42324 Federal Register / Vol. 83, No. 162 / Tuesday, August 21, 2018 / Notices 

1For purposes of this Notice, Separate Account 

65 is also a ‘‘Separate Account’’ and collectively 

with Separate Account 70, Separate Account A, 

Separate Account FP and MONY America Separate 

Account K, the ‘‘Separate Accounts.’’ 

the list of Negotiated Service 

Agreements in the Mail Classification 

Schedule’s Competitive Products List. 

DATES: Date of required notice: August 

21, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Elizabeth Reed, 202–268–3179. 

SUPPLEMENTARY INFORMATION: The 

United States Postal Service® hereby 

gives notice that, pursuant to 39 U.S.C. 

3642 and 3632(b)(3), on August 16, 

2018, it filed with the Postal Regulatory 

Commission a USPS Request to Add 

Priority Mail Express & Priority Mail 

Contract 71 to Competitive Product List. 

Documents are available at 

www.prc.gov, Docket Nos. MC2018–209, 

CP2018–291. 

Elizabeth Reed, 

Attorney, Corporate and Postal Business Law. 

[FR Doc. 2018–17990 Filed 8–20–18; 8:45 am] 

BILLING CODE 7710–12–P 

POSTAL SERVICE 

Product Change—Priority Mail 

Negotiated Service Agreement 

AGENCY: Postal ServiceTM. 

ACTION: Notice. 

SUMMARY: The Postal Service gives 

notice of filing a request with the Postal 

Regulatory Commission to add a 

domestic shipping services contract to 

the list of Negotiated Service 

Agreements in the Mail Classification 

Schedule’s Competitive Products List. 

DATES: Date of required notice: August 

21, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Elizabeth Reed, 202–268–3179. 

SUPPLEMENTARY INFORMATION: The 

United States Postal Service® hereby 

gives notice that, pursuant to 39 U.S.C. 

3642 and 3632(b)(3), on August 16, 

2018, it filed with the Postal Regulatory 

Commission a USPS Request to Add 

Priority Mail Contract 463 to 

Competitive Product List. Documents 

are available at www.prc.gov, Docket 

Nos. MC2018–208, CP2018–290. 

Elizabeth Reed, 

Attorney, Corporate and Postal Business Law. 

[FR Doc. 2018–17989 Filed 8–20–18; 8:45 am] 

BILLING CODE 7710–12–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

33201; File No. 812–14831] 

AXA Equitable Life Insurance 

Company, et al. 

August 15, 2018. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of application for an order 

approving the substitution of certain 

securities pursuant to section 26(c) of 

the Investment Company Act of 1940, as 

amended (the ‘‘Act’’) and an order of 

exemption pursuant to section 17(b) of 

the Act from section 17(a) of the Act. 

APPLICANTS: AXA Equitable Life 

Insurance Company (‘‘AXA Equitable’’), 

MONY Life Insurance Company of 

America (‘‘MONY America’’), Separate 

Account 70 of AXA Equitable 

(‘‘Separate Account 70’’), Separate 

Account A of AXA Equitable (‘‘Separate 

Account A’’), Separate Account FP of 

AXA Equitable (‘‘Separate Account 

FP’’), MONY America Variable Account 

K ((‘‘MONY America Separate Account 

K’’) and together with Separate Account 

70, Separate Account A and Separate 

Account FP, the ‘‘Separate Accounts’’) 

(collectively, the ‘‘Section 26 

Applicants’’); and Separate Account 65 

of AXA Equitable (‘‘Separate Account 

65’’) and EQ Advisors Trust (the ‘‘EQ 

Trust’’ and collectively with Separate 

Account 65 and the Section 26 

Applicants, the ‘‘Section 17 

Applicants’’).1

SUMMARY OF APPLICATION: The Section 

26 Applicants seek an order pursuant to 

section 26(c) of the Act, approving the 

substitution of shares issued by certain 

investment portfolios of registered 

investment companies (the ‘‘Removed 

Portfolios’’) for shares of certain 

investment portfolios of the EQ Trust 

(the ‘‘Replacement Portfolios’’), held by 

the Separate Accounts (except for 

Separate Account 65) to support certain 

variable annuity contracts and/or 

variable life insurance contracts (the 

‘‘Contracts’’). The Section 17 Applicants 

seek an order pursuant to section 17(b) 

of the Act exempting them from section 

17(a) of the Act to the extent necessary 

to permit them to engage in certain inkind transactions. 

FILING DATE: The application was filed 

on October 4, 2017 and was amended on 

February 8, 2018 and August 10, 2018. 

HEARING OR NOTIFICATION OF HEARING: An 

order granting the requested relief will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by writing to the 

Secretary of the Commission and 

serving the 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 

September 10, 2018 and should be 

accompanied by proof of service on the 

Applicants in the form of an affidavit or, 

for lawyers, a certificate of service. 

Pursuant to rule 0–5 under the Act, 

hearing requests should state the nature 

of the writer’s interest, any facts bearing 

upon the desirability of a hearing on the 

matter, the reason for the request, and 

the issues contested. Persons who wish 

to be notified of a hearing may request 

notification by writing to the 

Commission’s Secretary. 

ADDRESSES: Secretary, Securities and 

Exchange Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

Applicants: Steven M. Joenk, Managing 

Director and Chief Investment Officer, 

AXA Equitable Life Insurance Company, 

1290 Avenue of the Americas, New 

York, New York 10104; Patricia Louie, 

Esq., Managing Director and Associate 

General Counsel, AXA Equitable Life 

Insurance Company, 1290 Avenue of the 

Americas, New York, New York 10104; 

and Mark C. Amorosi, Esq., K&L Gates 

LLP, 1601 K Street NW, Washington, DC 

20006. 

FOR FURTHER INFORMATION CONTACT: 

Jennifer O. Palmer, Senior Counsel, at 

(202) 551–5786, or David J. Marcinkus, 

Branch Chief at (202) 551–6825 

(Division of Investment Management, 

Chief Counsel’s Office). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

website by searching for the file 

number, or for an Applicant using the 

Company name box, at http://

www.sec.gov.search/search.htm, or by 

calling (202) 551–8090. 

Applicants’ Representations 

1. AXA Equitable is a New York stock 

life insurance company licensed to 

conduct insurance business in all fifty 

states of the United States, the District 

of Columbia, Puerto Rico and the Virgin 

Islands. AXA Equitable is whollyowned by AXA Financial, Inc. (‘‘AXA 

Financial’’), a holding company. 

2. MONY America is an Arizona stock 

life insurance company licensed to 


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2The EQ Trust and FMG may rely on an order 

from the Commission that permits FMG, subject to 

certain conditions, including approval of the EQ 

Trust’s board of trustees but without the approval 

of shareholders, to select certain wholly-owned and 

non-affiliated investment sub-advisers to manage all 

or a portion of the assets of each portfolio of the 

EQ Trust pursuant to an investment sub-advisory 

agreement with FMG, and to materially amend subadvisory agreements with FMG. See EQ Advisors 

Trust and EQ Financial Consultants, Inc., 

Investment Company Act Release Nos. 23093 (Mar. 

30, 1998) (notice) and 23128 (April 24, 1998) (the 

‘‘Manager of Managers Order’’). After the 

Substitution Date (defined below), FMG will not 

change a Replacement Portfolio’s sub-adviser, add 

a new sub-adviser, or otherwise rely on the Manager 

of Managers Order or any replacement order from 

the Commission with respect to any Replacement 

Portfolio without first obtaining shareholder 

approval of the change in sub-adviser, the new subadviser, or the Replacement Portfolio’s ability to 

rely on the Manager of Managers Order or any 

replacement order from the Commission, at a 

shareholder meeting, the record date for which will 

be after the proposed Substitution has been 

effected. 

conduct insurance business in all fifty 

states of the United States, the District 

of Columbia, Puerto Rico and the Virgin 

Islands. MONY America is an indirect 

wholly-owned subsidiary of AXA 

Financial. 

3. Each Separate Account meets the 

definition of ‘‘separate account,’’ as 

defined in section 2(a)(37) of the Act 

and rule 0–1(e) thereunder. With the 

exception of Separate Account 65, the 

Separate Accounts are registered under 

the Act as unit investment trusts. 

Separate Account 65 is excluded from 

registration under the Act pursuant to 

section 3(c)(11) of the Act and is not a 

Section 26 Applicant. The assets of the 

Separate Accounts support the 

Contracts and interests in the Separate 

Accounts offered through such 

Contracts. AXA Equitable and MONY 

America are the legal owners of the 

assets in their respective Separate 

Accounts. The Separate Accounts are 

segmented into subaccounts, and each 

subaccount invests in an underlying 

registered open-end management 

investment company or series thereof. 

4. The Contracts are each registered 

under the Securities Act of 1933, as 

amended (the ‘‘1933 Act’’) on Form N– 

4 or Form N–6, as applicable. Each 

Contract has particular fees, charges, 

and investment options, as described in 

the Contracts’ respective prospectuses. 

5. The Contracts include individual 

and group variable annuity contracts or 

flexible premium, scheduled premium 

and single premium individual, second 

to die and corporate variable life 

policies. As set forth in the prospectuses 

for the Contracts, each Contract 

provides that AXA Equitable or MONY 

America, as applicable, reserves the 

right to substitute shares of the 

underlying investment options in which 

the Separate Accounts invest for shares 

of any underlying investment options 

already held or to be held in the future 

by the Separate Accounts. 

6. AXA Equitable and MONY 

America, on behalf of themselves and 

their respective Separate Accounts, 

propose to exercise their contractual 

rights to substitute shares of the 

Removed Portfolios for shares of the 

Replacement Portfolios 

(‘‘Substitutions’’), as shown in the table 

below: 

Substitution 

No. Removed portfolio Replacement portfolio 

1 .................... American Century VP Mid Cap Value Fund (Class II) ............... EQ/American Century Mid Cap Value Portfolio (Class IB). 

2 .................... Fidelity® VIP Contrafund® (Initial Class, Service Class 2) ......... EQ/Fidelity Institutional AMSM Large Cap Portfolio (Class K, 

Class IB). 

3 .................... Franklin Rising Dividends VIP Fund (Class 2) ........................... EQ/Franklin Rising Dividends Portfolio (Class IB). 

4 .................... Franklin Strategic Income VIP Fund (Class 2) ........................... EQ/Franklin Strategic Income Portfolio (Class IB). 

5 .................... Goldman Sachs VIT Mid Cap Value Fund (Service Class) ....... EQ/Goldman Sachs Mid Cap Value Portfolio (Class IB). 

6 .................... Invesco V.I. Global Real Estate Fund (Series II Class) ............. EQ/Invesco Global Real Estate Portfolio (Class IB). 

7 .................... Invesco V.I. International Growth Fund (Series II Class) ........... EQ/Invesco International Growth Portfolio (Class IB). 

8 .................... Ivy VIP Energy (Class II) ............................................................ EQ/Ivy Energy Portfolio (Class IB). 

9 .................... Ivy VIP Mid Cap Growth (Class II) ............................................. EQ/Ivy Mid Cap Growth Portfolio (Class IB). 

10 .................. Ivy VIP Science and Technology (Class II) ................................ EQ/Ivy Science and Technology Portfolio (Class IB). 

11 .................. Lazard Retirement Emerging Markets Equity Portfolio (Service 

Class).

EQ/Lazard Emerging Markets Equity Portfolio (Class IB). 

12 .................. MFS International Value Portfolio (Service Class) ..................... EQ/MFS International Value Portfolio (Class IB). 

13 .................. MFS Technology Portfolio (Service Class) ................................. EQ/MFS Technology Portfolio (Class IB). 

14 .................. MFS Utilities Series (Initial Class, Service Class) ...................... EQ/MFS Utilities Series Portfolio (Class K, Class IB). 

15 .................. PIMCO Real Return Portfolio (Advisor Class) ............................ EQ/PIMCO Real Return Portfolio (Class IB). 

16 .................. PIMCO Total Return Portfolio (Advisor Class) ........................... EQ/PIMCO Total Return Portfolio (Class IB). 

17 .................. T. Rowe Price Health Sciences Portfolio (II Class) .................... EQ/T. Rowe Price Health Sciences Portfolio (Class IB). 

7. The Replacement Portfolios are 

series of the EQ Trust, a Delaware 

statutory trust registered as an open-end 

management investment company 

under the Act (File No. 811–07953) and 

whose shares are registered under the 

1933 Act (File No. 333–17217). The 

Replacement Portfolios are currently 

available only as investment allocation 

options under variable insurance 

contracts issued by AXA Equitable and 

MONY America. 

8. AXA Equitable Funds Management 

Group, LLC (‘‘FMG’’), a wholly-owned 

subsidiary of AXA Equitable and an 

affiliate of MONY America, serves as the 

investment adviser of each Replacement 

Portfolio. FMG is a Delaware limited 

liability company that is registered as an 

investment adviser under the 

Investment Advisers Act of 1940. Each 

Replacement Portfolio is sub-advised by 

a registered investment adviser that is 

unaffiliated with the Section 26 

Applicants, the Section 17 Applicants 

or FMG. 

9. Applicants state that the proposed 

Substitutions are part of an ongoing 

effort by AXA Equitable and MONY 

America to make their Contracts more 

attractive to existing and prospective 

Contract owners. Applicants note that 

the proposed Substitutions are intended 

to improve portfolio manager selection 2

and simplify fund lineups while 

reducing costs and maintaining a menu 

of investment options that would offer 

a similar diversity of investment options 

after the proposed Substitutions as is 

currently available under the Contracts. 

Applicants believe that the Replacement 

Portfolios have investment objectives, as 

described in their prospectuses, which 

are identical, and principal investment 

strategies and principal risks, as 

described in their prospectuses, which 

are identical or substantially similar to 

the corresponding Removed Portfolios, 

making those Replacement Portfolios 

appropriate candidates as substitutes. 

Information for each Removed Portfolio 


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3The Section 26 Applicants state that, because 

the Substitutions will occur at relative net asset 

value, and the fees and charges under the Contracts 

will not change as a result of the Substitutions, the 

benefits offered by the guarantees under the 

Contracts will be the same immediately before and 

after the Substitutions. The Section 26 Applicants 

also state that what effect the Substitutions may 

have on the value of the benefits offered by the 

Contract guarantees would depend, among other 

things, on the relative future performance of the 

Removed Portfolios and Replacement Portfolios, 

which the Section 26 Applicants cannot predict. 

Nevertheless, the Section 26 Applicants note that at 

the time of the Substitutions, the Contracts will 

offer a comparable variety of investment options 

with as broad a range of risk/return characteristics. 

and Replacement Portfolio, including 

investment objectives, principal 

investment strategies, principal risks, 

and comparative performance history, 

can be found in the application. 

10. The Section 26 Applicants agree 

that, for a period of two years following 

the implementation of the proposed 

Substitution (the ‘‘Substitution Date’’), 

and for those Contracts with assets 

allocated to the Removed Portfolio on 

the Substitution Date, AXA Equitable, 

MONY America or an affiliate thereof 

(other than the EQ Trust) will 

reimburse, on the last business day of 

each fiscal quarter, the Contract owners 

whose subaccounts invest in the 

applicable Replacement Portfolio to the 

extent that the Replacement Portfolio’s 

net annual operating expenses (taking 

into account fee waivers and expense 

reimbursements) for such period 

exceeds, on an annualized basis, the net 

annual operating expenses of the 

Removed Portfolio for the most recent 

fiscal year preceding the date of the 

most recently filed application. Neither 

AXA Equitable nor MONY America will 

increase the Contract fees and charges 

that would otherwise be assessed under 

the terms of the Contracts for a period 

of at least two years following the 

Substitution Date. Importantly, for each 

Substitution, the combined current 

management fee and rule 12b–1 fee of 

the Replacement Portfolio at all asset 

levels will be no higher than that of the 

corresponding Removed Portfolio at 

corresponding asset levels. 

11. Applicants represent that as of the 

Substitution Date, the Separate 

Accounts will redeem shares of the 

Removed Portfolios for cash or in-kind. 

Redemption requests and purchase 

orders will be placed simultaneously so 

that Contract values will remain fully 

invested at all times. 

12. Each Substitution will be effected 

at the relative net asset values of the 

respective shares of the Replacement 

Portfolios in conformity with section 

22(c) of the Act and rule 22c–1 

thereunder without the imposition of 

any transfer or similar charges by the 

Section 26 Applicants. The 

Substitutions will be effected without 

change in the amount or value of any 

Contracts held by affected Contract 

owners.3

13. Contract owners will not incur 

any fees or charges as a result of the 

proposed Substitutions. The obligations 

of the Section 26 Applicants and the 

rights of the affected Contract owners, 

under the Contracts of affected Contract 

owners will not be altered in any way. 

AXA Equitable, MONY America and/or 

their affiliates (other than the EQ Trust) 

will pay all expenses and transaction 

costs of the Substitutions, including 

legal and accounting expenses, any 

applicable brokerage expenses and other 

fees and expenses. No fees or charges 

will be assessed to the affected Contract 

owners to effect the Substitutions. The 

proposed Substitutions will not cause 

the Contract fees and charges currently 

being paid by Contract owners to be 

greater after the proposed Substitution 

than before the proposed Substitution. 

In addition, the Substitutions will in no 

way alter the tax treatment of affected 

Contract owners in connection with 

their Contracts, and no tax liability will 

arise for Contract owners as a result of 

the Substitutions. 

14. From the date of the PreSubstitution Notice (defined below) 

through 30 days following the 

Substitution Date, Contract owners may 

make at least one transfer of Contract 

value from the subaccount investing in 

a Removed Portfolio (before the 

Substitution) or the Replacement 

Portfolio (after the Substitution) to any 

other available subaccount under the 

Contract without charge and without 

imposing any transfer limitations. 

Further, on the Substitution Date, 

Contract values attributable to 

investments in each Removed Portfolio 

will be transferred to the corresponding 

Replacement Portfolio without charge 

and without being subject to any 

transfer limitations. Moreover, except as 

described in the disruptive transfer or 

market timing provisions of the relevant 

prospectus, AXA Equitable and MONY 

America will not exercise any rights 

reserved under the Contracts to impose 

restrictions on transfers between the 

subaccounts under the Contracts, 

including limitations on the future 

number of transfers, for a period 

beginning at least 30 days before the 

Substitution Date through at least 30 

days following the Substitution Date. 

15. At least 30 days prior to the 

Substitution Date, Contract owners will 

be notified via prospectus supplements 

that the Section 26 Applicants received 

or expect to receive Commission 

approval of the applicable proposed 

Substitutions and of the anticipated 

Substitution Date (the ‘‘Pre-Substitution 

Notice’’). Pre-Substitution Notices sent 

to Contract owners will be filed with the 

Commission pursuant to rule 497 under 

the 1933 Act. The Pre-Substitution 

Notice will advise Contract owners that 

from the date of the Pre-Substitution 

Notice through the date 30 days after the 

Substitutions, Contract owners may 

make at least one transfer of Contract 

value from the subaccounts investing in 

the Removed Portfolios (before the 

Substitutions) or the Replacement 

Portfolios (after the Substitutions) to any 

other available subaccount without 

charge and without imposing any 

transfer limitations. Among other 

information, the Pre-Substitution Notice 

will inform affected Contract owners 

that, except as described in the 

disruptive transfers or market timing 

provisions of the relevant prospectus, 

AXA Equitable and MONY America will 

not exercise any rights reserved under 

the Contracts to impose additional 

restrictions on transfers out of a 

Replacement Portfolio subaccount from 

the date of the Pre-Substitution Notice, 

including limitations on the future 

number of transfers, until at least 30 

days after the Substitution Date. 

Additionally, all affected Contract 

owners will be sent prospectuses of the 

applicable Replacement Portfolios at 

least 30 days before the Substitution 

Date. 

16. In addition to the Supplements 

distributed to the Contract owners, 

within five business days after the 

Substitution Date, Contract owners 

whose assets are allocated to a 

Replacement Portfolio as part of the 

proposed Substitutions will be sent a 

written notice (each, a ‘‘Confirmation’’) 

informing them that the Substitutions 

were carried out as previously notified. 

The Confirmation also will restate the 

information set forth in the PreSubstitution Notice. The Confirmation 

will also reflect the values of the 

Contract owner’s positions in the 

Removed Portfolio before the 

Substitution and the Replacement 

Portfolio after the Substitution. 

Legal Analysis 

1. The Section 26 Applicants request 

that the Commission issue an order 

pursuant to section 26(c) of the Act 

approving the proposed Substitutions. 

Section 26(c) prohibits any depositor or 

trustee of a unit investment trust that 

invests exclusively in the securities of a 

single issuer from substituting the 

securities of another issuer without the 

approval of the Commission. Section 

26(c) provides that such approval shall 


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Federal Register / Vol. 83, No. 162 / Tuesday, August 21, 2018 / Notices 42327 

be granted by order from the 

Commission if the evidence establishes 

that the substitution is consistent with 

the protection of investors and the 

purposes of the Act. 

2. The Section 26 Applicants submit 

that the Substitutions meet the 

standards set forth in section 26(c) and 

that, if implemented, the Substitutions 

would not raise any of the concerns that 

Congress intended to address when the 

Act was amended to include this 

provision. Applicants state that each 

Substitution protects the Contract 

owners who have Contract value 

allocated to a Removed Portfolio by 

providing Replacement Portfolios with 

identical investment objectives and 

identical or substantially similar 

strategies and risks, and providing 

Contract owners with investment 

options that have net annual operating 

expense ratios that are lower than, or 

equal to, their corresponding investment 

options before the Substitutions. 

3. AXA Equitable and MONY America 

have reserved the right under the 

Contracts to substitute shares of another 

underlying portfolio for one of the 

current portfolios offered as an 

investment option under the Contracts. 

The Contracts and the Contracts’ 

prospectuses disclose this right. 

4. The Section 26 Applicants submit 

that the ultimate effect of the proposed 

Substitutions will be to simplify the 

investment line-ups that are available to 

Contract owners while reducing 

expenses and continuing to provide 

Contract owners with a wide array of 

investment options. The Section 26 

Applicants state that the proposed 

Substitutions will not reduce in any 

manner the nature or quality of the 

available investment options and the 

proposed Substitutions also will permit 

AXA Equitable and MONY America to 

present information to their Contract 

owners in a simpler and more concise 

manner. The Section 26 Applicants also 

state it is anticipated that after the 

proposed Substitutions, Contract 

owners will be provided with disclosure 

documents that contain a simpler 

presentation of the available investment 

options under the Contracts. The 

Section 26 Applicants also assert that 

the proposed Substitutions are not of 

the type that section 26 was designed to 

prevent because they will not result in 

costly forced redemption, nor will they 

affect other aspects of the Contracts. In 

addition, the proposed Substitutions 

will not adversely affect any features or 

riders under the Contracts because none 

of the features or riders will change as 

a result of the Substitutions. 

Accordingly, no Contract owner will 

involuntarily lose his or her features or 

riders as a result of any proposed 

Substitution. 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 (other than those 

necessary to implement policies and 

procedures designed to detect and deter 

disruptive transfers and other ‘‘market 

timing’’ activities) that may otherwise 

have been imposed for a period 

beginning on the date of the PreSubstitution Notice (which supplement 

will be delivered to the Contract owners 

at least 30 days before the Substitution 

Date) and ending no earlier than 30 days 

after the Substitution Date. The 

proposed Substitutions are also unlike 

the type of substitution that section 

26(c) was designed to prevent in that the 

Substitutions have no impact on other 

aspects of the Contracts. 

5. The Section 17 Applicants request 

an order under section 17(b) exempting 

them from the provisions of section 

17(a) to the extent necessary to permit 

the Section 17 Applicants to carry out 

some or all of the proposed 

Substitutions. The Section 17 

Applicants state that because the 

proposed Substitutions may be effected, 

in whole or in part, by means of in-kind 

redemptions and purchases, the 

proposed Substitutions may be deemed 

to involve one or more purchases or 

sales of securities or property between 

affiliated persons. 

6. Section 17(a)(1) of the Act, in 

relevant part, prohibits any affiliated 

person of a registered investment 

company, or any affiliated person of 

such person, acting as principal, from 

knowingly selling any security or other 

property to that company. Section 

17(a)(2) of the Act generally prohibits 

the persons described above, acting as 

principals, from knowingly purchasing 

any security or other property from the 

registered investment company. 

7. The Section 17 Applicants state 

that the proposed transactions may 

involve a transfer of portfolio securities 

by the Removed Portfolios to the 

Separate Accounts. Immediately 

thereafter, the Separate Accounts would 

purchase shares of the Replacement 

Portfolios with the portfolio securities 

received from the Removed Portfolios. 

Accordingly, the Section 17 Applicants 

provide that to the extent AXA 

Equitable, MONY America and the 

Removed Portfolios, and AXA 

Equitable, MONY America and the 

Replacement Portfolios, are deemed to 

be affiliated persons of one another 

under section 2(a)(3) or section 2(a)(9) of 

the Act, it is conceivable that this aspect 

of the proposed Substitutions could be 

viewed as being prohibited by section 

17(a). Accordingly, the Section 17 

Applicants have determined to seek 

relief from section 17(a). 

8. The Section 17 Applicants submit 

that the terms of the proposed in-kind 

purchases of shares of the Replacement 

Portfolios by the Separate Accounts, 

including the consideration to be paid 

and received, as described in the 

application, are reasonable and fair and 

do not involve overreaching on the part 

of any person concerned. The Section 

17 Applicants submit that the terms of 

the proposed in-kind transactions, 

including those considered to be paid to 

each Removed Portfolio and received by 

each Replacement Portfolio involved, 

are reasonable, fair and do not involve 

overreaching principally because the 

transactions will conform with all but 

one of the conditions enumerated in 

rule 17a–7 under the Act. The proposed 

transactions will take place at relative 

net asset value in conformity with the 

requirements of section 22(c) of the Act 

and rule 22c–1 thereunder without the 

imposition of any transfer or similar 

charges by the Section 26 Applicants. 

The Substitutions will be effected 

without change in the amount or value 

of any Contract held by the affected 

Contract owners. The Substitutions will 

in no way alter the tax treatment of 

affected Contract owners in connection 

with their Contracts, and no tax liability 

will arise for Contract owners as a result 

of the Substitutions. The fees and 

charges under the Contracts will not 

increase because of the Substitutions. 

Even though the Separate Accounts, 

AXA Equitable, MONY America and the 

EQ Trust may not rely on rule 17a–7, 

the Section 17 Applicants believe that 

the rule’s conditions outline the type of 

safeguards that result in transactions 

that are fair and reasonable to registered 

investment company participants and 

preclude overreaching in connection 

with an investment company by its 

affiliated persons. 

9. The Section 17 Applicants also 

submit that the proposed in-kind 

purchases by the Separate Accounts are 

consistent with the policies of the EQ 

Trust and the Replacement Portfolios, as 

provided in the EQ Trust’s registration 

statement and reports filed under the 

Act. Finally, the Section 17 Applicants 

submit that the proposed Substitutions 

are consistent with the general purposes 

of the Act. 

Applicants’ Conditions 

Applicants agree that any order 

granting the requested relief will be 

subject to the following conditions: 

1. The Substitutions will not be 

effected unless AXA Equitable or 

MONY America determines that: (i) The 


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Contracts allow the substitution of 

shares of registered open-end 

investment companies in the manner 

contemplated by the application; (ii) the 

Substitutions can be consummated as 

described in the application under 

applicable insurance laws; and (iii) any 

regulatory requirements in each 

jurisdiction where the Contracts are 

qualified for sale have been complied 

with to the extent necessary to complete 

the Substitutions. 

2. After the Substitution Date, FMG 

will not change a sub-adviser, add a 

new sub-adviser, or otherwise rely on 

the Multi-Manager Order, or any 

replacement order from the 

Commission, with respect to any 

Replacement Portfolio without first 

obtaining shareholder approval of the 

change in sub-adviser, the new subadviser, or the Replacement Portfolio’s 

ability to rely on the Multi-Manager 

Order, or any replacement order from 

the Commission, at a shareholder 

meeting, the record date for which shall 

be after the proposed Substitution has 

been affected. 

3. AXA Equitable, MONY America or 

an affiliate thereof (other than the EQ 

Trust) will pay all expenses and 

transaction costs of the Substitutions, 

including legal and accounting 

expenses, any applicable brokerage 

expenses and other fees and expenses. 

No fees or charges will be assessed to 

the affected Contract owners to effect 

the Substitutions. The proposed 

Substitutions will not cause the 

Contract fees and charges currently 

being paid by Contract owners to be 

greater after the proposed Substitution 

than before the proposed Substitution. 

4. The Substitutions will be effected 

at the relative net asset values of the 

respective shares of the Replacement 

Portfolios in conformity with section 

22(c) of the Act and rule 22c–1 

thereunder without the imposition of 

any transfer or similar charges by the 

Section 26 Applicants. The 

Substitutions will be effected without 

change in the amount or value of any 

Contracts held by affected Contract 

owners. 

5. The Substitutions will in no way 

alter the tax treatment of affected 

Contract owners in connection with 

their Contracts, and no tax liability will 

arise for Contract owners as a result of 

the Substitutions. 

6. The obligations of the Section 26 

Applicants, and the rights of the 

affected Contract owners, under the 

Contracts of affected Contract owners 

will not be altered in any way. 

7. Affected Contract owners will be 

permitted to make at least one transfer 

of Contract value from the subaccount 

investing in the Removed Portfolio 

(before the Substitution Date) or the 

Replacement Portfolio (after the 

Substitution Date) to any other available 

investment option under the Contract 

without charge for a period beginning at 

least 30 days before the Substitution 

Date through at least 30 days following 

the Substitution Date. Except as 

described in any market timing/shortterm trading provisions of the relevant 

prospectus, the Section 26 Applicants 

will not exercise any rights reserved 

under the Contracts to impose 

restrictions on transfers between the 

subaccounts under the Contracts, 

including limitations on the future 

number of transfers, for a period 

beginning at least 30 days before the 

Substitution Date through at least 30 

days following the Substitution Date. 

8. All affected Contract owners will be 

notified, at least 30 days before the 

Substitution Date about: (i) The 

intended Substitution of Removed 

Portfolios with the Replacement 

Portfolios; (ii) the intended Substitution 

Date; and (iii) information with respect 

to transfers as set forth in Condition 7 

above. In addition, the Section 26 

Applicants will also deliver to affected 

Contract owners, at least 30 days before 

the Substitution Date, a prospectus for 

each applicable Replacement Portfolio. 

9. The Section 26 Applicants will 

deliver to each affected Contract owner 

within five business days of the 

Substitution Date a written confirmation 

which will include: (i) A confirmation 

that the Substitutions were carried out 

as previously notified; (ii) a restatement 

of the information set forth in the PreSubstitution Notice; and (iii) values of 

the Contract owner’s positions in the 

Removed Portfolio before the 

Substitution and the Replacement 

Portfolio after the Substitution. 

10. For a period of two years 

following the Substitution Date, for 

Contract owners who were Contract 

owners as of the Substitution Date, AXA 

Equitable, MONY America or an affiliate 

thereof (other than the EQ Trust) will 

reimburse, on the last business day of 

each fiscal quarter, the Contract owners 

whose subaccounts invest in the 

applicable Replacement Portfolio to the 

extent that the Replacement Portfolio’s 

net annual operating expenses (taking 

into account fee waivers and expense 

reimbursements) for such period 

exceed, on an annualized basis, the net 

annual operating expenses of the 

Removed Portfolio for the most recent 

fiscal year preceding the date of this 

application. In addition, the Section 26 

Applicants will not increase the 

Contract fees and charges that would 

otherwise be assessed under the terms 

of the Contracts for affected Contract 

owners for a period of at least two years 

following the Substitution Date. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–17936 Filed 8–20–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meetings 

TIME AND DATE: 2:00 p.m. on Thursday, 

August 23, 2018. 

PLACE: Closed Commission Hearing 

Room 10800. 

STATUS: This meeting will be closed to 

the public. 

MATTERS TO BE CONSIDERED: 

Commissioners, Counsel to the 

Commissioners, the Secretary to the 

Commission, and recording secretaries 

will attend the closed meeting. Certain 

staff members who have an interest in 

the matters also may be present. 

The General Counsel of the 

Commission, or his designee, has 

certified that, in his opinion, one or 

more of the exemptions set forth in 5 

U.S.C. 552b(c)(3), (5), (6), (7), (8), 9(B) 

and (10) and 17 CFR 200.402(a)(3), 

(a)(5), (a)(6), (a)(7), (a)(8), (a)(9)(ii) and 

(a)(10), permit consideration of the 

scheduled matters at the closed meeting. 

Commissioner Peirce, as duty officer, 

voted to consider the items listed for the 

closed meeting in closed session. 

The subject matters of the closed 

meeting will be: 

Institution and settlement of 

injunctive actions; 

Institution and settlement of 

administrative proceedings; and 

Other matters relating to enforcement 

proceedings. 

At times, changes in Commission 

priorities require alterations in the 

scheduling of meeting items. 

CONTACT PERSON FOR MORE INFORMATION: 

For further information and to ascertain 

what, if any, matters have been added, 

deleted or postponed; please contact 

Brent J. Fields from the Office of the 

Secretary at (202) 551–5400. 

Dated: August 16, 2018. 

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2018–18069 Filed 8–17–18; 11:15 am] 

BILLING CODE 8011–01–P 


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