Exhibit (d)(17)
FORM OF INVESTMENT ADVISORY AGREEMENT
AGREEMENT, dated as of May 15, 2000, by and among The Equitable Life
Assurance Society of the United States, a New York Stock life insurance
corporation (the "Manager"), Prudential Investments Fund Management LLC, a New
York limited liability company ("Prudential"), and Xxxxxxxx Associates LLC, a
Delaware limited liability company ("Xxxxxxxx," and, together with Prudential,
"Advisers").
WHEREAS, EQ Advisors Trust ("Trust") is registered as an investment
company under the Investment Company Act of 1940, as amended ("Investment
Company Act");
WHEREAS, the Trust's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies and
variable annuity contracts under which income, gains, and losses, whether or not
realized, from assets allocated to such accounts are, in accordance with such
policies and contracts, credited to or charged against such accounts without
regard to other income, gains, or losses of such insurance companies;
WHEREAS, the Trust is and will continue to be a series fund having two
or more investment portfolios, each with its own investment objectives, policies
and restrictions;
WHEREAS, the Manager is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act"), and is the
investment manager to the Trust;
WHEREAS, each Adviser is registered as an investment adviser under the
Advisers Act;
WHEREAS, the Investment Company Act prohibits any person from acting as
an investment adviser to a registered investment company except pursuant to a
written contract; and
WHEREAS, the Board of Trustees of the Trust and the Manager desire that
the Manager retain Prudential and Xxxxxxxx to render investment advisory and
other services to that portion of the total assets of EQ/Balanced Portfolio
("Portfolio") that the Manager may allocate to the Advisers from time to time in
the manner and on the terms hereinafter set forth.
NOW, THEREFORE, the Manager and the Advisers agree as follows:
1. APPOINTMENT OF ADVISERS
The Manager hereby appoints Prudential and Xxxxxxxx to act as
investment advisers for that portion of the total assets of the Portfolio
allocated to them from time to time by the Manager ("Prudential/Xxxxxxxx
Allocated Portion"), subject to the overall supervision and control of the
Manager and the Trustees of the Trust, and in accordance with the terms and
conditions of this Agreement. The Advisers will be independent
contractors and will have no authority to act for or represent the Trust or the
Manager in any way or otherwise be deemed agents of the Trust or the Manager
except as expressly authorized in this Agreement or another writing by the
Trust, the Manager and each Adviser.
2. SERVICES TO BE RENDERED BY THE ADVISERS TO THE TRUST
A. Prudential shall allocate responsibilities for specific tasks
relating to the Prudential/Xxxxxxxx Allocated Portion between itself and
Xxxxxxxx. As such, Prudential assigns responsibility to Xxxxxxxx for
coordinating the investment and reinvestment of the assets of the
Prudential/Xxxxxxxx Allocated Portion and the composition of the assets of the
Prudential/Xxxxxxxx Allocated Portion and Prudential shall be responsible for
administrative support to the Trust, both Advisers subject always to the
supervision and control of the Manager and the Trustees of the Trust.
B. As part of the services it will provide hereunder, subject to the
supervision of the Board of Trustees and the Manager, Xxxxxxxx will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and
individual companies or industries, the securities of which are
included in the Prudential/Xxxxxxxx Allocated Portion of the Portfolio
or are under consideration for inclusion in the Prudential/Xxxxxxxx
Allocated Portion of the Portfolio;
(ii) formulate and implement a continuous investment program
for the Prudential/Xxxxxxxx Allocated Portion of the Portfolio;
(iii) provide assistance in determining the fair value of
certain portfolio securities when market quotations are not readily
available for the purpose of calculating the Portfolio's net asset value
in accordance with procedures and methods established by the Trustees of
the Trust; and
(iv) co-operate with and provide reasonable assistance to the
Manager, Prudential, the Trust's administrator, the Trust's custodian
and foreign custodians, the Trust's transfer agent and pricing agents
and all other agents and representatives of the Trust and the Manager,
keep all such persons fully informed as to such matters as they may
reasonably deem necessary to the performance of their obligations to
the Trust and the Manager, provide prompt responses to reasonable
requests made by such persons and establish appropriate interfaces with
each so as to promote the efficient exchange of information.
C. As part of the services it will provide hereunder, subject to the
supervision of the Board of Trustees and the Manager, Prudential and Xxxxxxxx
will:
(i) keep the Trustees of the Trust and the Manager fully
informed in writing on an ongoing basis of all material facts
concerning the investment and reinvestment of the assets in the
Prudential/ Xxxxxxxx Portion of the Portfolio, the
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Advisers and their personnel and operations, make regular and special
written reports of such additional information concerning the same as
may reasonably be requested from time to time by the Manager or the
Trustees of the Trust and will attend meetings with the Manager and/or
the Trustees, as reasonably requested, to discuss the foregoing.
(ii) provide composite prior account performance, if
appropriate, containing accounts that have investment objectives,
policies, and strategies substantially similar to those employed by
Xxxxxxxx or Prudential in managing the Prudential/ Xxxxxxxx Portion of
the Portfolio that may be reasonably necessary, under applicable laws,
to allow the Portfolio or its agent to present information concerning
Prudential or Xxxxxxxx'x prior performance in the Trust's Prospectus
and SAI (as hereinafter defined); provided, however, Prudential and
Xxxxxxxx shall not be responsible for ensuring the compliance of
presenting such prior account information in the Trust's Prospectus and
SAI with applicable laws;
D. In furnishing services hereunder, each Adviser shall be subject to,
and shall perform in accordance with the following: (i) the Trust's Agreement
and Declaration of Trust, as the same may be hereafter modified and/or amended
from time to time ("Trust Declaration"); (ii) the By-Laws of the Trust , as the
same may be hereafter modified and/or amended from time to time ("By-Laws");
(iii) the currently effective Prospectus and Statement of Additional Information
of the Trust filed with the SEC, as the same may be hereafter modified, amended
and/or supplemented ("Prospectus and SAI"). In furnishing services hereunder,
the Advisors agree to co-operate with Manager's compliance personnel, the
Trust's Administrator or the Trust's Custodian to ensure the Advisors' services
are performed in compliance with: (i) the Investment Company Act, with the
requirements applicable to both regulated investment companies and segregated
asset accounts under Subchapters M and L of the Internal Revenue Code of 1986,
as amended; (ii) all other applicable state and federal securities and other
laws; (iii) all regulations with respect to the foregoing; (iv) the Trust's
Compliance Manual and other policies and procedures adopted from time to time by
the Board of Trustees of the Trust; and (v) the written instructions of the
Manager. The Manager shall provide the Advisers with current copies of the Trust
Declaration, By-Laws, Prospectus and SAI, and Trust's Compliance Manual and
other policies and procedures adopted from time to time by the Manager or Board
of Trustees of the Trust.
E. The Advisers, at their expense, will furnish: (i) all necessary
facilities and personnel, including salaries, expenses and fees of any personnel
required for them to faithfully perform their duties under this Agreement; and
(ii) administrative facilities, including bookkeeping, clerical personnel and
equipment necessary for the efficient conduct of the investment affairs of the
Prudential/Xxxxxxxx Allocated Portion.
X. Xxxxxxxx will select brokers and dealers to effect all portfolio
transactions subject to the conditions set forth herein. Xxxxxxxx, will place
all necessary orders with brokers, dealers, or issuers, and will negotiate
brokerage commissions, if applicable. Xxxxxxxx is directed at all times to seek
to execute brokerage transactions for the
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Prudential/Xxxxxxxx Allocated Portion of the Portfolio (i) in accordance with
any written policies, practices or procedures that may be established by the
Board of Trustees or the Manager from time to time and (ii) as described in the
Trust's Prospectus and SAI. In placing any orders for the purchase or sale of
investments for the Prudential/Xxxxxxxx Allocated Portion, in the name of the
Portfolio or its nominees, Xxxxxxxx shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available, considering all
of the circumstances, and shall maintain records adequate to demonstrate
compliance with this requirement.
G. Subject to the appropriate policies and procedures approved by the
Board of Trustees, Xxxxxxxx may, to the extent authorized by Section 28(e) of
the Securities Exchange Act of 1934, as amended ("Exchange Act") cause the
Portfolio to pay a broker or dealer that provides brokerage or research services
to Xxxxxxxx an amount of commission for effecting a portfolio transaction in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction if such Adviser determines, in good faith, that
such amount of commission is reasonable in relationship to the value of such
brokerage or research services provided viewed in terms of that particular
transaction or its or Xxxxxxxx'x overall responsibilities to the Portfolio or
its other advisory clients. To the extent authorized by Section 28(e) and the
Trust's Board of Trustees, Xxxxxxxx shall not be deemed to have acted unlawfully
or to have breached any duty created by this Agreement or otherwise solely by
reason of such action. Subject to seeking the most favorable price and
execution, the Board or Trustees or the Manager may direct Xxxxxxxx to effect
transactions in portfolio securities through broker-dealers in a manner that
will help generate resources to: (i) pay the cost of certain expenses which the
Trust is required to pay or for which the Trust is required to arrange payment;
or (ii) finance activities that are primarily intended to result in the sale of
Trust shares; or (iii) compensate brokers for sales of the Trust's shares; or
(iv) pay for the cost of research services provided to the Manager by brokers.
The Board of Trustees and Manager acknowledge that such directed brokerage
transactions will be effected consistently with Xxxxxxxx'x policy as disclosed
in its Form ADV.
H. On occasions when Jennison deems the purchase or sale of a security
to be in the best interest of the Portfolio as well as its other clients,
Xxxxxxxx to the extent permitted by applicable laws and regulations, may, but
shall be under no obligation to, aggregate the securities to be purchased or
sold to attempt to obtain a more favorable price or lower brokerage commissions
and efficient execution under the circumstances. In such event, allocation of
the securities so purchased or sold, as well as the expenses incurred in the
transaction, will be made by such Xxxxxxxx in the manner Xxxxxxxx considers to
be the most equitable and consistent with its fiduciary obligations to the
Prudential/Xxxxxxxx Allocated Portion of the Portfolio and to its other clients.
I. The Advisers will maintain all accounts, books and records with
respect to the Prudential/Xxxxxxxx Allocated Portion of the Portfolio as are
required of an investment adviser of a registered investment company pursuant to
the Investment Company Act and Advisers Act and the rules thereunder and shall
file with the SEC all forms pursuant to Section 13 of the Exchange Act, with
respect to their duties as are set forth herein.
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X. Xxxxxxxx will, unless and until otherwise directed by the Manager or
the Board of Trustees, vote proxies with respect to the Prudential/Xxxxxxxx
Allocated Portion of the Portfolio's securities and exercise rights in corporate
actions or otherwise.
3. COMPENSATION OF ADVISERS
The Manager will pay Prudential an advisory fee for services provided
by both Prudential and Xxxxxxxx, as specified in this Agreement, with respect to
the Prudential/Xxxxxxxx Allocated Portion of the Portfolio at the following
annual rate: 0.35% of the average daily net assets of the Prudential/Xxxxxxxx
Allocated Portion of the Portfolio. The advisory fee due and payable hereunder
on account of any day shall be calculated by multiplying the net asset value of
the Prudential/Xxxxxxxx Allocated Portion at the close of the immediately
preceding business day (as defined in the Prospectus and SAI) by the applicable
annual rate specified above and dividing the result by the number of days in the
year. The advisory fee due and payable hereunder on account of the days in any
calendar month shall be due and payable within ten (10) business days following
the end of such calendar month. Prudential will in turn compensate Xxxxxxxx for
its services under this Agreement from the advisory fee received by Prudential
from the Manager.
4. LIABILITY AND INDEMNIFICATION
(a) Except as may otherwise be provided by the Investment Company Act
or any other federal securities law, the Advisers shall not be liable for any
losses, claims, damages, liabilities or litigation (including legal and other
expenses) incurred or suffered by the Manager or the Trust as a result of any
error of judgment or mistake of law by either or both of the Advisers with
respect to the services provided to the Prudential/Xxxxxxxx Allocated Portion of
the Portfolio hereunder, except that nothing in this Agreement shall operate or
purport to operate in any way to exculpate, waive or limit the liability of
either or both of the Advisers for, and each Adviser with respect to its own
actions shall indemnify and hold harmless the Trust, the Manager, all affiliated
persons thereof (within the meaning of Section 2(a)(3) of the Investment Company
Act) and all controlling persons (as described in Section 15 of the Securities
Act of 1933, as amended ("1933 Act")) (collectively, "Manager Indemnitees")
against any and all losses, claims, damages, liabilities or litigation
(including reasonable legal and other expenses) to which any of the Manager
Indemnities may become subject under the 1933 Act, the Investment Company Act,
the Advisers Act, or under any other statute, at common law or otherwise arising
out of or based on (a) any willful misconduct, bad faith, reckless disregard or
gross negligence of either or both of the Advisers in the performance of any of
their duties or obligations hereunder or (b) any untrue statement of a material
fact contained in the Prospectus and SAI, proxy materials, reports,
advertisements, sales literature, or other materials pertaining to the Portfolio
or the omission to state therein a material fact known to the applicable Adviser
which was required to be stated therein or necessary to make the statements
therein not misleading, if such statement or omission was made in reliance upon
information furnished to the Manager or the Trust by an Adviser Indemnitee (as
defined below) for use therein; provided, that the applicable Adviser Indemnitee
has had an opportunity to review and approve the use of such information in such
Prospectus and
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SAI, proxy materials, reports, advertisements, sales literature, or other
materials pertaining to the Portfolio prior to the filing with the applicable
regulatory authorities or use.
(b) Except as may otherwise be provided by the Investment Company Act
or any other federal securities law, the Manager and the Trust shall not be
liable for any losses, claims, damages, liabilities or litigation (including
legal and other expenses) incurred or suffered by either or both of the Advisers
as a result of any error of judgment or mistake of law by the Manager with
respect to the Portfolio, except that nothing in this Agreement shall operate or
purport to operate in any way to exculpate, waive or limit the liability of the
Manager for, and the Manager shall indemnify and hold harmless the Advisers, all
affiliated persons thereof (within the meaning of Section 2(a)(3) of the
Investment Company Act) and all controlling persons (as described in Section 15
of the 1933 Act) (collectively, "Adviser Indemnitees") against any and all
losses, claims, damages, liabilities or litigation (including reasonable legal
and other expenses) to which any of the Adviser Indemnities may become subject
under the 1933 Act, the Investment Company Act, the Advisers Act, or under any
other statute, at common law or otherwise arising out of or based on (a) any
willful misconduct, bad faith, reckless disregard or gross negligence of the
Manager in the performance of any of its duties or obligations hereunder or (b)
any untrue statement of a material fact contained in the Prospectus and SAI,
proxy materials, reports, advertisements, sales literature, or other materials
pertaining to the Portfolio or the omission to state therein a material fact
known to the Manager which was required to be stated therein or necessary to
make the statements therein not misleading, unless such statement or omission
was made in reliance upon information furnished to the Manager or the Trust by
an Adviser Indemnitee for use therein.
5. NON-EXCLUSIVITY
The services of the Advisers to the Manager, the Portfolio and the
Trust are not to be deemed to be exclusive, and each Adviser shall be free to
render investment advisory or other services to others (including other
investment companies) and to engage in other activities. It is understood and
agreed that the directors, officers, and employees of the Advisers are not
prohibited from engaging in any other business activity or from rendering
services to any other person, or from serving as partners, officers, directors,
trustees, or employees of any other firm or corporation, including other
investment companies.
6. SUPPLEMENTAL ARRANGEMENTS
Each Adviser may from time to time employ or associate with itself any
person it believes to be particularly fitted to assist it in providing the
services to be performed by such Adviser hereunder, provided that no such person
shall perform any services with respect to the Portfolio which would constitute
an assignment or require a written advisory agreement pursuant to the Investment
Company Act. Any compensation payable to such persons shall be the sole
responsibility of such Adviser, and neither the Manager nor the Trust shall have
any obligations with respect thereto.
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7. REGULATION
Each Adviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information, reports, or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
8. RECORDS
The records relating to the services provided under this Agreement
shall be the property of the Trust and shall be under its control; however, the
Trust shall furnish to the Advisers such records and permit them to retain such
records (either in original or in duplicate form) as either Adviser shall
reasonably require in order to carry out their duties. In the event of the
termination of this Agreement, such records shall promptly be returned to the
Trust by the Advisers; provided, however, the Advisers may retain copies of such
records to the extent necessary to comply with applicable laws and regulations,
subject to the confidentiality requirements hereunder. The Manager and each
Adviser shall keep confidential any information obtained in connection with its
duties hereunder and disclose such information only if the Trust has authorized
such disclosure or if such disclosure is expressly required or requested by
applicable federal or state regulatory authorities, or if such information is
already available to the public through disclosure other than by a party to this
Agreement.
9. DURATION OF AGREEMENT
This Agreement shall become effective with respect to the
Prudential/Xxxxxxxx Allocated Portion of the Portfolio on the later of the date
of its execution or the date of the commencement of the provision of services to
the Prudential/Xxxxxxxx Allocated Portion of the Portfolio. This Agreement will
continue in effect for a period more than two years from the date of its
execution only so long as such continuance is specifically approved at least
annually by the Board of Trustees provided that in such event such continuance
shall also be approved by the vote of a majority of the Trustees who are not
"interested persons" (as defined in the Investment Company Act) ("Independent
Trustees") of any party to this Agreement cast in person at a meeting called for
the purpose of voting on such approval.
10. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time, without the payment of
any penalty, by the Board of Trustees, including a majority of the Independent
Trustees, by the vote of a majority of the outstanding voting securities of the
Portfolio, on sixty (60) day's written notice to the Manager and the Advisers,
or by the Manager or either Adviser on sixty (60) day's written notice to the
Trust and the other parties. This Agreement will automatically terminate,
without the payment of any penalty, (i) in the event of its assignment (as
defined in the Investment Company Act), or (ii) in the event the Investment
Management Agreement between the Manager and the Trust is assigned or terminates
for
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any other reason. This Agreement will also terminate upon written notice (i) by
Equitable to Prudential and Xxxxxxxx; or (ii) by either Prudential or Xxxxxxxx
to Equitable that the non-terminating party is in material breach of this
Agreement, unless the party in material breach of this Agreement cures such
breach to the reasonable satisfaction of the party alleging the breach within
thirty (30) days after written notice.
11. PROVISION OF CERTAIN INFORMATION BY ADVISERS
Each Adviser will promptly notify the Manager in writing of the
occurrence of any of the following events:
A. the Adviser fails to be registered as an investment adviser under
the Advisers Act or under the laws of any jurisdiction in which the Adviser is
required to be registered as an investment adviser in order to perform its
obligations under this Agreement;
B. the Adviser is served or otherwise receives notice of any action,
suit, proceeding, inquiry, or investigation, at law or in equity, before or by
any court, public board, or body, involving the affairs of the Trust; and/or
C. the chief executive officer or controlling member of the Adviser or
the portfolio manager of the Prudential/Xxxxxxxx Allocated Portion of the
Portfolio changes or there is otherwise an actual change in control or
management of the Adviser.
12. USE OF ADVISERS NAMES
The parties agree that the name of each of the Advisers, the names of
any affiliates of the Advisers and any derivative or logo or trademark or
service xxxx or trade name are the valuable property of the Advisers and their
affiliates. The Manager and the Trust shall have the right to use such name(s),
derivatives, logos, trademarks or service marks or trade names only with the
prior written approval of the Adviser, which approval shall not be unreasonably
withheld or delayed so long as this Agreement is in effect.
Upon termination of this Agreement, the Manager and the Trust shall
forthwith cease to use such name(s), derivatives, logos, trademarks or service
marks or trade names. The Manager and the Trust agree that they will review
with, and obtain prior approval from, the Adviser with respect to any
advertisement, sales literature, or notice prior to its use that makes reference
to the Advisers or their affiliates or any such name(s), derivatives, logos,
trademarks, service marks or trade names so that the Advisers may review the
context in which it is referred to, it being agreed that the Advisers shall have
no responsibility to ensure the adequacy of the form or content of such
materials for purposes of the Investment Company Act or other applicable laws
and regulations. If the Manager or the Trust makes any unauthorized use of the
Advisers' names, derivatives, logos, trademarks or service marks or trade names,
the parties acknowledge that the Advisers shall suffer irreparable harm for
which monetary damages are inadequate and thus, the Advisers shall be entitled
to injunctive relief.
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13. AMENDMENTS TO THE AGREEMENT
Except to the extent permitted by the Investment Company Act or the
rules or regulations thereunder or pursuant to exemptive relief granted by the
SEC, this Agreement may be amended by the parties only if such amendment, if
material, is specifically approved by the vote of a majority of the outstanding
voting securities of the Portfolio, as defined by the Investment Company Act,
(unless such approval is not required by Section 15 of the Investment Company
Act as interpreted by the SEC or its staff or unless the SEC has granted an
exemption from such approval requirement) and by the vote of a majority of the
Independent Trustees cast in person at a meeting called for the purpose of
voting on such approval. The required shareholder approval shall be effective
with respect to the Portfolio if a majority of the outstanding voting securities
of the Portfolio, as defined by the Investment Company Act, vote to approve the
amendment, notwithstanding that the amendment may not have been approved by a
majority of the outstanding voting securities of any other Portfolio affected by
the amendment or all the Portfolios of the Trust.
14. ASSIGNMENT
No assignment (as that term is defined in the Investment Company Act)
shall be made by an Adviser without the prior written consent of the Trust and
the Manager. Notwithstanding the foregoing, no assignment shall be deemed to
result from any changes in the directors, officers or employees of such Adviser
except as may be provided to the contrary in the Investment Company Act or the
rules or regulations thereunder. Each Adviser agrees that it will notify the
Trust and the Manager of any changes in its directors, officers or employees
within a reasonable time thereafter.
15. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties with respect to the investment advisory services provided to the
Prudential/Xxxxxxxx Allocated Portion of the Portfolio.
16. HEADINGS
The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part hereof.
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17. NOTICES
All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of each applicable party
in person or by registered mail or a private mail or delivery service providing
the sender with notice of receipt. The specific person to whom notice shall be
provided for each party will be specified in writing to the other party. Notice
shall be deemed given on the date delivered or mailed in accordance with this
paragraph.
18. SEVERABILITY
Should any portion of this Agreement for any reason be held to be void
in law or in equity, the Agreement shall be construed, insofar as is possible,
as if such portion had never been contained herein.
19. GOVERNING LAW
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York, or any of the applicable
provisions of the Investment Company Act. To the extent that the laws of the
State of New York, or any of the provisions in this Agreement, conflict with
applicable provisions of the Investment Company Act, the latter shall control.
20. INTERPRETATION
Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the Investment Company Act shall be resolved by reference to such term or
provision of the Investment Company Act and to interpretations thereof, if any,
by the United States courts or, in the absence of any controlling decision of
any such court, by rules, regulations or orders of the SEC validly issued
pursuant to the Investment Company Act. Specifically, the terms "vote of a
majority of the outstanding voting securities," "interested persons,"
"assignment," and "affiliated persons," as used herein shall have the meanings
assigned to them by Section 2(a) of the Investment Company Act. In addition,
where the effect of a requirement of the Investment Company Act reflected in any
provision of this Agreement is relaxed by a rule, regulation or order of the
SEC, whether of special or of general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first mentioned above.
THE EQUITABLE LIFE ASSURANCE PRUDENTIAL INVESTMENTS FUND
SOCIETY OF THE UNITED STATES MANAGEMENT LLC
By: By:
--------------------------------- ---------------------------------
[Name] [Name]
[Title] [Title]
XXXXXXXX ASSOCIATES LLC
By:
---------------------------------
Xxxxx X. Xxxxxx
Senior Vice President
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