3(21) agreement

[PS]

Hi, 

Terminating plan has a 3(12) agreement and the plan sponsor would like to know if they require to submit any special document to disable this service .  I've never come across 3(21) agreement does the plan sponsor need to complete any special requirement?  

[Peter Gulia]

What does the to-be-ended agreement provide about how much notice, and what manner of notice, the service recipient must give the service provider to end the agreement?

Further, what does the agreement provide for whether the service provider’s fee is earned on the beginning of a period, or is apportioned regarding a partial-performance period?

Just as BenefitsLink neighbors often suggest to discern a retirement plan’s provisions Read The Fabulous Document, consider a similar step in dealing with a service provider.

If there is a doubt about what the agreement provides or about whether the agreement's provision or condition is legally valid, a prudent fiduciary would get its lawyer's advice.

This is not advice to anyone.

[Artie M]

Agree.  Look to the service agreement provisions regarding its termination.  Usually there will be something like 30 days' written notice.  Also, depending on the relationship between the advisor and the recordkeeper, there may be a provision that says that it terminates upon termination of the recordkeeper agreement.  So if you terminate the recordkeeper agreement that might be sufficient to terminate the 3(21) advisors agreement.  (Implicit here is that you may need to terminate the service agreement with the recordkeeper also).