PARTICIPATION AGREEMENT
Among
XXXX XXXXXXXXX VARIABLE INSURANCE TRUST,
XXXX XXXXXXXXX FUNDS DISTRIBUTOR, INC.,
AXA XXXXXXXXX INVESTMENT MANAGEMENT LLC,
and
THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES
THIS AGREEMENT, made and entered into as of the 1st day of May, 2003 by
and among THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES, a New York
stock life insurance company ("Equitable"), on its own behalf and on behalf of
each of its separate accounts set forth on Schedule A hereto, as amended from
time to time (each referred to as the "Account"), XXXX XXXXXXXXX VARIABLE
INSURANCE TRUST, a business trust organized under the laws of the Commonwealth
of Massachusetts (the "Trust"), XXXX XXXXXXXXX FUNDS DISTRIBUTOR, INC., a
Delaware corporation (the "Distributor") and AXA XXXXXXXXX INVESTMENT MANAGEMENT
LLC, a Delaware limited liability company (the "Adviser").
WHEREAS, the Trust engages in business as an open-end management
investment company and is available to act as the investment vehicle for
separate accounts of insurance companies that issue variable life insurance
policies, variable annuity contracts and certificates relating to such policies
or contracts (collectively, the "Variable Contracts") and which have entered
into participation agreements with the Trust and its Distributor (the
"Participating Insurance Companies"); 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
1 shares and the Class 2 shares, or such other classes of shares as may be
created in the future (the "Classes"); and
WHEREAS, one or more Portfolios or Classes thereof may be made
available by the Trust to serve as funding vehicles for Participating Insurance
Companies and their separate accounts funding Variable Contracts; and
WHEREAS, the Securities and Exchange Commission ("SEC") has granted
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 or Classes to be sold to and held
by insurance company separate accounts funding Variable Contracts of both
affiliated and unaffiliated life insurance companies (the "Shared Funding
Exemptive Order"); and
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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 Adviser is the investment adviser to the Trust 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, Equitable has registered or will register each of its Accounts
as a unit investment trust under the 1940 Act and has registered or will
register interests in each Account under the 1933 Act, other than those exempt
from such registration under applicable statutory provisions or regulations; and
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the Board of Directors of Equitable
or through properly delegated authority, and divided into subaccounts, to set
aside and invest assets attributable to the Variable Contracts; and
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, to the extent permitted by applicable insurance laws and
regulations, Equitable intends to purchase shares in the Portfolios and one or
more Classes thereof, listed on Schedule B hereto as amended from time to time
(the "Designated Portfolios and Classes") on behalf of each Account, in order to
fund certain of the Variable Contracts, and the Distributor is authorized to
sell such shares to each Account at the net asset value applicable to such
Portfolios and the Classes thereof.
NOW, THEREFORE, in consideration of their mutual promises, Equitable,
the Trust, the Distributor and the Adviser agree as follows:
ARTICLE I. Sale of Trust Shares
1.1. The Trust has granted to the Distributor authority to distribute
the Trust's shares, and has agreed to instruct, and has so instructed, the
Distributor to make available to Equitable, for purchase on behalf of any
Account, Trust shares of the Designated Portfolios and Classes. Pursuant to such
authority and instructions, the Distributor agrees to sell to each Account those
shares of the Designated Portfolios and Classes for which it serves as the
Trust's principal underwriter and which each Account orders, executing such
orders at the net asset value per share next computed after receipt by the Trust
or its designee of the order for the shares of the Designated Portfolios and
Classes. For purposes of this Section 1.1, Equitable shall be considered the
designee of the Trust for receipt of such purchase orders from each Account (and
only for such purpose or other purposes as described in this Agreement) and
receipt on any Business Day by Equitable of such purchase orders prior to the
Trust's close of business as defined from time to time in the applicable
prospectus for such Designated Portfolios and Classes (which as of the date of
execution of this Agreement is defined as the close of regular trading on the
New York Stock Exchange (normally 4:00 p.m. New York time)) shall constitute
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receipt by the Trust on such Business Day for purposes of calculating
each Portfolio's net asset value per share; provided that the Trust receives
notice of such order by 9:30 a.m. New York time on the next following Business
Day. "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 per share
of the Designated Portfolios and Classes pursuant to SEC rules.
1.2. The Trust agrees to make its shares of the Designated Portfolios
and Classes available for purchase by each Account at the applicable net asset
value per share on those days on which the Trust calculates the net asset value
per share of the Designated Portfolios and Classes in accordance with the
applicable prospectus and pursuant to rules of the SEC. The Trust or its
designee shall use reasonable efforts to calculate the net asset value per share
of the Designated Portfolios and Classes 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 any Designated
Portfolio or Class to any person, or suspend or terminate the offering of shares
of any Portfolio or Class thereof, if such action is required by law or by
regulatory authorities having jurisdiction or is, in the sole discretion of the
Board acting in good faith and in light of its fiduciary duties under federal
and any applicable state laws, necessary in the best interests of the
shareholders of such Portfolio or Class thereof.
1.3. The Trust agrees that shares of the Designated Portfolios and
Classes will be sold only to Participating Insurance Companies and/or their
separate accounts funding Variable Contracts or to other persons or entities
(each a "Qualified Person") permitted under Section 817(h) of the Internal
Revenue Code of 1986, as amended (the "Code"), or regulations promulgated
thereunder without impairing the ability of any Account to consider the
portfolio investments of the Trust as constituting investments of such Account
for the purpose of satisfying the diversification requirements of Section 817(h)
of the Code. No shares of any Portfolio will be sold to the general public,
except to the extent permitted under the Code. Equitable hereby represents and
warrants that it and each Account are Qualified Persons.
1.4. Neither the Trust nor the Distributor will sell Trust shares to
any Participating Insurance Company or separate account funding Variable
Contracts unless an agreement containing provisions substantially similar to the
provisions set forth in Article VII and Section 3.5 of Article III of this
Agreement is in effect to govern such sales.
1.5. The Trust agrees to redeem, at the request of any Account or
Equitable, any full or fractional shares of the Trust held by the Account or
Equitable, pursuant to the terms of the applicable prospectus. The Trust will
execute such requests at the net asset value per share of the Designated
Portfolios and Classes next computed after receipt by the Trust or its designee
of the request for redemption. For purposes of this Section 1.5, Equitable
shall be considered the designee of the Trust for receipt of requests for
redemption from each Account, and receipt on any Business Day by Equitable prior
to the Trust's close of business as defined from time to time in the applicable
prospectus for such Designated Portfolios and Classes (which as of the date of
execution of this Agreement is defined as the close of regular trading on the
New York Stock Exchange (normally 4:00 p.m. New York time)) shall constitute
receipt by the Trust on such Business Day for purposes of calculating each
Portfolio's net asset value per share; provided that the Trust receives notice
of such request for redemption by 9:30 a.m. Eastern time on the next following
Business Day. The Trust may delay redemption of Trust shares of any Portfolio or
Class to the extent permitted by the 1940 Act, any rules, regulations or orders
thereunder, or the then-current prospectus for such Portfolio or Class.
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1.6. Equitable agrees that purchases and redemptions of shares by it of
the Designated Portfolios and Classes offered by a then-current prospectus of
the Trust shall be made in accordance with the provisions of such prospectus.
The Trust or its designee will provide Equitable with a written confirmation of
purchase and redemption orders transmitted to the Trust pursuant to Sections 1.1
and 1.5 above by 10:00 a.m. on the next Business Day following the day the Trust
receives such orders, or in no event later than the time required under
applicable law, which confirmation will include the number of shares with
respect to each Designated Portfolios and Classes that is held by each Account.
Equitable agrees that all net amounts available under the Variable Contracts
listed on Schedule A attached hereto and incorporated herein by this reference,
as such Schedule A may be amended from time to time hereafter by mutual written
agreement of all the parties hereto (the "Equitable Contracts"), shall be
invested in the Trust and in such other investment companies or other investment
vehicles advised by the Adviser as may be mutually agreed to in writing by the
parties hereto, or in Equitable's general account. In addition, amounts also may
be invested in investment companies other than the Trust if: (a) any such other
investment company, or series thereof, has investment objectives or policies
that are, in the reasonable opinion of Equitable, substantially different from
the investment objectives and policies of the Portfolios of the Trust in which
the Accounts invest; or (b) Equitable gives the Trust and the Distributor sixty
(60) days written notice of its intention to make such other investment
companies available as a funding vehicle for the Equitable Contracts, and no
written objection is received by Equitable; or (c) any such other investment
companies were available as a funding vehicle for the Equitable Contracts prior
to the date of this Agreement, provided that Equitable shall provide the Trust
with a list of such other investment companies upon request; or (d) the Trust
and the Distributor consent to the use of any such other investment company.
Notwithstanding the foregoing, during the term of this Agreement, Equitable
shall (a) not undertake promotional activity that substantially disfavors the
Trust and the Designated Portfolios and Classes in comparison with other funding
vehicles available under the Equitable Contracts; (b) not, without prior notice
to the Distributor (unless otherwise required by applicable law), take any
action to operate any Account as a management investment company under the 1940
Act; (c) not, without the prior written consent of the Trust (unless otherwise
required by applicable law), solicit, induce or encourage Contractowners to
change or modify the Trust to change the Trust's distributor or investment
adviser; and (d) not withdraw the Accounts' investment in the Trust or a
Designated Portfolio or Class except as necessary to facilitate Contractowner
requests and routine processing.
1.7. Equitable shall pay for shares of Designated Portfolios and
Classes thereof purchased for the Accounts or its general account on the next
Business Day after an order to purchase Trust shares is made in accordance with
the provisions of Section 1.1 hereof. Payment shall be in federal funds
transmitted by wire and Equitable agrees to use its best efforts to transmit
such funds by no later than 4:00 p.m. New York time on the day of transmission.
If the issuance of shares is canceled because federal funds are not timely
received, Equitable shall indemnify the Trust, the Adviser and the Distributor
with respect to all costs, expenses and losses relating thereto. The Trust shall
settle redemption requests on the next Business Day after a request to redeem
shares of Designated Portfolios and Classes is made in accordance with the
provisions of Section 1.5 hereof. Payment shall be in federal funds transmitted
by wire and the Trust agrees to use commercially reasonable efforts to transmit
such funds by no later than 2:00 p.m. New York time on the day of transmission,
except that the Trust reserves the right to redeem shares of Designated
Portfolios and Classes in assets other than cash and may delay redemption of
such shares to the extent permitted by the 1940 Act, any roles, regulations or
orders
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thereunder, or the then-current prospectus for such Designated Portfolio or
Class. For purposes of Section 2.8 and 2.9, upon receipt of the federal funds so
wired, such funds shall cease to be the responsibility of the paying party and
shall become the responsibility of the receiving party.
1.8. Issuance and transfer of the shares of the Designated Portfolios
and Classes thereof will be by book entry only. Stock certificates will not be
issued to Equitable or any Account. Shares ordered from the Trust will be
recorded in an appropriate title for each Account or the appropriate subaccount
of each Account.
1.9. The Trust shall furnish same Business Day notice (by wire or
telephone, followed by written confirmation) of any income dividends or capital
gain distributions payable on the shares of the Designated Portfolios and
Classes thereof. Equitable and each Account hereby elect to receive all such
income dividends and capital gain distributions as are payable on the shares of
the Designated Portfolios and Classes thereof in additional shares of the
relevant Designated Portfolios and Classes. (Equitable and each Account reserve
the right to revoke this election and to receive all such income dividends and
capital gain distributions in cash; any such revocation shall be made in writing
and must be received by the Trust at least ten (10) days prior to a dividend or
distribution date.) The Trust shall provide notification by the end of the next
Business Day of the number of shares so issued as payment of such dividends and
distributions. The Trust shall provide advance notice to Equitable and each
Account of any date on which the Trust reasonably expects to make a dividend or
distribution; normally this notice will be given at least ten (10) days in
advance of the ex-dividend date.
1.10 The Trust or its designee shall make the net asset value per share
("NAV") for each Designated Portfolio and Class thereof available to Equitable
and each Account or their designee on each Business Day as soon as reasonably
practical after the NAV is calculated (normally by 6:00 p.m. New York time) and
shall use its best efforts to make such NAV available by 6:30 p.m. New York
time. If the Trust or its designee provides material incorrect NAV information
to Equitable, each Account shall be entitled to an adjustment with respect to
the shares of the Designated Portfolios and Classes purchased or redeemed to
reflect the correct NAV. The determination of the circumstances that require
such an adjustment of the shares of the Designated Portfolios and Classes shall
be consistent with the SEC's position regarding the correction of NAV errors.
The Trust agrees to provide Equitable with prompt notice of any material error
in NAV information that requires an adjustment of shares of the Designated
Classes and Portfolios maintained in the Accounts. The correction of any
material NAV error shall be made by the Trust at the Account level and shall be
carried out in accordance with the SEC's guidelines regarding such errors. The
Trust and Equitable agree to use reasonable efforts to take such action as may
be appropriate to avoid or mitigate costs or losses related to the correction
of NAV information.
1.11. Any purchase or redemption request for shares of the Designated
Portfolios and Classes held or to be held in Equitable's general account shall
be effected at the net asset value per share next determined after the Trust's
actual receipt of such request, provided that, in the case of a purchase
request, payment for Trust shares so requested is received by the Trust in
federal funds prior to the deadline for determination of such value, as set
forth from time to time in the applicable prospectus.
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1.12. The procedures set forth herein are subject to any additional
terms set forth in the applicable prospectus for the Designated Portfolio or
Class or by the requirements of applicable law.
ARTICLE II. Representations and Warranties
2.1. Equitable represents and warrants that: (a) the Equitable
Contracts will be issued and sold in compliance, in all material respects, with
all applicable federal and state laws; and (b) the sale of the Equitable
Contracts will comply, in all material respects, with state insurance
suitability requirements. Equitable further represents and warrants that: (a) it
is an insurance company duly organized and in good standing under applicable
law; (b) it has legally and validly established each Account, prior to any
issuance or sale of interests therein, as a segregated asset account under
applicable laws; (c) it has registered or, prior to any issuance or sale of the
Equitable Contracts, will register each Account as a unit investment trust in
accordance with the provisions of the 1940 Act to serve as a segregated
investment account for the Equitable Contracts (and will maintain such effective
registration), unless such Accounts are exempt from such registration under
applicable statutory provisions or regulations; (d) it has registered or, prior
to the issuance or sale of the Equitable Contracts, will register interests in
the Accounts and maintain such effective registration under the 1933 Act, unless
interests in such Accounts are exempt from such registration under applicable
statutory provisions or regulations; and (e) its entering into and performing
its obligations under this Agreement does not and will not violate its charter
and other organizational documents or by-laws, rules or regulations, or any
agreement to which it is a party.
Equitable represents that it is either a financial institution subject
to the Uniting and Strengthening America by Providing Appropriate tools Required
to Intercept and Obstruct Terrorism Act of 2001 ("USA Patriot Act") and the Bank
Secrecy Act (collectively, the "AML Acts") or it shall perform under this
Agreement and sell the Equitable Contracts as if it were subject to the AML
Acts, which require among other things, that financial institutions adopt
compliance programs to guard against money laundering, and it has adopted and
implemented and shall continue to administer a program in compliance with the
AML Acts and applicable anti-money laundering ("AML") rules of self regulatory
organizations, such as NASD Ru1e 3011, in all relevant respects. Equitable
agrees to cooperate with Distributor to satisfy Distributor's due diligence
policies, which may include annual AML compliance certifications, periodic AML
due diligence reviews and/or other requests deemed necessary to ensure
Equitable's compliance with the AML regulations.
In addition, the parties hereto agree that any Nonpublic Personal
Information, as the term is defined in SEC Regulation S-P ("Reg S-P"), that may
be disclosed by a party hereunder is disclosed for the specific purpose of
permitting the other party to perform the services set forth in this Agreement.
Each party agrees that, with respect to such information, it will comply with
Reg S-P and any other applicable regulations and that it will not disclose any
Nonpublic Personal Information received in connection with this Agreement or any
other party, except to the extent required to carry out the services set forth
in this Agreement or as otherwise permitted by law.
2.2. The Trust, to the best of its knowledge, represents and warrants
that Trust shares sold pursuant to this Agreement shall be: (a) registered under
the 1933 Act; and (b) duly authorized for issuance; and (c) sold in compliance
with and all applicable federal securities
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laws. The Trust further represents and warrants that it is and shall remain
registered under the 1940 Act. The Trust shall 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
shares of the Designated Portfolios and Classes. This requirement shall not,
however, in any manner limit the Trust's ability to cease offering shares in one
or more of the Designated Portfolios or Classes, provided such action complies
with applicable laws and regulations.
2.3. Equitable represents that the Equitable Contracts are currently
treated as annuity, endowment or life insurance contracts under applicable
provisions of the Code and that it will make every effort to maintain such
treatment and that it will notify the Trust and the Distributor immediately upon
having a reasonable basis for believing that the Equitable Contracts have ceased
to be so treated or that they might not be so treated in the future.
2.4. The Trust currently intends for one or more Classes, particularly
Class 2, to make payments to finance its distribution expenses pursuant to a
Plan adopted under Rule 12b-1 under the 1940 Act, although the Trustees may
determine to discontinue such practice in the future. To the extent that any
Class of the Trust finances its distribution expenses pursuant to a Plan adopted
under Rule 12b-l, the Trust undertakes to have a Board, a majority of members
who are not interested persons of the Trust or its Distributor or Adviser, and
to otherwise comply with any then current SEC and SEC staff interpretations
concerning Rule 12b-1 or any successor provision.
2.5. The Trust makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and investment
policies) complies with the insurance laws or regulations of any state.
2.6. The Distributor represents and warrants that: (a) it is duly
organized and has the authority to enter into this agreement, (b) it is a member
in good standing of the NASD; and (c) it is registered as a broker-dealer with
the SEC and all necessary states. The Distributor further represents that it
will sell and distribute the Trust's shares in accordance with all applicable
federal and state securities laws and regulations, including without limitation
the 1933 Act, the 1934 Act, the 1940 Act, and all applicable Rules of the NASD.
2.7. The Trust represents that (a) it is lawfully organized and validly
existing under the laws of the Commonwealth of Massachusetts, (b) it has the
authority to enter into this agreement, and (c) that it does and will comply, in
all material respects, with the 0000 Xxx.
2.8. The Trust, the Distributor and the Adviser severally represent and
warrant that all of their 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-(l) 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.
2.9. Equitable represents and warrants that all of its directors,
officers, employees, and other individuals/entities dealing with the money
and/or securities of the Accounts are covered
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by a blanket fidelity bond or similar coverage for the benefit of Equitable
and/or the Accounts. Equitable further represents and warrants that said
fidelity bond is issued by a reputable bonding company, includes coverage for
larceny and embezzlement, and is in an amount not less than $5 million.
Equitable agrees to make all reasonable efforts to see that this fidelity bond
or another bond containing these provisions is continuously in effect and agrees
to notify the Trust, the Distributor and the Adviser in the event that such
coverage no longer applies.
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. The Trust or the Distributor shall provide Equitable with a copy,
in camera-ready form or form otherwise suitable for printing or duplication, of
the Trust's current prospectus and Statement of Additional Information and any
supplements thereto for the Designated Portfolios and Classes thereof as
Equitable may reasonably request, and such other assistance as is reasonably
necessary in order for Equitable once each year (or more frequently if the
prospectus and/or Statement of Additional Information for the Designated
Portfolios and Classes thereof is amended during the year) to have the
prospectus for the Account, with respect to the Equitable Contracts, and the
Trust's prospectus printed together in one document, and to have the Statement
of Additional Information for the Trust and the Statement of Additional
Information for the Account, with respect to the Equitable Contracts, printed
together in one document. The parties may agree on alternate arrangements,
subject to the Trust's approval, including the provision of printed copies of
the Trust's prospectus and Statement of Additional Information and any
supplements thereto for the Designated Portfolios and Classes thereof.
Alternatively, subject to the Trust's prior approval, Equitable may print the
prospectus and/or Statement of Additional Information for the Designated
Portfolios and Classes thereof in combination within the prospectuses and
Statements of Additional Information for other investment companies. To the
extent that the foregoing Trust prospectuses, Statements of Additional
Information and any supplements thereto are with respect to Class 2 shares, or
other Classes of shares subject to a Plan adopted under Rule 12b-l under the
1940 Act, the cost of preparing, printing, and distributing such documents will
be at the expense of such Class or Classes of shares, with respect to
prospective owners of Equitable Contracts. In addition, with respect to
prospectuses and Statements of Additional Information for the Designated
Portfolios and Classes thereof provided by Equitable to its existing owners of
EqUitable Contracts ("Contractowners") in order to update disclosure as required
by the 1933 Act and/or the 1940 Act, the cost of preparing, printing, mailing
and otherwise distributing such prospectuses and Statements of Additional
Information and any supplements thereto shall be borne by the Trust.
Furthermore, if in such case Equitable is provided with camera-ready film of
such documents in lieu of printed documents, Equitable shall request
reimbursement from the Trust for their printing, mailing and other costs
associated with such distribution.
Equitable and the Distributor each agree to provide the Trust or its
designee with such information as may be reasonably requested by the Trust to
assure that the Trust's expenses or the expenses of any Class do not include the
cost of printing, mailing and otherwise distributing any prospectuses,
Statements of Additional Information or supplements thereto for the Designated
Portfolios and Classes thereof other than those actually distributed (a) to
existing Contractowners; or (b) under a Rule 12b-l Plan for a particular Class
of shares to prospective Contractowners.
3.2 Equitable may alter the form of the Trust's prospectus, Statement
of Additional Information, Annual and Semi-Annual Reports to shareholders, proxy
statements, and other Trust
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documents with the prior approval of the Trust. Equitable shall bear all costs
associated with such alteration of form.
3.3. The Trust's prospectus for the Designated Portfolios and Classes
thereof shall state that the Statement of Additional Information for the
Designated Portfolios and Classes thereof is available from the Distributor or
Equitable (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 Equitable with copies of
its proxy statements, Annual and Semi-Annual Reports to shareholders, and other
communications to shareholders in such quantities as Equitable shall reasonably
require for mailing or otherwise distributing such materials to Contractowners
and shall assume all expenses associated with mailing or otherwise distributing
those materials. In the alternative, the Trust shall reimburse Equitable for its
costs in printing, mailing and distributing such materials to Contractowners.
3.5. If and to the extent required by law, Equitable shall:
(a) solicit voting instructions from Contractowners;
(b) vote the Trust shares for the Designated Portfolios and
Classes in accordance with instructions received from Contractowners;
and
(c) vote Trust shares for the Designated Portfolios and Classes
for which no instructions have been received in a particular Account in
the same proportion as Trust shares for the Designated Portfolios and
Classes 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 Contractowners. Equitable reserves
the right to vote Trust shares held in any Account in its own right, to
the extent permitted by law. Participating Insurance Companies shall be
responsible for assuring that each of their separate accounts
participating in the Trust calculates voting privileges in a manner
consistent with the standards adopted by the Board, which standards
will be provided to all other Participating Insurance Companies.
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 staffs 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. Equitable 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 Adviser or the Distributor is named
prior to its first use and if the Distributor is named therein shall also
furnish such literature or material to the Distributor prior to its first use.
No such material shall be used if the Trust or its designee, or the Distributor,
if applicable, reasonably objects to its use after the Trust's or the
Distributor's, if applicable, receipt of such material.
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4.2. Equitable shall not give any information or make any
representations or statements on behalf of the Trust or the Distributor or
concerning the Trust or the Distributor in connection with the sale of the
Equitable Contracts 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
or, if applicable, the Distributor, except with the permission of the Trust or
its designees, or, if applicable, the Distributor.
4.3. The Trust, the Distributor or the Adviser, or their respective
designees, shall each furnish, or shall cause to be furnished, to Equitable or
its designees, the form of each piece of sales literature or other promotional
material it prepares in which Equitable is named prior to its use. No such
material shall be used if Equitable or its designees reasonably object to its
use after receipt of such material.
4.4. The Trust, the Distributor and the Adviser shall not give any
information or make any representations on behalf of Equitable or concerning
Equitable, each Account, or the Equitable Contracts other than the information
or representations contained in or accurately derived from a registration
statement, prospectus or Statement of Additional Information for the Accounts
with respect to the Equitable Contracts, as such registration statement,
prospectus or Statement of Additional Information may be amended or supplemented
from time to time, or in published reports for each Account which are in the
public domain or approved by Equitable for distribution to Contractowners, or in
sales literature or other promotional material approved by Equitable or its
designees, except with the permission of Equitable.
4.5. The Trust shall provide to Equitable (a) at least one complete
copy of all Registration Statements, prospectuses, Statements of Additional
Information, reports, proxy statements, sales literature and other promotional
materials, applications for exemptions, requests for no-action letters, and all
amendments to any of the above, that relate to the Trust or its shares,
contemporaneously with the filing of such document with the SEC, the NASD, or
other regulatory authorities and (b) drafts of each of the foregoing
sufficiently in advance of filing such materials with regulatory authorities to
allow Equitable a reasonable opportunity to review the materials.
4.6. Equitable shall provide to the Trust (a) at least one complete
copy of all registration statements, prospectuses, Statements of Additional
Information, reports, solicitations for voting instructions, sales literature
and other promotional materials, applications for exemptions, requests for
no-action letters, and all amendments to any of the above, that relate to the
Equitable Contracts or any Account if such document also relates to the Trust,
contemporaneously with the filing of such document with the SEC, the NASD, or
other regulatory authorities and (b) drafts of each of the foregoing
sufficiently in advance of filing such materials with regulatory authorities to
allow the Trust a reasonable opportunity to review the materials.
4.7. 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
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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, prospectuses, Statements of Additional Information,
shareholder reports, and proxy materials. However, it is anticipated that
materials provided solely: (a) internally to Equitable's or the Distributor's
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. The Trust, the Distributor and the Adviser shall pay no fee or
other compensation to Equitable under this Agreement except for: (a) items
covered in Article III; or (b) pursuant to a Plan adopted by the Trust in
accordance with Rule 12b-l under the 1940 Act to finance the distribution
expenses of any Class. Nevertheless, the Distributor and the Adviser may make
payments to Equitable or to any distributor for the Equitable Contracts in
amounts agreed to by the Distributor and the Adviser in any writing, and such
payments by the Distributor and the Adviser (other than pursuant to a Rule 12b-l
Plan) may be made out of existing fees otherwise payable to the Distributor and
the Adviser, past profits of the Distributor and the Adviser, or other resources
available to the Distributor and the Adviser.
5.2. All expenses incidental to performance by the Trust under this
Agreement shall be paid by the Trust. Without limiting the foregoing, the Trust
shall see to it that all shares are registered and authorized for issuance prior
to their sale in accordance with applicable federal law, and shall bear all
expenses with respect to: registration and qualification of the Trust's shares;
preparation and filing of the Trust's Registration Statement, prospectus,
Statement of Additional Information, proxy materials, and reports; preparing a
camera-ready copy of or, where otherwise agreed by the parties, setting the
prospectus and Statement of Additional Information in type; setting in type,
printing, mailing or otherwise distributing proxy materials and Semi-Annual and
Annual Reports sent to Contractowners (including the costs of setting in type,
printing, mailing or otherwise distributing a prospectus that constitutes an
Annual Report) and if certain Classes of the Trust so elect and the Rule 12b-l
Plan so provides, the preparation, printing, mailing or otherwise distributing
of such materials to prospective owners of Equitable Contracts; 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.
5.3. All expenses incidental to performance by Equitable under this
Agreement shall be paid by Equitable. Without limiting the foregoing, Equitable
shall ensure that all Equitable Contracts are registered and qualified under the
federal securities laws, and shall bear all expenses with respect to:
registration and qualification of the Equitable Contracts; preparation and
filing of the Equitable Contracts' Registration Statements, prospectuses and
Statements of Additional Information; setting the prospectuses and Statements of
Additional Information in type; administration of the Equitable Contracts;
except otherwise to the extent certain Classes of the Trust so elect and the
Rule 12b-l Plan so provides, the sale, marketing and distribution of the
Equitable Contracts, including the preparation, printing, mailing or otherwise
distributing of
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Trust prospectuses to prospective owners of Equitable Contracts; the preparation
of all statements and notices required by any federal or state insurance law
other than those paid for by the Trust; fees relating to the Equitable
Contracts, including, without limitation, all fees due under Rule 24f-2 of the
1940 Act; and preparation, printing and dissemination of all marketing materials
for the Equitable Contracts, except where other arrangements are made in
advance.
ARTICLE VI. Diversification
6.1. The Trust and each of its constituent Portfolios represent that:
(a) each currently has elected to qualify as a regulated investment company
under Subchapter M of the Code; (b) each will use its best efforts to maintain
such qualification (under Subchapter M or any successor or similar provision);
(c) each will notify Equitable 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) each will seek to minimize any damages and to rectify its
failure to so qualify promptly. The Trust acknowledges that any failure by any
Portfolio to qualify as a regulated investment company may eliminate the ability
of the Accounts to avail themselves of the "look through" provisions of Section
817(h) of the Code and that, as a result, the Equitable Contracts may fail to
qualify as life insurance and annuity contracts under Section 817(h) of the
Code.
6.2. Without limiting the scope of the foregoing, with respect to the
Trust's compliance with the foregoing, the Trust represents that, with respect
to each Portfolio, it will at all times comply with Section 817(h) of the 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, and upon request, the
Trust will provide Equitable with periodic (usually quarterly) certification, in
the form reasonably requested by Equitable. In the event of a breach of this
Article VI by the Trust, the Trust warrants that it will take all reasonable
steps: (a) to immediately notify Equitable 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.
ARTICLE VII. Potential Conflicts
7.1. The Board will monitor the Trust for the existence of any material
irreconcilable conflict between the interests of the contractowners of all
variable annuity and variable life insurance separate accounts investing in the
Trust. 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 by owners of Variable Contracts; or (f) a decision by an
insurer to disregard the voting instructions of owners of Variable Contracts.
Each party hereto shall promptly inform the others if it determines that a
material irreconcilable conflict exists and the implications thereof.
7.2. Equitable will report any potential or existing conflicts, of
which it is aware, to the Board. In this regard, Equitable will monitor its
operations for the purpose of identifying any material potential or existing
conflicts. Equitable will assist the Board in carrying out its responsibilities
under any Shared Funding Exemptive Order, by providing the Board with all
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information reasonably necessary for the Board to consider any issues raised.
This includes, but is not limited to, an obligation by Equitable to inform the
Board whenever the voting instructions of owners of Variable Contracts are
disregarded. Equitable's responsibilities under this Section 7.2 will be carried
out with a view only to the interests of its Contractowners.
7.3. If it is determined by a majority of the Board, or a majority of
its disinterested Trustees, that a material irreconcilable conflict exists,
which determination shall be deemed conclusive as to the existence of such
material irreconcilable conflict and as to whether any proposed action
adequately remedies such conflict, Equitable and other Participating Insurance
Companies 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) withdrawing the assets allocable to some or all of the variable
annuity and variable life insurance separate accounts from the Trust or any
Portfolio and reinvesting such assets in a different investment medium,
including (but not limited to) another Portfolio of the Trust, or submitting the
question of whether such withdrawal should be implemented to a vote of all
affected owners of Variable Contracts and, as appropriate, withdrawing the
assets of any appropriate group (i.e., owners of variable annuity contracts or
owners of variable life insurance contracts of one or more Participating
Insurance Companies) that votes in favor of such withdrawal, or offering to the
affected owners of Variable Contracts the option of making such a change; and
(b) establishing anew registered management investment company or managed
separate account. Equitable's responsibilities under this Section 7.3 will be
carried out with a view only to the interests of Contractowners.
7.4. If a material irreconcilable conflict were ever to arise because
of a decision by Equitable to disregard Contractowner voting instructions and
that decision represents a minority position or would preclude a majority vote,
Equitable may be required, at the Trust's election, to withdraw the affected
Account's (or subaccount's) investment in the Trust and terminate this Agreement
with respect to such Account (or subaccount); provided, however, that such
withdrawal and termination shall 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 withdrawal. Any such withdrawal and termination must take place
within six (6) months after the Trust gives written notice that this provision
is being implemented and, until the end of that six (6) month period, the
Distributor and Trust shall continue to accept and implement orders by Equitable
for the purchase (and redemption) of shares of the Trust.
7.5. If a material irreconcilable conflict were ever to arise because
a particular state insurance regulator's decision applicable to Equitable
conflicts with the majority of other state regulators, then Equitable shall
withdraw the affected Account's (or subaccount's) investment in the Trust and
terminate this Agreement with respect to such Account (or subaccount) within six
(6) months after the Board informs Equitable in writing that it has determined
that such decision has created a material irreconcilable conflict; provided,
however, that such withdrawal and termination shall be limited to the extent
required by the foregoing material irreconcilable conflict as dated by a
majority of the disinterested members of the Board. Until the end of the
foregoing six (6) month period, the Distributor and Trust shall continue to
accept and implement orders by Equitable for the purchase (and redemption) of
shares of the Trust.
7.6. For purposes of Sections 7.3 through 7.6 of this Agreement, a
majority of the disinterested members of the Board shall determine whether any
proposed action adequately
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remedies any material irreconcilable conflict, but in no event will the Trust be
required to establish a new funding medium for the Equitable Contracts.
Equitable shall not be required by Section 7.3 to establish a new funding medium
for the Equitable Contracts if an offer to do so has been declined by vote of a
majority of Contractowners materially adversely affected by the material
irreconcilable conflict. In the event that the Board determines that any
proposed action does not adequately remedy any material irreconcilable conflict,
then Equitable will withdraw the Account's (or subaccount's) investment in the
Trust and terminate this Agreement within six (6) months after the Board informs
Equitable 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.
7.7. 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 Participating Insurance
Companies, 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, 7.1, 7.2, 7.3, 7.4, and
7.5 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 VIII. Indemnification
8.1. Indemnification By Equitable
8.1(a). Equitable agrees to indemnify and hold harmless the Trust, each
member of the Board, the Distributor, the Adviser and their directors, officers,
members, employees and agents, 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 8.1) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement with
the written consent of Equitable, which consent shall not reasonably be
withheld), 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 the sale or acquisition of the Trust's shares or the Equitable
Contracts or interests in the Accounts and:
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statement, prospectus, or Statement of Additional
Information for the Equitable Contracts or contained in the Equitable
Contracts or sales literature for the Equitable Contracts (or any
amendment or supplement to any of the foregoing), 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, provided that this agreement to
indemnify
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shall not apply as to any Indemnified Party to the extent that such
statement or omission or such alleged statement or omission was made in
reliance upon and in conformity with information furnished to Equitable
by or on behalf of the Trust (with respect to Indemnified Parties who
are Trustees, officers or agents of the Trust) or the Distributor (with
respect to Indemnified Parties who are directors, officers, employees
or agents of the Distributor) for use in the registration statement,
prospectus, or Statement of Additional Information for the Equitable
Contracts or in the Equitable Contracts or sales literature (or any
amendment or supplement) or otherwise for use in connection with the
sale of the Equitable Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations contained in
the Registration Statement, prospectus or Statement of Additional
Information of the Trust not supplied by Equitable or persons under its
control) or negligent or wrongful conduct of Equitable or persons under
its control or acting at its direction, with respect to the sale or
distribution of the Equitable Contracts or Trust shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a Registration Statement,
prospectus, or Statement of Additional Information, or sales literature
of the Trust or any amendment thereof or supplement thereto 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, if such a statement or omission was made in reliance upon
information furnished to the Trust by or on behalf of Equitable; or
(iv) arise as a result of any failure by Equitable to provide
the services, furnish the materials or make the payments required to be
provided or furnished or made by it under the terms of this Agreement;
or
(v) arise out of or result from any material breach of any
representation and/or warranty made by Equitable in this Agreement or
arise out of or result from any other material breach of this Agreement
by Equitable, including any failure to transmit a request for
redemption or purchase of Trust shares or payment therefor on a timely
basis in accordance with the procedures set forth in Section 1.7;
as limited by and in accordance with the provisions of Sections 8.1(b) and
8.1(c) hereof.
8.1(b). Equitable shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities, or
litigation incurred or assessed against an Indemnified Party to the extent that
such arises 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 or duties
under this Agreement or to the Trust, whichever is applicable.
8.1(c). Equitable shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified Equitable 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
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agent), but failure to notify Equitable of any such claim shall not relieve
Equitable from any liability which it may have to the Indemnified Party against
whom such action is brought otherwise than on account of this indemnification
provision. In case any such action is brought against one or more Indemnified
Parties and indemnification is requested therefor, Equitable shall be entitled
to participate, at its own expense, in the defense of such action. Equitable
also shall be entitled to assume the defense thereof, with counsel reasonably
satisfactory to the party named in the action. After notice from Equitable to
such party of Equitable's election to assume the defense thereof, the
Indemnified Party shall bear the fees and expenses of any additional counsel
retained by it, and Equitable 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, unless such Indemnified Party's interests in such legal
process are materially adverse to those of Equitable and indemnification is
otherwise appropriate under this Section 8.1, provided that Equitable shall be
liable for the costs and expenses of different counsel for separate Indemnified
Parties for related claims or actions only to the extent that such Indemnified
Parties' interest in such legal process are materially adverse to each other.
Equitable shall not settle or compromise any action of which it assumes the
defense without the consent of the affected Indemnified Parties unless the
Indemnified Parties are thereby released of all liability, fault and obligation.
8.1(d). The Indemnified Parties shall promptly notify Equitable of the
commencement of any litigation or proceedings against them in connection with
this Agreement, the issuance or sale of the Trust's shares or the Equitable
Contracts or the operation of the Trust, but any failure to notify under this
Section 8.1(d) shall not constitute a failure to notify under Section 8.1(c).
8.2. Indemnification by the Distributor
8.2(a). The Distributor agrees to indemnify and hold harmless Equitable
and each of its directors, officers, members, employees and agents and each
person, if any, who controls Equitable within the meaning of Section 15 of the
1933 Act (collectively, the "Indemnified Parties" for purposes of this Section
8.2) against any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Distributor, which consent
shall not reasonably be withheld), 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 the sale or acquisition of the Trust's
shares or the Equitable Contracts or interests in the Accounts and:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement, prospectus or Statement of Additional
Information, or sales literature of the Trust (or any amendment or
supplement to any of the foregoing), 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, provided that this agreement to indemnify shall
not apply as to any Indemnified Party to the extent that such statement
or omission or such alleged statement or omission was made in reliance
upon and in conformity with information furnished to the Distributor or
Trust by or on behalf of Equitable for use in the Registration
Statement, prospectus, or Statement of Additional Information for the
Trust, or in sales literature (or any amendment or supplement) or
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otherwise for use in connection with the sale of the Equitable
Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations contained in
the registration statement, prospectus or Statement of Additional
Information for the Equitable Contracts not supplied by the Distributor
or persons under its control) or negligent or wrongful conduct of the
Distributor or persons under its control or acting at its direction,
with respect to the sale or distribution of the Equitable Contracts or
Trust shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration statement,
prospectus, or Statement of Additional Information or sales literature
covering the Equitable Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statement or statements therein not misleading, if such
statement or omission was made in reliance upon information furnished
to Equitable by or on behalf of the Distributor; or
(iv) arise as a result of any failure by the Distributor to
provide the services, furnish the materials or make the payments
required to be provided or furnished or made by the Distributor under
the terms of this Agreement; or
(v) 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;
as limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof.
8.2(b). The Distributor shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities, or
litigation incurred or assessed against an Indemnified Party to the extent that
such arises 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 Equitable or any Account, whichever is applicable.
8.2(c). The Distributor shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified the Distributor 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 Distributor of
any such claim shall not relieve the Distributor from any liability which they
may have to the Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any such action is
brought against one or more Indemnified Parties and indemnification is requested
therefor, the Distributor will be entitled to participate, at its own expense,
in the defense thereof. The Distributor also shall be entitled to assume the
defense thereof, with counsel reasonably satisfactory to the party named in the
action. After notice from the Distributor to such party of the Distributor'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 Distributor
will not be liable to
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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, unless such Indemnified Party's
interests in such action are materially adverse to those of Distributor and
indemnification is otherwise appropriate under this Section 8.2, provided that
in no event will Distributor be liable for the costs and expenses of more than
one counsel for all Indemnified Parties for related claims or actions.
Distributor shall not settle or compromise any action of which it assumes the
defense without the consent of the affected Indemnified Parties unless the
Indemnified Parties are thereby released of all liability, fault and obligation.
8.2(d). Equitable agrees promptly to notify the Distributor of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with this Agreement, the issuance or sale of the
Equitable Contracts or the operation of each Account, but any failure to notify
under this Section 8.2(d) shall not constitute a failure to notify under
Section 8.2(c).
8.3. Indemnification By the Adviser
8.3(a). The Adviser agrees to indemnify and hold harmless Equitable and
each of its directors, officers, members, employees and agents and each person,
if any, who controls Equitable within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.3)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Adviser, which consent shall not
reasonably be withheld), 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 the sale or acquisition of the Trust's shares or the
Equitable Contracts or interests in the Accounts and:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement, prospectus or Statement of Additional
Information of the Trust (or any amendment or supplement to any of the
foregoing), 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,
provided that this agreement to indemnify shall not apply as to any
Indemnified Party to the extent that such statement or omission or such
alleged statement or omission was made in reliance upon and in
conformity with information furnished to the Adviser or Trust by or on
behalf of Equitable for use in the Registration Statement, Prospectus,
or Statement of Additional Information of the Trust, or in sales
literature (or any amendment or supplement) or otherwise for use in
connection with the sale of the Equitable Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations contained in
the Registration Statement, Prospectus or Statement of Additional
Information for the Equitable Contracts not supplied by the Adviser or
persons under its control) or negligent or wrongful conduct of the
Adviser or persons under its control or acting at its direction, with
respect to the sale or distribution of the Equitable Contracts or Trust
shares; or
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(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration statement,
prospectus, or statement of additional information or sales literature
covering the Equitable Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statement or statements therein not misleading, to the extent
that such statement or omission was made in reliance upon information
furnished to Equitable by or on behalf of the Adviser or the Trust; or
(iv) arise as a result of any failure by the Adviser or the
Trust to provide the services, furnish the materials and make the
payments required to be provided or furnished or made by the Adviser or
the Trust under the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to comply with the
diversification or other qualification requirements specified in
Article VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Adviser in this Agreement or
arise out of or result from any other material breach of this Agreement
by the Adviser;
as limited by and in accordance with the provisions of Sections 8.3(b) and
8.3(c) hereof.
8.3(b). The Adviser shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities, or
litigation incurred or assessed against an Indemnified Party to the extent that
such arises from any 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 Equitable or any Account, whichever is applicable.
8.3(c). The Adviser shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified the Adviser 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 Adviser of
any such claim shall not relieve the Adviser from any liability which it may
have to the Indemnified Party against whom such action is brought otherwise than
on account of this indemnification provision. In case any such action is brought
against one or more Indemnified Parties and indemnification is requested
therefor, the Adviser will be entitled to participate, at its own expense, in
the defense thereof. The Adviser also shall be entitled to assume the defense
thereof, with counsel reasonably satisfactory to the party named in the action.
After notice from the Adviser to such party of the Adviser'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 Adviser 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, unless such Indemnified Party's
interests in such legal process are materially adverse to those of the Adviser
and indemnification is otherwise appropriate under this Section 8.3, provided
that in no event will the Adviser be liable for the costs and expenses of more
than one counsel for all Indemnified Parties for related claims or actions. The
Adviser shall not settle or compromise any action of which it assumes the
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defense without the consent of the affected Indemnified Parties unless the
Indemnified Parties are thereby released of all liability, fault and
obligation.
8.3(d). Equitable agrees promptly to notify the Adviser of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with this Agreement, the issuance or sale of the
Equitable Contracts or the operation of each Account, but any failure to notify
under this Section 8.3(d) shall not constitute a failure to notify under
Section 8.3(c).
ARTICLE IX. Applicable Law
9.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of New York.
9.2. This Agreement shall be subject to the provisions of the 1933,
1934, and 1940 Acts, 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 X. Termination
10.1. 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 Equitable upon thirty (30) days' written
notice to the Trust and the Distributor with respect to any
Designated Portfolio or Class thereof based upon Equitable's
determination that shares of such Designated Portfolio or Class
thereof are not reasonably available to meet the requirements of
the Equitable Contracts or are not consistent with Equitable's
obligations to Contractowners and the Trust and the Distributor
fail to make available, if the termination is for reason of
non-availability, within ten (10) business days after receipt of
such notice, a sufficient number of shares in such Portfolio or
Class or in an alternate Portfolio to meet the requirements of
the Equitable Contracts; or
(c) termination by Equitable upon thirty (30) days' written
notice to the Trust and the Distributor with respect to any
Designated Portfolio or Class thereof in the event any of the
Designated Portfolio's shares or any shares with respect to any
Class are not registered, issued or sold in accordance with
applicable federal and/or state law or such law precludes the
use of such shares as the underlying investment media of the
Equitable Contracts issued or to be issued by Equitable; or
(d) termination by Equitable by written notice to the Trust and
the Distributor: (1) with respect to any Designated Portfolio or
Class thereof in the event that such Designated Portfolio or
Class thereof ceases to qualify as a regulated investment
company under Subchapter M of the Code or any other
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failure under Section 817 of the Code, or under any successor or
similar provision of either, or if Equitable reasonably believes
that the Trust may fail to so qualify; or (2) upon institution
of formal proceedings against the Trust, Distributor or Adviser,
or Equitable's reasonable determination that institution of such
proceedings is being considered by the NASD, the SEC, the
insurance commission of any state or any other regulatory body
regarding the Trust's, Distributor's or Adviser's duties under
this Agreement, or an expected or anticipated ruling, judgment
or outcome which would, in Equitable's reasonable judgment
exercised in good faith, materially impair any party's ability
to meet and perform its obligations and duties hereunder, such
termination effective upon fifteen (15) days prior written
notice; or
(e) termination by the Trust, the Distributor or the Adviser by
written notice to Equitable, if the Trust, the Distributor or
the Adviser shall determine, in their sole judgment exercised in
good faith, that Equitable and/or its affiliated companies 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 (e)
until thirty (30) business days after Equitable has been
provided with a statement by the Trust, the Distributor or the
Adviser concerning the reason for notice of termination
hereunder; or
(f) termination by Equitable by written notice to the Trust, the
Distributor and the Adviser, if Equitable shall determine, in
its sole judgment exercised in good faith, that the Trust, the
Distributor or the Adviser 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 (f) until thirty (30) business
days after the Trust, the Distributor or the Adviser, as
applicable, have been provided with a statement by Equitable
concerning the reason for notice of termination hereunder; or
(g) termination with respect to the Distributor automatically
upon termination of the Distribution Agreement between the
Distributor and the Trust.
10.2. Notwithstanding any termination of this Agreement, the Trust and
the Distributor shall, at the option of Equitable, continue to make available
additional shares of the Trust pursuant to the terms and conditions of this
Agreement, for all Equitable Contracts in effect on the effective date of
termination of this Agreement (hereinafter referred to as "Existing Equitable
Contracts"). Specifically, without limitation, the owners of the Existing
Equitable Contracts shall be permitted to reallocate investments in the Trust,
redeem investments in the Trust, and/or invest in the Trust upon the making of
additional purchase payments under the Existing Equitable Contracts. The parties
agree that this Section 10.2 shall not apply to any terminations under Article
VII and the effect of such Article VII terminations shall be governed by Article
VII of this Agreement.
10.3. Equitable shall not redeem Trust shares attributable to the
Equitable Contracts (as opposed to Trust shares attributable to Equitable's
assets held in any Account) except: (a) as necessary to implement Contractowner
initiated or approved transactions; or (b) as required by
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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 that permits Equitable to redeem Trust
shares attributable to Equitable Contracts. Upon request, Equitable shall
promptly furnish to the Trust and the Distributor the opinion of counsel for
Equitable (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 provision of the 1940 Act. Furthermore, except in cases where
permitted under the terms of the Equitable Contracts, and as may be in the best
interests of Contractowners, as determined by Equitable, Equitable shall not
prevent Contractowners from allocating payments to a Designated Portfolio or
Class thereof that was otherwise available under the Equitable Contracts without
first giving the Trust or the Distributor ninety (90) days' notice of its
intention to do so.
lO.4. This Agreement, and the obligation of the Trust to make Trust
shares available for purchase pursuant to this Agreement, shall terminate at the
option of the Trust as follows: (a) upon institution of formal proceedings
against Equitable, or the Trust's reasonable determination that institution of
such proceedings is being considered by the NASD, the SEC, the insurance
commission of any state or any other regulatory body regarding Equitable's
duties under this Agreement or related to the sale of the Equitable Contracts,
the operation of the Accounts, the administration of the Equitable Contracts or
the purchase of Trust shares, or an expected or anticipated ruling, judgment or
outcome which would, in the Trust's reasonable judgment exercised in good faith,
materially impair Equitable's or the Trust's ability to meet and perform the
Equitable's or the Trust's obligations and duties hereunder, such termination
effective upon fifteen (15) days prior written notice; or (b) in the event any
of the Equitable Contracts is not registered, issued or sold in accordance with
applicable federal and/or state law, such termination effective immediately upon
receipt of written notice; or (c) if the Trust suspends or terminates the
offering of Trust shares of any Portfolio or Class to Participating Insurance
Companies, if such action is required by law or by regulatory authorities having
jurisdiction or if, in the sole discretion of the Trust acting in good faith,
suspension or termination is necessary in the best interests of the shareholders
of any Portfolio or Class (it being understood that "shareholders" for this
purpose shall mean Contractowners), such notice effective immediately upon
receipt of written notice, it being understood that a lack of sufficient
Participating Insurance Company interest in a Portfolio or Class may be grounds
for a suspension or termination as to such Portfolio or Class and that such
suspension or termination shall apply only to the specified Portfolio or Class;
or (d) upon the determination of the Trust's Board to dissolve, liquidate,
reorganize or merge the Trust.
10.5. Notwithstanding any termination of this Agreement for any reason
other than pursuant to Sections 10.1(d) or lOA, the terms and conditions of the
following provisions of this Agreement shall remain in effect with respect to
any Existing Equitable Contract, for so long as any assets invested in the Trust
are attributable to such Existing Equitable Contract: Sections 1.3 and 1.5
through 1.10 of Article I (governing the pricing and redemption of shares);
Article II (Representations and Warranties); 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; Diversification;
Potential Conflicts; Indemnification; and Applicable Law); Article XI (Notices);
and Sections 12.1, 12.2, 12.5 through 12.8 and 12.10 through 12.13 of Article
XII (Miscellaneous). Further, notwithstanding any termination of this Agreement
for any
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reason, the terms and conditions of the following provisions of this Agreement
shall remain in effect with regard to Equitable Contracts whose assets were
previously invested in the Trust: Article II (Representations and Warranties),
Article VI (Diversification) and Article VII (Indemnification).
10.6 The parties understand and acknowledge that it is essential for
compliance with Section 817(h) of the Code that the Equitable Contracts qualify
as annuity contracts or life insurance policies, as applicable, under the Code.
Accordingly, if any of the Equitable Contracts cease to qualify as annuity
contracts or life insurance policies, as applicable, under the Code, or if the
Trust reasonably believes that any such Equitable Contracts may fail to so
qualify, the Trust shall have the right to require Equitable to redeem Trust
shares attributable to such Equitable Contracts upon notice to Equitable and
Equitable shall so redeem such Trust shares in order to ensure that the Trust
complies with the provisions of Section 817(h) of the Code applicable to
ownership of Trust shares. Notice to Equitable shall specify the period of time
Equitable has to redeem the Trust shares or to make other arrangements
satisfactory to the Trust and its counsel, such period of time to be determined
with reference to the requirements of Section 817(h) of the Code. In addition,
Equitable may be required to redeem Trust shares pursuant to action taken or
request made by the Board in accordance with the Shared Funding Exemptive Order
or any conditions or undertakings set forth or referenced therein, or other SEC
rule, regulation or order that may be adopted after the date hereof. Equitable
agrees to redeem shares in the circumstances described herein and to comply with
applicable terms and provisions. Also, in the event that the Trust suspends or
terminates the offering of a Designated Portfolio or Class pursuant to Section
1O.4(c) of this Agreement, Equitable, upon request by the Distributor, will
cooperate in taking appropriate action to withdraw the Accounts' investments in
the respective Portfolio.
ARTICLE XI. 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:
Xxxx Xxxxxxxxx Variable Insurance Trust
c/o AXA Xxxxxxxxx Investment Management LLC
0 Xxxxxx Xxx, Xxxxxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
With a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, Xx.
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If to the Distributor:
Xxxx Xxxxxxxxx Funds Distributor, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Attention: President
If to the Adviser:
AXA Xxxxxxxxx Investment Management LLC
0 Xxxxxx Xxx, Xxxxxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Attention: Legal Department
If to Equitable:
The Equitable Life Assurance Society of the United States
1290 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx
ARTICLE XII. Miscellaneous
12.1. 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.
12.2 Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and addresses
of the Contractowners 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, and state securities or insurance regulators).
12.3. 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.
12.4. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
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12.5. 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.
12.6. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD, and state 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.
12.7. 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.
12.8. 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 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
Equitable, 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.
12.9. Equitable shall furnish, or shall cause to be furnished, to the
Trust or its designee upon request copies of the following reports:
(a) Equitable'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, proxy statement, notice, or
report of Equitable sent to policyholders, as soon as practical after the
delivery thereof to stockholders;
(c) any registration statement (without exhibits) and
financial reports of Equitable filed with the SEC or any state insurance
regulator, as soon as practical after the filing thereof; and
(d) any other report submitted to Equitable by independent accountants
in connection with any annual, interim, or special audit made by them of the
books of Equitable, as soon as practical after the receipt thereof; but nothing
in this subsection shall require Equitable to disclose any information that is
privileged or which, if disclosed, would put Equitable at a competitive
disadvantage or is both: (a) confidential; and (b) not material to Equitable's
financial condition.
12.10. 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.
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12.11 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.
12.12 Equitable is to be an independent contractor vis-a-vis the
Trust, the Adviser, the Distributor, or any of their affiliates for all purposes
hereunder and will have no authority to act for or represent any of them (except
to the limited extent Equitable acts as agent of the Trust pursuant to Sections
1.1 and 1.5 of this Agreement). In addition, no officer or employee of Equitable
will be deemed to be an employee or agent of the Trust, the Adviser, the
Distributor or any of their affiliates. Equitable will not act as an
"underwriter" or "distributor" of the Trust, as those terms variously are used
in the 1940 Act, the 1933 Act, and rules and regulations promulgated thereunder.
12.13 A copy of the Declaration of Trust of the Trust is on file with
the Secretary of State of the state of Massachusetts, and notice is hereby given
that this instrument is executed on behalf of the Trustees of the Trust as
trustees, and is not binding upon any of the Trustees, officers or shareholders
of the Trust individually, but binding only upon the assets and property of the
Trust. No Series of the Trust shall be liable for the obligations of any other
Series of the Trust.
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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 above.
XXXX XXXXXXXXX VARIABLE INSURANCE TRUST
By: /s/Xxxxxxx Xxxx
------------------
Name: Xxxxxxx Xxxx
Title: Trustee
XXXX XXXXXXXXX FUNDS DISTRIBUTOR, INC.
By: /s/Xxxxxxx Xxxxx
------------------
Name: Xxxxxxx Xxxxx
Title: President
AXA XXXXXXXXX INVESTMENT MANAGEMENT LLC
By: /s/Xxxxxxx X. Xxxxx
------------------
Name: Xxxxxxx X. Xxxxx
Title: CEO
THE EQUITABLE ASSURANCE SOCIETY OF THE UNITED STATES
By: /s/Xxxxxx X. Xxxxx
------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
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SCHEDULE A
ACCOUNTS AND ASSOCIATED VARIABLE INSURANCE CONTRACTS
Name of Account
Separate Account A
Separate Account FP
Separate Account 1
Separate Account 45
Separate Account 49
Separate Account 301
163992 v1
SCHEDULE B
XXXX XXXXXXXXX VARIABLE INSURANCE TRUST
---------------------------------------
Portfolios Classes
---------- -------
AXA Xxxxxxxxx VIT Value Long/Short Equity Fund Class l and Class 2
163992 v1
