FORM OF DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, dated as of _____________________ by and between
THE EQUITABLE OF COLORADO, INC. ("EOC") for itself and as depositor on behalf of
each presently existing or hereafter created separate accounts supporting EOC
variable products (the "Separate Accounts"), and EQUITABLE DISTRIBUTORS, INC.
(the "Distributor").
W I T N E S S E T H :
WHEREAS, EOC is a life insurance company which offers or may hereafter
offer a number of products, including without limitation, fixed and variable
annuities, fixed and variable life insurance, long-term care coverage and the
like;
WHEREAS, the net consideration from the sale of such products may be
allocated for investment in whole or in part to EOC's general account and/or one
or more of the Separate Accounts;
WHEREAS, the Separate Accounts are separate accounts established and
maintained by EOC pursuant to the laws of the State of Colorado under which
income, gains and losses, whether or not realized, from assets allocated to the
Separate Accounts, are credited to or charged against the Separate Accounts
without regard to other income, gains or losses of EOC;
WHEREAS, the Separate Accounts for which registration is required are
registered as investment companies under the Investment Company Act of 1940
("1940 Act"), and units of interest in the Separate Accounts are registered
under the Securities Act of 1933 ("1933 Act");
WHEREAS, certain general account and/or separate account interests, such
as MVA interests, are registered under the 1933 Act;
WHEREAS, the Distributor, a wholly-owned subsidiary of Equitable Life
Assurance Society of the United States ("Equitable Life"), is a broker-dealer
registered under the Securities Exchange Act of 1934 ("1934 Act") and is a
member of the National Association of Securities Dealers, Inc. ("NASD");
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I
Distribution Responsibilities
Section 1.1 EOC authorizes the Distributor to act, and the Distributor
agrees to serve, as a principal underwriter and distributor of the EOC products
listed on Schedule I attached hereto
and such other EOC products as the parties may from time to time agree will be
distributed by EOC (the "Products") for and on behalf of EOC and, if applicable,
the Separate Accounts with respect to such Products in all states and other
jurisdictions in which the Products may legally be sold. During the term of this
Agreement the Distributor agrees in turn that during such same period it will
act exclusively for Equitable Life and EOC and will not underwrite or distribute
or contract to underwrite or distribute any other financial services products
without the prior written consent of EOC in each instance.
Section 1.2 The Distributor represents that it is a broker-dealer duly
registered under the 1934 Act and is a member in good standing of the NASD and,
to the extent necessary to perform the activities contemplated hereunder, is
duly registered, or otherwise qualified, under the securities laws of every
state and other jurisdiction in which the Products are available for sale, and
the Distributor agrees to maintain such status.
Section 1.3 The Distributor shall at all times function as and be deemed
to be an independent contractor and will be under no obligation to effectuate
any particular number of sales of Products or to promote or make sales, except
to the extent the Distributor deems advisable. The Distributor shall be fully
responsible for carrying out all compliance and supervisory obligations in
connection with its distribution of the Products, to the extent the same are
securities, as required by the NASD Rules of Fair Practice ("NASD Rules") and by
federal and any applicable state or foreign securities laws. The Distributor
shall assume full responsibility for the oversight of securities activities of
any person associated with the Distributor, as defined in Section 3(a)(18) of
the 1934 Act, and engaged directly or indirectly in the distribution of the
Products ("Associated Persons"), and shall have the authority to require that
disciplinary action be taken with respect to the Associated Persons. The
Distributor shall be fully responsible for any and all compensation due and
payable to any persons distributing the Products and/or soliciting applications
therefor directly or indirectly by reason of the authorization granted to
Distributor herein.
Section 1.4 The Distributor is presently a party to or may hereafter enter
into written agreements ("Sales Agreements") with (a) broker-dealers ("Third
Party Broker Dealers") to solicit applications for the sale of securities, (b)
with general agents ("Third Party General Agents") to solicit applications for
insurance products and (c) with Third Party Broker Dealers and their affiliated
Third Party General Agents to jointly solicit applications for the sale of
products that are both securities and insurance products, and is hereby
authorized to PERMIT the solicitation of the products pursuant thereto. A Third
Party Broker Dealer may be a Third Party General Agent. Where state law does not
provide for or require general agents, existing Sales Agreements and new Sales
Agreements may be with individual insurance agents affiliated with a Third Party
Broker Dealer to act as designated insurance principals in place of a Third
Party General Agent, and all references herein to Third Party General Agents
shall also apply to such designated insurance principals. The Distributor
warrants and represents that it has delivered true and complete copies of all
existing Sales Agreements to EOC and that all the terms and conditions of this
Agreement applicable to Sales Agreements hereafter entered into are true with
respect to the existing Sales Agreements. All Sales Agreements hereafter entered
into herein for any Product shall be in the standard form thereof as to such
Product approved in advance by
-2-
EOC with such nonmaterial changes thereto as the other parties thereto may
require. The Distributor shall not hereafter enter into any other form of Sales
Agreement without the prior approval of EOC in each case. EOC has reviewed the
compensation agreements in all existing Sales Agreements and approved such
arrangements. All compensation arrangements in any Sales Agreement with Third
Party Broker Dealers and/or Third Party General Agents hereafter entered into
shall be approved in advance by EOC. The Distributor shall not modify or amend
any compensation arrangement in any Sales Agreement or offer any commission
specials, promotions, bonuses or other cash or non-cash compensation incentives,
without in each case first obtaining the prior consent of EOC thereto;
Section 1.5 The Sales Agreements hereafter entered into shall require that
each party thereto which is a Third Party Broker Dealer shall assume full
responsibility for continued compliance by itself and its associated persons (as
defined in Section 3(a)(18) of the 0000 Xxx) with the NASD Rules and applicable
federal and state securities and insurance laws. Each Third Party Broker Dealer
and its registered representatives ("Registered Representatives") soliciting
applications for the Products shall be duly and appropriately licensed,
registered and otherwise qualified for the sale of the Products under the NASD
Rules and federal and state securities and insurance laws applicable to the
offer and sale of the Products. The Distributor shall have full responsibility
for the supervision of all Third Party Broker Dealers and shall assume, and
indemnify and hold EOC harmless from and against, all liability for the acts and
omissions of any Third Party Broker Dealer or its Registered Representatives.
Section 1.6 The Distributor is authorized to recommend the appointment of
Third Party General Agents and Qualified Agents (as hereinafter defined) of such
Third Party General Agent as agents of EOC for the sale of particular Products.
As used herein a "Qualified Agent" shall mean an insurance agent of a Third
Party General Agent who is licensed to sell products such as the Products it is
being appointed to sell in all states and other jurisdictions in which such
agent intends to sell such Products and, if such Products are both securities
and insurance products, is also a Registered Representative of the Third Party
Broker Dealer affiliated with such Third Party General, an "Appointed EOC Agent"
shall mean a Qualified Agent who has been appointed as an agent of EOC for the
sale of particular Products, and a "Sales Representative" shall mean a
Registered Representative or Appointed EOC Agent, as the case may be. Each Sales
Agreement with a Third Party General Agent, hereafter entered into, shall
obligate such party to apply for and maintain proper insurance licenses for
itself and each of its Appointed EOC Agents in all states and other
jurisdictions in which applications for Products are to be solicited by such
agent. EOC will appoint Qualified Agents recommended by the Distributor as
Appointed EOC Agents in all states and other jurisdictions in which such agent
proposes to solicit applications for Products, provided that EOC reserves the
right to refuse to appoint any Third Party General Agent or individual agent
recommended by the Distributor which EOC determines in its sole discretion to be
unsatisfactory for appointment and, following written notice to the Distributor,
to terminate any such appointment thereafter.
Section 1.7 The parties hereto recognize that Appointed EOC Agents will be
acting as insurance agents of EOC and that the obligations and rights of the
Distributor to supervise such persons shall be limited to the extent
specifically described herein or required under applicable
-3-
federal or state securities laws or NASD Rules. All Sales Agreements hereinafter
entered into shall specifically provide that no sales representative shall be a
third party beneficiary of this Agreement or of such Sales Agreement. No Sales
Representative shall be considered an agent or employee of either EOC or the
Distributor.
Section 1.8 The Distributor shall take reasonable steps to ensure that no
Sales Representative shall recommend the purchase of a Product to any applicant
in the absence of reasonable grounds to believe that the purchase of the Product
is suitable for such applicant. While not limited to the following, a
determination of suitability shall be based on information furnished to the
Sales Representative after reasonable inquiry of such applicant (and any other
information known about the applicant) concerning the applicant's insurance and
investment objectives and financial situation and needs, including the
likelihood (depending upon the nature of the Product) that the applicant will
make sufficient payments or retain the Product for a sufficient period of time
to derive the benefits of the Product.
Section 1.9 The Distributor shall not use, develop or distribute, nor
permit any other person, including, without limitation, any Third Party Broker
Dealer, Third Party General Agent or Sales Representative to use, develop or
distribute, any promotional, sales, marketing and advertising materials relating
to Products, including, without limitation, advertisements, sales brochures,
circulars, research reports, market letters, form letters, seminar texts,
proposals, illustrations, or other materials and communications (collectively,
"Sales Materials") which have not been approved in advance by EOC. The
Distributor agrees that it will make timely filings, as required, with the NASD
and all other securities regulators of all Sales Materials and obtain such
approvals as may be necessary. EOC will be responsible for filing all Sales
Materials, as necessary, with insurance regulatory authorities and obtaining any
required approvals. The Distributor shall not make, nor shall it permit any
other person including, without limitation, any Third Party Broker Dealer, Third
Party General Agent or Sales Representative to make, any warranties or
representations with respect to the Products or communicate any information
regarding EOC, the Products, any Separate Account, any MVA interests or the
funding media as to any Product which is not contained in Sales Materials
approved by EOC, as provided in this Agreement, or included in any registration
statements with respect to such Product effective under the 1933 Act at the time
of such warranty, representation or communication.
Section 1.10 The Distributor shall not possess or exercise any authority
on behalf of EOC other than that expressly conferred pursuant to this Agreement.
In particular, and without limiting the foregoing, the Distributor shall not,
nor shall it permit any Third Party Broker Dealer, Third Party General Agent or
Sales Representative to, (i) modify or amend any Product in any respect or make,
alter or discharge any contract or policy or other contract entered into
pursuant to any such contract or policy; (ii) waive any contract or policy
provision; (iii) extend the time for payment of any premiums; (iv) receive any
monies in payment of premiums in respect of any contract or policy (except for
the sole purpose of forwarding the same to EOC); (v) make any representations
concerning any of the terms, rates, charges or provisions of any contract or
policy except as expressly authorized in writing by EOC, (vi) agree to any
private labeling of any Product or sell or distribute any Product under any name
other than EOC, (vii) enter into any reinsurance or coinsurance agreement or
undertaking, or (viii) issue, modify or amend any regulations or
-4-
procedures concerning the Products or the sale or distribution of the Products,
without in each case first obtaining the prior consent of EOC thereto.
Section 1.11 The Distributor shall be responsible for maintaining all
records with respect to Sales Representatives and for furnishing periodic
reports to EOC as to the sale of Products made pursuant to Sales Agreements
entered into pursuant to this Agreement.
Section 1.12 Anything in this Agreement to the contrary notwithstanding,
EOC shall retain the ultimate right of control over, and the responsibility for,
the issuance, servicing and marketing of the Products, including the right to
review and approve all advertising concerning the Products, to suspend sales of
the Products in any jurisdiction or jurisdictions, to appoint and discharge its
agents authorized to sell the Products, and to refuse to sell a Product to any
applicant for any reason whatsoever.
-5-
ARTICLE II
Recordkeeping Responsibility for the Products
Section 2.1 The Distributor and EOC shall each cause to be maintained and
preserved such accounts, books and other documents as are required of each of
them by the 1934 Act and 1940 Act and any other applicable laws and regulations.
In particular, without limiting the foregoing, the Distributor shall cause all
the books and records in connection with the offer and sale of the Products to
be maintained and preserved in conformity with the requirements of Rules 17a-3
and 17a-4 under the 1934 Act and as may otherwise be required under the NASD
Rules and federal and applicable state securities laws, to the extent that such
requirements are applicable to the Products.
Section 2.2 The Distributor and EOC shall each submit to all regulators
and administrative bodies having jurisdiction over the sales of the Products,
present or future, any information, reports or other material that any such body
may request or require pursuant to applicable laws or regulations. In
particular, without limiting the foregoing, EOC agrees that any books and
records which it maintains which are required to be maintained by the
Distributor under Rule 17a-3 or 17a-4 of the 1934 Act shall be subject to
inspection by the Securities and Exchange Commission ("SEC") in accordance with
Section 17(a) of the 1934 Act.
Section 2.3 The Distributor and EOC each agree and understand that all
documents, reports, records, books, files and other materials required under
applicable NASD regulations and federal and state securities laws relative to
the sale of Products shall be the property of the Distributor, with the
exception of any books and records maintained by EOC which relate to sales
compensation and which shall be the joint property of EOC and the Distributor.
If, however, such documents, reports, records, books, files and other materials
which are the property of the Distributor are required by applicable regulation
or law to be maintained also by EOC, such material shall be the joint property
of the Distributor and EOC. All other documents, reports, records, books, files
and other materials maintained relative to this Agreement shall be the property
of EOC. Upon the termination of this Agreement, all such material shall be
returned to the applicable party.
Section 2.4 The Distributor and EOC, from time to time during the term of
this Agreement, shall allocate among themselves, subject to a right of further
delegation, the administrative responsibility for maintaining and preserving the
books, records and accounts kept in connection with the Products; provided,
however, in the case of books, records and accounts kept pursuant to a
requirement of applicable law or regulation, the ultimate responsibility for
maintaining and preserving such books, records and accounts shall be that of the
party which is required to maintain or preserve such books, records and accounts
under the applicable law or regulation, and such books, records and accounts
shall be maintained and preserved under the supervision of that party. The
Distributor and EOC shall cause each other to be furnished with such reports as
each may reasonably request for the purpose of meeting its respective reporting
and recordkeeping requirements under such regulations and laws and under the
insurance laws of the State of Colorado and any other applicable states or
jurisdictions.
-6-
ARTICLE III
Sale Procedures
Section 3.1 EOC represents and warrants that all Products and units of
interest therein, if any, which must be registered under the 1933 Act have been
so registered, that all Separate Accounts to which any of the products are
allocated are registered under the 1940 Act, that the Products which are
insurance products are qualified to be sold under the insurance laws and that
the Products which are securities are qualified to be sold under the applicable
securities laws of all states and other jurisdictions in which the Products are
authorized for sale. EOC further represents and warrants that it is a life
insurance company duly organized under the laws of the State of Colorado in good
standing and authorized to conduct business under the laws of each state in
which the Products are offered and sold.
Section 3.2 The Sales Agreements hereafter entered into will obligate
Third Party Broker Dealers, Third Party General Agents and Sales Representatives
to use only the currently effective prospectuses, statements of additional
information ("SAIs") and other authorized materials in soliciting the sale of
the Products.
Section 3.3 The Sales Agreements hereafter entered into shall provide that
all applications for the Products shall be made on application forms supplied by
EOC or in a form otherwise satisfactory to EOC, and shall be forwarded directly
to EOC, together with any other required documentation and all premiums and
other sums at the address indicated on such application or to such other address
as EOC may, from time to time, designate in writing. Checks, money orders or
electronic transmissions of funds in payment on any Product shall be drawn to
the order of "Equitable of Colorado, Inc." All applications for Products shall
be subject to acceptance or rejection by EOC at its discretion. Any
applications, other documents or payments received by the Distributor shall be
immediately remitted by the Distributor to EOC. All matters relating to the
review and acceptance of applications and the negotiation and issuance of the
Products shall be solely within EOC's control.
Section 3.4 All money payable in connection with the Products, whether as
purchase payments or otherwise, and whether paid by, or on behalf of any
applicant or Product owner, is the property of EOC. If such money is not
transmitted directly by a Third Party Broker Dealer or the Third Party General
Agent to EOC in accordance with the administrative procedures of EOC and is
received by the Distributor, it shall be transmitted promptly by the Distributor
in accordance with the administrative procedures of EOC without any deduction or
offset for any reason, including by example but not limitation, any deduction or
offset for compensation claimed by the Distributor or payable to the Third Party
Broker Dealers or Third Party General Agents, without the prior written consent
of EOC. No payments shall be accepted by the Distributor in connection with the
Products.
Section 3.5 Subject to Section 4.2 below, EOC shall provide to the
Distributor copies of such prospectuses, statements of additional information,
financial statements sales materials and other documents in such numbers as the
Distributor shall reasonably request for use in connection with the solicitation
of applications for the Products.
-7-
Section 3.6 Unless otherwise agreed in writing by EOC, neither the
Distributor, the Third Party Broker Dealers, the Third Party General Agents nor
the Sales Representatives shall have any interest in any premiums, surrender
charges, deductions or other fees payable to EOC.
ARTICLE IV
Commissions and Expense Allowances
Section 4.1 EOC will pay the Distributor as full and complete compensation
for its services under this Agreement a commission and an expense allowance on
each premium actually received by EOC on a contract or policy (a "Contract") for
a Product solicited by a Third Party Broker Dealer and its affiliated Third
Party General Agent pursuant to a Sales Agreement. The amount of such commission
and such expense allowance shall, in each case, be determined in accordance with
the provisions of Schedule II annexed hereto. In no event, however, shall any
compensation paid hereunder exceed the compensation paid in the relevant market
for comparable services. Commissions and expense allowances shall be due and
payable by EOC to the Distributor monthly following the end of each calendar
month in an amount equal to the difference between (1) the total amount of all
commissions and expense allowances due and payable for the calendar year in
question calculated as above provided through and including the last day of such
calendar month and (2) all commissions and expense allowances previously paid to
the Distributor on account of such calendar year. EOC will maintain appropriate
documentation supporting the calculation of commissions and expense allowances
due and payable hereunder which shall be available to the Distributor upon
request. For the purposes of the above formula, the amount of total annual
premiums collected shall be reduced by the amount of premiums returned in the
year in question because of declinations, free look cancellations and, if within
twelve months of original issuance, rescissions.
Section 4.2 The Distributor shall pay all costs and expenses incurred by
it in the performance of its services hereunder, including without limitation,
sums due and payable to Third Party Broker Dealers and/or Third Party General
Agents under the Sales Agreements, without reimbursement or contribution by EOC
or any Separate Account, except that (a) unless otherwise provided in Schedule 1
to the contrary, EOC will reimburse the Distributor for sums due and payable to
Third Party Broker Dealers and/or Third Party General Agents under the Sales
Agreements, (b) the costs of printing the prospectuses, statements of additional
information and sales material used in connection with the solicitation of
applications for the Products pursuant to the Sales Agreements shall be borne by
EOC or the Distributor, or shall be paid in part by each of them, as EOC and the
Distributor shall from time to time mutually agree and (c) appointment and
similar fees with respect to Appointed EOC Agents, including without limitation,
initial appointment fees, renewal appointment fees, transfer fees and
termination fees, shall be borne by EOC or the Distributor, or shall be paid in
part by each of them, as EOC and the Distributor shall from time to time
mutually agree. Sums paid to Third Party Broker Dealers and/or Third Party
General Agents under the Sales Agreements shall be commissions and/or expense
allowances as provided in such Sales Agreements. Sums, if any, borne by EOC with
respect to printing costs pursuant to subsection (b) above and/or appointment
and/or similar fees pursuant to subsection (c) above will be expense allowances.
-8-
ARTICLE V
Complaints and Regulatory Proceedings
Section 5.1 The Distributor and EOC agree to cooperate fully in insurance
regulatory investigations or proceedings or judicial proceedings arising in
connection with the offering, sale or distribution of the Products. The
Distributor and Equitable Life further agree to cooperate fully in any
securities regulatory investigation or proceeding or judicial proceeding with
respect to Equitable Life, the Distributor, their respective affiliates and
agents or representatives, to the extent that such investigation or proceeding
is in connection with the Products.
Section 5.2 Without limiting the generality of Section 5.1, the
Distributor and EOC agree that:
(A) Each will promptly notify the other of any customer complaint or
notice of any regulatory investigation or proceeding or judicial proceeding
received by either of them or any agent or representative thereof which may
affect EOC's issuance of the Products and/or the Distributor.
(B) Each will promptly notify the other of any customer complaint or
notice of any regulatory investigation or proceeding received by it or any of
its affiliates with respect to any Product or the sale thereof.
(C) In the case of a substantive customer complaint, the Distributor
and EOC will cooperate in investigating such complaint and any response to such
complaint which either of them has prepared will be sent to the other for
approval not less than five (5) business days prior to its transmittal to the
customer or regulatory authority, except that if a more prompt response is
required, the proposed response shall be communicated by telephone or facsimile
transmission.
ARTICLE VI
Indemnification
Section 6.1 EOC agrees to indemnify and hold harmless the Distributor and
its officers, directors, employees, agents and representatives against any
losses, claims, damages or liabilities, joint or several, to which the
Distributor or its affiliates or such officer or director may become subject,
under the 1933 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact, required to be
stated therein or necessary to make the statements therein not misleading,
contained in
(A) any registration statement relating the Products or any interests
offered under the Products, or any amendment thereof, or
-9-
(B) any document executed by EOC specifically for the purpose of
qualifying the Products for sale under the securities laws of any jurisdiction.
EOC will reimburse the Distributor and each such officer, director, employee,
agent and/or representative for any legal or other expenses reasonably incurred
by the Distributor or such officer, director, employee, agent and/or
representative in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that EOC will not be
liable in any such case to the extent that such loss, claim, damage or liability
arises out of, or is based upon, an untrue statement or alleged untrue statement
or omission or alleged omission made in reliance upon and in conformity with
information (including, without limitation, negative responses to inquiries)
furnished to EOC by or on behalf of the Distributor specifically for use in the
preparation of any such registration statement or any amendment thereof or any
such qualification document or any amendment thereof.
Section 6.2 The Distributor agrees to indemnify and hold harmless EOC, its
directors, each of its officers who has signed a registration statement relating
to a Product, each person, if any, who controls EOC within the meaning of the
1933 Act or the 1934 Act, and the Separate Accounts against any losses, claims,
damages or liabilities to which EOC and any such director, officer, employee,
agent and/or representative or controlling person may become subject, under the
1933 Act or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon:
(A) Any untrue statement or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, contained in (i)
any registration statement relating to a Product or any interest offered under
the Product or any amendment thereof, or (ii) any qualification document
relating to the Product or interest offered under the Product or any amendment
thereof, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with information (including without
limitation, negative responses to inquiries) furnished to EOC by the Distributor
specifically for use in the preparation of such registration statement,
qualification document or amendment thereof; or
(B) Any unauthorized use of sales materials or any verbal or written
misrepresentations or any unlawful sales practices concerning the Products by
the Distributor or otherwise attributable to a failure by the Distributor to
discharge properly its responsibilities under this Agreement; or
(C) Claims by officers, directors, employees, agents or
representatives or employees of the Distributor for commissions, service fees,
expense allowances or other compensation or remuneration of any type.
The Distributor will reimburse EOC and any director, officer, employee, agent,
representative or controlling person for any legal or other expenses reasonably
incurred by EOC, such director, officer, employee, agent and/or representative
or controlling person in connection with
-10-
investigating or defending any such loss, claim, damage, liability or action.
This indemnity agreement will be in addition to any liability which the
Distributor may otherwise have.
Section 6.3 Promptly after receipt by a party entitled to indemnification
("Indemnified Party") under this Article VI of notice of the commencement of any
action, if a claim in respect thereof is to be made against any person obligated
to provide indemnification under this Article VI ("Indemnifying Party"), such
Indemnified Party will notify the Indemnifying Party in writing of the
commencement thereof, but the omission so to notify the Indemnifying Party will
not relieve it from any liability under this Article VI, except to the extent
that the omission results in a failure of actual notice to the Indemnifying
Party and such Indemnifying Party is damaged solely as a result of the failure
to give such notice. In case any such action is brought against any Indemnified
Party, and it notifies the Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled to participate therein, and, to the extent
that it may wish to assume the defense thereof, with separate counsel
satisfactory to the Indemnified Party. Such participation shall not relieve such
Indemnifying Party of the obligation to reimburse the Indemnified Party for
reasonable legal and other expenses incurred by such Indemnified Party in
defending itself, except for such expenses incurred after the Indemnifying Party
has deposited funds sufficient to effect the settlement, with prejudice, of the
claim in respect of which indemnity is sought. Any such Indemnifying Party shall
not be liable to any such Indemnified Party on account of any settlement of any
claim or action effected without the consent of such Indemnifying Party.
Section 6.4 The indemnity agreements contained in this Article VI shall
remain operative and in full force and effect, regardless of:
(A) any investigation made by or on behalf of the Distributor or any
officer or director thereof or by or on behalf of Equitable Life or any officer
or director thereof;
(B) delivery of any Products and payments therefor; and
(C) any termination of this Agreement.
A successor by law of the Distributor or of any other party to this Agreement,
as the case may be, shall be entitled to the benefits of the indemnity
agreements contained in this Article VI.
ARTICLE VII
Term of Agreement
Section 7.1 This Agreement shall become effective as of the date first
above written and shall continue in full force and effect from year to year
thereafter, until terminated as herein provided.
Section 7.2 This Agreement may be terminated by any party hereto on not
less than sixty (60) days' prior written notice to the other parties or by an
agreement in writing signed by all of the parties hereto. Unless otherwise
agreed by the parties hereto, this Agreement shall automatically be terminated
in the event of its assignment.
-11-
Section 7.3 Upon termination of this Agreement, all authorizations,
rights, and obligations shall cease except as expressly provided to the contrary
herein and except for the obligations of the parties to settle accounts
hereunder, including the settlement of monies due in connection with Products in
effect at the time of termination or issued pursuant to applications received by
EOC prior to termination, and the agreements contained in Articles V and VI.
ARTICLE VIII
Miscellaneous
Section 8.1 None of the parties hereto shall be liable to the other for
any action taken or omitted by it, or any of its officers, agents or employees,
in performing their respective responsibilities under this Agreement in good
faith and without negligence, willful misfeasance or reckless disregard of such
responsibilities.
Section 8.2 The Distributor will execute such papers and do such acts and
things as shall from time to time be reasonably requested by EOC for the purpose
of (a) maintaining the registration of the interests under the Contracts under
the 1933 Act and the Separate Accounts under the 1940 Act, and (b) qualifying
and maintaining qualification of the Contracts for sale under the applicable
laws of any state.
Section 8.3 All notices under this Agreement shall be given in writing and
addressed as follows:
-12-
if to the Distributor, to:
Equitable Distributors, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
if to EOC, to:
The Equitable of Colorado, Inc.
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Chief Distribution Officer
or to such other address as such party may hereafter specify in writing. Each
such notice shall be either hand delivered or transmitted by certified United
States mail, return receipt requested, and shall be effective upon delivery.
Section 8.4 If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
Section 8.5 This Agreement constitutes the entire agreement between the
parties hereto and may be amended only in a written instrument executed by all
parties hereto.
Section 8.6 This Agreement shall be subject to the provisions of the 1934
Act and, to the extent applicable, the 1940 Act and the rules, regulations and
rulings thereunder and of the NASD, from time to time in effect, including such
exemptions from the 1940 Act as the SEC may grant, and the terms hereof shall be
interpreted and construed in accordance therewith.
Section 8.7 This Agreement shall be interpreted in accordance with the
laws of the State of Colorado.
-13-
Section 8.8 This Agreement may be executed in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
amended and restated as of [Date] and to be signed by their respective officials
thereunto duly authorized, as of said date.
THE EQUITABLE OF COLORADO EQUITABLE DISTRIBUTORS, INC.
for itself and as depositor on behalf
of each of the Separate Accounts. By:
--------------------------------
Xxxxx X. Xxxxxxxxxxx, III
By: Co-President and Co-Chief
------------------------------------ Executive Officer
Xxxxx X. Xxxxxxxxxx
Chairman of the Board
and Chief Executive Officer By:
--------------------------------
Xxxx Xxxxxxxxx
Co-President and Co-Chief
Executive Officer
-14-
SCHEDULE I
PRODUCTS
PART 1 - Separate Account VLI
------ --------------------
The Distributor shall distribute the following Products allocated to
Separate Account VLI and/or MVA interests:
IL Protector
PART 2.-Separate Account VA
------ -------------------
The Distributor shall distribute the following Products allocated to
Separate Account VA and/or MVA interests:
Accumulator plus (Non-Qualified)
Accumulator plus (XXX)
Accumulator Xxxx XXX
Accumulator plus (QP)
-i-
SCHEDULE II
COMPENSATION
This Schedule II is annexed to the Distribution Agreement dated as of
January 1, 1998 by and between Equitable of Colorado, Inc., and Equitable
Distributors, Inc.
Compensation payable pursuant to Section 4.1 of the Distribution Agreement
shall be payable as follows:
Aggregate Base Expense
Compensation Commision Allowance
Total Annual Premiums on Premiums on Premiums on Premiums
Received(i) Received(ii) Received Received(iii) Trail
---------- ----------- -------- ------------ -----
Up to $350 Million
The next $350 Million
(i.e., over $350 but not more
than $700 Million)
The next $350 Million
(i.e., over $700 but not more
than $1,050 Million)
The next $350 Million
(i.e., over $1,050 but not more
than $1,400 Million)
All additional premiums
(i.e., over $1,400 Million)
-------------------------
(i) Compensation will be paid on each premium received by EOC on any contract
or policy for a Product which was solicited by a Third Party Broker Dealer and
its affiliated Third Party General Agent pursuant to a Sales Agreement (a
"Contract"). Compensation on each such premium will be in an amount equal to the
premium in question multiplied by the appropriate percentage provided for above.
The percentage used in each case will be determined on the basis of the
aggregate amount of all premiums previously received by EOC on all Contracts
during the calendar year in question.
(ii) Aggregate compensation on premiums received is the sum of base commissions
on premiums received and expense allowances on premiums received.
(iii) Expense allowances are paid in accordance with Colorado Insurance Law and
regulations thereunder. No payment hereunder will be used to effect compensation
in excess of the limits for the sale of insurance.
-i-
