RETIREMENT PLAN
PARTICIPATION AGREEMENT
AMONG
EQ ADVISORS TRUST,
EQ FINANCIAL CONSULTANTS, INC.,
THE EQUITABLE INVESTMENT PLAN FOR EMPLOYEES, MANAGERS AND AGENTS
AND
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
THIS AGREEMENT, made and entered into as of the 1st day of December,
1998 by and among EQ ADVISORS TRUST, a business trust organized under the laws
of the State of Delaware (the "Trust"), EQ FINANCIAL CONSULTANTS, INC., a
Delaware corporation (the "Distributor") and the Officers Committee on Benefit
Plans, as Plan Fiduciary of the EQUITABLE INVESTMENT PLAN FOR EMPLOYEES,
MANAGERS AND AGENTS, a New York trust (the "Plan") and THE EQUITABLE LIFE
ASSURANCE SOCIETY OF THE UNITED STATES, a New York corporation ("Equitable").
WHEREAS, the Trust engages in business as an open-end management
investment company and is available to act as the investment vehicle for the
separate accounts ("Separate Accounts") of both affiliated and unaffiliated life
insurance companies ("Insurance Companies") in connection with the sale of
variable life insurance policies, variable annuity contracts and certificates
relating to such policies or contracts ("Variable Contracts") and for tax
qualified retirement plans ("Qualified Plans"); and
WHEREAS, the beneficial interests in the Trust are divided into series
of shares, (each a "Portfolio"), each representing the interest in a particular
managed portfolio of securities and other assets, and each Portfolio is divided
or may be divided into one or more classes of shares, i.e., currently the Class
IA shares and the Class IB shares, or such other classes of shares as may be
created in the future (the "Classes"); and
WHEREAS, the Trust is registered as an open-end management investment
company under the 1940 Act, and shares of its Portfolios are registered under
the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Securities and Exchange Commission (the "SEC") has granted
the Trust exemptions from the provisions of Sections 9(a), 13(a), 15(a), and
15(b) of the Investment Company Act of 1940, as amended (the "1940 Act") and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Trust and each of its Portfolios and Classes to be sold to
and held by Separate Accounts funding Variable Contracts of Insurance Companies
and to Qualified Plans; (the "Shared Funding Exemptive Order"); and
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WHEREAS, the Distributor is registered as a broker-dealer with the SEC
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a
member in good standing of the National Association of Securities Dealers, Inc.
(the "NASD"); and
WHEREAS, the Distributor is also the investment manager to the Trust
(the "Manager") and is duly registered with the SEC as an investment adviser
under the Investment Advisers Act of 1940, as amended, and is registered or
exempt from registration under all applicable state securities laws; and
WHEREAS, the Plan is a duly organized, validly existing trust under the
laws of New York State and a qualified retirement plan under the Internal
Revenue Code of 1986, as amended (the "Tax Code"), and the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"); and
WHEREAS, the Trust and the Distributor desire to make available to the
Plan the Class 1A shares of the following Portfolios (the "Designated
Portfolios") of the Trust for purchase on the terms and conditions hereinafter
set forth:
o X. Xxxx Price Equity Income Portfolio
o MFS Emerging Growth Companies Portfolio
o Warburg Pincus Small Company Value Portfolio
o BT International Equity Index Portfolio; and
WHEREAS, the Plan desires to invest in Class 1A shares of the Designated
Portfolios if directed to do so by any Plan participants and the Distributor is
authorized to sell Class 1A shares of the Designated Portfolios to the Plan on
the terms and conditions hereinafter set forth; and
WHEREAS, Equitable is the sponsor of the Plan and desires to give Plan
participants the opportunity to invest in the Designated Portfolios through the
Plan;
NOW, THEREFORE, in consideration of their mutual promises, the Trust,
the Distributor and the Plan hereby agree as follows:
ARTICLE I. Sale of Trust Shares
1.1. The Trust shall make Class 1A shares of the Designated Portfolios
available for purchase by the Plan at the net asset value per share on those
days on which the Trust calculates the net asset value per share of the
Designated Portfolios pursuant to rules of the SEC. The Trust will use
reasonable efforts to calculate the net asset value per share of Class 1A shares
of the Designated Portfolios on each day on which the New York Stock Exchange is
open for trading. Notwithstanding the foregoing, the Board of Trustees of the
Trust (the "Board") may refuse to sell shares of Class 1A shares of any
Designated Portfolio to the Plan or suspend or terminate the offering of shares
of Class 1A shares of any Designated Portfolio to the Plan if such action is
required by law or by regulatory authorities or is, in the sole discretion of
the Board acting in good
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faith and in light of its fiduciary duties under federal and any applicable
state laws, necessary in the best interests of the Trust or its shareholders.
1.2. The Distributor, as a principal underwriter of the Trust, will sell
Class 1A shares of the Designated Portfolios to the Plan. Purchase by the Plan
of Class 1A shares of the Designated Portfolios on behalf of Plan participants
will be effected by purchase orders made by the Plan to the Distributor and will
be executed by the Distributor on a daily basis at the net asset value of the
Class 1A Shares next computed after receipt by the Trust or its designee of such
purchase order. For purposes of this Section 1.2, Equitable will not be
considered the designee of the Trust for receipt of purchase orders, and receipt
by Equitable shall not constitute receipt by the Trust for purposes of
calculating each Designated Portfolio's net asset value per share for the Class
1A shares.
1.3. The Trust, at the request of the Plan, will redeem for cash or
in-kind any full or fractional Class IA shares of the Designated Portfolios held
from time to time by the Plan. The Trust will execute such requests on a daily
basis at the net asset value of the Class IA shares of the Designated Portfolios
in question next computed after receipt by the Trust or its designee of a
redemption request from the Plan. All redemptions requests will be processed and
payment with respect thereto normally will be made within seven (7) days after
receipt by the Trust or its designee of a redemption request in good order,
unless otherwise permitted under the 1940 Act. For purposes of this Section 1.3,
Equitable shall not be considered the designee of the Trust for receipt of
requests for redemption, and receipt by Equitable shall not constitute receipt
by the Trust or its designee for purposes of calculating the net asset value per
share of any Designated Portfolio.
1.4. All purchases and redemptions of Class 1A shares of the Designated
Portfolios shall be made in accordance with the provisions of the most recent
Trust prospectus for the Class 1A shares of the Designated Portfolios (the
"Prospectus').
1.5. The Plan shall pay for Class 1A shares of Designated Portfolios
purchased by it on the same business day the Plan makes a purchase order for the
purchase of such shares in accordance with Section 1.2 hereof. "Business Day"
shall mean any day on which the New York Stock Exchange is open for trading and
on which the Trust calculates the net asset value of its Class 1A shares
pursuant to the rules of the SEC. Payment shall be in federal funds transmitted
by wire.
1.6. Issuance and transfer of Class 1A shares of the Designated
Portfolios will be by book entry only. Stock certificates will not be issued to
the Plan. Class 1A shares purchased by the Plan will be recorded in an
appropriate title.
1.7. The Trust shall furnish same day notice (by wire or telephone,
followed by written confirmation) of any income dividends or capital gain
distributions payable on the Class 1A shares of the Designated Portfolios. At
the election of the Plan, all income dividends and capital gain distributions
paid on the Class 1A shares of any Designated Portfolio shall be paid in
additional Class 1A shares of such Designated Portfolio The Trust shall provide
notification to the Plan of the number of shares issued as payment of dividends
and/or distributions by the end of the next Business Day after the issuance of
such dividends and/or distributions. The Trust shall provide
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advance notice to Plan of each date on which the Trust reasonably expects to
make a dividend or distribution payment; normally this notice will be given at
least ten (10) days in advance of the ex-dividend date. The Plan may by prior
written notice to the Trust received by the Trust at least ten (10) days prior
to such payment elect to receive income dividends and capital gain distributions
in cash in lieu of Class 1A shares.
1.8. The Trust shall make the net asset value of the Class 1A shares of
each Designated Portfolio available to the Plan on a daily basis as soon as
reasonably practical after the net asset value per share of the Class 1A shares
is calculated (normally by 6:30 p.m. New York time) and shall use its best
efforts to make such net asset value per share available by 7:00 p.m. New York
time.
ARTICLE II. Warranties and Covenants
2.1. The Trust warrants, represents and covenants, as the case may be,
that (a) it is a lawfully organized and validly existing business trust under
the laws of the State of Delaware, (b) it does and will comply, in all material
respects, with requirements applicable to the Trust under the 1940 Act, (c) to
the best of its knowledge, Class 1A shares sold pursuant to this Agreement shall
be: (1) registered under the 1933 Act; (2) duly authorized for issuance; and (3)
sold in compliance with and all applicable federal securities laws, and (d) the
Trust is and shall remain registered under the 1940 Act. The Trust will amend
the registration statement for its shares (the "Registration Statement") under
the 1933 Act and the 1940 Act from time to time as required in order to effect
the continuous offering of Class 1A shares of the Designated Portfolios. This
requirement shall not, however, in any manner limit the Trust's ability to cease
offering Class 1A shares of any Designated Portfolio, provided such action
complies with applicable laws and regulations.
2.2. The Trust warrants, represents and covenants that: (a) it currently
has elected to qualify as a regulated investment company under Subchapter M of
the Tax Code; (b) it will make every effort to maintain such qualification
(under Subchapter M or any successor or similar provision); (c) it will notify
Equitable and the Plan immediately upon having a reasonable basis for believing
that it has ceased to so qualify or that it might not so qualify in the future;
and (d) it will seek to minimize any damages and to rectify its failure to so
qualify promptly. The Trust acknowledges that any failure to qualify as a
regulated investment company will eliminate the ability of the Separate Accounts
to avail themselves of the "look through" provisions of Section 817(h) of the
Tax Code and that, as a result, the Variable Contracts will almost certain fail
to qualify as life insurance and annuity contracts under Section 817(h) of the
Tax Code.
2.3. The Trust warrants, represents and covenants that it will at all
times invest money from the Separate Accounts and the Plan in such a manner as
to assure that the Variable Contracts will be treated as variable annuity or
variable life insurance contracts under the Tax Code and the regulations issued
thereunder. Without limiting the scope of the foregoing, the Trust represents
that it will at all times comply with Section 817(h) of the Tax Code and
Treasury Regulation 1.817-5, relating to the diversification requirements for
variable annuity, endowment, or life insurance contracts, and any amendments or
other modifications to such Section or Regulations. In the event of a breach of
this Section 2.3 by the Trust, the Trust will take all reasonable steps: (a) to
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immediately notify all parties of such breach; and (b) to adequately diversify
the Trust's assets so as to achieve compliance within the grace period afforded
by Regulation 1.817-5.
2.4. The Distributor warrants, represents and covenants, as the case may
be, that (a) it is lawfully organized and validly existing under the laws of the
State of Delaware, (b) it does and will comply in all material respects with
requirements applicable to the Distributor under 1934 Act and NASDR rules and
regulations, (c) it is a member in good standing of the NASD, (d) it is
registered as a broker-dealer with the SEC and all necessary states, (e) it will
sell and distribute the Trust's shares in accordance with the laws of the State
of New York and all applicable federal and state securities laws, including
without limitation the 1933 Act, the 1934 Act, the 1940 Act, and all applicable
rules of the NASD, and (f) the Distributor is and will, in its capacity as the
Manager, remain duly registered under all applicable federal and state
securities laws and will perform its obligations to the Trust in compliance with
any and all applicable federal and state securities laws in all material
respects.
2.5. Equitable, the Trust and the Distributor each warrants, represents
and covenants, as the case may be, that all its trustees, directors, officers,
employees, investment managers and investment advisers, and other
individuals/entities dealing with the money and/or securities of the Trust are
and shall continue to be at all times covered by a blanket fidelity bond or
similar coverage for the benefit of the Trust in an amount not less than the
minimal coverage required by Rule 17g-(1) of the 1940 Act or such related
provisions as may be promulgated from time to time. The aforesaid fidelity bond
shall include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company.
2.6. Equitable and the Plan warrant, represent and covenant, as the case
may be, to the Trust and the Distributor that (a) the Plan has been since its
inception and will continue to be a "qualified pension or retirement plan"
within the meaning of Treasury Regulation 1.817-5(f)(iii) and a qualified plan
within the meaning of Section 401(a) of the Tax Code (collectively, a "Qualified
Plan") and (b) the named fiduciary of the Plan has furnished and will from time
to time furnish the Trust with a copy of the Plan's most recently issued IRS
determination letter on the Plan's status as a Qualified Plan under Section
401(a). Equitable and the Plan acknowledge and confirm that the present and
continuing status of the Plan as a Qualified Plan is critical to the
shareholders of the Trusts that are Separate Accounts and that the Trust is
expressly relying on the foregoing warranties and covenants of the Plan in
agreeing to sell shares to the Plan pursuant hereto. The named fiduciary of the
Plan will notify the Trust promptly at any time hereafter upon having a
reasonable basis to believe that the Plan has ceased to qualify or may
subsequently cease to qualify as a Qualified Plan.
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ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. The Trust or its Distributor shall provide the Plan with as many
printed copies of the Trust's current Prospectus and Statement of Additional
Information and any supplements thereto for the Class 1A shares of the
Designated Portfolios (the "Trust's SEC Disclosure Materials") as the Plan may
reasonably request for Plan participants then invested in Class 1A shares of the
Designated Portfolios ("Current Participants"). If requested by the Plan in lieu
thereof, the Trust or the Distributor shall provide camera-ready film containing
the Prospectus and Statement of Additional Information for the Class 1A shares
and such other assistance as is reasonably necessary in order for the Plan once
each year (or more frequently if any of the Prospectus and Statement of
Additional Information for the Class 1A shares is amended during the year) to
distribute the Trust's SEC Disclosure Materials to Current Participants. In
addition, with respect to the Trust's SEC Disclosure Materials provided by the
Plan to Current Participants in order to update disclosure as required by the
1933 Act and/or the 1940 Act, the cost of preparing, printing, mailing or
otherwise distributing the Trust's SEC Disclosure Materials to Current
Participants will be borne by the Trust. Furthermore, if in such case the Plan
or the Distributor is provided with camera-ready film of the Trust's SEC
Disclosure Materials in lieu of printed documents, the Trust shall promptly,
upon request, reimburse the Plan or the Distributor, as the case may be, for the
printing, mailing and other costs incurred in distributing of those documents to
Current Participants. The Plan and the Distributor shall provide the Trust with
such information as may be reasonably requested by the Trust to assure that the
Trust expenses do not include any costs or expenses with respect to the
printing, mailing or other distribution of the Trust's SEC Disclosure Materials
to Plan Participants other than Current Participants.
3.2. Neither Equitable nor the Plan may alter the form of the Trust's
SEC Disclosure Materials, Annual and Semi-Annual Reports to shareholders, proxy
statements or other Trust documents without the prior approval of the Trust.
Equitable or the Plan, as appropriate, will bear all costs associated with such
alteration.
3.3. If required by Form N-1A, the Trust's Prospectus shall state that
the Statement of Additional Information for the for the Class 1A shares of the
Designated Portfolios is available from the Distributor or the Plan (or in the
Trust's discretion, the Prospectus shall state that such Statement of Additional
Information is available from the Trust).
3.4. The Trust, at its expense, shall provide the Plan with copies of
its proxy statements, Annual and Semi-Annual Reports to shareholders, and other
communications to shareholders in such quantities as the Plan shall reasonably
require for mailing or otherwise distributing such materials to Current
Participants and shall assume all expenses associated with mailing or otherwise
distributing those materials. In the alternative, the Trust shall reimburse the
Plan for its costs in printing, mailing and distributing such materials to
Current Participants.
3.5. If and to the extent required by law or as required as a condition
to any exemptive or no-action relief granted by the SEC or the SEC staff to the
Trust, the Plan shall:
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(a) solicit voting instructions from Current Participants;
(b) vote the Trust shares for the Class 1A shares of the
Designated Portfolios in accordance with instructions received from
Current Participants; and
(c) vote Trust shares for the Class 1A shares of the Designated
Portfolios for which no instructions have been received in the same
proportion as Trust shares for the for the Class 1A shares of the
Designated Portfolios for which instructions have been received so long
as and to the extent that the SEC continues to interpret the 1940 Act to
require pass-through voting privileges for Current Participants. The
Plan reserves the right to vote Class 1A shares of the Designated
Portfolios in its own right, to the extent permitted by law. The Plan
will be responsible for calculating voting privileges in a manner
consistent with any standards adopted by the Board, from time to time,
and provided to the Plan.
3.6. The Trust will comply with all provisions of the 1940 Act requiring
voting by shareholders and in particular the Trust will comply with Section
16(c) of the 1940 Act as well as with Sections 16(a) and, if and when
applicable, Section 16(b). Further, the Trust will act in accordance with the
SEC or SEC staff's written interpretation concerning the requirements of Section
16(a) with respect to periodic elections of Trustees and with whatever rules the
SEC may promulgate with respect thereto.
ARTICLE IV. Sales Material and Information
4.1. The Distributor shall furnish, or shall cause to be furnished, to
the Trust or its designee, the form of each piece of sales literature or other
promotional material in which the Trust, the Manager or the Distributor are
named prior to its first use. No such material shall be used if the Trust or its
designee reasonably objects to its use after the Trust's receipt of such
material.
4.2. Neither Equitable nor the Plan will give any information or make
any representations or statements on behalf of the Trust or concerning the Trust
to other than the information or representations contained in or accurately
derived from the Registration Statements, prospectus or Statement of Additional
Information for the Trust, as such Registration Statements, prospectus or
Statement of Additional Information may be amended or supplemented from time to
time, or in reports or proxy statements for the Trust, or in sales literature or
other promotional material approved by the Trust or its designee, except with
the permission of the Trust or its designees.
4.3. The Trust or the Distributor, or their respective designees, shall
furnish, or shall cause to be furnished, to Equitable and the Plan or their
designees, the form of each piece of sales literature or other promotional
material in which the Plan is named prior to its use. No such material shall be
used if the Plan or its designees reasonably objects to its use after receipt of
such material.
4.4. The Trust will provide to Equitable and the Plan at least one
complete copy of each Registration Statement, prospectus, Statement of
Additional Information, report, proxy statement,
9
item of sales literature or other promotional material, application for
exemptions, request for a no-action letter or amendment to any of the above that
relates to the Class 1A shares of the Designated Portfolios contemporaneously
with the filing of such document with the SEC, the NASD or any other regulatory
authority.
4.5. For purposes of this Article IV, the phrase "sales literature or
other promotional material" includes, but is not limited to, any of the
following that refer to the Trust or any affiliate of the Trust: advertisements
(including materials published or designed for use in a newspaper, magazine, or
other periodical, radio, television, telephone or tape recording, videotape
display, signs or billboards, motion pictures, electronic messages or
communications or other public media), sales literature (i.e., any written
communication distributed or made generally available to customers or the
public, including brochures, circulars, research reports, market letters, form
letters, seminar texts, reprints or excerpts of any other advertisement, sales
literature, or published article), educational or training materials or other
communications distributed or made generally available to some or all agents or
employees, and Registration Statements, SEC Disclosure Materials, shareholder
reports, and proxy materials. However, it is anticipated that materials provided
solely: (a) internally to Equitable's or the Distributors' own employees or
counsel; or (b) to certain designated third parties and that are not designed to
be provided or communicated in any manner to the general public (e.g., training
materials provided to distributors or agents) will not be filed with the SEC,
the NASD, or any state securities or insurance regulatory authorities, although
such materials will be prepared in accordance with applicable laws.
ARTICLE V. Fees and Expenses
5.1. No fee or other compensation shall be payable by any party to the
other under this Agreement.
5.2. All expenses incident to performance by the Trust under this
Agreement, including without limitation expenses of the Trust as described in
Article III hereof, shall be paid by the Trust. Without limiting the foregoing,
all Trust shares shall be registered and authorized for issuance at Trust
expense prior to their sale in accordance with applicable federal law, and the
Trust shall bear all expenses with respect to: registration and qualification of
the Trust's shares; preparation and filing of the Trust's Registration
Statements, SEC Disclosure Materials, proxy materials and reports; setting in
type, printing, mailing or otherwise distributing the SEC Disclosure Materials,
proxy materials and Semi-Annual and Annual Reports sent to Current Participants
(including the costs of setting in type, printing, mailing or otherwise
distributing prospectuses that constitute Annual Reports); the preparation of
all statements and notices required by any federal or state law; and all taxes
on the issuance or transfer of the Trust's shares.
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ARTICLE VI. Potential Conflicts
6.1. The Board will monitor the Trust for the existence of any material
irreconcilable conflict between the interests of different Trust shareholders. A
material irreconcilable conflict may arise for a variety of reasons, including:
(a) an action by any state insurance regulatory authority; or (b) a change in
applicable federal or state insurance, tax, or securities laws or regulations,
or a public ruling, private letter ruling, no-action or interpretative letter,
or any similar action by insurance, tax, or securities regulatory authorities;
or (c) an administrative or judicial decision in any relevant proceeding; or (d)
the manner in which the investments of any Designated Portfolio are being
managed; or (e) a difference in voting instructions given different Trust
shareholders; or (f) a decision by a Trust shareholder to disregard the voting
instructions of its beneficial owners. The Board shall promptly inform the Plan
if it determines that a material irreconcilable conflict exists and the
implications thereof.
6.2. Equitable and the Plan each will report any potential or existing
conflicts, of which it is aware, to the Board. Equitable and the Plan will also
assist the Board in carrying out its responsibilities under any Shared Funding
Exemptive Order, by providing the Board with all information concerning the Plan
reasonably necessary for the Board to consider any issues raised. This includes,
but is not limited to, any obligation by the Plan to inform the Board whenever
the voting instructions of Current Participants are disregarded. The
responsibilities of Equitable and the Plan under this Section 6.2 will be
carried out with a view only to the interests of Current Participants.
6.3. If it is determined by a majority of the Board, or a majority of
its disinterested Trustees, that a material irreconcilable conflict exists, the
Plan and other Trust shareholders shall, at their expense and to the extent
reasonably practicable (as determined by a majority of the disinterested
Trustees), take whatever steps are necessary to remedy or eliminate the material
irreconcilable conflict, up to and including: (a) redeeming its shares from the
Trust and reinvesting its assets in another investment medium or submitting the
question of whether such withdrawal should be implemented to a vote of all
affected beneficial owners or (b) establishing a new registered management
investment company. The Plan's responsibilities under this Section 6.3 will be
carried out with a view only to the interests of Current Participants.
6.4. If a material irreconcilable conflict were ever to arise because of
a decision by the Plan to disregard the voting instructions of Current
Participants with respect to a Designated Portfolio and that decision represents
a minority position or would preclude a majority vote, the Plan may be required,
at the Trust's election, to redeem the Plan's investment in such Designated
Portfolio and terminate this Agreement with respect to such Delegated
Portfolio); provided, however, that such redemption and termination will be
limited to the extent required by the foregoing material irreconcilable conflict
as determined by a majority of the disinterested members of the Board. No charge
or penalty shall be imposed as a result of such redemption. Any such redemption
and termination must take place within six (6) months after the Trust gives
written notice that this provision is being implemented.
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6.5. For purposes of this Article 6, a majority of the disinterested
members of the Board shall determine whether any proposed action adequately
remedies any material irreconcilable conflict, but in no event will the Trust be
required to establish a new funding medium for any shareholder including the
Plan. In the event that the Board determines that any proposed action does not
adequately remedy any material irreconcilable conflict with respect to a
Designated Portfolio, then the Plan will redeem its shares in such Designated
Portfolio and terminate this Agreement with respect to such Portfolio within six
(6) months after the Board informs the Plan in writing of the foregoing
determination; provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested members of the Board.
6.6. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
1940 Act or the rules promulgated thereunder with respect to mixed or shared
funding (as defined in the Shared Funding Exemptive Order) on terms and
conditions materially different from those contained in the Shared Funding
Exemptive Order, then: (a) the Trust and/or the Plan, as appropriate, shall take
such steps as may be necessary to comply with Rules 6e-2 and 6e-3(T), as
amended, and Rule 6e-3, as adopted, to the extent such rules are applicable; (b)
Sections 3.4, 3.5, 6.1, 6.2, 6.3, 6.4, and 6.5 of this Agreement shall continue
in effect only to the extent that terms and conditions substantially identical
to such Sections are contained in such Rule(s) as so amended or adopted; and (c)
this Agreement shall be otherwise amended by the Trust, without the need for any
consent of the other parties, as required by such change in law.
ARTICLE VII. Indemnification
7.1. Indemnification By the Plan Except as provided to the contrary in
Section 7.4 or 7.5 hereof, Equitable and the Plan shall jointly and severally
indemnify and hold harmless the Trust, each member of the Board, the
Distributor, the trustees, directors and officers thereof and each person, if
any, who controls any such person within the meaning of Section 15 of the 1933
Act (collectively, the "Indemnified Parties" for purposes of this Section 7.1)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of Equitable and the Plan), investigation
of claims or litigation (including legal and other expenses), to which the
Indemnified Parties may become subject under any statute, regulation, at common
law or otherwise, insofar as such losses, claims, damages, liabilities or
expenses (or actions in respect thereof) or settlements are related to, arise
out of or are based upon:
(i) the failure (intentional or otherwise) of the Plan at any
time to be or to continue to be a Qualified Plan as defined in Section
2.4 hereof;
(ii) the sale or acquisition of the Class 1A shares of the
Designated Portfolios and (1) arise out of or are based upon any untrue
statements or alleged untrue statements of any material fact made by
Equitable or the Plan or any person under its control or the omission or
the alleged omission to state a material fact required to be stated or
necessary to make such statements not misleading, unless such statement
or omission or alleged statement or omission was made in reliance upon
and in conformity with information
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furnished by the Trust or the Distributor to Equitable or the Plan for
use in connection with the sale or distribution of Class 1A shares of
the Designated Portfolios; or (2) arise out of or as a result of
warranties or representations (other than warranties or representations
contained in a Registration Statement, any SEC Disclosure Materials or
sales literature of the Trust not supplied by the Plan or persons under
its control) or wrongful conduct of Equitable or the Plan or any of
such, with respect to the sale or distribution of Class 1A shares of the
Designated Portfolios; or (3) arise out of any untrue statement or
alleged untrue statement of a material fact contained in a Registration
Statement, any SEC Disclosure Materials or sales literature of the Trust
or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading , but only if such a statement or omission was
made in reliance upon information furnished to the Trust or the
Distributor by Equitable or the Plan or persons under their control; or
(iii) arise as a result of any failure by the Plan to provide the
services or furnish the materials required to be provided or furnished
by it under the terms of this Agreement; or
(iv) arise out of or result from any material breach of any
representation and/or warranty made by Equitable or the Plan in this
Agreement or arise out of or result from any other material breach of
this Agreement by Equitable or the Plan.
7.2. Indemnification by the Distributor Except as provided to the
contrary in Section 7.4 or 7.5 hereof, the Distributor shall indemnify and hold
harmless the Plan, its trustees, the Trust, the Board and their officers and
each person, if any, who controls the Plan within the meaning of Section 15 of
the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Section 7.2) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Distributor),
investigation of claims or litigation (including legal and other expenses) to
which the Indemnified Parties may become subject under any statute, regulation,
at common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) or settlements are related to, arise
out of or are based upon
(i) the sale or acquisition of Class 1A shares of the Designated
Portfolios by the Plan and (1) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in
a Registration Statement, any SEC Disclosure Materials or sales
literature of the Trust or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, but only if such statement or omission or such alleged
statement or omission was made in reliance upon and in conformity with
information furnished by the Distributor to the Trust for use in a
Registration Statement, any SEC Disclosure Materials or sales literature
of the Trust or otherwise for use in connection with the sale or
acquisition of Class 1A shares of the Delegated Portfolios by the Plan;
or (2) arise out of any untrue statement or alleged untrue statement of
a material fact contained in a Registration Statement, any SEC
Disclosure Materials or sales literature of the Trust or the omission or
alleged omission to state therein a material fact required to be stated
therein or
13
necessary to make the statement or statements therein not misleading,
but only if such statement or omission was made in reliance upon
information furnished to the Plan or the Trust by the Distributor; or
(ii) any failure by the Distributor to provide the services and
furnish the materials required to be provided or furnished by the
Distributor under the terms of this Agreement; or
(iii) arise out of or result from any material breach of any
representation and/or warranty made by the Distributor in this Agreement
or arise out of or result from any other material breach of this
Agreement by the Distributor.
7.3. Indemnification By the Trust Except as provided to the contrary in
Section 7.4 or 7.5 hereof, the Trust shall indemnify and hold harmless the Plan
and each of its trustees and officers, the Distributor, the directors and
officers thereof and each person, if any, who controls any such person within
the meaning of Section 15 of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this Section 7.3) against any and all losses, claims,
damages, liabilities (including amounts paid in settlement with the written
consent of the Trust), investigation of claims or litigation (including legal
and other expenses) to which the Indemnified Parties may become subject under
any statute, regulation, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements result from the gross negligence, bad faith or willful misconduct of
the Board or any member thereof, are related to, arise out of or are based upon:
(i) any failure by the Trust to provide the services and furnish
the materials required to be provided or furnished by it under the terms
of this Agreement (including a failure to comply with the
diversification and other qualification requirements specified in
Article VI of this Agreement); or
(ii) arise out of or result from any material breach of any
representation and/or warranty made by the Trust in this Agreement or
arise out of or result from any other material breach of this Agreement
by the Trust.
7.4. No party indemnifying another under this Article 7 (an
"Indemnitor") shall be liable hereunder with respect to any losses, claims,
damages, liabilities, or litigation incurred or assessed against an Indemnified
Party arising from such Indemnified Party's willful misfeasance, bad faith, or
gross negligence in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of obligations and duties
under this Agreement or to the Plan, the Trust or the Distributor, whichever is
applicable.
7.5. No Indemnitor shall not be liable hereunder with respect to any
claim made against an Indemnified Party unless such Indemnified Party shall have
notified the Indemnitor in writing within a reasonable time after the summons or
other first legal process giving information of the nature of the claim shall
have been served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent), but failure
to notify the
14
Indemnitor of any such claim shall not relieve the Indemnitor from any liability
which it may have to the Indemnified Party against whom such action is brought
otherwise than on account of this Article 7. In case any such action is brought
against the Indemnified Parties, the Indemnitor will be entitled to participate,
at its own expense, in the defense thereof. The Indemnitor shall also shall be
entitled to assume the defense thereof, with counsel reasonably satisfactory to
the party named in the action. After notice from the Indemnitor to such party of
the Indemnitor's election to assume the defense thereof, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
the Indemnitor will not be liable to such party under this Agreement for any
legal or other expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
7.6. Each Indemnitor hereunder agrees promptly to notify the other
parties hereto of the commencement of any material litigation or proceedings
against it or any of its respective officers, directors or trustees in
connection with this Agreement, the issuance or sale of the Class 1A shares of
the Designated Portfolios, the operation of the Plan or the sale or acquisition
of any other shares of the Trust.
ARTICLE VIII. Applicable Law
8.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of New York.
8.2. This Agreement shall be subject to the provisions of the 1933,
1934, and 1940 Acts, the Tax Code and the rules and regulations and rulings
thereunder, including such exemptions from those statutes, rules, and
regulations as the SEC may grant (including, but not limited to, any Shared
Funding Exemptive Order) and the terms hereof shall be interpreted and construed
in accordance therewith.
ARTICLE IX. Termination
9.1. This Agreement shall continue in full force and effect until the
first to occur of:
(a) termination by any party, with or without cause, upon six (6)
months' advance written notice delivered to the other parties; or
(b) termination by the Plan upon thirty (30) days' written notice to
the Trust and the Distributor with respect to any Designated
Portfolio of the Plan's determination that shares of such
Designated Portfolio are not reasonably available to meet the
requirements of the Plan or are not consistent with the Plan's
obligations to Current Participants; or
(c) termination by the Plan upon thirty (30) days' written notice to
the Trust and the Distributor with respect to any Designated
Portfolio in the event the Class 1A shares thereof are not
registered, issued or sold in accordance with applicable federal
15
and/or state law or such law precludes the use of such shares as
an underlying investment media of the Plan; or
(d) termination by either the Trust or the Distributor by written
notice to Equitable and the Plan, if the Trust or the Distributor
shall determine, in its sole judgment exercised in good faith,
that Equitable or the Plan have suffered a material adverse
change in their business, operations, financial condition, or
prospects since the date of this Agreement or are the subject of
material adverse publicity; but no termination shall be effective
under this subsection (d) until Equitable and the Plan have been
afforded a reasonable opportunity to respond to a statement by
the Trust or the Distributor concerning the reason for notice of
termination hereunder; or
(e) termination by either Equitable or the Plan by written notice to
the Trust and the Distributor, if either Equitable or the Plan
determines, in its sole judgment exercised in good faith, that
either the Trust or the Distributor has suffered a material
adverse change in its business, operations, financial condition,
or prospects since the date of this Agreement or is the subject
of material adverse publicity; but no termination shall be
effective under this subsection (e) until the Trust or the
Distributor have been afforded a reasonable opportunity to
respond to a statement by the Plan concerning the reason for
notice of termination hereunder; or
(f) termination by either the Trust or the Distributor by written
notice to Equitable and the Plan, if the Trust or the Distributor
shall determine, in its sole judgment exercised in good faith,
that the Plan has ceased to be or may in the future cease to be a
Qualified Plan as defined in Section 2.4 hereof.
9.2. Notwithstanding any termination of this Agreement, the Trust and
the Distributor shall, at the option of the Plan, continue to make available
additional shares of the Trust to the Plan pursuant to the terms and conditions
of this Agreement, with respect to all Current Participants on the effective
date of termination (the "Continuing Participants"). Specifically, without
limitation, the Plan shall be permitted to reallocate investments in the
Designated Portfolios, redeem Class 1A shares of the Designated Portfolios,
and/or purchase additional Class 1A shares of the Designated Portfolios in
accordance with the instructions of Continuing Participants. The parties agree
that this Section 9.2 shall not apply to any terminations under Article VI and
the effect of such Article VI terminations shall be governed by Article VI of
this Agreement.
9.3. The Plan shall not redeem Class 1A shares of the Designated
Portfolios except: (a) as necessary to implement the directions of Current
Participants; (b) as required by federal and/or state laws or regulations or
judicial or other legal precedent of general application (hereinafter referred
to as a "Legally Required Redemption"); or (c) as permitted pursuant to Section
26(b) of the 1940 Act or otherwise pursuant to an order of the SEC. Upon
request, the Plan shall promptly furnish to the Trust and the Distributor the
opinion of counsel for the Plan (which counsel shall be reasonably satisfactory
to the Trust and the Distributor) to the effect that any redemption pursuant to
clause (b) above is a Legally Required Redemption or any redemption pursuant to
clause (b) is permitted without first obtaining an order of the SEC pursuant to
Section 26(b) or any other
16
provision of the 1940 Act. Furthermore, as may be in the best interests of the
Current Participants, as determined by the Plan, the Plan shall not prevent Plan
participants from investing through the Plan in any Designated Portfolio
otherwise available under this Agreement without first giving the Trust or the
Distributor written notice of its intention to do so.
9.4. The terms and conditions of the following provisions of this
Agreement shall survive termination of this Agreement: Sections 1.3 to 1.10 of
Article I (governing the pricing and redemption of shares); Article II
(Warranties and Covenants); Sections 3.1 through 3.4 and 3.6 of Article III
(Prospectuses and Proxy Statements, and Voting); Articles IV through IX (Sales
Material and Information; Fees and Expenses; Potential Conflicts;
Indemnification; and Applicable Law); Article X (Notices); and Sections 11.1,
11.2, and 11.5 through 11.8 of Article XI (Miscellaneous).
ARTICLE X. Notices
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth below
or at such other address as such party may from time to time specify in writing
to the other party.
If to the Trust:
EQ Advisors Trust
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
If to the Distributor:
EQ Financial Consultants, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. XxXxxxx
If to the Plan:
The Equitable Investment Plan
The Equitable Life Assurance Society of the United States
1290 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
If to Equitable:
The Equitable Life Assurance Society of the United States
1290 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
17
Attention: Xxxxx X. Xxxxx
ARTICLE XI. Miscellaneous
11.1. All persons dealing with the Trust must look solely to the
property of the Trust for the enforcement of any claims against the Trust as
neither the Board (or its members), officers, agents, or shareholders shall
assume any personal liability for obligations entered into on behalf of the
Trust. All persons asserting claims against the Plan shall look solely to the
property of the Plan as neither the trustees thereof nor any of its officers,
agents, or participants shall assume any personal liability for obligations
entered into on behalf of the Plan.
11.2. Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and addresses
of the Plan participants and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
this Agreement, shall not disclose, disseminate, or utilize such names and
addresses and other confidential information until such time as it may come into
the public domain without the express written consent of the affected party.
Without limiting the foregoing, no party hereto shall disclose any information
that such party has been advised is proprietary, except such information that
such party is required to disclose by any appropriate governmental authority
(including without limitation the SEC, the NASD, the Department of Labor, and
state securities or insurance regulators).
11.3. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
11.4. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
11.5. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule, or otherwise, the remainder of the Agreement
shall not be affected thereby.
11.6. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD, the Department of Labor and state securities or insurance regulators) and
shall permit such authorities reasonable access to its books and records in
connection with any investigation or inquiry relating to this Agreement or the
transactions contemplated hereby.
11.7. The rights, remedies, and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies, and
obligations, at law or in equity, to which the parties hereto are entitled under
federal and state laws.
11.8. This Agreement or any of the rights and obligations hereunder may
not be assigned by any party without the prior written consent of all parties
hereto; provided, however, that the Distributor may assign this Agreement or any
rights or obligations hereunder to any affiliate of or
18
company under common control with the Distributor (but in such event the
Distributor shall continue to be liable under Article VIII of this Agreement for
any indemnification due to the Plan, and the assignee shall also be liable), if
such assignee is duly licensed and registered to perform the obligations of the
Distributor under this Agreement.
11.9. The Plan shall furnish, or shall cause to be furnished, to the
Trust upon request copies of the following reports:
(a) The Plan's annual statements (prepared under statutory accounting
principles) and annual reports (prepared under generally accepted accounting
principles ("GAAP"), if any), as soon as practical and in any event within
ninety (90) days after the end of each fiscal year;
(b) any material financial statement, notice, or report of the Plan
sends to Plan participants, as soon as practical after the delivery thereof to
such Plan participants;
(c) any financial or other reports or filings of the Plan filed with the
Department of Labor, the SEC or any other governmental regulator, as soon as
practical after the filing thereof; and
(d) any other report submitted to the Plan by independent accountants in
connection with any annual, interim, or special audit made by them of the books
of the Plan, as soon as practical after the receipt thereof; but nothing in this
subsection shall require the Plan to disclose any information that is privileged
or which, if disclosed, would put the Plan at a competitive disadvantage or is
both: (a) confidential; and (b) not material to the Plan's financial condition.
11.10. At the request of any party to this Agreement, each other party
will make available to the requesting party's independent auditors and/or
representatives of the appropriate regulatory agencies, all records, data, and
access to operating procedures that may be reasonably requested in connection
with compliance and regulatory requirements related to this Agreement or any
party's obligations under this Agreement.
11.11. Any controversy or claim arising out of or relating to this
Agreement, or breach thereof, shall be settled by arbitration in a forum jointly
selected by the relevant parties (but if applicable law requires some other
forum, then such other forum) in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof.
19
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed in its name and on its behalf by its duly authorized
representative as of the date specified below.
EQ ADVISORS TRUST THE EQUITABLE INVESTMENT PLAN FOR
EMPLOYEES, MANAGERS AND AGENTS
By:
-------------------------------
Name: Xxxxx X. Xxxxx By: Officers Committee on Benefit
Title: President and Trustee Plans, as Plan Fiduciary
By:
-------------------------------
EQ FINANCIAL CONSULTANTS, INC. Name: Xxxxxxx Xxxxxxx
Title: Chairman
By:
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman of the Board THE EQUITABLE LIFE ASSURANCE SOCIETY
and Chief Executive Officer OF THE UNITED STATES
By:
-------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Vice President,
Human Resources
20
