AMENDMENT
TO THE
INDIVIDUAL RETIREMENT ANNUITY (XXX)
GROUP ANNUITY CONTRACT [GAXXXXX] (CONTRACT)
ISSUED BY
AMERICAN UNITED LIFE INSURANCE COMPANY (AUL)
TO [XXX, INC. (CONTRACTHOLDER)]
When used in this Amendment, "we," "us," or "our" refer to AUL and "you" or
"your" refer to the Contractholder.
The following provisions are added to the Contract and supersede any contrary
provisions of the Contract, and are effective on [the later of January 1, 2002
or the Effective Date of the Contract]:
* "Annuity Commencement Date" is the first day of the month an annuity begins
under this contract. However, amounts allocated to a Participant's Account
will be distributed or begin to be distributed no later than the applicable
date determined below under "Death Benefits" or "Distributions Before
Death."
* "Code" means the Internal Revenue Code of 1986, as amended, and any
applicable regulations or rulings thereunder.
"Contributions" are funds which can be allocated to Participant Accounts
according to your instructions and which have been paid to us in cash
(pursuant to your plan, if applicable). These include funds which are
transferred in cash from a prior AUL group annuity contract or which are
transferred in cash from a prior funding medium to this contract [as part
of a transfer eligible for rollover treatment under Code Sections 402(c),
402(e)(6), 403(a)(4), 403(b)(8), 403(b)(10), 408(d)(3), or 457(e)(16). (For
taxable years beginning before 2002, references to Code Sections 402(e)(6),
403(b)(10), and 457(e)(16) in the previous sentence shall be deleted.
References to such Code Sections for taxable years beginning after 2010
shall also be deleted, unless the Code requires reference to such Code
Sections in this contract after 2010.)] Such transferred funds may be
listed under categories other than AContributions" on annual and quarterly
reporting. The legal title to, and ownership of, such amounts is vested
solely in the Participant.
* Exclusive Benefit of Participants: This contract is established for the
exclusive benefit of the Participants and their beneficiaries.
* Amount of Contributions:
(a) Contributions may vary in amount and frequency.
[(b) Except for eligible rollover Contributions under Code Sections 402(c),
402(e)(6), 403(a)(4), 403(b)(8), 403(b)(10), 408(d)(3), and
457(e)(16), Contributions during a Participant's taxable year (which
is presumed to be a calendar year) may not exceed the amounts
described below, as adjusted or otherwise determined under the Code.
(For taxable years beginning before 2002, references to Code Sections
402(e)(6), 403(b)(10), and 457(e)(16) in the preceding sentence shall
be deleted. References to such Code Sections for taxable years
beginning after 2010 shall also be deleted, unless the Code requires
reference to such Code Sections in this contract after 2010.):
(1) if this is a Code Section 408(b) traditional individual
retirement annuity (XXX) (not a SEP or a SIMPLE XXX), the dollar
amount in effect for that taxable year under Code Section
219(b)(1)(A), as follows:
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(A) (i) $2,000 for any taxable year beginning before 2002, and
(ii) $2,000 for any taxable year beginning after 2010
(unless the Code ceases to apply this $2,000 amount for
any taxable year beginning after 2010);
(B) $3,000 for any taxable year beginning in 2002 through 2004;
(C) $4,000 for any taxable year beginning in 2005 through 2007;
and
(D) $5,000 for any taxable year beginning in 2008 and years
thereafter (unless adjusted for taxable years beginning
after 2010 as described in Subsection (b)(1)(A)(ii) above).
After 2008, the limit will be adjusted by the Secretary of the
Treasury for cost-of-living increases under Code Section
219(b)(5)(C). Such adjustments will be in multiples of $500.
(This provision ceases to apply to taxable years beginning after
2010 unless the Code requires its application to such post-2010
years.)
For a Participant age 50 or older, the annual Contribution limit
is increased by $500 for any taxable year beginning in 2002
through 2005, and $1,000 for any taxable year beginning in 2006
and years thereafter. (This provision ceases to apply to taxable
years beginning after 2010 unless the Code requires its
application to such post-2010 years.)
(2) if this is a Code Section 408(k) Simplified Employee Pension
(SEP), the dollar amount in effect for that taxable year as
determined pursuant to Code Section 408(j).
(3) if this is a Code Section 408(p) SIMPLE XXX (an XXX used in
conjunction with a Simple Retirement Account (SIMPLE XXX plan)),
this contract will accept only:
(A) a cash Contribution made by a Participant's employer on
behalf of the Participant under the SIMPLE XXX plan that
meets the requirements of Code Section 408(p) in an amount
not to exceed the dollar amount in effect for that taxable
year under Code Section 408(p), and
(B) a rollover Contribution or a transfer of assets from another
SIMPLE XXX for the Participant.
No other Contributions will be accepted.
(c) If this contract is not a SIMPLE XXX, then, notwithstanding any other
provisions of this contract, no Contribution will be accepted under a
Code Section 408(p) SIMPLE XXX plan established by a Participant's
employer, with the exception that a transfer or rollover of funds
attributable to contributions made by a Participant's employer under
its SIMPLE XXX plan will be accepted from a SIMPLE XXX after the
expiration of the 2-year period beginning on the date the Participant
first participated in that employer's SIMPLE XXX plan.]
(d) Refunds of Contributions (other than excess Contributions) will be
applied before the close of the calendar year following the year of
such refund toward the payment of future Contributions or the purchase
of additional benefits.
* Transfers to or from Other Retirement Programs: If permitted by applicable
state and federal law, we may accept, or may initiate the transfer of,
amounts transferred from other retirement programs. Such transferred
amounts, as
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identified to us, are credited as a rollover Contribution under the
appropriate Participant Account and are tracked within this contract as
required by applicable state and federal law.
[If this contract is a SIMPLE XXX, prior to the expiration of the 2-year
period beginning on the date the Participant first participated in any
SIMPLE XXX plan maintained by the Participant's employer, any rollover or
transfer by the Participant of funds from this contract must be made to
another SIMPLE XXX of the Participant. Any distribution of funds to the
Participant during this 2-year period may be subject to a 25% additional
tax if the Participant does not roll over the amount distributed into a
SIMPLE XXX. After the expiration of this 2-year period, the Participant may
roll over or transfer funds to any XXX of his that is qualified under Code
Section Section 408(a), (b), or (p), or to another eligible retirement plan
described in Code Section 402(c)(8)(B).]
* Death Benefits:
[(a) (1) If the Participant dies before his Annuity Commencement Date, his
entire interest will be distributed at least as rapidly as follows:
(A) If the designated beneficiary is not the Participant's
surviving spouse, the entire interest will be distributed,
beginning on or before December 31 of the calendar year
immediately following the calendar year in which the
Participant died, over the remaining life expectancy of such
designated beneficiary. Such life expectancy is determined
using the age of the beneficiary as of his birthday in the
year following the year of the Participant's death or, if
elected, in accordance with Subsection (a)(1)(C) below.
(B) If the sole designated beneficiary is the Participant's
surviving spouse, the entire interest will be distributed,
beginning on or before December 31 of the calendar year
immediately following the calendar year in which the
Participant died (or by the end of the calendar year in
which the Participant would have attained age 70 1/2, if
later), over such spouse's life or, if elected, in
accordance with Subsection (a)(1)(C) below. If the surviving
spouse dies before required distributions commence to him,
the remaining interest will be distributed, beginning on or
before December 31 of the calendar year immediately
following the calendar year in which the spouse died, over
the spouse's designated beneficiary's remaining life
expectancy determined using such beneficiary's age as of his
birthday in the year following the death of the spouse, or,
if elected, will be distributed in accordance with
Subsection (a)(1)(C) below. If the surviving spouse dies
after required distributions commence to him, any remaining
interest will continue to be distributed under the payment
option chosen.
(C) If there is no designated beneficiary, or if applicable by
operation of Subsection (a)(1)(A) or (B) above, the entire
interest will be distributed no later than December 31 of
the calendar year containing the fifth anniversary of the
Participant's death (or of the spouse's death in the case of
the surviving spouse's death before distributions are
required to begin under Subsection (a)(1)(B) above).
(D) Life expectancy is determined using the Single Life Table in
Q&A-1 of Section 1.401(a)(9)-9 of the Income Tax
Regulations. If distributions are being made to a surviving
spouse as the sole designated beneficiary, such spouse's
remaining life expectancy for a year is the number in the
Single Life Table corresponding to such spouse's age in the
year. In all other cases, remaining life expectancy for a
year is the number in the Single Life Table corresponding to
the beneficiary's age in the
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year specified in Subsection (a)(1)(A) or (B) above and
reduced by 1 for each subsequent year.
(2) If the Participant dies on or after his Annuity Commencement
Date, any interest remaining under the benefit payment option
selected will continue to be distributed under that benefit
payment option.
(3) The Participant's "interest" includes the amount of any
outstanding rollover, transfer, and recharacterization under
Q&As-7 and -8 of Section 1.408-8 of the Income Tax Regulations
and the actuarial value of any other benefits provided under the
contract, such as guaranteed death benefits.
(4) For purposes of Subsection (a)(1) and (2) above, required
distributions are considered to commence on the Participant's
required beginning date or, if applicable, on the date
distributions are required to begin to the surviving spouse under
Subsection (a)(1)(B) above. However, if distributions start prior
to the applicable date in the preceding sentence, on an
irrevocable basis (except for acceleration) under an annuity
contract meeting the requirements of Section 1.401(a)(9)-6T of
the Temporary Income Tax Regulations, then required distributions
are considered to commence on the annuity starting date.
(b) If the sole designated beneficiary is the Participant's surviving
spouse, such spouse may treat the Participant's Account as his or her
own XXX. This election will be deemed to have been made if such
surviving spouse makes a Contribution to this contract, makes a
rollover to this contract, or fails to take required distributions as
a beneficiary.]
* [Distributions Before Death:
(a) Notwithstanding any provision of this contract to the contrary, the
distribution of the Participant's interest in the contract will be
made in accordance with the requirements of Code Section 408(b)(3) and
the regulations issued thereunder. If distributions are not made in
the form of an annuity on an irrevocable basis (except for
acceleration), then distribution of the Participant's interest in the
contract (as determined above under Subsection (a)(3) of "Death
Benefits") must satisfy the requirements of Code Section 408(a)(6) and
the regulations issued thereunder, rather than the requirements of
Subsections (b), (c), and (d) below and "Death Benefits" above.
(b) The Participant's entire interest will begin to be distributed no
later than the first day of April following the calendar year in which
the Participant attains age 70 1/2 (the "required beginning date")
over (1) the life of the Participant or the lives of the Participant
and his designated beneficiary or (2) a period certain not extending
beyond the life expectancy of the Participant or the joint and last
survivor expectancy of the Participant and his designated beneficiary.
Payments will be made in periodic payments at intervals of no longer
than 1 year, and must be either nonincreasing or they may increase
only as provided in Q&As-1 and -4 of Section 1.401(a)(9)-6T of the
Temporary Income Tax Regulations. In addition, any distribution must
satisfy the incidental benefit requirements specified in Q&A-2 of
Section 1.401(a)(9)-6T.
(c) The distribution periods described in Subsection (b) above cannot
exceed the periods specified in Section 1.401(a)(9)-6T of the
Temporary Income Tax Regulations.
(d) The first required payment can be made as late as April 1 of the year
following the year the Participant attains age 70 1/2, and must be the
payment that is required for one payment interval. The second payment
need not be made until the end of the next payment interval.]
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* Statements and Reports: Reasonably promptly after the end of each [Contract
Year Quarter], we will prepare a statement of the Account Value for each
Participant Account that is maintained under this contract. [We will also
furnish any information concerning required minimum distributions that is
required by the Internal Revenue Service.]
[If this contract is a SIMPLE XXX and Contributions made on behalf of a
Participant under a SIMPLE XXX plan maintained by the Participant's
employer are received directly by us from the employer, we will provide the
employer with the summary description required by Code Section
408(1)(2)(B).]
* Nonforfeitability and Nontransferability: [A Participant's entire interest
in this contract (minus any applicable charges under this contract) is
nonforfeitable and is nontransferable by the Participant. No sum payable
under this contract with respect to a Participant may be sold, assigned,
discounted, or pledged as collateral for a loan or as security for the
performance of an obligation or for any other purpose to any person or
entity other than us. In addition, to the extent permitted by law, no such
sum shall in any way be subject to legal process requiring the payment of
any claim against the payee.]
* [SIMPLE XXX of Designated Financial Institution: If this contract is a
SIMPLE XXX and it is maintained by a designated financial institution
within the meaning of Code Section 408(p)(7), under the terms of a SIMPLE
XXX plan of the Participant's employer, the Participant must be permitted
to transfer his balance without cost or penalty (within the meaning of Code
Section 408(p)(7) to another XXX of the Participant that is qualified under
Code Section 408(a), (b), or (p), or to another eligible retirement plan
described in Code Section 402(c)(8)(B).]
AMERICAN UNITED LIFE INSURANCE COMPANY(R)
By: /s/ Xxxxx X. Xxxxxx
[Chairman of the Board,
President, & Chief Executive Officer]
Attest
By: /s/ Xxxxxx X. Xxxxx
[Secretary]
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