Common use of Participant Directed Investment Option Clause in Contracts

Participant Directed Investment Option. (a) Section 40.4(d) provides that in the case of a contract which funds a participant directed investment option under which each contribution allocated to such option is credited with a specified rate of interest to a stated maturity date which rate and maturity date are disclosed to the participant prior to the allocation, such contract may provide that any withdrawals (other than withdrawals on account of bona fide termination of employment due to death or disability of the participant on whose behalf the withdrawal is made) be postponed until the stated maturity date for the contribution. (b) In such cases, the contract may permit withdrawals prior to maturity for the contribution that are subject to a negative market value adjustment and/or surrender charge. We have not required positive market-value adjustments. (c) Such contracts must have at least one option for participants age 55 and over on the date contributions are received where the maturity date will not exceed five years. The “age 55” rule in §40.4(b) is similar to §44.3(t) in Regulation No. 127.

Participant Directed Investment Option. (a) Section 40.4(d) provides that in the case of a contract which funds a participant directed investment option under which each contribution allocated to such option is credited with a specified rate of interest to a stated maturity date which rate and maturity date are disclosed to the participant prior to the allocation, such contract may provide that any withdrawals (other than withdrawals on account of bona fide termination of employment due to death or disability of the participant on whose behalf the withdrawal is made) be postponed until the stated maturity date for the contribution. (b) In such cases, the contract may permit withdrawals prior to maturity for the contribution that are subject to a negative market value adjustment and/or surrender charge. We have not required positive market-value adjustments. (c) Such contracts must have at least one option for participants age 55 and over on the date contributions are received where the maturity date will not exceed five years. The “age 55” rule in §40.4(b) is similar to §44.3(t) in Regulation No. 127.in

Participant Directed Investment Option. (a) Section 40.4(d) provides that in –In the case of a contract which funds a participant directed investment option under which each contribution allocated to such option is credited with a specified rate of interest to a stated maturity date which rate and maturity date are disclosed to the participant prior to the allocation, such contract may provide that any withdrawals (other than withdrawals on account of bona fide termination of employment due to death or disability of the participant on whose behalf the withdrawal is made) be postponed until the stated maturity date for the contribution. (ba) In such cases, the contract may permit withdrawals prior to maturity for the contribution that are subject to a negative market value adjustment and/or surrender charge. We have not required positive market-value adjustmentsadjustments in the non-§4223 market. (cb) Such contracts must have at least one option for participants age 55 and over on the date contributions are received where the maturity date will not exceed five years. The “age 55” rule in §40.4(b) is similar to §44.3(t) in Regulation No. 127. (c) The exception to the plan benefit rule is intended to recognize contracts that are similar to modified guaranteed annuities authorized by Chapter 864 of the Laws of 1985 and Regulation 127. (i) Note that in contracts subject to §4223 and Regulation 127 the MVA must be positive as well as negative.