[Federal Register Volume 69, Number 41 (Tuesday, March 2, 2004)]
[Notices]
[Pages 9871-9880]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-4568]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. IC-26368; File No. 812-12908]


Metropolitan Life Insurance Company, et al.

February 25, 2004.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of application for an order of exemption pursuant to 
Section 26(c) of the Investment Company Act of 1940 (the ``1940 Act'') 
approving a substitution of securities.

-----------------------------------------------------------------------

    Applicants: Metropolitan Life Insurance Company (``MetLife'') and 
New England Life Retirement Investment Account (the ``Separate 
Account'') (together, the ``Applicants'').
    Filing Dates: The application was filed on December 10, 2002, and 
amended and restated on February 23, 2004.
    Summary of Application: The Applicants request an order pursuant to 
Section 26(c) of the 1940 Act to permit the substitution of certain 
classes of shares of certain portfolios of the Metropolitan Series 
Fund, Inc. (the ``Replacement Portfolios'') for Class A shares of 
certain portfolios of the CDC Nvest Cash Management Trust, CDC Nvest 
Funds Trust I, and CDC Nvest Funds Trust II (the ``Substituted 
Portfolios'').
    Hearing or Notification of Hearing: An order granting the 
application will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Secretary of 
the Commission and serving Applicants with a copy of the request, 
personally or by mail. Hearing requests should be received by the 
Commission by 5:30 p.m. on March 26, 2004, and should be accompanied by 
proof of service on Applicants, in the form of an affidavit or, for 
lawyers, a certificate of service. Hearing requests should state the 
nature of the writer's interest, the reason for the request, and the 
issues contested. Persons may request notification of a hearing by 
writing to the Secretary of the Commission.

ADDRESSES: Secretary, Securities and Exchange Commission, 450 Fifth 
Street, NW., Washington, DC 20549-0604. Applicants, c/o Marie C. Swift, 
Esq. and Michele H. Abate, Esq., Metropolitan Life Insurance Company, 
501 Boylston Street, Boston, MA 02116. Copy to Stephen E. Roth, Esq., 
Sutherland Asbill & Brennan LLP, 1275 Pennsylvania Avenue, NW., 
Washington, DC 20004-2415.

FOR FURTHER INFORMATION CONTACT: Alison White, Senior Counsel, or Lorna 
MacLeod, Branch Chief, Division of Investment Management, Office of 
Insurance Products, at (202) 942-0670.

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained for a fee from 
the Public Reference Branch of the Commission, 450 5th Street, NW., 
Washington, DC 20549 (tel. (202) 942-8090).

Applicants' Representations

    1. MetLife is a life insurance company that is domiciled in New 
York and is a wholly owned subsidiary of MetLife, Inc., a publicly 
traded company. With approximately $331.7 billion of assets under 
management as of June 30, 2003, MetLife provides individual insurance 
and investment products to approximately 12 million individuals in the 
United States. MetLife also provides group insurance and investment 
products to 37 million employees and family members through their plan 
sponsors. MetLife operates as a life insurance company in all 50 
states, the District of Columbia, and Puerto Rico. Outside the U.S., 
the MetLife companies have insurance operations in 12 countries serving 
approximately 8 million customers.
    2. The Separate Account is a separate investment account of MetLife 
and is registered under the 1940 Act as a unit

[[Page 9872]]

investment trust. The Separate Account serves as a funding vehicle for 
variable annuity contracts known as Preference (the ``Contracts''), 
which are no longer available for purchase. The Contracts were 
initially issued by New England Mutual Life Insurance Company, and 
subsequent to its merger with and into MetLife, MetLife assumed all of 
the liabilities and obligations under the Contracts. The Separate 
Account is a ``separate account'' as defined in Section 2(a)(37) of the 
1940 Act.
    The terms of the Contracts funded by the Separate Account permit 
Contract owners to transfer contract value under the Contracts among 
subaccounts during the accumulation period and to exchange annuity 
units during the annuity period. MetLife does not currently impose a 
charge in connection with a transfer, but has reserved the right to do 
so (not to exceed $5). MetLife does not limit the number of transfers 
permitted each contract year, but does require a minimum transfer 
amount of $25.
    3. New England Securities Corporation (``NES'') serves as principal 
underwriter and distributor for the Contracts. NES is an indirect 
wholly owned subsidiary of New England Life Insurance Company 
(``NELICO''), which in turn is a subsidiary of MetLife. NES is 
registered as a broker-dealer under the Securities Exchange Act of 1934 
and is a member of the NASD.
    4. The Metropolitan Series Fund, Inc. (the ``Metropolitan Fund'') 
is registered as an open-end management investment company under the 
1940 Act and currently offers thirty-six separate investment 
portfolios, five of which would be involved in the proposed 
substitution. The Metropolitan Fund issues a separate series of shares 
of beneficial interest in connection with each portfolio, and has 
registered such shares under the Securities Act of 1933 (``1933 Act'') 
on Form N-1A. Shares of the Metropolitan Fund are offered only to 
separate accounts established by MetLife, NELICO, MetLife Investors USA 
Insurance Company, General American Life Insurance Company, or other 
insurance companies affiliated with any of these insurance companies 
and to certain eligible qualified retirement plans. The general public 
may not purchase Metropolitan Fund shares directly.
    5. MetLife Advisers LLC serves as the investment adviser to each 
Replacement Portfolio. MetLife Advisers is an indirect wholly owned 
subsidiary of NELICO. MetLife Advisers receives an investment advisory 
fee from each Replacement Portfolio it manages. MetLife Advisers has 
contracted with subadvisers to make the day-to-day investment decisions 
for all Replacement Portfolios it manages. Subadvisers are compensated 
by MetLife Advisers, and not by the Metropolitan Fund. MetLife Advisers 
derives the amounts that it pays the subadvisers from its own 
investment advisory fees. The following are the subadvisers for the 
Replacement Portfolios:

------------------------------------------------------------------------
          Replacement  Portfolios                    Subadviser
------------------------------------------------------------------------
Metropolitan Fund Alger Equity Growth       Fred Alger Management, Inc.
 Portfolio.
Metropolitan Fund Harris Oakmark Large Cap  Harris Associates L.P.
 Value Fund.
Metropolitan Fund Davis Venture Value       Davis Selected Advisers,
 Portfolio.                                  L.P.
Metropolitan Fund State Street Research     State Street Research &
 Bond Income Portfolio.                      Management Company.
Metropolitan Fund State Street Research     State Street Research &
 Money Market Portfolio.                     Management Company.
------------------------------------------------------------------------

    6. CDC Nvest Cash Management Trust, CDC Nvest Funds Trust I, and 
CDC Nvest Funds Trust II are registered as open-end management 
investment companies under the 1940 Act. CDC Nvest Cash Management 
Trust currently offers one separate investment series, which would be 
involved in the proposed substitution. CDC Nvest Funds Trust I 
currently offers nine separate investment series, three of which would 
be involved in the proposed substitution. CDC Nvest Funds Trust II 
currently offers two separate investment series, one of which would be 
involved in the proposed substitution. CDC Nvest Cash Management Trust 
issues a separate series of shares of beneficial interest in connection 
with its portfolio, the CDC Nvest Cash Management Trust--Money Market 
Series, and has registered such shares under the 1933 Act on Form N-1A. 
CDC Nvest Funds Trust I issues a separate series of shares of 
beneficial interest in connection with each of its portfolios, and has 
registered such shares under the 1933 Act on Form N-1A. CDC Nvest Funds 
Trust II issues a separate series of shares of beneficial interest in 
connection with each of its portfolios, and has registered such shares 
under the 1933 Act on Form N-1A. Shares of the portfolios of the CDC 
Nvest Cash Management Trust, the CDC Nvest Funds Trust I, and the CDC 
Nvest Funds Trust II are offered to the general public, as well as 
through the Contracts.
    7. CDC IXIS Asset Management Advisers, L.P. (``CDC IXIS Advisers'') 
serves as the investment manager to each Substituted Portfolio in the 
CDC Nvest Funds Trust I and CDC Nvest Funds Trust II, except for the 
CGM Advisor Targeted Equity Fund, for which Capital Growth Management 
Limited Partnership (``CGM''), an affiliate of CDC IXIS Advisers, 
serves as the investment adviser and Loomis Sayles Core Plus Bond Fund, 
for which Loomis, Sayles & Company, L.P. (``Loomis Sayles''), an 
affiliate of CDC IXIS Advisers, serves as investment adviser. CDC IXIS 
Advisers also serves as the investment manager to the Money Market 
Series of the CDC Nvest Cash Management Trust. As the investment 
managers to their respective portfolios, CDC IXIS Advisers, Loomis 
Sayles and CGM receive investment advisory fees from the portfolios. 
CDC IXIS Advisers, Loomis Sayles and CGM are also responsible for the 
day-to-day investment management responsibility of certain portfolios 
they manage, including the Substituted Portfolios. CDC IXIS Advisers 
has contracted with subadvisers to make the day-to-day investment 
decisions for the Substituted Portfolios it manages. The amount of 
investment management fee payable to CDC IXIS Advisers is offset by the 
amount of investment advisory fee payable to the subadvisers. The 
following are the subadvisers for the Substituted Portfolios:

------------------------------------------------------------------------
          Substituted  Portfolios                   Subadviser(s)
------------------------------------------------------------------------
CGM Advisor Targeted Equity Fund..........  Not Applicable.
Harris Associates Growth and Income Fund..  Harris Associates L.P.
CDC Nvest Star Value Fund.................  Harris Associates L.P.,
                                             Loomis, Sayles & Company,
                                             L.P., Vaughan Nelson
                                             Investment Management,
                                             L.P., Westpeak Global
                                             Advisors, L.P.
Loomis Sayles Core Plus Bond Fund.........  Not Applicable.
CDC Nvest Cash Management Trust--Money      Reich & Tang Asset
 Market Series.                              Management, LLC.
------------------------------------------------------------------------

    8. Met Life proposes the following substitution of certain classes 
of shares of the Replacement Portfolios for Class A shares of the 
Substituted Portfolios (the ``Substitutions''):

[[Page 9873]]



------------------------------------------------------------------------
         Substituted Portfolios               Replacement Portfolios
------------------------------------------------------------------------
Class A shares of the GM Advisor         Class B shares of the Alger
 Targeted Equity Fund of the CDC Nvest    Equity Growth Portfolio of the
 Funds Trust I.                           Metropolitan Series Fund, Inc.
Class A shares of the Harris Associates  Class B shares of the Harris
 Growth and Income Fund of the CDC        Oakmark Large Cap Value Fund
 Nvest Funds Trust II.                    of the Metropolitan Series
                                          Fund, Inc.
Class A shares of the CDC Nvest Star     Class B shares of the Davis
 Value Fund of the CDC Nvest Funds        Venture Value Portfolio of the
 Trust I.                                 Metropolitan Series Fund, Inc.
Class A shares of the Loomis Sayles      Class B shares of the State
 Core Plus Bond Fund of the CDC Nvest     Street Research Bond Income
 Funds Trust I.                           Portfolio of the Metropolitan
                                          Series Fund, Inc.
Class A shares of the Money Market       Class B shares of the State
 Series of the CDC Nvest Cash             Street Research Money Market
 Management Trust.                        Portfolio of the Metropolitan
                                          Series Fund, Inc.
------------------------------------------------------------------------

    9. The following chart sets out the investment objectives and 
certain policies of the Substituted Portfolios and the Replacement 
Portfolios, as stated in their respective prospectuses and statements 
of additional information.

------------------------------------------------------------------------
         Substituted Portfolios               Replacement Portfolios
------------------------------------------------------------------------
    CGM Advisor Targeted Equity Fund      Metropolitan Fund Alger Equity
                                                 Growth Portfolio
Investment Objective: The Fund seeks     Investment Objective: The
 long-term growth of capital through      investment objective of the
 investment in equity securities of       Metropolitan Fund Alger Equity
 companies whose earnings are expected    Growth Portfolio is long-term
 to grow at a faster rate than that of    capital appreciation.
 the overall United States economy..
Investment Strategies: Under normal      Investment Strategies: Fred
 market conditions, the Fund will         Alger Management, Inc.
 invest at least 80% of its net assets    (``Alger''), subadviser to the
 in equity investments. The Fund will     Portfolio, invests, under
 generally invest in a focused            normal circumstances, the
 portfolio of common stocks of large      Portfolio's assets primarily
 capitalization companies that CGM        in growth stocks. Alger will
 expects will grow at a faster rate       ordinarily invest at least 80%
 than that of the overall United States   of the Portfolio's assets in
 economy. When CGM believes that market   equity securities. The
 conditions warrant, however, CGM may     Portfolio will invest in
 select stocks based upon overall         equity securities of issuers
 economic factors such as the general     with a market capitalization
 economic outlook, the level and          of $1 billion or greater.
 direction of interest rates and         Alger seeks out and invests
 potential impact of inflation. The       primarily in companies that
 Fund will not invest in small            are traded on domestic stock
 capitalization companies..               exchanges or in the domestic
The Fund may also invest a significant    over-the counter market. The
 portion of its assets in a single        companies Alger chooses for
 industry sector, invest in foreign       the Portfolio may still be in
 securities, invest in other investment   the development stage, may be
 companies and invest in real estate      older companies that appear to
 investment trusts..                      be entering a new stage of
                                          growth progress due to factors
                                          like management changes or
                                          development of new
                                          technologies, products or
                                          markets, or may be companies
                                          providing products or services
                                          with a high unit volume growth
                                          rate. Alger focuses on
                                          fundamental characteristics of
                                          individual companies and does
                                          not allocate assets based on
                                          specific industry sectors.
----------------------------------------
  Harris Associates Growth and Income        Metropolitan Fund Harris
                  Fund                     Oakmark Large Cap Value Fund
Investment Objective: The Fund seeks     Investment Objective: The
 opportunities for long-term capital      investment of the Metropolitan
 growth and income..                      Fund Harris Oakmark Large cap
                                          Value Fund is long-term
                                          capital appreciation.
Investment Strategies: Under normal      Investment Strategies: Harris
 market conditions, the Fund will         Associates L.P. (``Harris''),
 invest substantially all of its assets   subadviser to the Portfolio,
 in common stocks of large and mid-       will invest under normal
 capitalization companies in any          market conditions at least 80%
 industry..                               the Portfolio's assets in
The Fund's subadviser, Harris             equity securities of large
 Associates L.P. (``Harris''), uses a     capitalization U.S. companies.
 value investment philosophy in           This minimum may be changed on
 selecting equity securities for the      60 days' notice. Harris
 Fund, based on the belief that, over     defines large capitalization
 time, a company's stock price            companies as those, at the
 converges with that company's true       time of purchase, with a
 business value. Harris defines ``true    market capitalization larger
 business value'' to mean its estimate    than the market capitalization
 of the price a knowledgeable buyer       of the smallest company
 would pay to acquire the entire          included in the Russell 1000
 business..                               Index. As of June 30, 2002,
The Fund may invest in foreign            this included companies with
 securities traded in U.S. markets        capitalizations of
 (through American Depositary Receipts    approximately $1.3 billion and
 or stocks sold in U.S. dollars..         above.
                                         Harris may invest up to 20% of
                                          the Portfolio's total assets
                                          in fixed-income securities,
                                          including investment grade
                                          securities and high yield
                                          debt.
----------------------------------------
       CDC Nvest Star Value Fund         Metropolitan Fund Davis Venture
                                                  Value Portfolio
Investment Objective: The Fund seeks a   Investment Objective: The
 reasonable, long-term investment         investment objective of the
 return from a combination of market      Metropolitan Fund Davis
 appreciation and dividend income from    Venture Value Portfolio is
 equity securities..                      growth of capital.

[[Page 9874]]

 
Investment Strategies: Under normal      Investment Strategies: Davis
 market conditions, the Fund invests      Selected Advisers, L.P.
 substantially all of its assets in       (``Davis Selected''),
 equity securities. The Fund primarily    subadviser to the Portfolio,
 will invest in the common stocks of      invests, under normal
 mid- and large-capitalization            circumstances, the majority of
 companies of various industries. The     the Portfolio's assets
 companies in which the Fund invests      primarily in equity securities
 are value-oriented according to one or   of companies with market
 more of the following measures: price-   capitalizations of at least
 to-earnings ratio, return on equity,     $10 billion. Davis Selected
 dividend yield, price-to-book value      searches for companies that it
 ratio or price-to-sales ratio..          believes are of high quality
Subject to the allocation policies        and whose stocks are selling
 adopted by the Fund's Board of           at attractive prices with the
 Trustees, CDC IXIS Advisers generally    intention of holding them for
 allocates capital invested in the Fund   the long term. Davis Selected
 equally among four segments which are    believes that managing risk is
 managed by the subadvisers set forth     the key to delivering superior
 in this column below. Each subadviser    long-term investment results;
 manages its segment of the fund's        therefore, it considers how
 assets in accordance with its            much could potentially be lost
 distinctive investment style and         on an investment before
 strategy..                               considering how much might be
The segment of the Fund managed by        gained.
 Harris Associates L.P. (``Harris'')     Davis Selected has developed a
 primarily invests in common stocks of    list of ten characteristics
 mid- and large-capitalization            that it believes allow
 companies that Harris believes are       companies to sustain long-term
 trading at a substantial discount to     growth and minimize risks to
 the company's ``true business value.''.  enhance their potential for
A segment of the Fund is managed by       superior long-term returns.
 Loomis, Sayles & Company, L.P. by       Davis Selected does not have
 using a fundamental research in a        particular allocation
 value-oriented selection process to      strategies, and emphasizes
 seek companies with the following        individual stock selection
 characteristics; low price-to-earnings   rather than industry sectors.
 ratios based on earnings estimates;      Davis Selected relies heavily
 competitive return on equity;            on its evaluation of the
 competitive current and estimated        management of potential
 dividend yield; and favorable earnings   investments, and will
 prospects..                              ordinarily visit the managers
A segment of the Fund is managed by       at their place of business to
 Vaughan Nelson Investment Management,    gain insight into the relative
 L.P. by using rigorous fundamental       value of different companies.
 research and active management to
 analyze a broad selection of company
 or industry sectors and to seek
 companies with market capitalizations
 of at least $2 billion with the
 following characteristics: strong
 balance sheets; growing cash flows;
 reasonable valuations based upon
 discounted cash flow models; stable
 and proven management teams; and high
 relative dividend yield..
A segment of the Fund is managed by
 Westpeak Global Advisors, L.P. by
 constructing a portfolio of
 recognizable, reasonably priced stocks
 by combining its experience and
 judgment with a dynamic weighting
 process known as ``portfolio
 profiling.'' Using proprietary
 research based on economic, market and
 company specific information, Westpeak
 analyzes each stock and ranks them
 based on factors such as: earnings-to-
 price ratios, earnings growth rates,
 positive earnings surprises, book-to-
 price ratios and dividend yields.
 Westpeak invests in stocks of
 companies in the Russell 3000 Index..
----------------------------------------
   Loomis Sayles Core Plus Bond Fund      Metropolitan Fund State Street
                                          Research Bond Income Portfolio
Investment Objective: The Fund seeks a   Investment Objective: The
 high level of current income             investment objective of the
 consistent with what the Fund            Metropolitan Fund State Street
 considers reasonable risk. It invests    Research Bond Income Portfolio
 primarily in corporate and U.S.          is a competitive total return
 government bonds..                       primarily from investing in
                                          fixed-income securities.
Investment Strategies: Under normal      Investment Strategies: State
 market conditions, the Fund will         Street Research & Management
 invest primarily in U.S. corporate and   Company (``State Street
 U.S. government bonds. It will adjust    Research''), subadviser to the
 to changes in the relative strengths     Portfolio, invests, under
 of the U.S. corporate or U.S.            normal circumstances, at least
 government bond markets by shifting      80% of the Portfolio's assets
 the relative balance between the two.    in fixed-income securities.
 The Fund will invest at least 80% of     The Portfolio may invest in
 its net assets in bond investments. In   investment grade fixed-income
 addition, the Fund will invest at        securities, obligations of the
 least 80% of its assets in investment-   U.S. Treasury or any U.S.
 grade bonds (those rated BBB or higher   government agency, mortgage-
 by Standard & Poor's Ratings Group       backed and asset-backed
 (``S&P'') or Baa or higher by Moody's    securities, corporate debt
 Investors Service, Inc. (``Moody's'')    securities of U.S. and foreign
 or, if unrated, of comparable quality    issuers, and cash equivalents.
 as determined by Loomis Sayles and       The Portfolio may also invest
 will generally maintain an average       in securities through Rule
 effective maturity of ten years or       144A and other private
 less. The Fund may also purchase lower-  placement transactions.
 quality bonds (those rated below BBB    In addition, the Portfolio may
 by S&P and below Baa by Moody's, also    invest up to 20% of its total
 known as junk bonds'')..                 assets in high yield
The Fund may also invest in foreign       securities. It may also invest
 securities, including those of           up to 20% of its total assets
 emerging markets, and related currency   in foreign securities and up
 hedging transactions. The Fund may       to 10% of its total assets in
 also invest in Rule 144A securities,     securities of issuers located
 Foreign securities, including emerging   in developing or emerging
 markets, and related currency hedging    market countries. The 10%
 transactions and mortgage-related        limit on emerging market
 securities..                             securities will not be counted
                                          toward the limits on foreign
                                          or high yield securities. No
                                          combination of investments in
                                          high yield securities, foreign
                                          securities or emerging market
                                          securities will exceed 30% of
                                          the Portfolio's total assets.
----------------------------------------
 CDC Nvest Cash Management Trust--Money   Metropolitan Fund State Street
             Market Series                     Research Money Market
                                                     Portfolio
Investment Objective: The Fund seeks     Investment Objective: The
 maximum current income consistent with   investment objective of the
 preservation of capital and liquidity..  Metropolitan Fund State Street
                                          Research Money Market
                                          Portfolio is a high level of
                                          current income consistent with
                                          preservation of capital.

[[Page 9875]]

 
Investment Strategies: The Fund will     Investment Strategies: State
 invest up to 100% of its assets in       Street Research, subadviser to
 high-quality, short-term, U.S. dollar-   the Portfolio, invests the
 denominated money market investments     Portfolio, invests the
 issued by U.S. and foreign issuers. To   Portfolio's assets in a
 preserve investors' capital, the Fund    managed portfolio of money
 seeks to maintain a stable $1.00 share   market instruments. The
 price. Some of the Fund's portfolio      Portfolio may invest in the
 positions include certificates of        highest quality, short-term
 deposit, bankers' acceptances or bank    money market instruments or in
 notes, securities issued or guaranteed   U.S. government securities.
 by the U.S. government, commercial       The Portfolio may invest in
 paper, repurchase agreements, other      commercial paper and asset-
 corporate debt obligations cash..        backed securities, including
                                          those issued in Rule 144A and
                                          other private placement
                                          transactions. The Portfolio
                                          also may invest in U.S. dollar-
                                          denominated securities issued
                                          by foreign companies or banks
                                          or their U.s. affiliates. The
                                          Portfolio may invest all of
                                          its assets in any one type of
                                          security.
------------------------------------------------------------------------

    10. The following chart compares the fees paid for advisory 
services for the fiscal year ended December 31, 2002 (fiscal year ended 
June 30, 2003 for the CDC Nvest Cash Management Trust--Money Market 
Series and fiscal year ended September 30, 2003 for the Loomis Sayles 
Core Plus Bond Fund), expressed as an annual percentage of average 
daily net assets, by each Substituted Portfolio and each Replacement 
Portfolio. The advisory fee rate for the Harris Associates Growth and 
Income Fund is the pro forma fee rate that the Fund would have incurred 
for the fiscal year ended December 31, 2002 assuming that the 
combination of the Growth and Income Fund and the CDC Nvest Balanced 
Fund, which occurred in June 2003, had occurred on January 1, 2002.

------------------------------------------------------------------------
 
------------------------------------------------------------------------
          Substituted portfolios  Replacement portfolios
CGM Advisor Targeted Equity          0.69%  Metropolitan           0.75%
 Fund.                                       Fund Alger
                                             Equity Growth
                                             Portfolio.
Harris Associates Growth and         0.67%  Metropolitan           0.75%
 Income Fund.                                Fund Harris
                                             Oakmark Large
                                             Cap Value Fund.
CDC Nvest Star Value Fund....        0.75%  Metropolitan           0.75%
                                             Fund Davis
                                             Venture Value
                                             Portfolio.
Loomis Sayles Core Plus Bond         0.41%  Metropolitan           0.40%
 Fund.                                       Fund State
                                             Street
                                             Research Bond
                                             Income
                                             Portfolio.
CDC Nvest Cash Management            0.40%  Metropolitan           0.35%
 Trust--Money Market Series.                 Fund State
                                             Street
                                             Research Money
                                             Market
                                             Portfolio.
------------------------------------------------------------------------

    11. The following charts compare the total operating expenses 
(before and after any waivers and reimbursements) for the fiscal year 
ended December 31, 2002 (fiscal year ended June 30, 2003 for the CDC 
Nvest Cash Management Trust--Money Market Series and fiscal year ended 
September 30, 2003 for the Loomis Sayles Core Plus Bond Fund), 
expressed as an annual percentage of average daily net assets, of the 
Substituted Portfolios and the Replacement Portfolios. The total 
operating expenses for the Harris Associates Growth and Income Fund are 
the pro forma expenses that the Fund would have incurred for the fiscal 
year ended December 31, 2002 assuming that the Growth and Income Fund 
and the CDC Nvest Balanced Fund combined as of January 1, 2002. The 
Substituted Portfolios, other than the Money Market Series of the CDC 
Nvest Cash Management Trust, and the Replacement Portfolios have 
adopted plans pursuant to Rule 12b-1 under the 1940 Act.

                              [In percent]
------------------------------------------------------------------------
                                                             Replacement
                                               Substituted    Portfolio
                                                Portfolio   Metropolitan
                                               CGM Advisor   Fund Alger
                                                 Targeted      Equity
                                               Equity Fund     Growth
                                                 (Class A)    Portfolio
                                                              (Class B)
------------------------------------------------------------------------
Management Fees..............................         0.69          0.75
Distribution and/or Service (12b-1) Fees.....         0.25          0.25
Other Expenses...............................         0.53          0.04
                                              --------------
Total Operating Expenses.....................         1.47          1.04
Less Expense Waivers and Reimbursements......          N/A           N/A
                                              --------------
Net Operating Expenses.......................         1.47          1.04
------------------------------------------------------------------------


[[Page 9876]]


                              [In percent]
------------------------------------------------------------------------
                                                             Replacement
                                               Substituted    Portfolio
                                                Portfolio   Metropolitan
                                                  Harris     Fund Harris
                                                Associates     Oakmark
                                                Growth and    Large Cap
                                               Income Fund   Value Fund
                                                 (Class A)    (Class B)
------------------------------------------------------------------------
Management Fees..............................         0.67          0.75
Distribution and/or Service (12b-1) Fees.....         0.25          0.25
Other Expenses...............................         0.61          0.08
                                              --------------
Total Operating Expenses.....................         1.53          1.08
Less Expense Waivers and Reimbursements......          N/A           N/A
                                              --------------
Net Operating Expenses.......................         1.53          1.08
------------------------------------------------------------------------


                              [In percent]
------------------------------------------------------------------------
                                                             Replacement
                                               Substituted    Portfolio
                                                Portfolio   Metropolitan
                                                CDC Nvest    Fund Davis
                                                Star Value     Venture
                                                   Fund         Value
                                                (Class A)     Portfolio
                                                              (Class B)
------------------------------------------------------------------------
Management Fees..............................         0.75          0.75
Distribution and/or Service (12b-1) Fees.....         0.25          0.25
Other Expenses...............................         0.68          0.05
                                              --------------
Total Operating Expenses.....................         1.68          1.05
Less Expense Waivers and Reimbursements......          N/A           N/A
                                              --------------
Net Operating Expenses.......................         1.68          1.05
------------------------------------------------------------------------


                              [In percent]
------------------------------------------------------------------------
                                                             Replacement
                                               Substituted    Portfolio
                                                Portfolio   Metropolitan
                                                  Loomis     Fund State
                                               Sayles Core     Street
                                                Plus Bond     Research
                                                   Fund      Bond Income
                                                (Class A)     Portfolio
                                                              (Class B)
------------------------------------------------------------------------
Management Fees..............................         0.41          0.40
Distribution and/or Service (12b-1) Fees.....         0.25          0.25
Other Expenses...............................         0.62          0.11
                                              --------------
Total Operating Expenses.....................         1.28          0.76
Less Expense Waivers and Reimbursements......          N/A           N/A
                                              --------------
Net Operating Expenses.......................         1.28          0.76
------------------------------------------------------------------------


                              [In percent]
------------------------------------------------------------------------
                                               Substituted   Replacement
                                                Portfolio     Portfolio
                                                CDC Nvest   Metropolitan
                                                  Cash       Fund State
                                               Management      Street
                                              Trust--Money    Research
                                                 Market     Money Market
                                                 Series       Portfolio
                                                (Class A)     (Class B)
------------------------------------------------------------------------
Management Fees.............................          0.40          0.35
Distribution and/or Service (12b-1) Fees....           N/A          0.25
Other Expenses..............................          0.48          0.08
                                             ---------------
Total Operating Expenses....................          0.88          0.68

[[Page 9877]]

 
Less Expense Waivers and Reimbursements.....           N/A           N/A
                                             ---------------
Net Operating Expenses......................          0.88          0.68
------------------------------------------------------------------------

    12. The following chart illustrates the average annual total 
returns for the Substituted Portfolios:

                                             Substituted Portfolios
                                                  [In percent]
----------------------------------------------------------------------------------------------------------------
                                                                                                      CDC Nvest
                                                                 Harris                    Loomis        Cash
                                                 CGM Advisor   Associates   CDC Nvest   Sayles Core   Management
  Average Annual Total Returns For the Periods     Targeted    Growth and   Star Value   Plus Bond   Trust-Money
          Ended 9/30/03 (Before Taxes)           Equity Fund  Income Fund      Fund         Fund        Market
                                                   (Class A)    (Class A)   (Class A)    (Class A)      Series
                                                                                                      (Class A)
----------------------------------------------------------------------------------------------------------------
One Year.......................................         7.99        22.60        25.57        10.48         0.55
Five Years.....................................         0.49       (1.00)         1.04         4.88         3.25
Ten Years......................................         7.67         7.91         7.32         6.23         3.90
----------------------------------------------------------------------------------------------------------------

    The following chart illustrates the average annual total returns 
for the Replacement Portfolios (performance information shown for the 
periods prior to the inception of Class B of each series is the 
performance of Class A of each series adjusted to reflect the expenses 
of Class B):

                                             Replacement Portfolios
                                                  [In percent]
----------------------------------------------------------------------------------------------------------------
                                                                                      Metropolitan  Metropolitan
                                            Metropolitan  Metropolitan  Metropolitan   Fund State    Fund State
                                             Fund Alger    Fund Harris   Fund Davis      Street        Street
   Average Annual Total Returns For the        Equity        Oakmark       Venture      Research      Research
   Periods Ended 9/30/03 (Before Taxes)        Growth       Large Cap       Value      Bond Income  Money Market
                                              Portfolio    Value Fund     Portfolio     Portfolio     Portfolio
                                              (Class B)     (Class B)     (Class B)     (Class B)     (Class B)
----------------------------------------------------------------------------------------------------------------
One Year..................................         23.84         21.67         21.89          6.97          0.69
Five Years................................          0.44           N/A          5.56          5.95          3.42
Ten Years.................................           N/A           N/A           N/A          6.83          4.06
Since Inception...........................         10.36          2.93         12.11           N/A           N/A
----------------------------------------------------------------------------------------------------------------

    13. Pursuant to its authority under the Contracts and the 
prospectus describing the same, and subject to the approval of the 
Commission under Section 26(c) of the 1940 Act, MetLife proposes the 
Substitutions described above. Applicants propose to redeem shares of 
each of the Substituted Portfolios for cash. The proceeds of these 
redemptions will then be used to purchase shares of the Replacement 
Portfolios. Redemption requests and purchase orders will be placed 
simultaneously so that the contract values will remain fully invested 
at all times.
    14. The proposed Substitutions are part of an overall business plan 
involving the management of MetLife. MetLife is seeking to make its 
products, including the Contracts, more competitive and more efficient 
to administer and oversee. MetLife has also been reviewing the 
efficiencies and structures of the funds it offers as investment 
options under the Contracts. MetLife believes that more concentrated 
and streamlined operations for investment options could result in 
increased operational and administrative efficiencies and economies of 
scale for its Contract owners. In connection with these efforts, 
MetLife has determined that the funds currently offered under the 
Contracts warrant replacement.
    15. After considering the Substituted Portfolios' performance and 
generally declining asset growth to date, the Applicants determined 
that it would be both difficult to find replacement funds which mirror 
the investment objectives

[[Page 9878]]

and strategies of the Substituted Portfolios, and inadvisable to do so. 
Rather, the Applicants determined that it was in the best interests of 
Contract owners to eliminate the Substituted Portfolios as investment 
options and to substitute Contract owners into portfolios that have 
comparable investment objectives with greater expectations for growth 
and performance. To accomplish this goal, the Applicants evaluated 
investment objectives and strategies, expense ratios, performance 
history, and asset sizes of other investment options offered in other 
variable contracts issued by MetLife in order to identify the most 
appropriate choices as Replacement Portfolios.
    16. Although not identical, the investment objectives and 
strategies of the Replacement Portfolios are comparable to those of 
their corresponding Substituted Portfolios. Both the Metropolitan Fund 
Alger Equity Growth Portfolio and the CGM Advisor Targeted Equity Fund 
invest principally in growth stocks of large cap companies. Both the 
Metropolitan Fund Harris Oakmark Large Cap Value Fund and the Harris 
Associates Growth and Income Fund invest principally in stocks of large 
cap companies that are considered undervalued. While the name of the 
Substituted Portfolio suggests a greater emphasis on dividend income, 
the dividend yield of the two funds, as of December 31, 2003, was 
virtually identical. Similarly, while the CDC Nvest Star Value Fund may 
seek dividend income from its equity holdings, the fund's dividend 
yield as of December 31, 2003 was virtually the same as that of its 
Replacement Portfolio. Finally, both the Metropolitan Fund State Street 
Research Bond Income Portfolio and the Loomis Sayles Core Plus Bond 
Fund invest principally in investment grade fixed-income securities.
    17. In each case, the types of investment advisory and 
administrative services provided to the Replacement Portfolios by 
MetLife Advisers are comparable to the types of investment advisory and 
administrative services provided to the Substituted Portfolios by CDC 
IXIS Advisers, Loomis Sayles and CGM. Thus, the level and quality of 
services will remain high. Additionally, utilization of the Replacement 
Portfolios will permit Contract owners to continue to pursue comparable 
objectives after the Substitutions.
    18. MetLife believes that the elimination of the Substituted 
Portfolios as investment options will make its Contracts more efficient 
to administer and oversee and, thus, more cost-efficient and attractive 
to customers. As the Replacement Portfolios are already offered in 
other variable contracts issued by MetLife, moving the assets from the 
Substituted Portfolios to the Replacement Portfolios will permit 
MetLife to administer the Contracts through a newer administration 
system which will decrease costs and increase efficiency. Also, as the 
Replacement Portfolios are offered through other MetLife variable 
contracts, the costs of sending reports, data transfer, and other 
communications with the Portfolios will decrease due to efficiencies of 
dealing with the same fund complex across multiple product lines. 
Overall, Applicants can achieve better economies of scale by offering 
the Replacement Portfolios as investment options, which will benefit 
Contract owners. Applicants believe that replacing the Substituted 
Portfolios with the Replacement Portfolios is appropriate and in the 
best interests of Contract owners, who will benefit from investments in 
underlying funds with increasing or consistent asset bases, better 
performance, and lower overall expenses than currently is the case with 
the Substituted Portfolios.
    19. MetLife will effect the Substitutions as soon as practicable 
following the issuance of the requested order as follows. As of the 
effective date of the Substitutions (``Effective Date''), shares of 
each Substituted Portfolio will be redeemed in cash by MetLife. The 
proceeds of such redemptions will then be used to purchase shares of 
each Replacement Portfolio, with each subaccount of the Separate 
Account investing the proceeds of its redemption from a Substituted 
Portfolio in the corresponding Replacement Portfolio. All redemptions 
of shares of the Substituted Portfolios and purchases of shares of the 
Replacement Portfolios will be effected in accordance with Rule 22c-1 
of the Act.
    20. The Substitutions will take place at relative net asset value 
with no change in the amount of any Contract owner's contract value or 
death benefit or in the dollar value of his or her investments in any 
of the subaccounts. Contract owners will not incur any additional fees 
or charges as a result of the Substitutions, nor will their rights or 
MetLife's obligations under the Contracts be altered in any way. All 
expenses incurred in connection with the Substitutions, including 
legal, accounting, transactional, and other fees and expenses, 
including brokerage commissions, will be paid by MetLife. In addition, 
the Substitutions will not impose any tax liability on Contract owners. 
The Substitutions will not cause the Contract fees and charges 
currently paid by existing Contract owners to be greater after the 
Substitutions than before the Substitutions. MetLife will not exercise 
any right it may have under the Contracts to impose restrictions on 
transfers under the Contracts for a period of at least thirty days 
following the Substitutions.
    21. For a period of two years from the date of the Substitution, 
MetLife will not increase Contract charges or total Separate Account 
charges (net of any waiver or reimbursements) of the subaccounts that 
invest in the Metropolitan Fund Davis Venture Value Portfolio or the 
Metropolitan Fund State Street Research Bond Income Portfolio. If the 
total operating expenses for the Davis Venture Value Portfolio or the 
State Street Research Bond Income Portfolio (taking into account any 
expense waiver or reimbursement) for any fiscal quarter for the two-
year period following the date of Substitution exceed on an annualized 
basis the net expense ratio for its corresponding Substituted Portfolio 
for the fiscal year ended December 31, 2002 (for the CDC Nvest Star 
Value Fund), or fiscal year ended September 30, 2003 (for the Loomis 
Sayles Core Plus Bond Fund), MetLife will reduce (through waiver or 
reimbursement) the Separate Account expenses paid during that quarter 
of the subaccount that invests in such Replacement Portfolio to the 
extent necessary to offset the amount by which the Replacement 
Portfolio's expense ratio for such period exceeds, on an annualized 
basis, the relevant expense ratio level of the Substituted Portfolio. 
MetLife will reduce (through waiver or reimbursement) the Separate 
Account expenses if the corresponding Replacement Portfolio's expense 
ratio exceeds the following levels:

------------------------------------------------------------------------
                                                               Two-Year
                   Replacement Portfolios                    Expense Cap
------------------------------------------------------------------------
Metropolitan Fund Davis Venture Value Portfolio (Class B)..        1.68%
Metropolitan Fund State Street Research Bond Income                1.28%
 Portfolio (Class B).......................................
------------------------------------------------------------------------

    22. At no time after the date of the Substitution will MetLife 
increase Contract charges or total Separate Account charges (net of any 
waiver or reimbursements) of the subaccounts that invest in the 
following Replacement Portfolios: the Metropolitan Fund Harris Oakmark 
Large Cap Value Fund, the Metropolitan Fund State Street Research Money 
Market Portfolio, or the Metropolitan Fund Alger Equity Growth

[[Page 9879]]

Portfolio. If the total operating expenses for the Harris Oakmark Large 
Cap Value Fund, the State Street Research Money Market Portfolio, or 
the Alger Equity Growth Portfolio (taking into account any expense 
waiver or reimbursement) for any fiscal quarter following the date of 
Substitution exceed on an annualized basis the net expense ratio for 
its corresponding Substituted Portfolio for the fiscal year ended 
December 31, 2002 (for the Harris Associates Growth and Income Fund and 
the CGM Advisor Targeted Equity Fund) or fiscal year ended June 30, 
2003 (for the CDC Nvest Cash Management Trust--Money Market Series), 
MetLife will reduce (through waiver or reimbursement) the Separate 
Account expenses paid during that quarter of the subaccount that 
invests in such Replacement Portfolio to the extent necessary to offset 
the amount by which the Replacement Portfolio's expense ratio for such 
period exceeds, on an annualized basis, the following levels:

------------------------------------------------------------------------
                                                              Permanent
                   Replacement portfolios                    expense cap
------------------------------------------------------------------------
Metropolitan Fund Harris Oakmark Large Cap Value Fund              1.53%
 (Class B).................................................
Metropolitan Fund State Street Research Money Market               0.88%
 Portfolio (Class B).......................................
Metropolitan Fund Alger Equity Growth Portfolio (Class B)..        1.47%
------------------------------------------------------------------------

    23. Contract owners were notified of the initial Application by 
means of a supplement to the prospectus that disclosed that the 
Applicants filed the Application to seek approval for the 
Substitutions. Further, before the Effective Date, a notice (``Pre-
Substitution Notice''), in the form of an additional supplement to the 
prospectuses for the Contracts, will be mailed to Contract owners 
setting forth the scheduled Effective Date and advising Contract owners 
that contract values attributable to investments in the Substituted 
Portfolios will be transferred to the Replacement Portfolios, without 
charge, on the Effective Date. In addition, all Contract owners will 
have received a copy of the most recent Replacement Portfolio 
prospectuses prior to the Substitutions. The Effective Date will be no 
earlier than twenty days after the mailing of the Pre-Substitution 
Notice. The Pre-Substitution Notice will state that, from the date the 
Application was filed with the Commission through the date thirty days 
after the Substitution, Contract owners may transfer contract value 
from any subaccount to any other subaccount without charge. In 
addition, within five days after the Substitutions, all Contract owners 
will be sent a written notice informing them that the Substitutions 
were carried out and advising them of their transfer rights (``Post-
Substitution Notice'').

Applicants' Legal Analysis

    1. Section 26(c) of the 1940 Act (formerly, Section 26(b)) 
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 be 
granted by order of the Commission, if the evidence establishes that 
the substitution is consistent with the protection of investors and the 
purposes of the 1940 Act.
    2. Section 26(c) was intended to provide for Commission scrutiny of 
proposed substitutions which could, in effect, force shareholders 
dissatisfied with the substitute security to redeem their shares, 
thereby possibly incurring a loss of the sales load deducted from 
initial purchase payments, an additional sales load upon reinvestment 
of the proceeds of redemption, or both. The section was designed to 
forestall the ability of a depositor to present holders of interest in 
a unit investment trust with situations in which a holder's only choice 
would be to continue an investment in an unsuitable underlying 
security, or to elect a costly and, in effect, forced redemption. The 
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 aforementioned concerns that Congress intended to 
address when the 1940 Act was amended to include this provision.
    3. The replacement of the Substituted Portfolios with the 
Replacement Portfolios is consistent with the protection of Contract 
owners and the purposes fairly intended by the policy and provisions of 
the 1940 Act and, thus, meets the standards necessary to support an 
order pursuant to Section 26(c) of the 1940 Act. The investment 
objectives and strategies of the Replacement Portfolios are comparable 
to the investment objectives and strategies of their respective 
Substituted Portfolios. In each case, the substitution of a Replacement 
Portfolio for the corresponding Substituted Portfolio should assure 
that the essential investment objectives of Contract owners will 
continue to be met.
    4. The level and quality of services provided by MetLife after the 
Substitutions will be comparable to the level and quality of services 
provided by CDC IXIS Advisers, Loomis Sayles and CGM prior to the 
Substitutions. The actual investment management fee for each 
Replacement Portfolio is expected to be less than, or the same as, the 
actual investment management fee for each corresponding Substituted 
Portfolio, except for the Metropolitan Fund Alger Equity Growth 
Portfolio (the Replacement Portfolio for the CGM Advisor Targeted 
Equity Fund) and the Metropolitan Fund Harris Oakmark Large Cap Value 
Fund (the Replacement Portfolio for the Harris Associates Growth and 
Income Fund). Although the actual investment management fee for the 
Metropolitan Fund Alger Equity Growth Portfolio for the fiscal year 
ended December 31, 2002 (0.75%) was greater than the actual investment 
management fee for the CGM Advisor Targeted Equity Fund for the fiscal 
year ended December 31, 2002 (0.69%), the estimated overall expense 
ratio for the Class B shares of Metropolitan Fund Alger Equity Growth 
Portfolio for the fiscal year ended December 31, 2002 (1.04%) was 
significantly less than the overall expense ratio for the Class A 
shares of CGM Advisor Targeted Equity Fund for the fiscal year ended 
December 31, 2002 (1.47%). Similarly, although the actual investment 
management fee for the Metropolitan Fund Harris Oakmark Large Cap Value 
Fund for the fiscal year ended December 31, 2002 (0.75%) was greater 
than the actual investment management fee for the Harris Associates 
Growth and Income Fund for the fiscal year ended December 31, 2002 
(0.67%), the estimated overall expense ratio for the Class B shares of 
Metropolitan Fund Harris Oakmark Large Cap Value Fund for the fiscal 
year ended December 31, 2002 (1.08%) was significantly less than the 
overall expense ratio for the Class A shares of the Harris Associates 
Growth and Income Fund for the fiscal year ended December 31, 2002 
(1.53%). To ensure such lower expenses, MetLife has agreed to impose a 
permanent expense cap on the Metropolitan Fund Alger Equity Growth 
Portfolio and the Metropolitan Fund Harris Oakmark Large Cap Value Fund 
as described infra.
    5. Each Replacement Portfolio's total expense ratio for the fiscal 
year ended December 31, 2002 was significantly lower than the expense 
ratio of the corresponding Substituted Portfolio for the fiscal year 
ended December 31, 2002 (fiscal year ended June 30, 2003 for the CDC 
Nvest Cash Management Trust --Money Market Series and fiscal year

[[Page 9880]]

ended September 30, 2003 for the Loomis Sayles Core Plus Bond Fund). 
The Metropolitan Fund State Street Research Money Market Portfolio's 
total expense ratio for the fiscal year ended December 31, 2002 was 
lower that the CDC Nvest Cash Management Trust--Money Market Series for 
the fiscal year ended June 30, 2003, even though the Metropolitan Fund 
State Street Research Money Market Portfolio imposes a 12b-1 fee while 
the CDC Nvest Cash Management Trust--Money Market Series does not. To 
ensure such lower expenses, MetLife has agreed to impose a permanent 
expense cap on the Metropolitan Fund State Street Research Money Market 
Portfolio, as described infra. Further, the Replacement Portfolios 
generally have outperformed the Substituted Portfolios over time and 
the generally increasing asset levels of the Replacement Portfolios 
should lead to continued lower expense ratios over time.
    6. The rights of the Contract owners and the obligations of MetLife 
under the Contracts would not be altered by the Substitutions except, 
of course, that Contract owners will not be able to continue to 
allocate contract value to subaccounts that currently invest in the 
Substituted Portfolios. Contract owners will not incur any additional 
tax liability as a result of the Substitutions. MetLife will bear the 
costs of any legal or accounting fees and transactional expenses of the 
Substitutions, including brokerage commissions.
    7. The Applicants assert that the procedures to be implemented are 
sufficient to assure that each Contract owner's contract value 
immediately after the Substitutions shall be equal to the contract 
value immediately before the Substitutions, and that the Substitutions 
will not affect the value of the interests of those owners of other 
MetLife variable contracts (other than the Contracts) who currently 
have contract value allocated to any of the portfolios of the 
Metropolitan Fund, the CDC Nvest Cash Management Trust, the CDC Nvest 
Funds Trust II, or the CDC Nvest Funds Trust I.
    8. The Applicants will permit Contract owners to transfer contract 
value from any subaccount to any other subaccount without charge, but 
subject to minimum transfer requirements. The Applicants also note 
that, in accordance with the terms of the Contracts, no sales charges 
or surrender charges or other charges will apply to transfers in 
connection with the Substitutions, and MetLife represents that no such 
charge shall be imposed.
    9. The Applicants request an order of the Commission pursuant to 
Section 26(c) of the 1940 Act approving the Substitutions by the 
Applicants. The Applicants submit that, for all the reasons stated 
above, the Substitutions are consistent with the protection of 
investors and the purposes fairly intended by the provisions of the 
1940 Act.

Applicants' Conditions for Relief

    For purposes of the approval sought pursuant to Section 26(c) of 
the 1940 Act, the Substitutions described in this amended and restated 
Application will not be completed unless all of the following 
conditions are met.
    1. The Commission shall have issued an order approving the 
Substitutions under Section 26(c) of the 1940 Act as necessary to carry 
out the transactions described in this amended and restated 
Application.
    2. Each Contract owner will have been sent (a) prior to the 
Effective Date, a copy of the effective prospectuses for the 
Replacement Portfolios, (b) prior to the Effective Date, a Pre-
Substitution Notice describing the terms of the Substitutions and the 
rights of the Contract owners in connection with the Substitutions, and 
(c) a Post-Substitution Notice within five days after the Substitutions 
informing them that the Substitutions were carried out and advising 
them of their transfer rights.
    3. MetLife shall have satisfied itself that (a) the Contracts allow 
the substitution of portfolios in the manner contemplated by the 
Substitutions and related transactions described herein, (b) the 
transactions can be consummated as described in this amended and 
restated Application under applicable insurance laws, and (c) that any 
applicable regulatory requirements in each jurisdiction where the 
Contracts are qualified for sale have been complied with to the extent 
necessary to complete the transaction.

Conclusion

    Applicants request an order of the Commission pursuant to Section 
26(c) of the Act approving the Substitution. Section 26(c), in 
pertinent part, provides that the Commission shall issue an order 
approving a substitution of securities if the evidence establishes that 
it is consistent with the protection of investors and the purposes 
fairly intended by the policy and provisions of the Act. For the 
reasons and upon the facts set forth above, the requested order meets 
the standards set forth in Section 26(c) and should, therefore, be 
granted.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-4568 Filed 3-1-04; 8:45 am]
BILLING CODE 8010-01-P