GROUP FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT
GROUP ANNUITY CONTRACT NO. [12345]
ISSUE DATE:
CONTRACT HOLDER: [EMPLOYER OR TRUSTEE]
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This Group Annuity Contract is issued in consideration of payment of the
Contributions.
The terms of this Group Annuity Contract, which consists of the following pages
including the Application are agreed to by the Contract Holder and AXA Equitable
Life Insurance Company ("AXA Equitable").
In this Contract "we", "our" and "us" mean AXA Equitable.
AXA EQUITABLE LIFE INSURANCE COMPANY
[OBJECT OMITTED] [GRAPHIC OMITTED][GRAPHIC OMITTED]
/s/ Xxxxxxxxxxx X. Xxxxxxx /s/ Xxxxxxx Xxxxxxx
Xxxxxxxxxxx X. Xxxxxxx Xxxxxxx Xxxxxxx
President, Chairman Senior Vice President,
and Chief Executive Officer Secretary and Associate
General Counsel
GROUP FLEXIBLE PREMIUM COMBINATION FIXED AND VARIABLE DEFERRED ANNUITY CONTRACT.
THE PORTION OF ANNUITY ACCOUNT VALUE HELD IN THE VARIABLE SEPARATE ACCOUNT MAY
INCREASE OR DECREASE IN VALUE.
INTEREST RATE IS GUARANTEED WITH RESPECT TO THE PORTION OF THE ANNUITY ACOUNT
VALUE HELD IN THE GUARANTEED INTEREST OPTION.
THIS GROUP ANNUITY CONTRACT CONTAINS A MARKET VALUE ADJUSTMENT FORMULA THAT MAY
RESULT IN A POSITIVE OR NEGATIVE ADJUSTMENT IN BENEFITS. FIXED MATURITY OPTIONS
ARE ONLY AVAILABLE IF THE RATE TO MATURITY IS MORE THAN 3%.
FIXED ANNUITY BENEFITS- NON-PARTICIPATING
2004EDCGAC
TABLE OF CONTENTS
PAGE
PART I DEFINITIONS 3
PART II - INVESTMENT OPTIONS 7
SECTION 2.01-AVAILABILITY AND TYPES
OF INVESTMENT OPTIONS
SECTION 2.02-GUARANTEED INTEREST OPTION-CONDITIONS
SECTION 2.03-SEPARATE ACCOUNT
SECTION 2.04-VARIABLE INVESTMENT OPTIONS/
ACCUMULATION UNITS AND UNIT VALUES
SECTION 2.05-CHANGES WITH RESPECT TO
VARIABLE SEPARATE ACCOUNTS
SECTION 2.06-FIXED MATURITY OPTION
PART III - CONTRIBUTIONS, ALLOCATIONS AND DISCONTINUANCE 13
SECTION 3.01-CONTRIBUTIONS
SECTION 3.02-ALLOCATIONS
SECTION 3.03-DISCONTINUANCE OF CONTRIBUTIONS
PART IV - TRANSFERS AMONG INVESTMENT OPTIONS 14
SECTION 4.01-TRANSFER REQUESTS
SECTION 4.02-TRANSFER RULES
PART V - DISTRIBUTIONS AND DEATH BENEFITS 16
SECTION 5.01-RESTRICTIONS ON DISTRIBUTIONS
SECTION 5.02-GENERAL WITHDRAWALS
SECTION 5.03-WITHDRAWAL FOR A DIRECT ROLLOVER
SECTION 5.04-DEATH BENEFIT
SECTION 5.05-BENEFICIARY CONTINUATION OPTION
PART VI - PLAN LOANS 20
SECTION 6.01 LOANS
2004EDCGAC 1
TABLE OF CONTENTS (CONTINUED)
PART VII - ANNUITY BENEFITS 22
SECTION 7.01-FORMS OF DISTRIBUTION
SECTION 7.02-ELECTION/REPORT FOR ANNUITY BENEFIT
SECTION 7.03-ANNUITY BENEFIT FORMS
SECTION 7.04-AMOUNT OF ANNUITY BENEFITS
SECTION 7.05-ANNUITY BENEFIT
SECTION 7.06-PAYMENT OF BENEFITS AND REQUIRED MINIMUM
DISTRIBUTION RULES
SECTION 7.07-COMMENCEMENT OF ANNUITY BENEFITS
SECTION 7.08-CONDITIONS
SECTION 7.09-CHANGES
PART VIII - PARTICIPANT ACCOUNTS 26
SECTION 8.01-PARTICIPANT ACCOUNTS
PART IX - CHARGES 27
SECTION 9.01-WITHDRAWAL CHARGES
SECTION 9.02-EARLY WITHDRAWAL CHARGE
SECTION 9.03-THIRD PARTY TRANSFERS
SECTION 9.04-EMPLOYER EXPENSE DEDUCTION
SECTION 9.05-CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE
SECTION 9.06-TRANSFER AND LOAN CHARGES
SECTION 9.07-VARIABLE SEPARATE ACCOUNT CHARGE
SECTION 9.08-PLAN RECORDKEEPING SERVICE CHARGES
SECTION 9.09-APPLICABLE TAX CHARGES
SECTION 9.10-CHANGES
PART X UNALLOCATED ACCOUNT 29
PART XI - GENERAL PROVISIONS 30
SECTION 11.01-CONTRACT
SECTION 11.02-STATUTORY COMPLIANCE
SECTION 11.03-DEFERMENT
SECTION 11.04-NON-FORFEITABILITY, NON-TRANSFERABILITY
AND ASSIGNMENTS
SECTION 11.05-OWNERSHIP RIGHTS
SECTION 11.06-EMPLOYER'S RESPONSIBILITY
SECTION 11.07-PLAN STATUS
SECTION 11.08-TERMINATION OF THE CONTRACT
SECTION 11.09-DISQUALIFICATION OF PLAN OR CONTRACT
SECTION 11.10-MANNER OF PAYMENT
SECTION 11.11-REPORTS AND NOTICES
SECTION 11.12-CONTRACT HOLDER'S RESPONSIBILITY
TABLE OF GUARANTEED ANNUITY PAYMENTS 33
2004EDCGAC 2
PART I - DEFINITIONS
SECTION 1.01-ACCUMULATION UNIT
"Accumulation Unit" means a unit of measure used to calculate the variable
Annuity Account Value during the accumulation period.
SECTION 1.02-ACCUMULATION UNIT VALUE
"Accumulation Unit Value" means the dollar value of each Accumulation Unit in a
Variable Separate Account on a given date.
SECTION 1.03-ANNUITY ACCOUNT VALUE
"Annuity Account Value" means with respect to each Participant the sum of the
amounts held for the benefit of the Participant in the Investment Options,
including any amount in the Loan Reserve Account.
SECTION 1.04-ANNUITY BENEFIT
"Annuity Benefit" means a benefit payable by us pursuant to Part VII of this
Contract.
SECTION 1.05-ANNUITY COMMENCEMENT DATE
"Annuity Commencement Date" means the date on which annuity payments to the
Participant are to commence as reported to us by the Employer.
SECTION 1.06-ANNUITY UNIT
"Annuity Unit" means a unit of measure used after the Annuity Commencement Date
to calculate the amount of variable annuity payout.
SECTION 1.07-APPLICATION
"Application" means the Application for this Group Annuity Contract or
participation in this Group Annuity Contract by the Employer and accepted by us.
SECTION 1.08-BENEFICIARY
"Beneficiary" means the person designated by the Participant under the Plan to
receive the death benefit.
SECTION 1.09-BUSINESS DAY
"Business Day" means any day on which the New York Stock Exchange is open for
trading and generally ends at 4:00 P.M., Eastern Time, or such other time as we
state in writing to the Participant.
SECTION 1.10-CASH VALUE
"Cash Value" means an amount equal to the Annuity Account Value held for the
Participant, less any charge that applies and less the amount of the entire
unpaid balance of any loan, including interest due but not paid.
SECTION 1.11-CERTIFICATE
"Certificate" means the document issued to each Participant as evidence of the
Participant's enrollment under this Contract.
2004EDCGAC 3
SECTION 1.12-CODE
"Code" means the Internal Revenue Code of 1986, as now or hereafter amended, or
any corresponding provisions of prior or subsequent United States revenue laws,
and includes applicable tax regulations.
SECTION 1.13-CONTRACT
"Contract" means this Group Annuity Contract and Application between the
Contract Holder, Employer and us providing a variable annuity to fund the Plan.
The terms of the Contract are agreed to by the Employer and us.
SECTION 1.14-CONTRACT DATE
"Contract Date" means the date following our acceptance of an Application with
respect to a Plan.
SECTION 1.15-CONTRACT HOLDER
"Contract Holder" means the person or entity as set forth on the cover page of
this Contract.
SECTION 1.16-CONTRACT YEAR
"Contract Year" with respect to a Plan means the twelve-month period starting on
(i) the Contract Date and (ii) each anniversary of the Contract Date, unless we
agree to another period.
SECTION 1.17-CONTRIBUTION
"Contribution" means a payment remitted to us under the section "Contributions".
SECTION 1.18-EMPLOYER
The term "Employer" means a governmental unit which is a State, a political
subdivision of a State, or any agency or instrumentality of a State or political
subdivision of a State as defined in Section 457(e)(1)(A) of the Code, which has
adopted a Plan which participates under this Contract.
SECTION 1.19-EXPIRATION DATE
"Expiration Date" means the date that a Fixed Maturity Option matures.
SECTION 1.20-FIXED MATURITY AMOUNT
"Fixed Maturity Amount" means the amount held with respect to a given Fixed
Maturity Option. The Fixed Maturity Amount reflects Contributions and transfers
made to a Fixed Maturity Option, plus interest at the Rate to Maturity, minus
any withdrawals, transfers and charges, if any, deducted from a Fixed Maturity
Option.
SECTION 1.21-FIXED MATURITY OPTION
"Fixed Maturity Option" means the Investment Option that specifies a period of
time during which the Rate to Maturity is guaranteed to remain the same for
amounts allocated to and held for such period until its expiration.
SECTION 1.22-GUARANTEED INTEREST OPTION
"Guaranteed Interest Option" means the Investment Option that pays interest at
Guaranteed Interest Rates set by us from time to time.
2004EDCGAC 4
SECTION 1.23-GUARANTEED INTEREST RATE
"Guaranteed Interest Rate" means the effective annual rate at which interest
accrues on amounts allocated to the Guaranteed Interest Option.
SECTION 1.24-INVESTMENT OPTION
"Investment Option" means a Variable Investment Option, Fixed Maturity Option or
Guaranteed Interest Option.
SECTION 1.25-PARTICIPANT
"Participant" means an individual covered under the Plan who has been enrolled
under this Contract and for whom we maintain an Annuity Account Value.
SECTION 1.26-PARTICIPATION DATE
"Participation Date" means the earlier of (a) the Business Day on which we issue
a Certificate to the Participant under this Contract and (b) the Business Day on
which the first Contribution for the Participant is received at the Processing
Office.
The original Participation Date is the Business Day on which the Participant was
enrolled under a Prior Contract/Certificate if applicable.
SECTION 1.27-PARTICIPATION YEAR
"Participation Year" means, with respect to the Participant, the twelve-month
period starting on (i) the Participation Date and (ii) each anniversary of the
Participation Date, unless we agree to another period.
SECTION 1.28-PLAN
"Plan" means a governmental plan, described in Section 457(g) of the Code,
adopted and maintained by the Employer, that is intended to meet the
requirements of Section 457(b) of the Code and which is named in the
Application.
SECTION 1.29-PORTFOLIO
"Portfolio" means a separate class (or series) of shares of a specified trust or
investment company, where each class (or series) represents a separate portfolio
in the specified trust or investment company.
SECTION 1.30-PRIOR CONTRACT
"Prior Contract" means a contract or certificate issued by us and from which the
Employer and we have agreed to transfer certain assets or liabilities associated
with the Plan, if applicable, to this Contract.
SECTION 1.31-PROCESSING OFFICE
"Processing Office" means our administrative office or such other location as we
may designate upon written notice to the Employer.
SECTION 1.32-PROCESSING DATE
"Processing Date" means the day(s) we deduct charges from the Annuity Account
Value.
2004EDCGAC 5
SECTION 1.33-RATE TO MATURITY
"Rate to Maturity" means a specified interest rate that we credit to amounts
allocated to a Fixed Maturity Option. Different Fixed Maturity Options have
different Rates to Maturity.
SECTION 1.34-SEPARATE ACCOUNT
"Separate Account" means Separate Account [48] (which contains the Fixed
Maturity Options) and the Variable Separate Account(s).
SECTION 1.35-TRANSACTION DATE
"Transaction Date" means the Business Day we receive a Contribution or a
transaction request at the appropriate Processing Office. Transaction requests
must be in a form acceptable to us.
SECTION 1.36-VARIABLE INVESTMENT OPTION
"Variable Investment Option" means either a subaccount of a Variable Separate
Account, or a Variable Separate Account that has not been divided into
subaccounts. A Variable Investment Option may invest its assets in a Portfolio.
SECTION 1.37-VARIABLE SEPARATE ACCOUNT
"Variable Separate Account(s) refers to our Separate Account A and any Separate
Accounts added to this Contract as described in Part II except Separate Account
[48]. Variable Separate Accounts may be divided into subaccounts.
2004EDCGAC 6
PART II - INVESTMENT OPTIONS
SECTION 2.01-AVAILABILITY AND TYPES OF INVESTMENT OPTIONS
The Application sets forth the Investment Options available under this Contract
as of the issue date.
The availability of Investment Options may be subject to the terms of the Plan,
as reported to us by the Employer.
We reserve the right to change, limit or amend the number of Investment Options
that an Employer may elect.
The Investment Options may consist of Investment Options that are classified as
"Type A" or "Type B", or any other type that may be specified in the
Application, as we designate in our discretion for purposes of the transfer
rules described in the section "Transfer Rules". The Application indicates the
classification as of the issue date of this Contract. Announcements of new
Investment Options will include the new Option type.
SECTION 2.02-GUARANTEED INTEREST OPTION-CONDITIONS
(a) GUARANTEED INTEREST OPTION
Any amount held for the Participant in the Guaranteed Interest Option
becomes part of our general assets, which support the guarantees of this
Contract as well as other policies and contracts that we offer.
The amount held for each Participant in such Guaranteed Interest Option at
any time with respect to this Contract is equal to the sum of:
o all amounts that have been allocated or transferred to such Guaranteed
Interest Option, plus
o the amount of any interest credited, less
o all amounts that have been withdrawn (including charges) or
transferred from such Option.
We will credit the amount held in the Guaranteed Interest Option with
interest at effective annual rates that we set. We will also set a minimum
Guaranteed Interest Rate that will remain in effect throughout a stated
twelve-month period or a calendar year. We credit interest daily to amounts
in the Guaranteed Interest Option.
We guarantee that any rate so determined will never be less than the
minimum Guaranteed Interest Rate specified in the Application.
(b) CONDITIONS
The Employer agrees:
(i) With respect to the investment option of the Plan that is funded
under the Guaranteed Interest Option and to the extent that the
Plan provides for allocations to, and transfers to and from such
option are to be made solely at the discretion of the individuals
covered by the Plan, such allocations and transfers are to be
made in accordance with instructions by the Employer or
Participant covered by the Plan. We are to be given at least 60
days advance written notice by the Employer of any noncompliance
with this condition.
(ii) The Employer is to provide us with any amendment to the Plan or
its investment policy, any communication to the Participants
covered by the Plan concerning the Guaranteed Interest Option or
the investment option of the Plan to which it relates, or any
change in the manner in which the Plan is administered. Any such
document is to be provided to us at least 60 days before its
effective date.
2004EDCGAC 7
We may also request, and the Employer will thereupon provide, any
other information that we reasonably determine would bear upon
the flow of funds to and from the Guaranteed Interest Option.
If the conditions stated in (i) and (ii) above are not complied with or, if
the Employer fails to remit Contributions in accordance with Part III on
"Contributions, Allocations and Discontinuance" or if we determine and so
notify the Employer by written notice that an amendment to the Plan, its
investment policy, or any change in the manner in which the Plan is
administered would materially and adversely affect the flow of funds to or
from the Guaranteed Interest Option, then we will have the right to:
1. decline further requests for transfers to or from the Guaranteed
Interest Option; and/or
2. deem that a discontinuance of Contributions has occurred under
the section, "Discontinuance of Contributions".
SECTION 2.03-SEPARATE ACCOUNT
We have established the Separate Account(s) and maintain the Separate Account(s)
in accordance with the laws of New York State. Xxxxxx, realized and unrealized
gains and losses from the assets of a Separate Account are credited to or
charged against it without regard to our other income, gains or losses. Assets
are placed in the Separate Account(s) to support the Contract and other annuity
contracts and certificates. Assets may be placed in the Separate Account(s) for
other purposes, but not to support contracts or policies other than variable
annuities and variable life insurance.
The assets of a Separate Account are our property. The portion of such assets
equal to the reserves and other contract liabilities with respect to the
Separate Account will not be chargeable with liabilities that arise out of any
other business we conduct. We may transfer assets of a Separate Account in
excess of the reserves and other Contract liabilities with respect to such
Separate Account, to another Separate Account, or to our general account.
We may, in our discretion, invest Separate Account assets in any investment
permitted by applicable law. We may rely conclusively on the opinion of counsel
(including counsel in our employ) as to the type of investments that the
Separate Account is permitted by law to make.
SECTION 2.04-VARIABLE INVESTMENT OPTIONS/ACCUMULATION UNITS AND UNIT VALUES
The amount in a Variable Separate Account at any time is equal to the number of
Accumulation Units in that Account multiplied by the Accumulation Unit Value
that applies at that time. If the Contract has Variable Investment Options, then
the terms of this section apply separately to each Variable Investment Option,
unless otherwise stated.
Amounts allocated or transferred to a Variable Investment Option are used to
purchase Accumulation Units of that Option. Accumulation Units are redeemed when
amounts are deducted, transferred or withdrawn. The number of Accumulation Units
in a Variable Investment Option at any time is equal to the number of
Accumulation Units purchased minus the number of Accumulation Units redeemed in
that Variable Investment Option up to that time. The number of Accumulation
Units purchased or redeemed in a transaction is equal to the dollar amount of
the transaction divided by the Variable Investment Option Accumulation Unit
Value for that Transaction Date.
We determine Accumulation Unit Values for each Variable Investment Option for
each Valuation Period. A "Valuation Period" is each Business Day together with
any consecutive preceding non-business days. For example, for each Monday that
is a Business Day, the preceding Saturday and Sunday will be included to equal a
three-day Valuation Period.
2004EDCGAC 8
The Accumulation Unit Value of a Variable Investment Option for any Valuation
Period is equal to the Accumulation Unit Value for that Variable Investment
Option on the immediately preceding Valuation Period multiplied by the Net
Investment Factor for that Variable Investment Option for the current Valuation
Period. The Net Investment Factor for a Valuation Period is (a) divided by (b)
minus (c), where:
(a) is the value of the Portfolio shares held by the Variable Investment
Option at the end of the Valuation Period (before taking into account
any amounts allocated to, or withdrawn from, the Variable Investment
Option for the Valuation Period, and after deduction of fees, charges
and expenses of the Portfolio; for this purpose, we use the share value
reported to us for the Portfolio plus the applicable dividend and
capital gain rates on the ex-dividend date);
(b) is the value of the Portfolio shares held by the Variable Investment
Option at the end of the preceding Valuation Period (taking into
account any amounts allocated or withdrawn for that Valuation Period);
(c) is the daily Variable Separate Account charges for the expenses and
risks of the Contract, times the number of calendar days in the
Valuation Period, plus any charge for taxes or amounts set aside as a
reserve for taxes.
SECTION 2.05-CHANGES WITH RESPECT TO VARIABLE SEPARATE ACCOUNTS
In addition to the right reserved pursuant to the section "Availability and
Types of Investment Options", we reserve the right, subject to compliance with
applicable law, including approval of the Employer, if required:
(a) to add Variable Investment Options to, or to remove Variable
Investment Options from, the Variable Separate Account(s), or to
add other Separate Accounts;
(b) to combine any two or more Variable Investment Options or
sub-funds thereof;
(c) to transfer the assets we determine to be the share of the class
of contracts to which this Contract belongs from a Variable
Investment Option to another Variable Investment Option;
(d) to operate any Variable Separate Account or any Variable
Investment Option as a management investment company under the
Investment Company Act of 1940; in which case charges and
expenses that otherwise would be assessed against an underlying
trust or investment company would be assessed against the
Variable Separate Account.
(e) to operate any Separate Account or any Variable Investment Option
as a unit investment trust under the Investment Company Act of
1940.
(f) to deregister the Variable Separate Account under the Investment
Company Act of 1940;
(g) to restrict or eliminate any voting rights as to the Variable
Separate Account;
(h) to cause one or more Variable Investment Options to invest some
or all of their assets in one or more other Portfolios.
(i) to close an Investment Option to Transfers and Contributions.
We reserve the right to add a Variable Investment Option in which (i) there are
periods during which Contributions are restricted, (ii) amounts therein may be
automatically liquidated pursuant to the investment policy of the Variable
Investment Option, and (iii) investments therein may mature. We will have the
right to reallocate amounts arising from liquidation or maturity according to
the Participant's allocation instructions then in effect. If no such allocation
instructions have been made, the reallocation will be made to a designated
Investment Option, or to the next established Variable Investment Option of the
same type as described in this paragraph.
2004EDCGAC 9
A Portfolio of a Variable Investment Option might, in our judgment, become
unsuitable for investment by a Separate Account or a Variable Investment Option
because of legal, regulatory, or federal income tax restrictions. In such event,
shares of another series or shares of another unit investment trust may be
substituted for shares already purchased with respect to the Separate Account or
as the security to be purchased in the future, provided that such substitution
meets applicable federal income tax guidelines and, to the extent required by
law, has been approved by the Securities and Exchange Commission and such other
regulatory authorities as may be necessary.
If the exercise of these rights results in a material change in the underlying
investments of a Variable Separate Account or Variable Investment Option, the
Employer will be notified of such exercise, as required by law.
SECTION 2.06-FIXED MATURITY OPTIONS
Amounts allocated to the Fixed Maturity Options are held in our Separate
Account No. [48].
We have the right, subject to compliance with applicable law, to: (a) add new
Separate Accounts to be used for the same purpose as Separate Account [48], (b)
divide Separate Account [48] into two or more Separate Accounts to be used for
the same purpose, and (c) combine Separate Account [48] with any other Separate
Account that is used for the same purpose as Separate Account [48].
Each Fixed Maturity Option is subject to a market value adjustment formula that
may result in adjustments, positive or negative, in benefits. Such market value
adjustment will not apply upon transfer to a new Fixed Maturity Option or to
another Investment Option on the Fixed Maturity Option's Expiration Date. The
amount in a Fixed Maturity Option before application of a market value
adjustment is called the Fixed Maturity Amount. Before the Expiration Date, the
Annuity Account Value in a Fixed Maturity Option on any day will reflect the
market value adjustment that we would make if the entire amount in the Fixed
Maturity Option were withdrawn.
1. FIXED MATURITY OPTIONS
We may offer one or more Fixed Maturity Options. For each such Fixed
Maturity Option, we guarantee to credit interest at the Rate to Maturity.
Interest will be credited daily to amounts in the Fixed Maturity Options.
The duration of each Fixed Maturity Option offered under the Participant's
account under this Contract and the Rate to Maturity, which applies to each
Fixed Maturity Option, will be furnished by us upon request. The Fixed
Maturity Option duration(s) and the Rate to Maturity for each Fixed
Maturity Option elected by the Participant upon issuance of the
Participant's Certificate will be shown in the Certificate.
Contributions and transfers to a Fixed Maturity Option as described in Part
III "Contributions, Allocations and Discontinuance" will be allocated
according to the Participant's election. Contributions or transfers into a
Fixed Maturity Option will receive the Rate to Maturity applicable to the
elected Fixed Maturity Option on the Transaction Date. The Fixed Maturity
Amount of a Fixed Maturity Option is equal to the amount allocated to that
Fixed Maturity Option, plus interest at the Rate to Maturity, minus
withdrawals, transfers and charges, if any, deducted from the Fixed
Maturity Option and adjusted for any market value adjustment previously
applied.
The last day of a Fixed Maturity Option is the Expiration Date. We will
notify the Participant at least 15 days but not more than 45 days before
the Expiration Date of each Fixed Maturity Option. One of the following
three options may be elected at the Expiration Date, none of which will
result in a market value adjustment:
(a) transfer the amount in the Fixed Maturity Option into another Fixed
Maturity Option of any available duration that we then offer;
(b) transfer the amount in the Fixed Maturity Option to another Investment
Option;
(c) make a withdrawal from the amount in the Fixed Maturity Option
(subject to any withdrawal charges and applicable restrictions which
may apply pursuant to the section "Restrictions on Distributions" and
the section "Withdrawal Charges").
2004EDCGAC 10
If no election is made with respect to amounts in a Fixed Maturity Option
as of the Expiration Date, such amounts will be transferred into a Fixed
Maturity Option with the earliest available Expiration Date that occurs
after the then current calendar year. If we are not offering new Fixed
Maturity Options then such amounts will be transferred into the Money
Market Variable Investment Option. During the 30 days following the
Expiration Date, the amount in the Fixed Maturity Option (less any
withdrawals or transfers made or charges deducted during such 30 day
period) may be transferred into a new Fixed Maturity Option or other
Investment Option. A market value adjustment will not apply. In no event
may the Participant elect a Fixed Maturity Option that extends beyond the
Annuity Commencement Date.
2. TRANSFERS, WITHDRAWALS, DEATH AND ANNUITY BENEFITS
If a request is made, other than as described in item 1 above, for a
transfer to an Investment Option as described in the section "Transfer
Requests" or a withdrawal as described in the section "General
Withdrawals", any such transfer or withdrawal from a Fixed Maturity Option,
will be subject to a market value adjustment described below. The market
value adjustment will be in addition to any charges that apply as described
in the section "Withdrawal Charges".
Amounts applied from a Fixed Maturity Option to provide a death benefit as
described in the section "Death Benefit", an annuity as described in Part
VII "Annuity Benefits" or any other annuity form that we offer will be
subject to a market value adjustment. A negative market value adjustment
will not be imposed on a death benefit.
No transfers are permitted to a Fixed Maturity Option from any Investment
Option after the initial Contribution or transfer into such Fixed Maturity
Option.
3. MARKET VALUE ADJUSTMENT
The market value adjustment upon transfer or withdrawal from a Fixed
Maturity Option is determined as follows:
(a) We determine the Fixed Maturity Amount that would be payable on
the Expiration Date, of the Participant's Fixed Maturity Option
using the Rate to Maturity for such Fixed Maturity Option.
(b) We determine the period remaining in the Participant's Fixed
Maturity Option (on the Transaction Date of the Participant's
transfer or withdrawal) and convert it to fractional years based
on a 365-day year. For example, three years and 12 days becomes
3.0329.
(c) We determine the current Rate to Maturity that would apply on the
Transaction Date to new allocations to the same Fixed Maturity
Option, and add a current rate percentage that we determine up to
a maximum of [0.50%].
(d) We determine the present value of the Fixed Maturity Amount
payable at the Expiration Date, using the period determined in
(b) and the rate determined in item (c).
(e) We determine the Fixed Maturity Amount as of the Transaction
Date.
(f) We subtract (d) from the result in (e). The result is the market
value adjustment (which may be positive or negative) applicable
to such Fixed Maturity Option.
The market value adjustment (positive or negative) resulting from a withdrawal
or transfer of a portion of the amount in a Fixed Maturity Option will be a
percentage of the market value adjustment that would apply if the Participant
were to withdraw the entire amount in that Fixed Maturity Option. The percentage
is determined by dividing (i) the amount of the withdrawal or transfer from the
Fixed Maturity Option by (ii) the Fixed Maturity Amount in such Fixed Maturity
Option prior to the withdrawal or transfer.
The market value adjustment will be in addition to any charges which otherwise
apply as described in Part IX "Charges".
2004EDCGAC 11
If we are not offering a Fixed Maturity Option to which the current " Rate to
Maturity" would apply, we will use the rate at the closest Expiration Date. If
we are no longer offering new Fixed Maturity Options, we will use the "Moody's
rate" which will be a rate based on the most recent Moody's Corporate Bond Yield
Average - Monthly Average Corporates, for the duration required, as published by
Xxxxx'x Investor Services, Inc. The rate for the numerator will be the Moody's
rate for the initial duration of the Fixed Maturity Option on the date the
allocation or transfer was made to such Fixed Maturity Option and the rate for
the denominator will be the Moody's rate for the remaining duration on the date
the withdrawal or transfer out is made. If such Moody's rate is not available, a
rate based on a substantially similar average will be used.
2004EDCGAC 12
PART III - CONTRIBUTIONS, ALLOCATIONS AND DISCONTINUANCE
SECTION 3.01-CONTRIBUTIONS
The Employer makes Contributions from time to time pursuant to the terms of the
Plan.
We reserve the right to reject any Contributions of less than [$20.00] for any
one Participant unless otherwise specified by the Code. We have the right to
require a minimum aggregate amount of Contributions on an annual basis; the
Application will specify if a minimum applies. If any such minimum amount
requirement is not met, we have the right to deem that a termination of Plan
participation has occurred and apply the terms of the section "Participant
Accounts".
Each Contribution received by us on the Participant's behalf will, before its
allocation under this Contract, be reduced by the amount of any applicable tax
charge as described in Part IX "Charges".
Contributions to the Contract determined by reference to compensation are
limited to the maximum amount that may be deferred for a Participant for any
taxable year under Section 457 of the Code.
If and as permitted by the Plan and other applicable law we may agree to accept,
subject to our rules at the time, "rollover contributions" from another eligible
retirement plan described in Sections 457(e)(16) and 402(c) of the Code.
Rollover contributions will be separately accounted for as required under the
Code.
If we are notified that any Contributions would cause the Participant's account
under this Contract not to qualify under Section 457(b) of the Code, we reserve
the right to either (i) refuse to accept any such Contributions or (ii) apply
such Contributions to a nonqualified deferred annuity contract for the exclusive
benefit of the Participant and any Beneficiary. We are not required to monitor
compliance with contribution limits under Section 457(b).
SECTION 3.02-ALLOCATIONS
Each Contribution (less any applicable tax charge in accordance with the section
"Applicable Tax Charges") is allocated among Investment Options in accordance
with the instructions submitted in a form acceptable to us by the Employer or
Participant.
SECTION 3.03-DISCONTINUANCE OF CONTRIBUTIONS
Contributions under this Contract can be discontinued either by the Employer or
by us.
If the Contract terminates or Contributions are discontinued no additional
Contributions can be made and we will rely on the instructions provided by the
Employer, or the Participant, if the Participant has severed from employment.
All other terms and conditions of the Contract applicable to the Participant's
account under this Contract will remain in effect with respect to the
Participant. Amounts maintained in the Contract will continue to be subject to
withdrawal charges, if any, based on the Participant's Participation Date.
If the Participant has severed from employment, his or her participation under
this Contract will terminate. The Participant may elect subject to the approval
of the Employer and the terms of the Plan to (a) maintain, subject to our
agreement, the Certificate which will continue to be owned by the Employer or
Trust or (b) make a withdrawal.
2004EDCGAC 13
PART IV - TRANSFERS AMONG INVESTMENT OPTIONS
SECTION 4.01-TRANSFER REQUESTS
Unless we are otherwise instructed by the Employer, the Participant may submit a
request to transfer all or part of the amount held in an Investment Option to
one or more of the other Investment Options. Transfer requests are subject to a
minimum amount of [$300]. The request must specify the source(s) of
Contributions, if applicable, to which the transfer applies. All transfers will
be made on the Transaction Date and will be subject to the terms in the section
"Transfer Rules" and to our rules in effect at the time of transfer. With
respect to a Variable Separate Account, the transfers will be made at the
Accumulation Unit Value next computed for that Transaction Date.
SECTION 4.02-TRANSFER RULES
Transfer requests must be in writing and delivered by U.S. mail to our
Processing Office unless we accept an alternative form of communication (such as
internet or automated telephone). The use of alternative forms of communication
is subject to our rules then in effect for each such service. We may provide
information about our rules and the use of communication services in the product
prospectus, prospectus supplements or other notifications, as mailed to the
Employer's last known address in our records from time to time. Any alternative
form of communication that we make available may be changed or discontinued at
any time. Communication services may be restricted or denied if we determine
that the Participant used such services for market timing or other trading
strategies that may disrupt operation of a Variable Investment Option or have a
detrimental effect on the Accumulation Unit Value of any Variable Investment
Option.
If the Employer has elected to have any Type B Investment Option available to
the Participant, as described in the section "Types of Investment Options",
whether or not the Participant has amounts in any such Investment Options, then
the following applies unless otherwise specified in the Application:
The maximum amount that the Participant may transfer from the Guaranteed
Interest Option to a Variable Investment Option or to a Fixed Maturity Option in
any Participation Year is as follows:
(a) A percentage, as stated in the Application, of the amount in the
Guaranteed Interest Option on the last day of the prior Participation
Year, or if greater,
(b) The total of all amounts transferred at the Participant's request from
the Guaranteed Interest Option to a Variable Investment Option or a
Fixed Maturity Option in the prior Participation Year.
The percentage referred to in subsection (a) above may not be less than 5% or
more than 25%.
If an amount was allocated to the Guaranteed Interest Option as a result of a
total transfer of Plan funds (that is, a transfer initiated by the Employer on
the Participant's behalf) from another funding vehicle, the maximum amount which
may be transferred from the Guaranteed Interest Option for the transfer period
in which such allocation occurred will be an amount equal to the percentage
determined in (a) above, but applied to the amount initially allocated to the
Guaranteed Interest Option on the Participant's behalf.
We reserve the right to:
(1) limit transfers among or to the Variable Investment Options to no more
than once every 30 days;
(2) require a minimum time period between each transfer into or out of one
or more specified Variable Investment Options;
(3) reject transfer requests from a person acting on behalf of multiple
Participants pursuant to a trading authorization agreement that we
have accepted;
2004EDCGAC 14
(4) impose conditions or limitations on transfer rights, restrict
transfers or refuse any particular transfer if we are concerned that
market timing, excessive trading or other trading strategies may
disrupt operation of a Variable Investment Option or may have a
detrimental effect on the Accumulation Unit Value of any Variable
Investment Option or determine that the Participant has engaged in any
such strategy;
(5) defer transfers for up to six months, as described in the section
"Deferment";
(6) revise our transfer rules; and
(7) charge for any transfer made by the Participant between Investment
Options, in any Participation Year, if the number of transactions
exceed [12].
Any action taken pursuant to subsection (1) through (7) above will be made by us
upon advance notice to the Employer.
2004EDCGAC 15
PART V-DISTRIBUTIONS AND DEATH BENEFITS
SECTION 5.01-RESTRICTIONS ON DISTRIBUTIONS
Payments of Cash Value pursuant to the section on "General Withdrawals" or Part
VII "Annuity Benefits" are subject to the restrictions described in this
section. We reserve the right to require proof acceptable to us that a request
for payment under any of those sections is permissible under either the Plan
before processing the requested transaction.
Except as otherwise permitted under Section 457 of the Code and in accordance
with the terms of the Plan, amounts will not be paid to Plan Participants or
their Beneficiaries earlier than (i) the calendar year in which the Plan
Participant attains age 70-1/2 (ii) when the Plan participant has a severance
from employment with the Employer or (iii) when the Plan Participant is faced
with an unforeseeable emergency (within the meaning of applicable federal income
tax Regulations).
We reserve the right to limit transfers of Cash Value, up to the amount of any
Loan Reserve Account under this Contract, to another funding vehicle under the
Employer's Plan or to another Governmental Employer Plan, while there is a loan
outstanding as described in the section "Plan Loans".
SECTION 5.02-GENERAL XXXXXXXXXXX
All withdrawal requests will require the Employer's written authorization in a
form acceptable to us, unless otherwise instructed by the Employer, specifying
the portion of the Participant's Annuity Account Value that is available for
distribution, the amount to be withdrawn and the Investment Option(s) from which
the withdrawal is to be made. Withdrawals are subject to the restrictions in the
section "Restrictions on Distributions".
Unless instructed otherwise, the amount withdrawn (including any withdrawal
charge) will be deducted from the Investment Options in proportion to the
amounts in such Investment Options.
We may decline to accept a request for a withdrawal of less than [$300], or
where the withdrawal would violate the provisions of this section. If a
withdrawal made under this section would result in an Annuity Account Value of
less than [$500], we will inform the Participant and reserve the right to
terminate participation under this Contract pursuant to the section "Participant
Accounts".
Prior to making any payment, we may request from the Employer such information
which may include a certification as we may reasonably require to determine if
the withdrawal, alone or together with any previous withdrawal by the
Participant is necessary and proper under the terms of the Plan.
We will pay any amount payable under this subsection as the Employer directs in
writing and such payment will fully discharge us from all liability with respect
to the amount paid.
SECTION 5.03-WITHDRAWAL FOR A DIRECT ROLLOVER
Unless otherwise instructed by the Employer on the Application, any withdrawal
request from the Participant for a direct rollover to or from the Certificate
must be made through the Employer.
The Participant (or Beneficiary) may elect to have all or any portion of the
Cash Value or the Death Benefit described in this Contract, as applicable, paid
directly to another "eligible retirement plan" in a "direct rollover
transaction" in accordance with Sections 457, 402(c) and 401(a)(31) of the Code.
2004EDCGAC 16
In order to elect this option all of the following requirements must be met:
(A) The recipient of the distribution must be an eligible retirement plan
maintained for the benefit of the Participant (or the Participant's spousal
beneficiary).
(B) The distribution must not include any after-tax Contributions to the
Contract except as otherwise permitted under the Code.
(C) The direct rollover option is not available to the extent that a minimum
distribution is required under Section 401(a)(9) of the Code. See the
section "Payment of Benefits and Required Minimum Distribution Rules". We
reserve the right to determine the amount of the Required Minimum
Distribution. If the Participant has elected a payment option in Part VII
"Annuity Benefits" which is either a life-contingent annuity or paying
substantially equal periodic payments for a period of ten years or more,
the direct rollover option does not apply to those funds.
(D) The direct rollover option is not available for a distribution due to an
unforeseen emergency, except as otherwise permitted under the Code.
SECTION 5.04-DEATH BENEFIT
Upon our receipt of due proof of the Participant's death and any required
instructions, information and forms necessary to effect the payment (the
Transaction Date), we will pay to the Participant's Beneficiary the amount of
the death benefit. We will pay the death benefit in the form elected by the
Beneficiary and reported by the Employer. Subject to the rules and laws then in
effect the Beneficiary may elect:
(a) to receive the death benefit in a single sum;
(b) to apply the death benefit to purchase an Annuity Benefit in a form
that we currently offer;
(c) to apply the death benefit to provide any other form of benefit that
we offer.
If the Participant so elects in writing any amount that would otherwise be
payable to a Beneficiary in a single sum will be applied to provide an Annuity
Benefit. Subject to our rules then in effect, such election may be changed
during the Participant's lifetime. Any such change must be made in writing in a
form acceptable to us. The Participant's election cannot be changed by the
Beneficiary. If at the Participant's death there is no election in effect, the
Beneficiary may make such an election. In the absence of any election by either
the Participant or the Beneficiary, we will pay the death benefit in a single
sum.
The amount of the death benefit is equal to the greater of (i) the Annuity
Account Value (without any negative market value adjustment that would otherwise
apply) as of the Transaction Date less any unpaid loan balance including
interest due but not paid, and (ii) the minimum death benefit. The minimum death
benefit is the sum of all Contributions less any withdrawals, withdrawal charges
(if applicable), and less any unpaid loan balance including interest due but not
paid. Withdrawals will reduce the minimum death benefit on a pro rata basis.
Reduction on a pro rata basis means that we calculate the percentage of the
Participant's current Annuity Account Value that is being withdrawn and we
reduce the Participant's current minimum death benefit by that same percentage.
2004EDCGAC 17
ENHANCED DEATH BENEFIT
If the Participant elects the Enhanced Death Benefit the following will apply to
the amount of the death benefit instead of the amount of the death benefit
described above. The amount of the death benefit will be equal to the greater of
(i) the Annuity Account Value (without any negative market value adjustment that
would otherwise apply) as of the Transaction Date less any outstanding loan and
accrued loan interest, and (ii) the Enhanced Death Benefit as of the date of the
Participant's death.
On the Participation Date, the Enhanced Death Benefit is equal to the initial
Contribution. Thereafter, the Enhanced Death Benefit will be reset every [three]
years on the Participation Date anniversary to the Annuity Account Value if
greater than the previously established Enhanced Death Benefit (adjusted for
Contributions and withdrawals), up to the date the Participant attains age [85].
Contributions will increase the Enhanced Death Benefit on a dollar-for-dollar
basis. Withdrawals will reduce the Enhanced Death Benefit on a pro rata basis,
in the same manner as for the minimum death benefit described above.
Once elected at the time of enrollment the Participant may not terminate the
Enhanced Death Benefit. The charge for the Enhanced Death Benefit will be a
percentage of the Annuity Account Value on the Participation Date anniversary,
see the section "Charges Deducted From Annuity Account Value".
BENEFICIARY
Subject to the terms of the Plan, the Participant may name one or more persons
to be primary Beneficiary and one or more persons to be successor Beneficiary if
the primary Beneficiary dies before the Participant. If the Participant has
named two or more persons as Beneficiary, the Beneficiary will be the named
person or persons who survive the Participant and payments will be made to such
persons in equal shares or to the survivor. Unless the Participant specifically
elects in writing otherwise, we will treat each Beneficiary's share of the death
benefit payable as a separate account for the benefit of each Beneficiary as
described in Treasury Regulation Section 1.401(a)(9)-8 Q&A A-2(a)(2) or any
successor Regulation.
The Participant may change the Beneficiary during the Participant's lifetime and
while coverage of the Participant under this Contract is in force. Any such
change must be made in writing in a form acceptable to us. A change will take
effect as of the date the written form is executed, whether or not the
Participant is living on the date of receipt at the Processing Office. We will
not be liable as to any payments made or actions taken before receipt of any
such change at the Processing Office.
Any part of a death benefit payable as described in the section "Beneficiary"
for which there is no named Beneficiary living at the Participant's death will
be payable in a single sum to the Participant's spouse, if any, or if there is
no spouse, then to the Participant's children who survive the Participant, in
equal shares, or, if there are no surviving children, then to the Participant's
estate.
SECTION 5.05-BENEFICIARY CONTINUATION OPTION
This section will apply only if the Participant dies before the Annuity
Commencement Date, and the Beneficiary named under the "Beneficiary" section of
this Contract is an individual. With the exception of the following paragraph,
this section does not apply to any Beneficiary that is not an individual and the
non-individual Beneficiary's portion of the death benefit is payable to such
non-individual Beneficiary.
This Section applies to a non-individual Beneficiary only if it is a "see
through trust". A see through trust is an irrevocable trust, valid under state
law, the only beneficiaries of which are individuals, and which trust has met
applicable documentation requirements under applicable Regulations as we may
determine. If such a "see-through trust" described in Treasury Regulation
Section 1.40(a)(9)-4 Q&A, or any successor Regulation, is the Beneficiary named
pursuant to the "Beneficiary" section of the Contract, the successor Participant
is the oldest Beneficiary of such trust.
2004EDCGAC 18
If this Section applies and there is more than one Beneficiary, the
Participant's entire interest in the Participant's account under this Contract
will be apportioned among the Participant's Beneficiaries as the Participant
designates pursuant to the "Beneficiary" section of this Contract.
If the Beneficiary qualifies to continue the Participant's account under this
Contract, and we receive that Beneficiary's completed election no later than
September 30 of the calendar year following the calendar year of the
Participant's death and before any contrary election is made, that Beneficiary
may continue the Participant's account under this Contract pursuant to this
Section under the terms set forth in (a) through (i) below. Each such
Beneficiary electing to continue his or her portion of the interest under the
Participant's account under this Contract is a " Continuation Beneficiary".
For any Beneficiary who does not timely elect to continue his or her portion of
the interest under the Participant's account under this Contract, we will pay
that Beneficiary's share of the death benefit pursuant to the "Death Benefit"
section of this Contract, in a lump sum. The terms of the Beneficiary
Continuation Option are as follows:
a. If the Beneficiary Continuation Option is elected, then as of the
date we receive due proof of the Participant's death, and any
required instructions, information and forms necessary to effect
the Beneficiary Continuation Option feature, we will increase the
Annuity Account Value to equal the applicable death benefit if
such death benefit is greater than such Annuity Account Value.
b. Each Continuation Beneficiary will automatically become the
Participant as defined in the Contract with respect to that
Continuation Beneficiary's portion of the interest in the
Participant's account under the Contract. If the Participant has
specifically elected under the "Beneficiary" section of the
Contract that we not separately account for each Beneficiary's
portion of the interest in the Participant's account under the
Contract, the oldest Continuation Beneficiary will be the
Participant for purposes of calculating the Required Minimum
Distribution payments.
c. Each Continuation Beneficiary will have the right to transfer
amounts among the Investment Options with respect to that
Continuation Beneficiary's portion of the interest in the
Participant's account under this Contract.
d. Any death benefit provision (including the minimum death benefit
provision) will no longer be in effect.
e. A Continuation Beneficiary cannot make any additional
Contributions.
f. Distributions to the Continuation Beneficiary with respect to
that Continuation Beneficiary's portion of the interest in the
Participant's account under this Contract will be made in
accordance with requirements of the Code.
g. A Continuation Beneficiary may withdraw the Annuity Account Value
apportioned to such Continuation Beneficiary at any time;
withdrawals made after we have received a Continuation
Beneficiary's election to continue the Participant's account
under this Contract are not subject to a withdrawal charge.
h. Upon a Continuation Beneficiary's death, we will make a lump sum
payment to the person designated by the deceased Continuation
Beneficiary to receive that deceased Continuation Beneficiary's
portion of the Annuity Account Value, if any remains. In the
alternative, the deceased Continuation Beneficiary's designated
Beneficiary may elect to continue the payment method originally
elected by the deceased Continuation Beneficiary in accordance
with the Code rules (Required Minimum Distribution Rules-Required
Payments After Death).
i. The Participant's account under this Contract cannot be assigned
and must continue in the Participant's name for the benefit of
the Participant's Continuation Beneficiary.
2004EDCGAC 19
PART VI - PLAN LOANS
SECTION 6.01-LOANS
Prior to the Participant's Annuity Commencement Date, the Participant may make a
request for a loan subject to the terms of the Plan and the Code by completing a
Loan Request Form.
We reserve the right not to permit a new loan if the Participant has previously
defaulted on a loan and has not repaid the outstanding amount due.
The Loan Request Form together with the loan confirmation notice will be the
loan agreement and will contain all of the terms of the loan which apply,
including the amount of the loan, interest rate and the payment due dates.
A loan is effective on the date we specify and after we approve the Loan Request
Form.
Only [one] outstanding loan is permitted at a time for each Participant.
A. LOAN AMOUNT:
As a condition for granting a loan, we will require the Participant's
representation that the loan amount requested, when aggregated with loans
(principal plus interest) from all qualified plans of the Employer, does not
exceed the greater of $10,000 or 50% of the value of the Participant's
nonforfeitable accrued benefits, and in no event exceeds $50,000 less the
highest outstanding balance of all loans from qualified plans of the Employer
during the one year period ending on the day before the effective date of the
loan. We reserve the right to also require that the Participant elect not to
have income tax withholding apply with respect to any interest and/or loan
principal that would otherwise be subject to withholding.
The minimum loan amount will be stated on the Loan Request Form. In no event
will the minimum loan amount be less than [$1,000].
B. LOAN TERM:
The loan term will be for a maximum of five years. If the Loan Request Form
indicates that the purpose of the loan is to purchase a principal
residence, the loan term will be for a maximum of ten years. Repayment of
the loan may be accelerated and full repayment of any unpaid principal and
interest will be required upon the earliest of (1) the election and
commencement of Annuity Benefits under the section "Commencement of Annuity
Benefits", (2) the date of termination pursuant to the sections
"Discontinuance of Contributions", "Participant Accounts" and "Termination
of the Contract" or, (3) the date we pay a death benefit pursuant to the
section "Death Benefit".
C. LOAN RESERVE ACCOUNT:
On the date the loan is effective, we will transfer to a "Loan Reserve
Account" an amount equal to the sum of (1) the loan amount, which will earn
interest at the "Loan Reserve Account Rate" during the loan term and (2)
10% of the loan amount, which will earn interest at the Guaranteed Interest
Rate. The Participant may not make any partial withdrawals or transfers
among Variable Investment Options or to another 457(b) funding arrangement
or qualified employer plan from the Loan Reserve Account until after
repayment of the principal amount then due. The Participant may specify on
the Loan Request Form from which Investment Option(s) the Loan Reserve
Account will be funded.
The "Loan Reserve Account Rate" will equal the loan interest rate (see
subsection D below) minus 2%, or such other percentage determined by us in
accordance with our then current procedures. Such rate shall not be greater
than permitted under any current applicable state or federal law.
2004EDCGAC 20
D. LOAN INTEREST RATE:
We will from time to time set the effective annual rate at which interest
on a loan will accrue daily (the "loan interest rate"). Such rate will not
be greater than any maximum rate required under any current applicable
state or federal law. However, if a different rate is requested by the
Employer we will substitute the rate subject to any limitations imposed by
law. The rate so determined by us will be a reasonable rate based on
prevailing rates available at the date of determination on loans, charged
by persons in the business of lending money for loans that would be made
under similar circumstances.
E. REPAYMENTS:
The loan must be repaid according to the repayment schedule, which will
require that substantially level amortization payments of principal and
interest be made no less frequently than quarterly, unless otherwise
required or permitted by law. The loan may be repaid in full at any time,
including interest due. We will first apply any payments to interest due,
with the balance applied towards repayment of the loan principal. After any
repayment is made, including full repayment of the loan, the principal
amount repaid will be transferred from the Loan Reserve Account to the
Guaranteed Interest Option.
F. DEFAULT:
By each due date (or specified date thereafter according to our then
current procedures) if the amount of the loan payment is less than the
amount due or the loan payment is not received at our Processing Office, we
will treat the amount of the unpaid balance of the loan at that time,
including interest due but not paid, as a deemed distribution for federal
income tax purposes.
If the amount in the Loan Reserve Account is not subject to the
restrictions described in the section "Restrictions on Distributions", on
default we reserve the right to deduct from the Loan Reserve Account an
amount equal to the interest and principal payments due. We also reserve
the right to deduct any withdrawal charges that apply and any required tax
withholding.
If the amount in the Loan Reserve Account is subject to the restrictions
described in the section "Restrictions on Distributions", on default we
will designate in the Loan Reserve Account an amount equal to the unpaid
loan balance (interest and principal payments due) at the time of the
default. When the Contract is no longer subject to the withdrawal
restrictions of the section "Restrictions on Distributions", we will have
the right to foreclose on this amount, and deduct any withdrawal charges
that would have applied at the time of the default, plus any interest due,
and any required tax withholding. This will be no later than the date the
Participant reaches age 70-1/2 or we are notified in writing that another
event has occurred which would permit amounts subject to restrictions on
distribution to be paid. (Such an event includes but is not limited to
severance from employment.)
G. CHANGES:
We have the right to change the loan terms, as long as any such change is
made to maintain compliance with the terms of any applicable law or
regulations that apply to this Contract.
2004EDCGAC 21
PART VII ANNUITY BENEFITS
SECTION 7.01-FORMS OF DISTRIBUTION
The Participant may elect (i) a single sum distribution, (ii) an Annuity
Benefit, or (iii) any other form of payment of the Cash Value offered by us,
subject to the terms of the Plan and the approval of the Employer.
SECTION 7.02-ELECTION/REPORT FOR ANNUITY BENEFIT
An election to have the Cash Value paid in the form of an Annuity Benefit can
only be made if the Cash Value is at least $2,000. The Employer will report to
us each Participant or other person with respect to whom an Annuity Benefit is
to be provided under this Contract and whether all or a portion of the Cash
Value is to be used for such Annuity Benefit. The report must be made before the
first payment under such Annuity Benefit and must be in the form prescribed by
us and will include all pertinent facts and determinations requested by us. We
will rely on the reports and other information furnished by the Employer and
will not inquire as to the accuracy or completeness thereof.
SECTION 7.03-ANNUITY BENEFIT FORMS
The "Normal Form" of Annuity Benefit is an Annuity Benefit payable on the
Life-10 Year Period Certain Annuity Form described below, unless another form
may apply pursuant to the terms of the Plan, or any other law that applies. We
may offer other annuity forms available from us or from one of our affiliated or
subsidiary life insurance companies. Such form may include the Joint and
Survivor Life Annuity Form that provides monthly payments while either of the
two persons upon whose lives such payments depend is living. The monthly amount
to be continued when only one of the persons is living will be equal to a
percentage, as elected, of the monthly amount that was paid while both were
living.
The Life 10 Year Period Certain Annuity Form is an annuity payable during the
lifetime of the person on whose life the payments depend, but with 10 years of
payments guaranteed (10 years certain period). That is, if the Participant dies
before the 10-year certain period has ended, payments will continue to the
Beneficiary named to receive such payments for the balance of the certain
period. In no event will the certain period exceed the life expectancy of the
person on whose life the annuity payments depend in accordance with the Code.
The Life 10 Year Period Certain Annuity Form is payable on a unisex basis.
SECTION 7.04-AMOUNT OF ANNUITY BENEFITS
If an Annuity Benefit payment is elected in lieu of the Cash Value, the amount
applied to provide the Annuity Benefit will, unless otherwise specified by the
Employer or required by applicable laws and regulations, be (1) the Annuity
Account Value, if the annuity form elected provides payments for a person's
remaining lifetime or (2) the Cash Value, if the annuity form elected does not
provide such lifetime payments.
The amount applied to provide an Annuity Benefit may be reduced by a charge for
any taxes, as described under the section "Applicable Tax Charges", that apply
on annuity purchase payments. If we have previously deducted charges for
applicable taxes from Contributions, we will not again deduct charges for the
same taxes before an Annuity Benefit is provided. The balance will be used to
purchase the Annuity Benefit on the basis of either (1) the Tables of Guaranteed
Annuity Payments or (2) our then current individual annuity rates, whichever
rates would provide a larger benefit with respect to the payee, or (3) any of
our single consideration immediate annuity contracts offered at the time to the
same class of Participants.
2004EDCGAC 22
SECTION 7.05-ANNUITY BENEFIT
Payments under an Annuity Benefit will be made monthly. An election may be made
by the Employer on behalf of the Participant to have the Annuity Benefit paid at
other intervals, such as every three months, six months, or twelve months,
instead of monthly, subject to our rules at the time of election. This election
may be made at the time the Annuity Benefit form as described in the section
"Annuity Benefit Forms" is elected. In that event, all references in this
Contract to monthly payments will be deemed to mean payments at the frequency
elected.
SECTION 7.06-PAYMENT OF BENEFITS AND REQUIRED MINIMUM DISTRIBUTION RULES
As required under Sections 457 and 401(a)(9) of the Code and pursuant to the
terms of the Plan, the entire interest of the Participant in this Contract is to
be distributed or will begin to be distributed at least annually from this
Contract beginning no later than the first day of April following the later of
the calendar year in which the Participant attains age 70-1/2 or (b) retires
from service with the Employer ("Required Beginning Date").
The amount to be distributed for a year is a "Required Minimum Distribution."
The entire interest may be distributed, as elected pursuant to the Plan and this
Contract, over (a) the life of the Participant, or the lives of the Participant
and a designated Beneficiary or (b) a period certain not extending beyond the
Participant's life expectancy or the joint and last survivor life expectancy of
the Participant and a designated Beneficiary. All distributions made hereunder
shall be made in accordance with the requirements of Sections 457 and 401(a)(9)
of the Code, and applicable Treasury Regulations including the incidental death
benefit requirements of Section 401(a)(9)(G) of the Code.
If the Participant dies after distribution of the interest in this Contract
described in the first paragraph of this Section has begun, the remaining
portion of such interest will continue to be distributed at least as rapidly as
under the method of distribution being used prior to the Participant's death.
If the Participant dies before distribution of the interest described in the
first paragraph of this Section begins:
(1) If the Participant's interest is payable to a designated individual
Beneficiary, then the entire interest will be distributed in accordance with
Treasury Regulations over the life of the Beneficiary or over a period certain
not greater than the life expectancy of the designated Beneficiary. Such
distributions must commence on or before December 31 of the calendar year
immediately following the calendar year of the Participant's death.
(2) If the designated Beneficiary is the Participant's surviving spouse, the
date distributions that are required to begin in accordance with (1) above shall
not be earlier than the later of (A) December 31 of the calendar year
immediately following the calendar year of the Participant's death or (B)
December 31 of the calendar year in which the Participant would have attained
age 70-1/2.
(3) If neither (1) nor (2) applies, or if elected by the designated individual
Beneficiary, then distribution of the entire interest in the Contract shall be
completed no later than December 31 of the calendar year containing the fifth
anniversary of the Participant's death.
Notwithstanding the above paragraphs and the following paragraphs of this
Section, while any distribution shall be subject to requirements of the Code,
any distribution shall also be subject to the terms of this Contract. That is,
the forms of distribution shall be those that are made available by us at the
time of the Participant's election.
Evidence of each payee's survival must be furnished to us either by personal
endorsement of the check drawn for payment or by other means satisfactory to us.
2004EDCGAC 23
If a benefit payment under the terms of this Contract was based on information
that is subsequently found to be incorrect, the benefit will not be invalidated,
but an adjustment on the basis of the correct information will be made in the
amount of the benefit payments, or any amount used to provide the benefit, or
any combination thereof. Overpayments by us will be charged against, and
underpayments will be added to, any payments thereafter falling due under this
Contract with respect to the payee, affecting as many such payments as are
necessary to correct the overpayment or underpayment. Our liability, with
respect to a payee, is limited to the correct information and the actual amounts
used to provide the benefits then in force with respect to the payee under this
Contract.
If we receive evidence satisfactory to us that (i) a payee entitled to receive
any payment under this Contract is physically or mentally incompetent to receive
such payment or is a minor, (ii) another person or an institution is then
maintaining or has custody of such payee, and (iii) no guardian, committee or
other representative of the estate of such payee has been appointed, we may make
the payments (in the case of a minor, at a rate not exceeding $200 a month) to
such other person or institution, and will thereupon be fully discharged from
all liability with respect thereto.
If a variable annuity form made available by us provides for payment for a
period certain, such as 120 or 180 months, and thereafter during the remaining
lifetime of one person, or of at least one of two persons, a payee for payments
thereunder may elect, without the concurrence of any other person, to receive
the commuted value of any remaining payments, provided no person upon whose life
the income depends is surviving.
Pursuant to the section "Election/Report For Annuity Benefit", upon the election
of an annuity form providing payments for a period certain, the Employer (or the
Participant, if the Employer has advised us in writing that it is permitted
under the terms of the Plan) may designate (with the right to change such
designation) a payee to receive any payments that may become due after the death
of the person or persons upon whose life or lives the income may depend.
Subject to the terms of the Plan, the payee may designate (with the right to
change such designation and without the concurrence of any other person) a
person or persons to receive any payments or installments payable after such
payee's death, if the absence of such a designation would result in a single sum
payment to such payee's estate in accordance with the following paragraph.
If at the death of any payee there is no designated person living entitled to
receive any remaining payments or installments, we will pay in a single sum to
such payee's estate the commuted value of any remaining payments or
installments.
The commuted value of any such remaining payments will be determined on the
basis of compound interest at the rate utilized in the actuarial rate basis
applicable in determining the annuity amount.
If the amount to be applied hereunder is less than $2,000, or would result in an
initial payment of less than $20, we may pay the amount to the payee in a single
sum instead of applying it under the annuity form elected.
Payments under annuity forms with life contingencies terminate with the last
payment due before the death of the person or persons upon whose life the income
depends or the end of the certain period, whichever is later.
We will require satisfactory evidence of the age of any person upon whose life
an annuity form depends.
SECTION 7.07-COMMENCEMENT OF ANNUITY BENEFITS
At or prior to the Annuity Commencement Date or age 70-1/2 we will notify the
Participant of the payout options available under this Contract.
2004EDCGAC 24
Before the Annuity Commencement Date, the Participant may elect to change such
date. The changed Annuity Commencement Date may be any date after the election
is filed (other than the 29th, 30th, or 31st day of any month). Any election for
such change must be made in writing by the Participant and will not take effect
until received and accepted at our Processing Office.
No Annuity Commencement Date will, however, be later than the first day of the
month that follows the date the Participant attains the "maximum maturity age"
or, if later, the tenth anniversary of the Participation Date. The current
maximum maturity age will be specified in the Participant's Certificate. We may
change this age in conformance with applicable law.
SECTION 7.08-CONDITIONS
We may require proof acceptable to us that the person on whose life a benefit
payment is based is alive when each payment is due. We will require proof of the
age of any person on whose life an Xxxxxxx Xxxxxxx is based.
If a benefit was based on information that is later found not to be correct,
such benefit would be adjusted on the basis of the correct information. The
adjustment will be made in the number or amount of the benefit payments, or any
amount used to provide the benefit, or any combination. Overpayments by us will
be charged against future payments. Underpayments will be added to future
payments. Our liability is limited to the correct information and the actual
amounts used to provide the benefits.
If the age (or sex, if applicable as stated in the Tables of Guaranteed Annuity
Payments) of any person upon whose life an Annuity Benefit depends has been
misstated, the benefits payable will be based on the benefit amount applicable
to those that would have been purchased at the correct age (or sex). Any
overpayments or underpayments made by us will be charged or credited with
interest at (a) the rate of [6%] or (b) the then current Guaranteed Interest
Rate; we will determine which rate will apply, on a uniform and
nondiscriminatory manner, for similar Contracts. Such interest will be deducted
from or added to future payments.
If we receive proof satisfactory to us that (1) a payee entitled to receive any
payment under the terms of this Contract is physically or mentally incompetent
to receive such payment or is a minor, (2) another person or an institution is
then maintaining or has custody of such payee, and (3) no guardian, committee or
other representative of the estate of such payee has been appointed, we may make
the payments to such other person or institution. In the case of a minor, the
payments will not exceed $200. We will have no further liability with respect to
the payments so made.
If the amount to be applied hereunder is less than $2,000 or would result in an
initial payment of less than $20, we may pay the amount to the payee in a single
sum instead of applying it under the annuity form elected.
SECTION 7.09-CHANGES
We reserve the right, upon advance written notice to the Employer, to change at
any time on and after the fifth anniversary of the Contract Date, at intervals
of not less than five years, the actuarial basis used in the Tables of
Guaranteed Annuity Payments; however, no such change will apply to (A) any
Annuity Benefit provided before the change or (B) Contributions made before such
change that are applied to provide an Annuity Benefit.
2004EDCGAC 25
PART VIII - PARTICIPANT ACCOUNTS
SECTION 8.01-PARTCIPANT ACCOUNTS
The Employer will specify each Participant for whom an account is to be
maintained under this Contract. The Employer will also specify by Participant
each Contribution being remitted, the source, if applicable, to which each
Contribution relates, and the allocation by source of such Contribution among
the Investment Options. The terms of the section "Guaranteed Interest
Option-Conditions", the section "Variable Investment Options /Accumulation Units
and Unit Values" and the section "Fixed Maturity Options" apply separately with
respect to each Participant's account under this Contract.
Subject to the terms of the Plan and the restrictions on distributions stated in
the section "Restrictions on Distributions", we will at the Employer's request
terminate the Participant's participation under this Contract by paying the
Annuity Account Value to the Participant. This right will be exercised only if
(i) no initial Contributions have been received on the Participant's behalf
within 120 days of the Participation Date under the Certificate, (ii) there have
been no on-going Contributions received on the Participant's behalf during the
last three completed Participation Years, and the Annuity Account Value is less
than [$500], or (iii) a partial withdrawal is made that would result in the
Participant's Annuity Account Value falling below [$500].
The designations or maintenance of any account under this Contract shall not
give any Participant, or Beneficiary of the Participant or any other person any
right or interest specific to the assets invested in the Investment Options of
the Contract unless so specifically provided by the provisions of this Contract.
2004EDCGAC 26
PART IX - CHARGES
SECTION 9.01-WITHDRAWAL CHARGES
Payment made under Part V " Distributions and Death Benefits" may be subject to
a withdrawal charge as specified in the Application.
The years of participation under the Prior Contract or Certificate, if
applicable, may be included for purposes of determining the withdrawal charge.
The withdrawal charge will be reduced to the extent required to comply with any
applicable state law.
We reserve the right to reduce or waive the withdrawal charge upon such events
specified in the Application.
If the Plan is subject to a withdrawal charge then, a "Free Withdrawal Amount"
will apply as follows:
"Free Withdrawal Amount" means an amount equal to 10% of the Annuity Account
Value minus the total of all prior withdrawals (and associated withdrawal
charges) in the current Participation Year minus any amount in the Loan Reserve
Account without incurring a withdrawal charge. The free withdrawal amount when
applicable may be changed but it will always be a percentage between 0% and 30%.
SECTION 9.02-EARLY WITHDRAWAL CHARGE
If requested by the Employer after the completion of a period agreed upon by the
Employer and us not to exceed five Contract Years from the date as of which an
agreement is entered into between the Employer and us and after the completion
of each successive period, any assets of the Plan that are currently held in
Participant accounts under the Contract will be transferred as soon as
administratively practicable to a successor funding agency designated by the
Employer unless, not later than 7 days before the date on which a transfer would
otherwise occur, the Employer notifies us to renew that agreement. Such funds
will be transferred in a single sum and no withdrawal charges will be applied in
connection with such a transfer. However, upon termination of participation or a
partial withdrawal prior to the end of the agreed upon period, a withdrawal
charge may apply as described above in the section "Withdrawal Charges". We will
not be responsible for the validity of any instructions by the Employer.
SECTION 9.03-THIRD PARTY TRANSFER CHARGE
We have the right to deduct a charge for each occurrence for a direct transfer
to another annuity contract or custodian account that meets the requirements of
Section 457(b) of the Code. This charge, if any, will be specified in the
Application and will not be less than $25 or greater than $65.
SECTION 9.04-EMPLOYER EXPENSE DEDUCTION
If the Employer so requests and we agree, we will deduct amounts from the
Annuity Account Value requested by the Employer in accordance with the terms of
the Plan to pay Plan operating expenses to a party designated by the Employer.
SECTION 9.05-CHARGES DEDUCTED FROM ANNUITY ACCOUNT VALUE
[OPTIONAL FEATURES]
ENHANCED DEATH BENEFIT CHARGE
If the Participant elects the Enhanced Death Benefit the charge will be a
percentage of the Annuity Account Value not to exceed [.15%]. This charge will
be deducted on each Participation Date anniversary pro rata from the Guaranteed
Interest Option and Variable Investment Options. If there are not sufficient
amounts in those Investment Options, we will make up the required amounts from
the Fixed Maturity Options in order of the earliest Expiration Date(s) first.
2004EDCGAC 27
ADMINISTRATIVE CHARGE
As of each Processing Date, we will deduct Administrative Charges related to the
administration and/or distribution of the Certificate from the Annuity Account
Value. Such charges, if any, are shown in the Application. The amount of any
such Charge may be increased to a maximum of $65 in accordance with the section
"Changes".
The administrative charge, if applicable, will be deducted pro rata from the
Guaranteed Interest Option and Variable Investment Options. If there are not
sufficient amounts in those Investment Options, we will make up the required
amounts from the Fixed Maturity Options in order of the earliest Expiration
Date(s) first. Also, the charge will be prorated for the Participation Year or
portion thereof in which the Participation Date occurs or in which the Annuity
Account Value is withdrawn or applied to provide an Annuity Benefit or death
benefit.
We have the right to change the amount of the charges with respect to future
Contributions. We will give the Employer and the Participant advance notice of
any such change.
SECTION 9.06-TRANSFER AND LOAN CHARGES
We reserve the right to impose a charge with respect to any of the following
1.) establishing and administration of a loan
2.) any transfer among Variable Investment Options (after the number of such
transfers indicated in the section "Transfer Rules")
The amount of the charge, if any, will be set forth in the Application.
SECTION 9.07-VARIABLE SEPARATE ACCOUNT CHARGE
Assets of the Variable Separate Account will be subject to a daily asset charge
as specified in the Application. The annual charge is 1.49% of the assets of the
Variable Separate Accounts.
SECTION 9.08-PLAN RECORDKEEPING SERVICE CHARGES
If the Employer requests that we provide Plan recordkeeping services and we
agree, the Employer will pay such charge directly to us or in the alternative
the Employer may direct us to deduct such charge from Participant accounts. Such
charges will be mutually agreed upon by the Employer and us.
SECTION 9.09 APPLICABLE TAX CHARGES
We reserve the right to deduct a charge that we determine to approximate certain
taxes that may be imposed on us, including but not limited to premium taxes that
may apply in the Participant's state of residence. The tax charge will be
deducted from amounts applied to an Annuity Benefit in accordance with Part VII
"Annuity Benefits". If the tax is imposed at a time other than when amounts are
applied to an Annuity Benefit, we reserve the right to deduct the charge from
Contributions in the section "Contributions" or withdrawals in the section
"General Withdrawals".
SECTION 9.10-CHANGES
In addition to our right to reduce or waive charges as described in this Part IX
of the Contract, we reserve the right, upon advance notice to the Employer, to
increase the amount of any charge with respect to each Participant, subject to
(a) any maximum amount provided in this Part IX and (b) with respect to
withdrawal and administrative charges deducted from the Annuity Account Value.
The application of any increase is to be made on a prospective basis. We also
reserve the right, upon advance written notice to the Employer, to increase the
maximum amount of any charge provided in this Part IX or the Application, only
with respect to Participants whose Participation Date occurs after the effective
date of the increase, but not to exceed the maximum amount then permitted by any
law that applies.
2004EDCGAC 28
PART X - UNALLOCATED ACCOUNT:
SECTION 10.01 UNALLOCATED ACCOUNT
Subject to the conditions set forth in this section, we will accept transfers of
cash into this Contract; we do not accept in-kind asset transfers from a prior
funding vehicle. When we receive cash transferred from a prior funding vehicle,
the transferred amount will be credited as one lump sum to the Plan's
Unallocated Account, as set forth in the Application. Any amount held in the
Plan Unallocated Account becomes part of our Guaranteed Interest Option and will
be credited with interest at the rate applicable to amounts held in the
Guaranteed Interest Option. The transferred amount will remain in the Plan
Unallocated Account until we have received all the information we require,
including properly completed forms, to effect a transfer from the Plan
Unallocated Account to a Participant account. With respect to each Participant,
we will allocate amounts to each Participant's account only after the Employer
provides instructions that are acceptable and necessary in order to complete the
allocation process. We reserve the right to limit the period during which such
instructions may be received to no more than [10] days from the initial transfer
into the Plan Unallocated Account and to return funds to the Employer for which
transfer information has not been timely received in good order. Under no
circumstances will we be required to transfer to Participant accounts an amount
in aggregate greater than the amount deposited by the Employer plus such
interest as we credited to the Unallocated Account, unless otherwise expressly
agreed upon between the Employer and us.
The Employer is solely responsible for effectuating the asset transfer in
accordance with all applicable laws and regulations.
2004EDCGAC 29
PART XI - GENERAL PROVISIONS
SECTION 11.01-CONTRACT
This Contract and the Application constitute the entire contract between the
parties and will govern with respect to our rights and obligations.
This Contract may not be modified, nor may any of our rights or requirements be
waived, except in writing and signed by one of our authorized officers. In
addition to the rights of change reserved by us as provided in this Contract,
the Contract may be changed by amendment or replacement without the consent of
any other person provided that such change does not reduce any Annuity Benefit
provided before such change and provided that no rights, privileges or benefits
under the Contract with respect to Contributions made hereunder prior to the
effective date of such change may be adversely affected by an amendment to the
Contract without the consent of the Employer.
We are under no obligation or by reason of issuance of this Contract either (a)
to determine whether any payment, distribution or transfer under this Contract
complies with the provisions, terms and conditions of the Plan or with
applicable law or (b) to administer the Plan, including without limitation, any
provisions required by any applicable law.
Subject to our approval, the Employer may designate another person to exercise
rights under the Contract.
SECTION 11.02-STATUTORY COMPLIANCE
We reserve the right to amend this Contract without the consent of any other
person in order to comply with applicable laws and regulations. Such right will
include, but not be limited to, the right to conform the Contract to reflect
changes in the Code, in Treasury regulations or published rulings of the
Internal Revenue Service.
No amendment to this Contract may vest in any Employer any interest or control
over any assets of the Plan invested in this Contract or cause any such assets
to be used for or diverted to, purposes other than the exclusive benefit of Plan
participants or their Beneficiaries.
The benefits and values available under this Contract will not be less than the
minimum benefits required by any applicable federal and /or state law.
THE PROVISIONS OF THIS CERTIFICATE CONFORM TO THE MINIMUM REQUIREMENTS OF
MONTANA LAW AND CONTROL OVER CONFLICTING STATUTES OF ANY STATE IN WHICH THE
INSURED RESIDES ON OR AFTER THE PARTICIPATION DATE.
SECTION 11.03-DEFERMENT
Application of proceeds to provide a payment of a death benefit under Part V and
payment of any portion of the Annuity Account Value (less any applicable
withdrawal charge) will be made within seven days after the Transaction Date.
Payments or applications of proceeds from a Variable Separate Account may be
deferred for any period during which (1) the New York Stock Exchange is closed
or trading is restricted, (2) sales of securities or determination of the fair
value of the Variable Separate Account's assets is not reasonably practicable
because of an emergency, or (3) the Securities and Exchange Commission, by
order, permits us to defer payment in order to protect persons with interests in
the Variable Separate Account. We may defer payment or transfer of any portion
of the Annuity Account Value in the Guaranteed Interest Option and the Fixed
Maturity Options for up to six months while the Participant is living.
SECTION 11.04-NONFORFEITABILITY, NONTRANSFERABILITY AND ASSIGNMENTS.
The Participant's entire interest under this Contract is nonforfeitable. This
Contract is nontransferable except by surrender to us.
2004EDCGAC 30
Any interest under the terms of this Contract may not 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 other than
us.
2004EDCGAC 30
No amount payable under the terms of this Contract may be assigned or commuted,
unless specifically provided for under the terms of this Contract, or encumbered
by the payee, and, to the extent permitted by law, no such amount will in any
way be subject to any claim against such payee.
Subject to the requirements of applicable law, no amount payable to the
Participant or Beneficiary under the Contract may be assigned, commuted or
encumbered by the payee and no such amount will in any way be subject to any
claim against such payee. Such prohibition will not apply to any assignment,
transfer or attachment pursuant to a qualified domestic relations order, as
defined in Section 414(p) of the Code if such qualified domestic relations order
is applicable as determined by the Employer, or the person (such as the plan
administrator) designated, if any, in the Plan to make such determination. Any
interest under the terms of this Contract may not be sold, assigned, discounted,
or pledged as collateral for a loan or as security for performance of an
obligation or for any other purpose to any person other than us.
This Contract is not transferable within the meaning of Section 401 (g) of the
Code except by surrender to us.
It is impossible, prior to the satisfaction of all liabilities with respect to
the Participants and Beneficiaries under the Plan, for any part of the assets
and income of the Contract to be used for, or diverted to, purposes other than
for the exclusive benefit of the Participants and Beneficiaries.
SECTION 11.05-OWNERSHIP RIGHTS
The Employer will hold all the assets of the Plan invested in this Contract
including all Annuity Account Values and Cash Values of all Plan Participants in
trust for the exclusive benefit of the Participants and the Participants'
Beneficiaries under the Plan. This Contract is not subject to the claims of the
general creditors of the Employer.
It is impossible, prior to the satisfaction of all liabilities with respect to
the Participants and the Participant's Beneficiaries under the Plan, for any
part of the assets and income of the Contract to be used for, or diverted to,
purposes other than for the exclusive benefit of the Participants and their
Beneficiaries under the Plan.
SECTION 11.06-EMPLOYER'S RESPONSIBILITY
The Employer will have responsibility for the administration of the Plan,
Contributions, authorization of payments and other distributions hereunder. We
will deal with the Employer in accordance with the terms and conditions of this
Contract. We shall make no payment without written consent from the Employer,
and we will be fully discharged of any liability therefore to the extent such
payments are made pursuant to such direction from the Employer.
SECTION 11.07-PLAN STATUS
A "Section 457 Plan" is a plan or agreement that meets the requirements for
qualification under Section 457 of the Code. The Employer is to provide evidence
satisfactory to us that the Plan is a Section 457 Plan and, if at any time the
Plan no longer meets the requirements of Section 457(b) of the Code, the
Employer is to give us prompt written notice thereof.
If (a) within one year after the Contract Date, or such longer period as may be
agreed upon in writing between the Employer and us, the Employer does not
provide such evidence, or (b) the Employer gives notice that the Plan is no
longer a qualified plan, then upon at least thirty days advance written notice
to the Employer, we may:
(i) prohibit further Contributions under this Contract with respect to the
Plan, and
(ii) withdraw from the Investment Options the amounts therein
with respect to the Plan.
2004EDCGAC 31
In that event, at the Employer's option we will (i) terminate the Plan's
participation under this Contract and pay the amounts held in the Investment
Options with respect to the Plan, or (ii) we will transfer the amounts held in
the Investment Options to another contract agreed to by both the Employer and
us.
SECTION 11.08-TERMINATION OF THE CONTRACT
The Employer may terminate the Contract at any time by written notice in a form
acceptable to us. The Contract will also terminate when Contributions are
discontinued and the Annuity Account Value with respect to each Participant is
zero.
SECTION 11.09-DISQUALIFICATION OF PLAN OR CONTRACT
If the Plan no longer meets all of the requirements of Section 457(b) of the
Code, the Employer will notify us in writing. In that event, at the Employer's
option, (i) we will terminate the Plan's participation under this Contract and
pay the amounts held in the Investment Options with respect to the Plan, or (ii)
we will transfer the amounts held in the Investment Options to another contract
agreed to by both the Employer and us.
SECTION 11.10-MANNER OF PAYMENT
Unless the Employer and we agree, all amounts paid to or from this Contract are
payable by check in United States dollars.
SECTION 11.11-REPORTS AND NOTICES
With respect to each Participant, at least once each year until the Annuity
Commencement Date, we will furnish the Participant with a report showing for
each Investment Option the Annuity Account Value, the number of Accumulation
Units for each Variable Investment Option and for each Fixed Maturity Option,
the Fixed Maturity Amount, market value adjustment, and Annuity Account Value.
The terms of this Contract which requires us to send a report or any written
notice will be satisfied by our mailing any such report or notice to the
Employer or Participant's last known address as shown in our records.
Notifications of rules in effect and other matters of general applicability to
this contract may be included in the product prospectus and prospectus
supplements as mailed to such address from time to time. The notices and reports
may also be delivered by electronic means as agreed upon between us and the
Employer or Participant.
All written notices sent to us will not be effective until received in good
order on a Business Day at the Processing Office.
SECTION 11.12 - CONTRACT HOLDER'S RESPONSIBILITY
If the Contract Holder is the trustee of a trust established pursuant to a trust
agreement between us and said trustee and adopted by the Employer, such trustee
will have no responsibility for Contributions or any payments or other
distributions under the Plan or Contract or for the administration of the Plan
or Contract. In addition, we will deal with such trustee in accordance with the
terms and conditions of the trust agreement pursuant to which the trustee agreed
to act as such and in such manner as the trustee and we agree, without the
consent of any other person.
2004EDCGAC 32
TABLE OF GUARANTEED ANNUITY PAYMENTS
AMOUNT OF ANNUITY BENEFIT PAYABLE MONTHLY ON THE LIFE ANNUITY FORM WITH TEN*
YEARS CERTAIN PROVIDED BY APPLICATION OF $1,000.
Retirement Unisex Length of Retirement Unisex Length of
Age Factor Period Certain Age Factor Period Certain
60 3.78 10 73 4.98 10
61 3.84 10 74 5.11 10
62 3.91 10 75 5.24 10
63 3.99 10 76 5.37 10
64 4.07 10 77 5.52 10
65 4.15 10 78 5.66 10
66 4.24 10 79 5.81 10
67 4.33 10 80 6.04 9
68 4.42 10 81 6.21 9
69 4.53 10 82 6.49 8
70 4.63 10 83 6.68 8
71 4.74 10 84 7.00 7
72 4.86 10 85 7.23 7
* Certain Period of 10 Years not to Exceed Life Expectancy
The amount of income provided under an Annuity Benefit payable on the Life
Annuity form with Ten Years Certain is based on 2.5% interest and the 1983
Individual Annuity Mortality Table "a" projected with modified Scale "G".
We will calculate amounts required for ages or for annuity forms not shown in
the above Table or for other annuity forms on the same actuarial basis.
If a variable annuity form is available from us and elected pursuant to the
section "Annuity Benefit Forms", then the amounts required will be calculated by
us based on the 1983 Individual Annuity Mortality Table "a" projected with
modified Scale "G" and a modified two year age setback and on an Assumed Base
Rate of Net Investment Return of 3.5% or 5.0%, whichever will apply, as we will
inform you.
2004EDCGAC 33
