ``Replacement Portfolio'' for
purposes of this discussion). The total annual operating expenses of
the Replacement Portfolio have been restated to reflect recent changes
to the administration fees charged with respect to that Portfolio (as
described above). Class IA shares of the Replacement Portfolio and the
Initial Class shares of the Removed Portfolio have not adopted plans
pursuant to Rule 12b-1 under the 1940 Act.
------------------------------------------------------------------------
Dreyfus Variable
Investment Fund-- EQ/Mercury
International Value International
Portfolio Value Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \6\................ 1.00 0.85
[[Page 61098]]
Rule 12b-1 Fee.................... None None
Other Expenses.................... 0.20 0.23
Total Annual Operating Expenses... 1.20 1.08
Less Fee Waiver/Expense N/A (0.08)
Reimbursement \7\................
Net Annual Operating Expenses..... 1.20 1.00
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
of the Removed Portfolio due primarily to the Replacement Portfolio's
lower management fee rate and an expense limitation arrangement in
effect for the Replacement Portfolio. In addition, as of December 31,
2005, the assets of the Replacement Portfolio were approximately $1.4
billion, while the assets of the Removed Portfolio were approximately
$149.2 million.
---------------------------------------------------------------------------
\6\ The management fee schedule for the Replacement Portfolio on
an annual basis is equal to 0.850% of the first $1 billion; 0.800%
on the next $1 billion; 0.775% on the next $3 billion; 0.750% on the
next $5 billion; and 0.725% thereafter.
\7\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 1.00%. With respect to the Removed Portfolio, the investment
adviser has agreed to waive its fees and/or assume expenses of the
Portfolio to the extent that the Total Annual Operating Expenses
exceed 1.40% for the fiscal year ended December 31, 2006.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
primarily to the lower management fee rate and economies of scale from
the substantially larger asset base as well as the expense limitation
arrangement in effect. The Section 26 Applicants assert that the
proposed Substitution of the Replacement Portfolio for the Removed
Portfolio will therefore benefit the Contract owners by lowering the
annual operating expense ratio. To ensure that Contract owners with
amounts allocated to the Removed Portfolio on the date of the
Substitution do not incur higher expenses with respect to such amounts
for a period of two years after the Substitution, MLOA and MONY also
have agreed to impose a two year expense limitation with respect to
such amounts, as summarized below.
16. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Class VC shares of the Lord Abbett Series Fund--Growth and Income
Portfolio (the ``Removed Portfolio'' for purposes of this discussion)
and the Class IA shares of the EQ/Lord Abbett Growth and Income
Portfolio (the ``Replacement Portfolio'' for purposes of this
discussion). The total annual operating expenses of the Replacement
Portfolio have been restated to reflect recent changes to the
administration fees charged with respect to that Portfolio (as
described above). Class IA shares of the Replacement Portfolio and the
Class VC shares of the Removed Portfolio have not adopted plans
pursuant to Rule 12b-1 under the 1940 Act.
------------------------------------------------------------------------
Lord Abbett
Series Fund-- EQ/Lord Abbett
Growth and Growth and
Income Income
Portfolio Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \8\..................... 0.48 0.65
Rule 12b-1 Fee......................... None None
Other Expenses......................... 0.41 0.93
Total Annual Operating Expenses........ 0.89 .58
Less Fee Waiver/Expense Reimbursement N/A (0.83)
\9\...................................
Net Annual Operating Expenses.......... 0.89 0.75
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the net annual
operating expense ratio of the Replacement Portfolio was lower than the
net annual operating expense ratio of the Removed Portfolio due
primarily to an expense limitation arrangement in effect for the
Replacement Portfolio. This arrangement more than offset the
Replacement Portfolio's higher management fee rate and the higher rate
of ``other expenses.'' The Class VC shares of the Removed Portfolio are
not subject to any expense limit.
---------------------------------------------------------------------------
\8\ The management fee schedule for the Replacement Portfolio on
an annual basis is equal to 0.650% of the first $1 billion; 0.600%
on the next $1 billion; 0.575% on the next $3 billion; 0.550% on the
next $5 billion; and 0.525% thereafter. The management fee schedule
for the Removed Portfolio on an annual basis is equal to 0.50% on
the first $1 billion and 0.45% over $1 billion.
\9\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.75%.
---------------------------------------------------------------------------
As of December 31, 2005, the assets of the Replacement Portfolio
were approximately $38.3 million, while the assets in the Removed
Portfolio were approximately $1.6 billion. Although the Replacement
Portfolio is smaller than the Removed Portfolio, it is anticipated that
the Replacement Portfolio's net annual operating expense ratio will be
lower than the Removed Portfolio's net annual operating expense ratio
immediately after the Substitution due to the expense limitation
arrangement in effect. In addition, after the Substitution, the
Replacement Portfolio will be substantially larger,
[[Page 61099]]
which should enable the Portfolio to realize greater economies of
scale. The Section 26 Applicants assert that the proposed Substitution
of the Replacement Portfolio for the Removed Portfolio will therefore
benefit the Contract owners by lowering the annual operating expense
ratio. To ensure that Contract owners with amounts allocated to the
Removed Portfolio on the date of the Substitution do not incur higher
expenses with respect to such amounts after the Substitution, MLOA and
MONY also have agreed to impose a permanent expense limitation with
respect to such amounts, as summarized below.
17. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the shares of the T. Rowe Price Fixed Income Series, Inc.--Limited-Term
Bond Portfolio (the ``Removed Portfolio'' for purposes of this
discussion) and the Class IA shares of the EQ/Short Duration Bond
Portfolio (the ``Replacement Portfolio'' for purposes of this
discussion). The total annual operating expenses of the Replacement
Portfolio have been restated to reflect recent changes to the
administration fees charged with respect to that Portfolio (as
described above). Class IA shares of the Replacement Portfolio and the
shares of the Removed Portfolio have not adopted plans pursuant to Rule
12b-1 under the 1940 Act.
------------------------------------------------------------------------
T. Rowe Price
Fixed Income
Series, Inc.-- EQ/Short
Limited-Term Duration Bond
Bond Portfolio Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \10\..................... 0.70 0.45
Rule 12b-1 Fee.......................... None None
Other Expenses.......................... None 0.14
Total Annual Operating Expenses......... 0.70 0.59
Less Fee Waiver/Expense Reimbursement N/A N/A
\11\...................................
Net Annual Operating Expenses........... 0.70 0.59
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
of the Removed Portfolio due primarily to the Replacement Portfolio's
lower management fee rate. In addition, the Class IA shares of the
Replacement Portfolio are subject to a 0.60% annual expense limit,
while the shares of the Removed Portfolio are not subject to any
expense limit. Moreover, as of December 31, 2005, the assets of the
Replacement Portfolio were approximately $1.3 billion, while the assets
in the Removed Portfolio were approximately $86.5 million.
---------------------------------------------------------------------------
\10\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.450% of the first $750 million;
0.425% on the next $750 million; 0.400% on the next $1 billion;
0.380% on the next $2.5 billion; and 0.370% thereafter.
\11\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.60%.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
to the lower management fee rate and economies of scale from the
substantially larger asset base. The Section 26 Applicants assert that
the proposed Substitution of the Replacement Portfolio for the Removed
Portfolio will therefore benefit the Contract owners by lowering the
annual operating expense ratio. To ensure that Contract owners with
amounts allocated to the Removed Portfolio on the date of the
Substitution do not incur higher expenses with respect to such amounts
for a period of two years after the Substitution, MLOA and MONY also
have agreed to impose a two-year expense limitation with respect to
such amounts, as summarized below.
18. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the shares of the T. Rowe Price Fixed Income Series, Inc.--Prime
Reserve Portfolio (the ``Removed Portfolio'' for purposes of this
discussion) and the Class IA shares of the EQ/Money Market Portfolio
(the ``Replacement Portfolio'' for purposes of this discussion). The
total annual operating expenses of the Replacement Portfolio have been
restated to reflect recent changes to the administration fees charged
with respect to that Portfolio (as described above). Class IA shares of
the Replacement Portfolio and the shares of the Removed Portfolio have
not adopted plans pursuant to Rule 12b-1 under the 1940 Act.
---------------------------------------------------------------------------
\12\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.350% of the first $750 million;
0.325% on the next $750 million; 0.280% on the next $1 billion;
0.270% on the next $2.5 billion; and 0.250% thereafter.
------------------------------------------------------------------------
T. Rowe Price
Fixed Income
Series, Inc.-- EQ/Money
Prime Reserve Market
Portfolio Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \12\..................... 0.55 0.34
Rule 12b-1 Fee.......................... None None
Other Expenses.......................... None 0.13
Total Annual Operating Expenses......... 0.55 0.47
Less Fee Waiver/Expense Reimbursement... N/A N/A
[[Page 61100]]
Net Annual Operating Expenses........... 0.55 0.47
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
of the Removed Portfolio due primarily to the Replacement Portfolio's
lower management fee rate. In addition, as of December 31, 2005, the
assets of the Replacement Portfolio were approximately $1.5 billion,
while the assets in the Removed Portfolio were approximately $24.1
million.
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
to the lower management fee rate and economies of scale from the
substantially larger asset base. The Section 26 Applicants assert that
the proposed Substitution of the Replacement Portfolio for the Removed
Portfolio will therefore benefit the Contract owners by lowering the
annual operating expense ratio. To ensure that Contract owners with
amounts allocated to the Removed Portfolio on the date of the
Substitution do not incur higher expenses with respect to such amounts
for a period of two years after the Substitution, MLOA and MONY also
have agreed to impose a two-year expense limitation with respect to
such amounts, as summarized below.
19. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the shares of the T. Rowe Price International Series, Inc.--
International Stock Portfolio (the ``Removed Portfolio'' for purposes
of this discussion) and the Class IA shares of the EQ/Alliance
International Portfolio (the ``Replacement Portfolio'' for purposes of
this discussion). The total annual operating expenses of the
Replacement Portfolio have been restated to reflect recent changes to
the administration fees charged with respect to that Portfolio (as
described above). Class IA shares of the Replacement Portfolio and the
shares of the Removed Portfolio have not adopted plans pursuant to Rule
12b-1 under the 1940 Act.
------------------------------------------------------------------------
T. Rowe Price
International EQ/Alliance
Series, Inc.-- International
International Stock Portfolio
Portfolio (percent)
(percent)
------------------------------------------------------------------------
Management Fee \13\................ 1.05 0.72
Rule 12b-1 Fee..................... None None
Other Expenses..................... None 0.21
Total Annual Operating Expenses.... 1.05 0.93
Less Fee Waiver/Expense N/A (0.08)
Reimbursement \14\................
Net Annual Operating Expenses...... 1.05 0.85
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
of the Removed Portfolio due primarily to the Replacement Portfolio's
lower management fee rate and an expense limitation arrangement in
effect for the Replacement Portfolio. The Removed Portfolio is not
subject to any expense limitation arrangement. In addition, as of
December 31, 2005, the assets of the Replacement Portfolio were
approximately $2.3 billion, while the assets in the Removed Portfolio
were approximately $467.5 million.
---------------------------------------------------------------------------
\13\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.750% of the first $1 billion;
0.700% on the next $1 billion; 0.675% on the next $3 billion; 0.650%
on the next $5 billion; and 0.625% thereafter.
\14\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.85%.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
to the lower management fee rate, economies of scale from the
substantially larger asset base and the expense limitation arrangement
in effect. The Section 26 Applicants assert that the proposed
Substitution of the Replacement Portfolio for the Removed Portfolio
will therefore benefit the Contract owners by lowering the annual
operating expense ratio. To ensure that Contract owners with amounts
allocated to the Removed Portfolio on the date of the Substitution do
not incur higher expenses with respect to such amounts for a period of
two years after the Substitution, MLOA and MONY also have agreed to
impose a two-year expense limitation with respect to such amounts, as
summarized below.
20. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Class I shares of The Universal Institutional Funds, Inc.--Emerging
Markets Equity Portfolio (the ``Removed Portfolio'' for purposes of
this discussion) and the Class IA shares of the EQ/Van Kampen Emerging
Markets Equity Portfolio (the ``Replacement Portfolio'' for purposes of
this discussion). The total annual operating expenses of the
Replacement Portfolio have been restated to reflect recent changes to
the administration
[[Page 61101]]
fees charged with respect to that Portfolio (as described above). Class
IA shares of the Replacement Portfolio and the Class I shares of the
Removed Portfolio have not adopted plans pursuant to Rule 12b-1 under
the 1940 Act.
------------------------------------------------------------------------
The Universal
Institutional EQ/Van Kampen
Funds, Inc.-- Emerging
Emerging Markets Equity
Markets Equity Portfolio
Portfolio (percent)
(percent)
------------------------------------------------------------------------
Management Fee \15\................... 1.25 1.15
Rule 12b-1 Fee........................ None None
Other Expenses........................ 0.41 0.48
Total Annual Operating Expenses....... 1.66 1.63
Less Fee Waiver/Expense Reimbursement (0.01) (0.08)
\16\.................................
Net Annual Operating Expenses......... 1.65 1.55
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
of the Removed Portfolio due primarily to the Replacement Portfolio's
lower management fee rate and an expense limitation arrangement in
effect for the Replacement Portfolio. In addition, as of December 31,
2005, the assets of the Replacement Portfolio were approximately $1.3
billion, while the assets in the Removed Portfolio were approximately
$740.0 million.
---------------------------------------------------------------------------
\15\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 1.150% of the first $1 billion;
1.100% on the next $1 billion; 1.075% on the next $3 billion; 1.050%
on the next $5 billion; and 1.025% thereafter. The management fee
schedule for the Removed Portfolio on an annual basis is equal to
1.25% of the first $500 million; 1.20% from $500 million to $1
billion; 1.15% from $1 billion to $2.5 billion; and 1.00%
thereafter.
\16\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 1.55%. With respect to the Removed Portfolio, the investment
adviser has agreed to reduce its advisory fee and/or reimburse the
Portfolio to the extent that the Total Annual Operating Expenses
exceed 1.65% for the fiscal year ended December 31, 2006.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
to the lower management fee rate, economies of scale from the
substantially larger asset base and the expense limitation arrangement
in effect. The Section 26 Applicants assert that the proposed
Substitution of the Replacement Portfolio for the Removed Portfolio
will therefore benefit the Contract owners by lowering the annual
operating expense ratio. To ensure that Contract owners with amounts
allocated to the Removed Portfolio on the date of the Substitution do
not incur higher expenses with respect to such amounts for a period of
two years after the Substitution, MLOA and MONY also have agreed to
impose a two-year expense limitation with respect to such amounts, as
summarized below.
21. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the shares of the Old Mutual Insurance Series Fund--Mid-Cap Portfolio
(the ``Removed Portfolio'' for purposes of this discussion) and the
Class IA shares of the EQ/FI Mid Cap Portfolio (the ``Replacement
Portfolio'' for purposes of this discussion). The total annual
operating expenses of the Replacement Portfolio have been restated to
reflect recent changes to the administration fees charged with respect
to that Portfolio (as described above). Class IA shares of the
Replacement Portfolio and the shares of the Removed Portfolio have not
adopted plans pursuant to Rule 12b-1 under the 1940 Act.
------------------------------------------------------------------------
Old Mutual
Insurance
Series Fund-- EQ/FI Mid Cap
Mid-Cap Portfolio
Portfolio (percent)
(percent)
------------------------------------------------------------------------
Management Fee \17\................... 0.95 0.69
Rule 12b-1 Fee........................ None None
Other Expenses........................ 0.22 0.14
Total Annual Operating Expenses....... 1.17 0.83
Less Fee Waiver/Expense Reimbursement (0.18) (0.08)
\18\.................................
Net Annual Operating Expenses......... 0.99 0.75
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense
[[Page 61102]]
ratio for the Replacement Portfolio (before and after waivers and
reimbursements) was lower than the annual operating expense ratio for
the Removed Portfolio due to a lower management fee rate and a lower
rate of ``other expenses.'' In addition, the Class IA shares of the
Replacement Portfolio are subject to a 0.75 annual expense limit, while
the shares of the Removed Portfolio are subject to a 0.99 fee cap.
Moreover, as of December 31, 2005, the assets of the Replacement
Portfolio were approximately $1.4 billion, while the assets in the
Removed Portfolio were approximately $54.8 million.
---------------------------------------------------------------------------
\17\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.700% of the first $1 billion; 0.65%
on the next $1 billion; 0.625% on the next $3 billion; 0.600% on the
next $5 billion; and 0.575% thereafter. The management fee schedule
for the Removed Portfolio on an annual basis is equal to 0.950% of
the first $300 million; 0.900% from $300 million to $500 million;
0.850% from $500 million to $750 million; 0.800% from $750 million
to $1 billion; 0.750% from $1 billion to $1.5 billion; 0.700% from
$1.5 billion to $2.0 billion; and 0.65% thereafter.
\18\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.75%. With respect to the Removed Portfolio, the investment
adviser has contractually agreed to waive a portion of its
management fee or to pay certain expenses of the Portfolio to the
extent that the Total Annual Operating Expenses exceed 0.99% for the
fiscal year ended December 31, 2006.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
to the lower management fee rate, the lower rate of other expenses,
economies of scale from the substantially larger asset base and the
expense limitation arrangement in effect. The Section 26 Applicants
assert that the proposed Substitution of the Replacement Portfolio for
the Removed Portfolio will therefore benefit the Contract owners by
lowering the annual operating expense ratio. To ensure that Contract
owners with amounts allocated to the Removed Portfolio on the date of
the Substitution do not incur higher expenses with respect to such
amounts for a period of two years after the Substitution, MLOA and MONY
also have agreed to impose a two-year expense limitation with respect
to such amounts, as summarized below.
22. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Class VC shares of the Lord Abbett Series Fund--Mid-Cap Value
Portfolio (the ``Removed Portfolio'' for purposes of this discussion)
and the Class IA shares of the EQ/Lord Abbett Mid Cap Value Portfolio
(the ``Replacement Portfolio'' for purposes of this discussion). The
total annual operating expenses of the Replacement Portfolio have been
restated to reflect recent changes to the administration fees charged
with respect to that Portfolio (as described above). Class IA shares of
the Replacement Portfolio and the Class VC shares of the Removed
Portfolio have not adopted plans pursuant to Rule 12b-1 under the 1940
Act.
------------------------------------------------------------------------
Lord Abbett
Series Fund-- EQ/Lord Abbett
Mid-Cap Value Mid Cap Value
Portfolio Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \19\.................... 0.74 0.70
Rule 12b-1 Fee......................... None None
Other Expenses......................... 0.38 0.40
Total Annual Operating Expenses........ 1.12 1.10
Less Fee Waiver/Expense Reimbursement N/A (0.30)
\20\..................................
Net Annual Operating Expenses.......... 1.12 0.80
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio (before and after waivers
and reimbursements) was lower than the annual operating expense ratio
for the Removed Portfolio due primarily to the lower management fee
rate for the Replacement Portfolio and an expense limitation
arrangement in effect for the Replacement Portfolio.
---------------------------------------------------------------------------
\19\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.700% of the first $1 billion;
0.650% on the next $1 billion; 0.625% on the next $3 billion; 0.600%
on the next $5 billion; and 0.575% thereafter. The management fee
schedule for the Removed Portfolio on an annual basis is equal to
0.75% of the $1 billion; 0.70% on the next $1 billion; and 0.65%
over $2 billion.
\20\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.80%.
---------------------------------------------------------------------------
As of December 31, 2005, the assets of the Replacement Portfolio
were approximately $123.6 million, while the assets in the Removed
Portfolio were approximately $1.2 billion. Although the Replacement
Portfolio is smaller than the Removed Portfolio, it is anticipated that
the Replacement Portfolio's net annual operating expense ratio will be
lower than the Removed Portfolio's net annual operating expense ratio
immediately after the Substitution due to the lower management fee rate
and the expense limitation arrangement in effect. The Section 26
Applicants assert that the proposed Substitution of the Replacement
Portfolio for the Removed Portfolio will therefore benefit the Contract
owners by lowering the annual operating expense ratio. To ensure that
Contract owners with amounts allocated to the Removed Portfolio on the
date of the Substitution do not incur higher expenses with respect to
such amounts for a period of two years after the Substitution, MLOA and
MONY also have agreed to impose a two-year expense limitation with
respect to such amounts, as summarized below.
23. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Administrative Class shares of the PIMCO Variable Insurance Trust--
Real Return Portfolio (the ``Removed Portfolio'' for purposes of this
discussion) and the Class IA shares of the EQ/JPMorgan Core Bond
Portfolio (the ``Replacement Portfolio'' for purposes of this
discussion). The total annual operating expenses of the Replacement
Portfolio have been restated to reflect recent changes to the
administration fees charged with respect to that Portfolio (as
described above). Class IA shares of the Replacement Portfolio and the
Administrative Class shares of the Removed Portfolio have not adopted
plans pursuant to Rule 12b-1 under the 1940 Act.
[[Page 61103]]
------------------------------------------------------------------------
PIMCO Variable
Insurance EQ/JPMorgan
Trust--Real Core Bond
Return Portfolio
Portfolio (percent)
(percent)
------------------------------------------------------------------------
Management Fee \21\.................... 0.25 0.44
Rule 12b-1 Fee......................... None None
Other Expenses......................... 0.41 0.13
Total Annual Operating Expenses........ 0.66 0.57
Less Fee Waiver/Expense Reimbursement N/A N/A
\22\..................................
Net Annual Operating Expenses.......... 0.66 0.57
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio was lower than the annual
operating expense ratio of the Removed Portfolio, even though the
management fee rate for the Replacement Portfolio was higher than the
Removed Portfolio's management fee rate. The lower total annual
operating expense ratio of the Replacement Portfolio was due primarily
to the Portfolio's lower rate of ``other expenses.'' In addition, the
Class IA shares of the Replacement Portfolio are subject to a 0.60%
annual expense limit, while the Administrative Class shares of the
Removed Portfolio are not subject to any expense limit. Moreover, as of
December 31, 2005, the assets of the Replacement Portfolio were
approximately $1.4 billion, while the assets in the Removed Portfolio
were approximately $1.1 billion.
---------------------------------------------------------------------------
\21\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.450% of the first $750 million;
0.425% on the next $750 million; 0.400% on the next $1 billion;
0.380% on the next $2.5 billion; and 0.370% thereafter.
\22\ The Manager of the Replacement Portfolio has agreed to make
payments or waive its management, administrative and other fees to
limit the expenses of the Portfolio through April 30, 2007, pursuant
to an expense limitation agreement, so that the Total Annual
Operating Expenses of the Class IA shares of the Portfolio do not
exceed 0.60%.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's net annual
operating expense ratio will be lower than the Removed Portfolio's net
annual operating expense ratio immediately after the Substitution due
primarily to the lower rate of ``other expenses'' due to economies of
scale as well as the expense limitation arrangement in effect. The
Section 26 Applicants assert that the proposed Substitution of the
Replacement Portfolio for the Removed Portfolio will therefore benefit
the Contract owners by lowering the annual operating expense ratio. To
ensure that Contract owners with amounts allocated to the Removed
Portfolio on the date of the Substitution do not incur higher expenses
with respect to such amounts after the Substitution, MLOA and MONY also
have agreed to impose a permanent expense limitation with respect to
such amounts, as summarized below.
24. The following chart compares the fees paid for advisory
services and the total annual operating expenses (before and after any
waivers and reimbursements) for the fiscal year ended December 31,
2005, expressed as an annual percentage of average daily net assets, of
the Class VC shares of the Lord Abbett Series Fund--Bond-Debenture
Portfolio (the ``Removed Portfolio'' for purposes of this discussion)
and the Class A shares of the AXA Premier VIP High Yield Portfolio (the
``Replacement Portfolio'' for purposes of this discussion). Class A
shares of the Replacement Portfolio and the Class VC shares of the
Removed Portfolio have not adopted plans pursuant to Rule 12b-1 under
the 1940 Act.
------------------------------------------------------------------------
Lord Abbett
Series Fund-- AXA Premier
Bond-Debenture VIP High Yield
Portfolio Portfolio
(percent) (percent)
------------------------------------------------------------------------
Management Fee \23\.................... 0.50 0.58
Rule 12b-1 Fee......................... None None
Other Expenses \24\.................... 0.44 0.18
Total Annual Operating Expenses........ 0.94 0.76
Less Fee Waiver/Expense Reimbursement.. (0.04) N/A
Net Annual Operating Expenses.......... 0.90 0.76
------------------------------------------------------------------------
For the fiscal year ended December 31, 2005, the annual operating
expense ratio of the Replacement Portfolio was lower than the annual
operating expense ratio of the Removed Portfolio (before and after
waivers and reimbursements), even though the management fee rate for
the Replacement Portfolio was higher than the Removed Portfolio's
management fee rate. The lower annual operating expense ratio was due
primarily to the Replacement Portfolio's lower rate of ``other
expenses.'' In addition, as of December 31, 2005, the assets of the
Replacement Portfolio were approximately $1.8 billion, while the assets
in the Removed Portfolio were approximately $212.3 million.
---------------------------------------------------------------------------
\23\ The management fee schedule for the Replacement Portfolio
on an annual basis is equal to 0.600% of the first $750 million;
0.575% on the next $750 million; 0.550% on the next $1 billion;
0.530% on the next $2.5 billion; and 0.520% thereafter. The
management fee schedule for the Removed Portfolio on an annual
basis, as of January 1, 2006, is equal to 0.50% of the first $1
billion; and 0.45% thereafter. However, the management fee rate for
the fiscal year ended December 31, 2005, as reflected in the total
annual operating expenses table above, was 0.50% and did not include
breakpoints.
\24\ With respect to the Removed Portfolio, the investment
adviser has contractually agreed through April 30, 2007 to reimburse
a portion of the Portfolio's expenses to maintain its ``Other
Expenses'' at an annualized rate of 0.40%.
---------------------------------------------------------------------------
It is anticipated that the Replacement Portfolio's total annual
operating expense ratio will be lower than the Removed Portfolio's
total annual operating expense ratio immediately
[[Page 61104]]
after the Substitution, notwithstanding the difference in the
management fee rates, due primarily to the lower rate of other expenses
as a result of economies of scale attributable to the Replacement
Portfolio's substantially larger asset base. The Section 26 Applicants
assert that the proposed Substitution of the Replacement Portfolio for
the Removed Portfolio will therefore benefit the Contract owners by
lowering the annual operating expense ratio. To ensure that Contract
owners with amounts allocated to the Removed Portfolio on the date of
the Substitution do not incur higher expenses with respect to such
amounts after the Substitution, MLOA and MONY also have agreed to
impose a permanent expense limitation with respect to such amounts, as
summarized below.
25. Appendix A describes each proposed substitution with respect to
each portfolio's comparative performance history. Information regarding
the average annual total returns of each Replacement and Removed
Portfolio for the one-, five- and ten-year periods (or since inception,
if shorter) ended December 31, 2005 is included in the Appendix.
26. By supplements to the prospectuses for the Contracts and
Separate Accounts which will be delivered to Contract owners at least
thirty (30) days before the Substitutions, each Insurance Company will
notify all Contract owners of its intention to take the necessary
actions, including seeking the order requested by the Application, to
substitute shares of the Replacement Portfolios for the Removed
Portfolios as described in this notice. The supplements will advise
Contract owners that from the date of the supplement until the date of
the proposed Substitutions, owners are permitted to make transfers of
Contract value (or annuity unit value) out of each Removed Portfolio
subaccount to one or more other subaccounts without the transfers (or
exchanges) being treated as one of a limited number of permitted
transfers (or exchanges) or a limited number of transfers (or
exchanges) permitted without a transfer charge. The supplements also
will inform Contract owners that the Insurance Companies will not
exercise any rights reserved under any Contract to impose additional
restrictions on transfers until at least 30 days after each proposed
Substitution (other than with respect to implementing policies and
procedures designed to prevent disruptive transfer and other market
timing activity). The supplements also will advise Contract owners how
to provide instructions on reallocating Contract value in light of the
proposed Substitutions. In addition, the supplements will advise
Contract owners that any Contract value remaining in a Removed
Portfolio subaccount on the Substitution Date will be transferred to
the corresponding Replacement Portfolio subaccount and that the
Substitutions will take place at relative net asset value. The
supplements will also advise Contract owners that for at least 30 days
following each proposed Substitution, the Insurance Companies will
permit Contract owners to make transfers of Contract value (or annuity
unit value) out of each Replacement Portfolio subaccount to one or more
other subaccounts without the transfers (or exchanges) being treated as
one of a limited number of permitted transfers (or exchanges) or a
limited number of transfers (or exchanges) permitted without a transfer
charge, as applicable.
27. Each Insurance Company also will send affected Contract owners
prospectuses for the Replacement Portfolio prior to the Substitutions.
Also the Section 26 Applicants will send the appropriate prospectus
supplement (or other notice, in the case of Contracts no longer
actively marketed and for which there are a relatively small number of
existing Contract owners (``Inactive Contracts'')), containing this
disclosure to all existing Contract owners. Prospective purchasers and
new purchasers of Contracts will be provided with a Contract prospectus
and the supplement containing disclosure regarding the Substitutions,
as well as a prospectus and/or supplement for the Replacement
Portfolios. Applicants represent that the Contract prospectus and the
supplement and the prospectus and/or supplement for the Replacement
Portfolios will be delivered to purchasers of new Contracts in
accordance with all applicable legal requirements.
28. In addition to the prospectus supplements distributed to
Contract owners, within five business days after the proposed
Substitutions are completed, Contract owners will be sent a written
notice of the Substitutions informing them that each Substitution was
carried out and that they may transfer all Contract value or cash value
under a Contract invested in any one of the subaccounts on the date of
the notice to one or more other subaccounts available under their
Contract at no cost and without regard to the usual limit on the
frequency of transfers among the variable account options. The notice
will also reiterate that (other than with respect to implementing
policies and procedures designed to prevent disruptive transfers and
other market timing activity) each Insurance Company will not exercise
any rights reserved by it under the Contracts to impose additional
restrictions on transfers or to impose any charges on transfers until
at least 30 days after each proposed Substitution. The Insurance
Companies will also send each Contract owner a current prospectus for
each of the relevant Replacement Portfolios to the extent they have not
previously received a current version. Each Insurance Company also is
seeking approval of the proposed Substitutions from any state insurance
regulators whose approval may be necessary or appropriate.
29. The proposed Substitutions will take place at relative net
asset value determined on the date of the Substitutions pursuant to
Section 22 of the 1940 Act and Rule 22c-1 thereunder, with no change in
the amount of any Contract owner's Contract value, cash value, or death
benefit or in the dollar value of his or her investment in the Separate
Accounts. Each Substitution will be effected by redeeming shares of the
Removed Portfolio in cash and/or in-kind on the Substitution Date at
their net asset value and using the proceeds of those redemptions to
purchase shares of the Replacement Portfolio at their net asset value
on the same date. All in-kind redemptions from a Removed Portfolio of
which any of the Applicants is an affiliated person will be effected in
accordance with the conditions set forth in the no-action letter issued
by the staff of the Commission to Signature Financial Group, Inc. (Dec.
28, 1999).
30. Contract owners will not incur any fees or charges as a result
of the proposed Substitutions, nor will their rights or insurance
benefits or the Insurance Companies' obligations under the Contracts be
altered in any way. All expenses incurred in connection with the
proposed Substitutions, including any brokerage, legal, accounting, and
other fees and expenses, will be paid by the Insurance Companies. In
addition, the proposed Substitutions will not impose any tax liability
on Contract owners. The proposed Substitutions will not cause the
Contract fees and charges currently being paid by Contract owners to be
greater after the proposed Substitutions than before the proposed
Substitutions. All Contract-level fees will remain the same after the
proposed Substitutions. No fees will be charged on the transfers made
at the time of the proposed Substitutions because each proposed
Substitution will not be treated as a transfer for purposes of
assessing transfer charges or computing
[[Page 61105]]
the number of permissible transfers under the Contracts.
31. With respect to those who were Contract owners on the date of
the proposed Substitutions, the Insurance Companies will reimburse, on
the last business day of each fiscal period (not to exceed a fiscal
quarter) during the two years following the date of the proposed
Substitutions, the subaccounts investing in the Replacement Portfolios
such that the sum of each Replacements Portfolio's net operating
expense ratio (taking into account any expense waivers or
reimbursements) and subaccount expense ratio (asset-based fees and
charges deducted on a daily basis from subaccount assets and reflected
in the calculations of subaccount unit value) for such period will not
exceed, on an annualized basis, the sum of the corresponding Removed
Portfolio's net operating expense ratio (taking into account any
expense waivers or reimbursements) and subaccount expense ratio for
fiscal year 2005, except for the Substitutions involving the Lord
Abbett Series Fund--Growth and Income Portfolio, PIMCO Variable
Insurance Trust--Real Return Portfolio and Lord Abbett Series Fund--
Bond-Debenture Portfolio. With respect to the Lord Abbett Series Fund--
Growth and Income Portfolio, PIMCO Variable Insurance Trust--Real
Return Portfolio and Lord Abbett Series Fund--Bond-Debenture Portfolio,
the Insurance Companies will reimburse, on the last business day of
each fiscal period (not to exceed a fiscal quarter) for the life of
each Contract outstanding on the date of the proposed Substitutions,
the subaccounts investing in the Replacement Portfolios such that the
sum of each Replacement Portfolio's net operating expense ratio (taking
into account any expense waivers or reimbursements) and subaccount
expense ratio (asset-based fees and charges deducted on a daily basis
from subaccount assets and reflected in the calculations of subaccount
unit value) for such period will not exceed, on an annualized basis,
the sum of the corresponding Removed Portfolio's net operating expense
ratio (taking into account any expense waivers or reimbursements) and
subaccount expense ratio for fiscal year 2005.
32. For a period of two years from the date of each proposed
Substitution, except the Substitutions involving the Lord Abbett Series
Fund--Growth and Income Portfolio, PIMCO Variable Insurance Trust--Real
Return Portfolio and Lord Abbett Series Fund--Bond-Debenture Portfolio,
the Insurance Companies will not increase total Separate Account
charges (net of any waivers or reimbursements) for any existing owner
of the Contracts on the date of the proposed Substitutions. With
respect to the Lord Abbett Series Fund--Growth and Income Portfolio,
PIMCO Variable Insurance Trust--Real Return Portfolio and Lord Abbett
Series Fund--Bond-Debenture Portfolio, at no time after the date of the
proposed Substitutions will the Insurance Companies increase the total
Separate Account charges (net of any waiver or reimbursements) of each
Contract outstanding on the date of the proposed Substitutions.
Applicants' Legal Analysis
1. Section 26(c) of the 1940 Act prohibits the depositor of a
registered unit investment trust that invests in the securities of a
single issuer from substituting the securities of another issuer
without Commission approval. Section 26(c) provides that ``[t]he
Commission shall issue an order approving such substitution if the
evidence establishes that it is consistent with the protection of
investors and the purposes fairly intended by the policy and provisions
of this title.'' Section 26(c) protects the expectation of investors
that the unit investment trust will accumulate shares of a particular
issuer and is intended to ensure that unnecessary or burdensome sales
loads, additional reinvestment costs and other charges will not be
incurred due to unapproved substitutions of securities.
2. The proposed Substitutions involve a substitution of securities
within the meaning of Section 26(c) of the 1940 Act. The Section 26
Applicants, therefore, request an order from the Commission pursuant to
Section 26(c) approving the proposed Substitutions.
3. The Section 26 Applicants have reserved the right under the
Contracts to substitute shares of another eligible investment fund for
one of the current investment funds offered as a funding option under
the Contracts. The prospectuses for the Contracts and the Separate
Accounts contain appropriate disclosure of this right. The Section 26
Applicants have reserved this right of substitution both to protect
themselves and their Contract owners in situations where either might
be harmed or disadvantaged by events affecting the issuer of the
securities held by a Separate Account and to preserve the opportunity
to replace such shares in situations where a substitution could benefit
the Insurance Companies and their respective Contract owners.
4. Applicants assert that each Replacement Portfolio and its
corresponding Removed Portfolio have similar, and in some cases
substantially similar or identical, investment objectives, policies and
risks. In addition, the proposed Substitutions retain for Contract
owners the investment flexibility that is a central feature of the
Contracts. According to the Applicants, any impact on the investment
programs of affected Contract owners, including the appropriateness of
the available investment options, should therefore be negligible.
5. Applicants maintain that the ultimate effect of each
Substitution would be to remove overlapping and duplicative investment
options and that each Substitution will permit each Insurance Company
to present information to its Contract owners in a simpler and more
concise manner. Applicants anticipate that after each proposed
Substitution, Contract owners will be provided with disclosure
documents that contain a simpler presentation of the available
investment options under their Contracts.
6. Applicants also state that, as a result of each proposed
Substitution, Contract owners with subaccount balances invested in each
Replacement Portfolio will have lower net operating expenses. Each
Insurance Company has agreed to impose a two year expense limit, except
with respect to the proposed Substitutions involving the Lord Abbett
Series Fund--Growth and Income Portfolio, PIMCO Variable Insurance
Trust--Real Return Portfolio and Lord Abbett Series Fund--Bond-
Debenture Portfolio for which each Insurance Company has agreed to
impose an expense limit for the life of each Contract, so that the sum
of each Replacement Portfolio's net operating expense ratio (taking
into account any expense waivers and reimbursements) and subaccount
expense ratio (asset-based charges deducted on a daily basis from
subaccount assets and reflected in the calculation of subaccount unit
values) for each fiscal period (not to exceed a fiscal quarter) will
not exceed, on an annualized basis, the sum of the corresponding
Removed Portfolio's net operating expense ratio and subaccount expense
ratio for fiscal year 2005.
7. Applicants contend that, therefore, each Substitution protects
the Contract owners who have allocated Contract value to each Removed
Portfolio by: (i) Providing an underlying investment option for
subaccounts invested in the Removed Portfolio that is similar to the
Removed Portfolio; (ii) providing such Contract owners with simpler
disclosure documents; and (iii) providing such Contract owners with an
investment option that would have net operating
[[Page 61106]]
expenses that are lower than the current investment option.
8. Applicants assert that the proposed Substitutions are not of the
type that Section 26(c) was designed to prevent. Unlike traditional
unit investment trusts where a depositor could only substitute
investment securities in a manner which permanently affected all the
investors in the trust, the Contracts provide each Contract owner with
the right to exercise his or her own judgment, and transfer Contract
values and cash values into and among other investment options
available to Contract owners under their Contracts. Additionally, the
Section 26 Applicants claim that the Substitutions will not, in any
manner, reduce the nature or quality of the available investment
options. Moreover, the Section 26 Applicants will offer Contract owners
the opportunity to transfer amounts out of the affected subaccounts
without any cost or other penalty that may otherwise have been imposed
for a period beginning on the date of the supplement notifying Contract
owners of the proposed Substitutions (which supplement will be
delivered to Contract owners at least thirty (30) days before the
Substitutions) and ending no earlier than thirty (30) days after the
Substitution Date. The Substitutions, therefore, will not result in the
type of costly forced redemption that Section 26(c) was designed to
prevent.
9. Applicants maintain that the proposed Substitutions are also
unlike the type of substitution that Section 26(c) was designed to
prevent in that by purchasing a Contract, Contract owners select much
more than a particular underlying fund in which to invest their
Contract values. They also select the specific type of insurance
coverage offered by the Section 26 Applicants under the applicable
Contract, as well as numerous other rights and privileges set forth in
the Contract. Contract owners also may have considered the Insurance
Company's size, financial condition, and its reputation for service in
selecting their Contract. These factors will not change as a result of
the proposed Substitution.
10. Section 17(a)(1) of the 1940 Act prohibits any affiliated
person (as defined in Section 2(a)(3) of the 1940 Act) of a registered
investment company, or any affiliated person of such a person, acting
as principal, from knowingly selling any security or other property to
that company. Section 17(a)(2) of the 1940 Act generally prohibits the
same persons, acting as principals, from knowingly purchasing any
security or other property from the registered investment company.
11. The Section 17 Applicants state that shares held by a separate
account of an insurance company are legally owned by the insurance
company and that, the Insurance Companies and their affiliates
collectively own substantially all of the shares of EQAT. Accordingly,
EQAT and its respective Portfolios are arguably under the control of
the Insurance Companies, notwithstanding the fact that the Contract
owners may be considered the beneficial owners of those shares held in
the Separate Accounts. If EQAT is under the common control of the
Insurance Companies, then each Insurance Company is an affiliated
person or an affiliated person of an affiliated person of EQAT and its
respective Portfolios. If EQAT and its respective Portfolios are under
the control of the Insurance Companies, then EQAT and its respective
affiliates are affiliated persons of the Insurance Companies.
12. The Section 17 Applicants note that, regardless of whether or
not the Insurance Companies can be considered to control EQAT and its
respective Portfolios, because the Insurance Companies and their
affiliates own of record more than 5% of the shares of each of them and
are under common control with each Replacement Portfolio's investment
adviser, the Insurance Companies are affiliated persons of EQAT and its
respective Portfolios. Likewise, EQAT's respective Portfolios are each
an affiliated person of the Insurance Companies.
13. In addition to the above, the Insurance Companies, through
their respective Separate Accounts, in the aggregate own more than 5%
of the outstanding shares of certain of the Removed Portfolios,
including the Dreyfus Variable Investment Fund--International Value
Portfolio, Lord Abbett Series Fund--Bond-Debenture Portfolio, T. Rowe
Price Fixed Income Series, Inc.--Prime Reserve Portfolio, Old Mutual
Insurance Series Fund--Mid-Cap Portfolio and PIMCO Variable Insurance
Trust--Real Return Portfolio. Therefore, each Insurance Company is an
affiliated person of those portfolios.
14. The Section 17 Applicants state that the proposed In-Kind
Transactions could be seen as the indirect purchase of shares of
certain Replacement Portfolios with portfolio securities of certain
Removed Portfolios and the indirect sale of portfolio securities of
certain Removed Portfolios for shares of certain Replacement
Portfolios. Pursuant to this analysis, the proposed In-Kind
Transactions also could be categorized as a purchase of shares of
certain Replacement Portfolios by certain Removed Portfolios, acting as
principal, and a sale of portfolio securities by certain Removed
Portfolios, acting as principal, to certain Replacement Portfolios. In
addition, the proposed In-Kind Transactions could be viewed as a
purchase of securities from certain Removed Portfolios, and a sale of
securities to certain Replacement Portfolios, by MONY or MLOA (or their
Separate Accounts), acting as principal. If categorized in this manner,
the proposed In-Kind Transactions may be deemed to contravene Section
17(a) due to the affiliated status of these participants.
15. Rule 17a-7 under the 1940 Act exempts from the prohibitions of
Section 17(a), subject to certain enumerated conditions, a purchase or
sale transaction between registered investment companies or separate
series of registered investment companies, which are affiliated
persons, or affiliated persons of affiliated persons, of each other,
between separate series of a registered investment company, or between
a registered investment company or a separate series of a registered
investment company and a person which is an affiliated person of such
registered investment company (or affiliated person of such person)
solely by reason of having a common investment adviser or investment
advisers which are affiliated persons of each other, common directors,
and/or common officers.
16. MONY, MLOA, their Separate Accounts, certain Removed
Portfolios, and certain Replacement Portfolios, in connection with
their participation in the proposed In-Kind Transactions, must rely on
that portion of Rule 17a-7 that requires that they be affiliated
persons of each other solely by reason of having a common investment
adviser or affiliated investment advisers, common directors, and/or
common officers. That is not the case as detailed above. Moreover, one
of the conditions enumerated in Rule 17a-7 requires that the
transaction be a purchase or sale, for no consideration other than cash
payment against prompt delivery of a security for which market
quotations are readily available. If the proposed In-Kind Transactions
are viewed as purchases and sales of securities, the consideration in
the proposed redemptions of shares of certain Removed Portfolios and
the proposed purchases of shares of certain Replacement Portfolios
would not be cash, but would be the portfolio securities received from
the Removed Portfolio.
17. Section 17(b) of the 1940 Act provides that the Commission may,
upon application, issue an order
[[Page 61107]]
exempting any proposed transaction from Section 17(a) if: (i) The terms
of the proposed transactions are reasonable and fair and do not involve
overreaching on the part of any person concerned; (ii) the proposed
transactions are consistent with the policy of each registered
investment company concerned; and (iii) the proposed transactions are
consistent with the general purposes of the 1940 Act.
18. The Section 17 Applicants request an order pursuant to Section
17(b) of the 1940 Act exempting them from the provisions of Section
17(a) to the extent necessary to permit them to carry out the In-Kind
Transactions in connection with the proposed Substitutions.
19. The Section 17 Applicants submit that the terms of the proposed
In-Kind Transactions, including the consideration to be paid and
received are reasonable and fair and do not involve overreaching on the
part of any person concerned. The Section 17 Applicants also submit
that the proposed In-Kind Transactions are consistent with the policies
of the relevant Removed Portfolios and the relevant corresponding
Replacement Portfolios, as recited in the current registration
statement and reports of the relevant investment company filed with the
Commission under the federal securities laws. Finally, the Section 17
Applicants submit that the proposed In-Kind Transactions are consistent
with the general purposes of the 1940 Act.
20. The Section 17 Applicants state that they will assure
themselves that the investment companies will carry out the proposed
In-Kind Transactions in conformity with the conditions of Rule 17a-7
(or, as applicable, a Removed Portfolio's and a Replacement Portfolio's
normal valuation procedures, as set forth in the relevant investment
company's registration statement), except that the consideration paid
for the securities being purchased or sold will not be cash. The In-
Kind Transactions will be effected at the respective net asset values
of each Removed Portfolio and the corresponding Replacement Portfolio,
as determined in accordance with the procedures disclosed in the
Portfolios' registration statements and as required by Rule 22c-1 under
the 1940 Act. The In-Kind Transactions will not change the dollar value
of any Contract owner's investment in any of the Separate Accounts, the
value of any Contract, the accumulation value or other value credited
to any Contract, or the death benefit payable under any Contract. After
the proposed In-Kind Transactions, the value of a Separate Account's
investment in a Replacement Portfolio will equal the value of its
investments in the Removed Portfolio (together with the value of any
pre-existing investments in the Replacement Portfolio) before the In-
Kind Transactions.
21. When the Commission initially proposed and adopted Rule 17a-7,
it noted that the purpose of the rule was to eliminate the filing and
processing of applications ``in circumstances where there appears to be
no likelihood that the statutory finding for a specific exemption under
Section 17(b) could not be made'' by establishing ``conditions as to
the availability of the exemption to those situations where the
Commission, upon the basis of its experience, considers that there is
no likelihood of overreaching of the investment companies participating
in the transaction.'' When the Commission amended Rule 17a-7 in 1981 to
cover transactions involving non-investment company affiliates, it
indicated that such transactions could be reasonable and fair and not
involve overreaching if appropriate conditions were imposed on the
transaction. In this regard, the Section 17 Applicants state they will
assure themselves that the In-Kind Transactions will be in substantial
compliance with the conditions of Rule 17a-7 under the 1940 Act. The
Section 17 Applicants assert that because the proposed In-Kind
Transactions would comply in substance with the principal conditions of
Rule 17a-7, the Commission should consider the extent to which the In-
Kind Transactions would meet these or other similar conditions and
issue an order if such conditions would provide the substance of the
protections embodied in Rule 17a-7.
22. The Section 17 Applicants state that the proposed In-Kind
Transactions will be effected based upon the independent current market
price of the portfolio securities as specified in paragraph (b) of Rule
17a-7. The proposed In-Kind Transactions will comply with paragraph (d)
of Rule 17a-7 because no brokerage commission, fee or other
remuneration (except for any customary transfer fees) will be paid to
any party in connection with the proposed In-Kind Transactions.
Furthermore, a written record of the proposed In-Kind Transactions will
be maintained and preserved in accordance with paragraph (g) of Rule
17a-7. With respect to those securities for which market quotations are
not readily available, the Substitutions will be effected in accordance
with the relevant Removed Portfolios' and the relevant corresponding
Replacement Portfolios' normal valuation procedures, as set forth in
the registration statement for the relevant investment company.
23. Even though the proposed In-Kind Transactions will not comply
with the cash consideration requirement of paragraph (a) of Rule 17a-7,
the Section 17 Applicants state that the terms of the proposed In-Kind
Transactions will offer to each of the relevant Removed Portfolios and
each of the relevant Replacement Portfolios the same degree of
protection from overreaching that Rule 17a-7 generally provides in
connection with the purchase and sale of securities under that Rule in
the ordinary course of business. In particular, the Insurance Companies
and their affiliates cannot effect the proposed In-Kind Transactions at
a price that is disadvantageous to any Replacement Portfolio.
24. The Section 17 Applicants represent that the proposed
redemption of shares of each of the relevant Removed Portfolios will be
consistent with the investment policies of each Removed Portfolio and
the corresponding Replacement Portfolio, as recited in their respective
current registration statements, provided that the shares are redeemed
at their net asset value in conformity with Rule 22c-1 under the 1940
Act. Likewise, the proposed sale of shares of each of the relevant
Replacement Portfolios for investment securities is consistent with the
investment policies of the relevant Replacement Portfolio, as recited
in the relevant Trust's registration statement, provided that: (i) The
shares are sold at their net asset value; and (ii) the investment
securities are of the type and quality that a Replacement Portfolio
could have acquired with the proceeds from the sale of its shares had
the shares been sold for cash. To assure the second of these conditions
is met, the Manager and relevant Adviser will examine the portfolio
securities being offered to each Replacement Portfolio and accept only
those securities as consideration for shares that it would have
acquired for each such Portfolio in a cash transaction.
25. Applicants also assert that the proposed In-Kind Transactions
are consistent with the general purposes of the 1940 Act and that the
proposed In-Kind Transactions do not present any conditions or abuses
that the 1940 Act was designed to prevent. In particular, Sections
1(b)(2) and 1(b)(3) of the 1940 Act state, among other things, that the
national public interest and the interest of investors are adversely
affected ``when investment companies are organized, operated, managed,
or their portfolio securities are selected in the
[[Page 61108]]
interest of directors, officers, investment advisers, depositors, or
other affiliated persons thereof, * * * or in the interest of other
investment companies or persons engaged in other lines of business,
rather than in the interest of all classes of such companies' security
holders; * * * when investment companies issue securities containing
inequitable or discriminatory provisions, or fail to protect the
preferences and privileges of holders in their outstanding
securities.'' As explained above, the terms of the proposed In-Kind
Transactions are designed to prevent the abuses described in Sections
1(b)(2) and 1(b)(3) of the 1940 Act.
26. The Section 17 Applicants submit that, for all the reasons
stated above, the terms of the proposed In-Kind Transactions as set
forth in the Application, including the consideration to be paid and
received, are reasonable and fair to: (i) Each of the relevant
Replacement Portfolios and each of the relevant Removed Portfolios; and
(ii) Contract owners. The Section 17 Applicants also assert that the
proposed In-Kind Transactions do not involve overreaching on the part
of any person concerned. Furthermore, the Section 17 Applicants
represent that the proposed In-Kind Transactions are, or will be,
consistent with all relevant policies of (i) the relevant Replacement
Portfolios and the relevant Removed Portfolios as stated in the
relevant investment company's registration statement and reports filed
under the 1940 Act, and (ii) the general purposes of the 1940 Act.
Conclusion
For the reasons set forth in the Application, the Section 26
Applicants and the Section 17 Applicants respectively state that the
proposed Substitutions and the related In-Kind Transactions meet the
standards of Section 26(c) of the 1940 Act and of Section 17(b) of the
1940 Act, and request that the Commission issue an order of approval
pursuant to Section 26(c) of the 1940 Act and an order of exemption
pursuant to Section 17(b) of the 1940 Act.
For the Commission, by the Division of Investment Management,
under delegated authority.
J. Lynn Taylor,
Assistant Secretary.
Appendix A
The charts below compare the average annual total returns of the
Class IA shares of each Replacement Portfolio and relevant class of
shares (as indicated below) of each Removed Portfolio for the one-,
five- and ten-year or since inception periods ended December 31,
2005.
---------------------------------------------------------------------------
\25\ Replaced November 30, 2005.
1.--The Dreyfus Socially Responsible Growth Fund, Inc. (Initial Class Shares) (``Removed Portfolio'') Replaced
by EQ/Calvert Socially Responsible Portfolio (Class IA Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
Since
Portfolio Periods Ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio......................................... 8.92 (2.00) (0.87)
Russell 1000 Growth Index..................................... 5.26 (3.58) (3.74)
Russell 3000 Index\25\........................................ 6.12 1.58 1.86
Removed Portfolio............................................. 3.62 (5.27) 5.93
S&P 500....................................................... 4.91 0.54 9.07
----------------------------------------------------------------------------------------------------------------
* The Replacement Portfolio commenced operations on September 1, 1999. The Removed Portfolio commenced
operations on December 31, 2000.
2.--Dreyfus Variable Investment Fund--International Value Portfolio (Initial Class Shares) (``Removed
Portfolio'') Replaced by EQ/Mercury International Value Portfolio (Class IA Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
Since
Portfolio periods ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 11.07 2.46 8.80
MSCI EAFE Index................................................. 13.54 4.55 6.17
Removed Portfolio............................................... 11.89 6.88 7.97
MSCI EAFE Index................................................. 13.54 4.55 5.42
----------------------------------------------------------------------------------------------------------------
* The Replacement Portfolio commenced operations on March 25, 2002. The Removed Portfolio commenced operations
on May 1, 1996.
3.--Lord Abbett Series Fund--Growth and Income Portfolio (Class VC Shares) (``Removed Portfolio'') Replaced by
EQ/Lord Abbett Growth and Income Portfolio (Class IA Shares) (``Replacement Portfolio'')**
----------------------------------------------------------------------------------------------------------------
1 year 5 years 10 years*
Portfolio periods ended 12/31/2005 (percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Removed Portfolio............................................... 3.25 3.10 10.22
[[Page 61109]]
S&P 500......................................................... 4.91 0.54 9.07
----------------------------------------------------------------------------------------------------------------
* The Removed Portfolio commenced operations on December 11, 1989.
** The inception date for the Replacement Portfolio is April 29, 2005 and, therefore, the Portfolio does not
have performance information for a full fiscal year.
4.--T. Rowe Price Fixed Income Series, Inc.--Limited-Term Bond Portfolio (``Removed Portfolio'') Replaced by EQ/
Short Duration Bond Portfolio (Class IA Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
10 years or
1 year 5 years since
Portfolio periods ended 12/31/2005 (percent) (percent) inception*
(percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 1.38 N/A 1.58
Lehman 1-3 Year Government Credit Index......................... 1.77 N/A 1.72
Removed Portfolio............................................... 1.74 4.17 4.80
Merrill Lynch 1-5 Year U.S. Corporate and Government Index...... 1.44 4.63 5.35
----------------------------------------------------------------------------------------------------------------
* The predecessor of the Replacement Portfolio, the Enterprise Short Duration Portfolio, commenced operations on
May 1, 2003. The assets of the Enterprise Short Duration Portfolio were transferred to the Replacement
Portfolio on July 9, 2004. The Removed Portfolio commenced operations on May 13, 1994.
5.--T. Rowe Price Fixed Income Series, Inc.--Prime Reserve Portfolio (``Removed Portfolio'') Replaced by EQ/
Money Market Portfolio (Class IA shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
10 years or
1 year 5 years since
Portfolio periods ended 12/31/2005 (percent) (percent) inception*
(percent
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 2.85 2.00 3.72
3-Month Treasury Bill........................................... 3.07 2.34 3.85
Removed Portfolio............................................... 2.79 1.96 3.48
Lipper Variable Annuity Underlying Money Market Funds Average... 2.69 1.85 3.38
----------------------------------------------------------------------------------------------------------------
*The predecessor of the Replacement Portfolio, the HRT/Alliance Money Market Portfolio, commenced operations on
July 13, 1981. The assets of the HRT/Alliance Money Market Portfolio were transferred to the Replacement
Portfolio on October 18, 1999. The Removed Portfolio commenced operations on December 31, 1996.
6.--T. Rowe Price International Series, Inc.--International Stock Portfolio (``Removed Portfolio'') Replaced by
EQ/Alliance International Portfolio (Class IA shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
1 year 5 years 10 years*
Portfolio periods ended 12/31/2005 (percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 15.61 5.20 4.87
MSCI EAFE Index................................................. 13.54 4.55 5.84
Removed Portfolio............................................... 16.03 1.84 5.09
MSCI EAFE Index................................................. 14.02 4.94 6.18
----------------------------------------------------------------------------------------------------------------
*The predecessor of the Replacement Portfolio, the HRT/Alliance International Portfolio, commenced operations on
April 3, 1995. The assets of the HRT/Alliance International Portfolio were transferred to the Replacement
Portfolio on October 18, 1999. The Removed Portfolio commenced operations on March 31, 1994.
7.--The Universal Institutional Funds, Inc.--Emerging Markets Equity Portfolio (Class I Shares) (``Removed
Portfolio'') Replaced by EQ/Van Kampen Emerging Markets Equity Portfolio (Class IA Shares) (``Replacement
Portfolio'')
----------------------------------------------------------------------------------------------------------------
Since
Portfolio periods ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 33.04 17.97 5.48
MSCI EMF Gross Dividend Index................................... 34.54 19.44 7.13
Removed Portfolio............................................... 33.85 16.01 6.95
MSCI Emerging Markets Free Net Index............................ 34.00 19.09 6.62
----------------------------------------------------------------------------------------------------------------
* The Replacement Portfolio commenced operations on August 20, 1997. The Removed Portfolio commenced operations
on October 1, 1996.
[[Page 61110]]
8.--Old Mutual Insurance Series Fund--Mid-Cap Portfolio (``Removed Portfolio'') Replaced by EQ/FI Mid Cap
Portfolio (Class IA Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
Since
Portfolio periods ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 6.63 4.58 4.38
S&P MidCap 400 Index............................................ 12.56 8.60 6.91
Removed Portfolio............................................... 5.71 8.18 14.78
S&P MidCap 400 Index............................................ 10.26 6.52 11.35
----------------------------------------------------------------------------------------------------------------
* The Replacement Portfolio commenced operations on September 1, 2000. The Removed Portfolio commenced
operations on November 30, 1998.
9.--Lord Abbett Series Fund--Mid-Cap Value Portfolio (Class VC Shares) (``Removed Portfolio'') Replaced by EQ/
Lord Abbett Mid Cap Value Portfolio (Class IA Shares) (``Replacement Portfolio'')**
----------------------------------------------------------------------------------------------------------------
Since
Portfolio periods ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Removed Portfolio............................................... 8.22 10.30 15.34
Russell MidCap Value Index...................................... 12.65 12.21 12.50
----------------------------------------------------------------------------------------------------------------
* The Removed Portfolio commenced operations on September 15, 1999.
** The inception date for the Replacement Portfolio is April 29, 2005 and, therefore, the Portfolio does not
have performance information for a full fiscal year.
10.--PIMCO Variable Insurance Trust--Real Return Portfolio (Administrative Class Shares) (``Removed Portfolio'')
Replaced by EQ/JPMorgan Core Bond Portfolio (Class IA Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
Since
Portfolio periods ended 12/31/2005 1 year 5 years inception*
(percent) (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 2.50 5.41 5.69
Lehman Brothers Aggregate Bond Index............................ 2.43 5.87 6.06
Removed Portfolio............................................... 2.09 9.34 9.68
Lehman Brothers U.S. TIPS Index................................. 2.84 8.74 9.07
----------------------------------------------------------------------------------------------------------------
* The Replacement Portfolio commenced operations on January 1, 1998. The Removed Portfolio commenced operations
on September 30, 1999.
11.--Lord Abbett Series Fund--Bond-Debenture Portfolio (Class VC Shares) (``Removed Portfolio'') Replaced by AXA
Premier VIP High Yield Portfolio (Class A Shares) (``Replacement Portfolio'')
----------------------------------------------------------------------------------------------------------------
10 years or
1 year 5 years since
Portfolio periods ended 12/31/2005 (percent) (percent) inception*
(percent)
----------------------------------------------------------------------------------------------------------------
Replacement Portfolio........................................... 3.26 6.32 5.17
Merrill Lynch High Yield Master Cash Pay Only Index............. 2.83 8.76 6.80
Credit Suisse First Boston Global High Yield Index\26\.......... 2.25 9.82 7.13
Removed Portfolio............................................... 1.31 N/A 8.53
Lehman Brothers Aggregate Bond Index............................ 2.43 N/A 4.97
CSFB High Yield Bond Index...................................... 2.26 N/A 10.64
----------------------------------------------------------------------------------------------------------------
* The predecessor of the Replacement Portfolio, the EQ/High Yield Portfolio, merged with the AXA Premier VIP
High Yield Portfolio on August 15, 2003. The assets of the HRT Alliance High Yield Portfolio were transferred
to the EQ/High Yield Portfolio on October 19, 1999. The HRT Alliance High Yield Portfolio commenced operations
on January 2, 1987. The Removed Portfolio commenced operations on December 3, 2001.
[[Page 61111]]
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\26\ Replaced December 31, 2005.
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[FR Doc. E6-17236 Filed 10-16-06; 8:45 am]
BILLING CODE 8011-01-P