Exhibit (d)(17)(i)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, dated as of July 10, 2002, by and between The Equitable Life
Assurance society of the United States, a New York Stock life insurance
corporation (the "Manager") and Xxxxxxxx Associates LLC, a Delaware limited
liability company ("Xxxxxxxx," or "Adviser").
WHEREAS, EQ Advisors Trust ("Trust") is registered as an investment
company under the Investment Company Act of 1940, as amended (the "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, the 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 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 Adviser from time to time in the manner and on the
terms hereinafter set forth.
NOW, THEREFORE, the Manager and the Adviser agree as follows:
1. APPOINTMENT OF ADVISER
The Manager hereby appoints Xxxxxxxx to act as investment adviser for
that portion of the total assets of the Portfolio allocated to the Adviser from
time to time by the Manager ("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 Adviser
will be an independent contractor and will have no authority to act for or
represent the Trust or the Manager in any way or otherwise be deemed an agent of
the Trust or the Manager except as expressly authorized in this Agreement or
another writing by the Trust, the Manager and the Adviser.
2. SERVICES TO BE RENDERED BY THE ADVISER TO THE TRUST
A. As investment adviser to the Xxxxxxxx Allocated Portion, the Adviser
will coordinate the investment and reinvestment of the assets of the Xxxxxxxx
Allocated Portion and
determine the composition of the assets of the Xxxxxxxx Allocated Portion,
subject always to the supervision and control of the Manager and the Trustees of
the Trust.
B. As part of the services hereunder and 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 Xxxxxxxx Allocated Portion of the Portfolio or are
under consideration for inclusion in the Xxxxxxxx Allocated Portion of
the Portfolio;
(ii) formulate and implement a continuous investment program
for the 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;
(iv) cooperate with and provide reasonable and necessary
assistance to the Manager, and each of the Trust's other service
providers, including but not limited to: the Trust's administrator,
sub-administrator, custodian and foreign custodians, transfer agent,
dividend disbursing agent, pricing agents and all other agents and
representatives of the Trust. In this regard, Xxxxxxxx shall: (a) keep
the Manager and all service providers to the Trust fully informed as to
any and all matters that such persons may deem necessary in connection
with the performance of such person's duties and responsibilities to
the Trust; (b) provide such persons with prompt responses to all
reasonable or necessary requests for information; and (c) establish
appropriate interfaces with each such person so as to promote the
efficient exchange of information.
C. As part of the services that the Adviser will provide hereunder,
Xxxxxxxx will:
(i) keep the Trustees of the Trust and the Manager fully
informed in writing, on an ongoing basis, with respect to all material facts
concerning the investment and reinvestment of the assets in the Xxxxxxxx
Allocated Portion of the Portfolio and the Adviser and its personnel and
operations, will 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 information,
if appropriate, with respect to accounts that have investment objectives,
policies, and strategies substantially similar to those employed by Xxxxxxxx in
managing the Xxxxxxxx Allocated Portion of the Portfolio and supporting
documentation which may be necessary, under applicable laws, to allow the
Portfolio or its agent to present information concerning Xxxxxxxx'x prior
performance in the Trust's Prospectus and SAI (as hereinafter defined);
provided, however, 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.
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D. In furnishing services hereunder, the 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 their services under
this Agreement, the Adviser agrees to coordinate its activities with those of
the Manager's compliance personnel, the Trust's administrator and custodian and
other service providers to the Trust in order to ensure that the Adviser's
services hereunder are, at all times, in compliance with: (i) the Investment
Company Act; (ii) 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; (iii) all other applicable state and
federal securities and other laws; (iv) all regulations with respect to the
foregoing; (v) the Trust's Compliance Manual and other policies and procedures
adopted from time to time by the Board of Trustees of the Trust; and (vi) the
written instructions of the Manager. The Manager shall provide the Adviser with
current copies of the Trust Declaration, By-Laws, the Prospectus and SAI, the
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 Adviser, at its 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
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 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 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 the Manager or 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 the 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 the Manager's or Xxxxxxxx'x overall responsibilities
to the Portfolio or their 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. In addition, subject to seeking the
most favorable price and best
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execution available, the Manager may direct Xxxxxxxx to consider sales of shares
of the Trust as a factor in the selection of brokers and dealers. Subject to
seeking the most favorable price and execution, the Board of 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.
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 Xxxxxxxx in the manner Xxxxxxxx considers to be the
most equitable and consistent with its fiduciary obligations to the Xxxxxxxx
Allocated Portion of the Portfolio and to its other clients.
I. The Adviser will maintain all accounts, books and records with
respect to the 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.
X. Xxxxxxxx will, unless and until otherwise directed by the Manager or
the Board of Trustees, vote proxies with respect to the Xxxxxxxx Allocated
Portion of the Portfolio's securities and exercise rights in corporate actions
or otherwise.
3. COMPENSATION OF ADVISER
The Manager will pay Xxxxxxxx an advisory fee for services provided as
specified in this Agreement, with respect to the Xxxxxxxx Allocated Portion of
the Portfolio at the following annual rate: 0.35% of the average daily net
assets of the 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 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.
4. LIABILITY AND INDEMNIFICATION
(a) Except as may otherwise be provided by the Investment Company Act
or any other federal securities law, the Adviser 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 the Adviser with respect to the services
provided to the 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 the Adviser for its own actions, and
the Adviser shall indemnify and hold harmless the Trust, the Manager, all
affiliated persons thereof (within the meaning of Section
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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, the Exchange 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 Adviser 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 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 such information
as included in such Prospectus and SAI, proxy materials, reports,
advertisements, sales literature, or other materials pertaining to the
Portfolio.
(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 the Adviser 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 Adviser, 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, the Exchange
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 Adviser to the Manager, the Portfolio and the Trust
are not to be deemed to be exclusive, and the 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 Adviser 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.
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6. SUPPLEMENTAL ARRANGEMENTS
The 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 the 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 the Adviser, and neither the Manager nor the Trust shall have
any obligations with respect thereto.
7. REGULATION
The 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 Adviser such records and permit it to retain such
records (either in original or in duplicate form) as the Adviser shall
reasonably require in order to carry out its duties. In the event of the
termination of this Agreement, such records shall promptly be returned to the
Trust by the Adviser; provided, however, the Adviser may, at its own expense
make and 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 the Adviser shall keep confidential any information
obtained in connection with its duties hereunder and shall 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 known to the public
through the disclosure of such information by a person or persons other than a
party to this Agreement.
9. DURATION OF AGREEMENT
This Agreement shall become effective with respect to the Xxxxxxxx
Allocated Portion of the Portfolio on the date first written above. This
Agreement will continue in effect for a period more than one year 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 Section 2(a)(19) of 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
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the Manager and the Adviser, or by the Manager or the 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 any other reason. This Agreement will also terminate
upon written notice: (i) by the Manager to Xxxxxxxx; or (ii) by Xxxxxxxx to the
Manager 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 ADVISER
The 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
any portfolio manager of the Xxxxxxxx Allocated Portion of the Portfolio changes
or there is otherwise an actual change in control or management of the Adviser.
12. USE OF ADVISER'S NAME
The parties agree that the name of the Adviser, the names of any
affiliates of the Adviser and any derivative or logo or trademark or service
xxxx or trade name are the valuable property of the Adviser and its 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 Adviser or its affiliates or any such name(s), derivatives, logos,
trademarks, service marks or trade names so that the Adviser may review the
context in which it is referred to, it being agreed that the Adviser 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
Adviser's name, derivatives, logos, trademarks or service marks or trade names,
the parties acknowledge that the Adviser shall suffer irreparable harm for which
monetary damages are inadequate and thus, the Adviser 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 the 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. The 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
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.
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.
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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.
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
SOCIETY OF THE UNITED STATES XXXXXXXX ASSOCIATES LLC
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxx Xxxxx X. Xxxxxx
Executive Vice President and Chief Executive Vice President
Executive Officer
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