Prior to the Armistice, there was the Empire of Tamriel (ruled by Tiber Septim) and also a place called Resdayn (ruled by the Tribunal and their Temple). An armistice is an agreement to stop fighting in which no one surrenders. So the armistice was an agreement between Septim and the Tribunal in which neither surrendered or conceded to the other. The terms by which this happened must've been something along these lines...
- -The Empire of Tamriel recognized the Tribunal and their Temple as sovereign unto themselves and not under the authority of the Emperor.
-At the same time, the territory of Resdayn came under the sovereignty of the Kingdom of Morrowind. A king from the Raathim line was appointed and his descendents remain on the throne at the time of Morrowind. The Kingdom of Morrowind is a vassal state to the Emperor; this is consistent with the structure in many of the other provinces (Hammerfell and Skyrim in particular come to mind).
-The Temple and kingdom are co-sovereign over the territory of Morrowind. The kingdom and the imperial apparatus which supports it enforce the Basic Laws of the Empire (don't kill, don't steal), whereas the Temple enforce traditional laws - House right, ban on profane magicks, etc. The ban on slavery is not a part of the Basic Laws and it is not enforced in Morrowind.
-Ebonheart and Firewatch were conceded to the Empire as military installations to defend the east. Other smaller concessions for forts were made throughout Morrowind.
-The artifacts of the Dwemer were made the personal property of the Emperor as part of the Armistice.
- -The Temple rescinded its ban on outlanders holding land other than the legion concessions. Mostly through leases from the Hlaalu Council Company, the East Empire Company (as well as possible private companies, I'm thinking particularly of Helnim here) have installed several colonies. One of these, Caldera, sits on the largest ebony lode discovered and is on land disputed between Hlaalu and Redoran.
-This probably also meant the introduction of the guilds to Morrowind, which are allowed to enforce their monopolies except on the Temple and Houses (which are protected by the Temple's sovereignty and the Temple's enforcement of House rights).
-The opening of Morrowind has led to the emboldening of the abolitionist movement. It has always been illegal to enslave a papered Imperial citizen; it is now illegal to move persons as commodities across provincial lines, and there is increasing pressure on the Empire in Morrowind to protect citizens from enslavement (at one point in the past, outlanders, especially betmer, were at risk being in Morrowind). Most recently, the Empire has ruled that the Inner Seas are imperial waters and therefore it is illegal to bring slaves to Vvardenfell; for this reason, slaves must be smuggled across the Inner Sea.