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Pruco Life Insurance Company of New Jersey
Newark, NJ 07102
A Stock Company Subsidiary of
The Prudential Insurance Company of America
EXHIBIT (4)(a)
This is an annuity contract. Subject to the provisions of the Contract, and in
consideration of any Purchase Payments you make and we accept, we will make
Annuity Payments starting on the Annuity Date shown on the Contract Data pages.
Please read the Contract carefully; it is a legal contract between you and Pruco
Life Insurance Company. Expense charges applicable to the Contract are shown on
the Contract Data pages. If you have a question about the Contract, or a claim,
see your representative or contact the Annuity Service Center.
RIGHT TO CANCEL CONTRACT
This Contract may be returned within 10 days after you receive it. It can be
mailed or delivered to either us, at the Annuity Service Center, or the
representative who sold it to you. Return of this Contract by mail is effective
on being postmarked, properly addressed and postage prepaid. The returned
Contract will be cancelled upon our receipt, and we will return an amount equal
to the sum of (i) the difference between Purchase Payments received, including
any fees or other charges, and the amount(s) allocated to the Allocation Options
under the Contract, and (ii) the Contract Value as of the date the Contract is
mailed or delivered to us or the representative who sold it to you. If you
exercise your Right to Cancel the Contract, the entire Credit will be
recaptured.
READ YOUR CONTRACT CAREFULLY
Signed for Pruco Life Insurance Company of New Jersey,
a New Jersey Corporation.
[SIG] [SIG]
--------------------- ---------------------
Secretary President
INDIVIDUAL FLEXIBLE PREMIUM DEFERRED VARIABLE
ANNUITY CONTRACT
NONPARTICIPATING
ANNUITY PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
VBON-2000--NY
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Pruco Life Insurance Company of New Jersey
Newark, NJ 07102
A Stock Company Subsidiary of
The Prudential Insurance Company of America
This is an annuity contract. Subject to the provisions of the Contract, and in
consideration of any Purchase Payments you make and we accept, we will make
Annuity Payments starting on the Annuity Date shown on the Contract Data pages.
Please read the Contract carefully; it is a legal contract between you and Pruco
Life Insurance Company. Expense charges applicable to the Contract are shown on
the Contract Data pages. If you have a question about the Contract, or a claim,
see your representative or contact the Annuity Service Center.
RIGHT TO CANCEL CONTRACT
This Contract may be returned within 10 days after you receive it. It can be
mailed or delivered to either us, at the Annuity Service Center, or the
representative who sold it to you. Return of this Contract by mail is effective
on being postmarked, properly addressed and postage prepaid. The returned
Contract will be cancelled upon our receipt, and we will return an amount equal
to the sum of (i) the difference between Purchase Payments received, including
any fees or other charges, and the amount(s) allocated to the Allocation Options
under the Contract, and (ii) the Contract Value as of the date the Contract is
mailed or delivered to us or the representative who sold it to you. If you
exercise your Right to Cancel the Contract, the entire Credit will be
recaptured.
READ YOUR CONTRACT CAREFULLY
Signed for Pruco Life Insurance Company of New Jersey,
a New Jersey Corporation.
[SIG] [SIG]
--------------------- ---------------------
Secretary President
INDIVIDUAL FLEXIBLE PREMIUM DEFERRED VARIABLE
ANNUITY CONTRACT
NONPARTICIPATING
ANNUITY PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE
INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND ARE NOT
GUARANTEED AS TO DOLLAR AMOUNT.
VBON-2000--NY
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TABLE OF CONTENTS
CONTRACT DATA PAGES......................................................... 3
DEFINITIONS................................................................. 4
PURCHASE PAYMENTS........................................................... 6
CREDITS..................................................................... 6
CONTRACT VALUE.............................................................. 7
VARIABLE SEPARATE ACCOUNT................................................... 7
CONTRACT MAINTENANCE CHARGE................................................. 7
TRANSFERS................................................................... 8
WITHDRAWALS................................................................. 8
PROTECTED VALUE............................................................. 9
GUARANTEED MINIMUM DEATH BENEFIT............................................ 10
ANNUITY AND SETTLEMENT OPTIONS.............................................. 12
BENEFICIARY................................................................. 13
SUSPENSION OR DEFERRAL OF PAYMENTS OR TRANSFERS FROM THE SEPARATE ACCOUNT... 13
GENERAL PROVISIONS.......................................................... 14
VALUES AND BENEFITS......................................................... 15
ANNUITY SETTLEMENT TABLES................................................... 15
VBON-2000--NY Page 2
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CONTRACT DATA
OWNER: XXXXX 8. XXXXX 8 SEX: M AGE AT ISSUE: 34
ANNUITANT: XXXXX 8. XXXXX 8 SEX: M AGE AT ISSUE: 34
CO-ANNUITANT: NONE SEX: AGE AT ISSUE:
CONTRACT NUMBER: E0024064 CONTRACT DATE: June 26, 2001
PLAN TYPE: QUALIFIED ANNUITY DATE: June 26, 2057
PURCHASE PAYMENTS:
INITIAL PURCHASE PAYMENT: $52,200.00.
MINIMUM SUBSEQUENT PURCHASE PAYMENT: $1,000. For IRA contracts, the
Minimum Subsequent Purchase Payment is $1,000. The Minimum Subsequent
Purchase Payment for automatic purchase plans, if available, is $100.
ANNUAL PURCHASE PAYMENT LIMITS: The total of all Purchase Payments (net
of Purchase Payments withdrawn) made into this Contract in the first
Contract Year may not exceed $7,000,000. The total of all Purchase
Payments (net of Purchase Payments withdrawn) made into this Contract in
any Contract Year after the first Contract Year may not exceed
$2,000,000. Purchase Payments of greater value may be allowed with our
prior approval.
AGGREGATE PURCHASE PAYMENT LIMIT: The total of all Purchase Payments
(net of Purchase Payments withdrawn) made into this Contract may not
exceed $7,000,000. Purchase Payments of greater value may be allowed
with our prior approval.
CREDIT PAYMENT: 4% of Initial Purchase Payment.
CREDIT VESTING SCHEDULE:
Number of Contract Anniversaries Vested Percentage
Since Date of Each Purchase Payment
0 0%
1 10%
2 20%
3 30%
4 40%
5 50%
6 60%
7 100%
BENEFICIARY:
Class 1: Children of the Annuitant.
CONTRACT MAINTENANCE CHARGE:
If your Contract Value is less than $50,000, we will charge a Contract
Maintenance Charge of the lesser of $30 or 2% of the Contract Value. In
no event will the Contract Maintenance Charge ever exceed $30. This
charge is deducted on the Contract Anniversary and when a surrender of
the Contract occurs, if the Contract Value at the time is then less than
$50,000. The Contract Maintenance Charge will be deducted on a pro-rata
basis from all Allocation Options to which your Contract Value is
allocated. We reserve the right to increase the Contract Value amount
over which we will waive the Contract Maintenance Charge.
VBON-2000--NY Page 3
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INSURANCE CHARGE:
This charge depends on whether you have elected the Guaranteed Minimum
Death Benefit ("GMDB") feature. This charge is deducted daily from the
assets in each of the Subaccounts. If you do not elect the GMDB feature,
you do not elect a GMDB Protected Value option either, and your death
benefit is equal to the base death benefit as described in the GMDB
section of the contract.
[X] You have not elected the GMDB feature. Therefore, the daily
rate is 0.00380909%, which is equivalent to an annual rate of
1.40%.
[ ] You have elected the GMDB feature and the GMDB Protected Value
option of the Step-Up. Therefore, the daily rate is 0.00434896%,
which is equivalent to an annual rate of 1.60%.
ALLOCATION OPTIONS:
VARIABLE INVESTMENT OPTIONS:
The following variable investment options are available through
allocation to subaccounts of the Pruco Life of New Jersey Flexible
Premium Variable Annuity Account. We reserve the right to limit the
availability of the below options, if necessary, in order to comply with
federal, state or local law.
THE PRUDENTIAL SERIES FUND, INC.
Prudential Global Portfolio
Prudential Xxxxxxxx Portfolio
Prudential Money Market Portfolio
Prudential Stock Index Portfolio
SP Aggressive Growth Asset Allocation Portfolio
SP AIM Aggressive Growth Portfolio
SP AIM Growth and Income Portfolio
SP Alliance Large Cap Growth Portfolio
SP Alliance Technology Portfolio
SP Balanced Asset Allocation Portfolio
SP Conservative Asset Allocation Portfolio
XX Xxxxx Value Portfolio
SP Deutsche International Equity Portfolio
SP Growth Asset Allocation Portfolio
SP INVESCO Small Company Growth Portfolio
XX Xxxxxxxx International Growth Portfolio
SP Large Cap Value Portfolio
SP MFS Capital Opportunities Portfolio
SP MFS Mid Cap Growth Portfolio
SP PIMCO High Yield Portfolio
SP PIMCO Total Return Portfolio
SP Prudential U.S. Emerging Growth Portfolio
SP Small/Mid Cap Value Portfolio
SP Strategic Partners Focused Growth Portfolio
JANUS ASPEN SERIES
Janus Aspen Series Growth Portfolio - Service Shares
VBON-2000--NY Page 3A
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ALLOCATION GUIDELINES:
Currently, you may select any Allocation Option which is available at
the time the Purchase Payment or transfer is made. However, an amount of
at least 1% of the Invested Purchase Payment must be allocated to any
Allocation Option. Allocations made pursuant to automatic rebalancing or
dollar cost-averaging are not subject to these limitations. We reserve
the right to limit the availability of the above Allocation Options, if
necessary, in order to comply with federal, state or local law.
TRANSFERS:
NUMBER OF TRANSFERS PERMITTED: Currently, there are no limits on the
number of transfers that can be made among Subaccounts. We reserve the
right to change this, but the Owner will always be allowed at least 12
transfers among Subaccounts in a Contract Year.
TRANSFER CHARGE: The Transfer Charge for each transfer after the first
12 in a Contract Year is $25. The charge is taken pro-rata from the
Allocation Options from which the transfer is made. Transfers made due
to automatic rebalancing or dollar cost-averaging will not be counted
for purposes of the Transfer Charge.
MINIMUM AMOUNT TO BE TRANSFERRED: Subject to the restrictions contained
in the Contract on transfers, the minimum transfer amount is $250 or
your entire interest in any Allocation Option, if less. This requirement
is waived if the transfer is pursuant to automatic rebalancing or dollar
cost-averaging.
WITHDRAWALS:
WITHDRAWAL CHARGE: The Withdrawal Charge is a percentage of the amount
withdrawn that is subject to a charge, and depends on the number of
Contract Anniversaries that have elapsed since a Purchase Payment was
made.
Number of Contract Withdrawal
------------------ ----------
Anniversaries Since Date Charge
------------------------ ------
of Each Purchase
----------------
Payment
-------
0 7%
1 7%
2 7%
3 6%
4 5%
5 4%
6 3%
7 2%
8 1%
9 or more 0%
CHARGE-FREE AMOUNT: A certain amount (the Charge-Free Amount) may be
withdrawn without incurring a Withdrawal Charge. The Charge-Free Amount
available in any Contract Year is calculated on the Contract Anniversary
date. The Charge-Free amount is equal to 10% of the sum of gross
Purchase Payments that are subject to Withdrawal Charges as of the
Contract Anniversary date. Purchase Payments subject to a Withdrawal
Charge are withdrawn on a first-in, first-out basis for purposes of
determining the Charge-Free Amount.
MINIMUM AMOUNT WHICH MAY BE WITHDRAWN: The minimum amount which may be
withdrawn is $250. The minimum amount which may be withdrawn under a
systematic withdrawal plan is $100.
MINIMUM CONTRACT VALUE WHICH MUST REMAIN IN THE CONTRACT AFTER A
WITHDRAWAL: The minimum Contract Value which must remain in the Contract
in order to keep the Contract inforce after a withdrawal is $2,000.
VBON-2000--NY Page 3B
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ENDORSEMENTS:
ANNUITY SERVICE CENTER:
Annuity Service Center
P.O. Box 7960
Philadelphia, PA 19101
VBON-2000--NY Page 3C
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DEFINITIONS
ACCUMULATION PERIOD: The period from, and including, the Contract Date to, but
excluding, the Annuity Date.
ADJUSTED CONTRACT VALUE: The Contract Value as of the Annuity Date less any
applicable charges for any type of tax (or component thereof) measured by or
based on the amount of Purchase Payment we receive. The Applicable Annuity Table
is applied to this amount to determine the initial Annuity Payment.
ALLOCATION OPTIONS: Those investment options available under the Contract as of
any given time to which Contract Value may be allocated. Allocation Options as
of the Contract Date are shown on the Contract Data pages.
ANNUITANT: The person named on the first page upon whose continuation of life
any Annuity Payment involving life contingencies depends. If the Annuitant dies
before the Annuity Date, the Co-Annuitant, if applicable, becomes the Annuitant,
if the requirements for changing Annuity Date are met (see definition of Annuity
Date). If there is no surviving or eligible Co-Annuitant, and the Annuitant was
not the Owner, the Owner becomes the Annuitant. You then have 60 days from the
date we receive due proof of death of the Annuitant or Co-Annuitant to name a
new Annuitant. If no new Annuitant is named during that 60 day period, the Owner
will remain the Annuitant. You may not change an Annuitant or Co-Annuitant and
may add or remove an Annuitant or Co-Annuitant only with our prior approval.
ANNUITY DATE: The date the first Annuity or Settlement Payment to the Payee is
due. The Annuity Date is shown on the original Contract Data pages. You must
have our permission to change the Annuity Date. The maximum annuity age is age
90. If there is a new Annuitant due to the death of the Annuitant, and the new
Annuitant is older than the prior Annuitant, the Annuity Date will be based on
the age of the new Annuitant; however any such changed Annuity Date must be at
least one year after the Contract Date, must be earlier than the date shown on
the Contract Data pages, cannot be later than the Contract Anniversary next
following the new Annuitant's 90th birthday and must be consistent with
applicable law at the time.
ANNUITY OR SETTLEMENT PAYMENTS: The series of payments made to you or any named
payee after the Annuity Date as described under the Annuity or Settlement Option
selected.
ANNUITY PERIOD: The period of time, beginning on the Annuity Date, during which
Annuity or Settlement Payments are made.
ANNUITY SERVICE CENTER: The office indicated on the Contract Data pages to which
notices, requests and Purchase Payments must be sent. All sums payable to us
under the Contract must be sent to the Annuity Service Center. The Annuity
Service Center address may be changed at any time. You will be notified in
advance and in writing of any change in address.
BENEFICIARY: The person(s) or entity(ies) who has the right to receive the death
benefit when the Owner dies.
BUSINESS DAY: Any day the New York Stock Exchange and the Company are open for
business.
CHARGE-FREE AMOUNT: The Charge-Free Amount is a portion of the Contract Value
that may be withdrawn without incurring a Withdrawal Charge.
CO-ANNUITANT: The person shown on the Contract Data pages who becomes the
Annuitant upon the death of the Annuitant before the Annuity Date. No
Co-Annuitant may be designated if the Owner is a non-natural person.
COMPANY: Pruco Life Insurance Company of New Jersey, a New Jersey corporation.
CONTRACT ANNIVERSARY: The same day and month as the Contract Date in each later
year.
CONTRACT DATE: The date shown on the Contract Data pages on which the first
Contract Year begins.
CONTRACT SURRENDER VALUE: The Contract Value less any applicable Withdrawal
Charge, Credit recapture, Contract Maintenance Charge or charge for any type of
tax (or component thereof) measured by or based on the amount of Purchase
Payment we receive.
CONTRACT VALUE: The dollar value as of any Business Day prior to the Annuity
Date of all amounts accumulated under this Contract.
CONTRACT YEAR: A year which starts on the Contract Date or on a Contract
Anniversary.
VBON-2000--NY Page 4
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CREDIT: An amount we add to your Contract Value at the time an Invested Purchase
Payment is credited to the Contract Value.
EARNINGS: The excess of the Contract Value over the sum of all Purchase Payments
made and not yet withdrawn and non-vested Credits not yet recaptured.
GOOD ORDER: An instruction received at the Annuity Service Center, utilizing
such forms, signatures and datings as we require, that is sufficiently complete
and clear that we do not need to exercise any discretion to follow such
instructions. We will notify you if an instruction is not in Good Order.
INVESTED PURCHASE PAYMENTS: The balance of each Purchase Payment after we make
any applicable deduction for charges for any type of tax (or component thereof)
measured by or based on the amount of Purchase Payment we receive.
OWNER: The person or entity named on the Contract Data pages who has ownership
rights as defined under the Contract. You may change the Owner subject to our
underwriting rules. Any change of an Owner will be effective when we process the
request.
PAYEE: The person who has a right to receive Annuity or Settlement Payments
under the Annuity and Settlement Options provision of this Contract. The Payee
can be designated as revocable or irrevocable at your discretion. If you do not
designate a Payee at least 5 Business Days before the Annuity Date, the Owner
will become the Payee.
PURCHASE PAYMENT: A payment you make to this Contract.
SUBACCOUNT: Variable Separate Account assets are divided into Subaccounts.
Assets of each Subaccount will be invested in shares of a Variable Investment
Option.
VARIABLE INVESTMENT OPTION: Those investment options available under the
Contract through the Subaccounts as of any given time. Variable Investment
Options as of the Contract Date are shown on the Contract Data pages.
VARIABLE SEPARATE ACCOUNT: A segregated asset account maintained by us to
support this and certain other contracts. The segregated asset account(s)
available as of the Contract Date is shown on the Contract Data pages.
WE, OUR AND US: Pruco Life Insurance Company of New Jersey.
WITHDRAWAL CHARGE: A charge assessed on partial or full withdrawals during the
Withdrawal Charge Period. The Withdrawal Charge equals a percentage, shown on
the Contract Data pages, of the amount subject to the charge.
WITHDRAWAL CHARGE PERIOD: The number of Contract Anniversaries since each
Purchase Payment during which Withdrawal Charges are applied to withdrawals of
amounts in the Contract. The Withdrawal Charge Period is shown on the Contract
Data pages.
YOU AND YOUR: The Owner of the Contract.
VBON-2000--NY Page 5
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PURCHASE PAYMENTS
PURCHASE PAYMENTS: The initial Purchase Payment must be paid on the Contract
Date. In general, subsequent Purchase Payments may be made at any time before
the Annuity Date. However, no Purchase Payments may be made on or after the
Owner's or Annuitant's 80th birthday. The Minimum Subsequent Purchase Payment,
Annual Purchase Payment Limits and Aggregate Purchase Payment Limit are shown on
the Contract Data pages.
ALLOCATION OF PURCHASE PAYMENTS: Invested Purchase Payments are allocated to one
or more of the Allocation Options in accordance with your selection. The
allocation of the initial Invested Purchase Payment is made in accordance with
your selection made on the Contract Date. You may change the allocation of
future Invested Purchase Payments at any time. If, after the Initial Purchase
Payment, we receive a Purchase Payment without allocation instructions, we will
allocate the corresponding Invested Purchase Payment in the same proportion as
the most recent Purchase Payment you made (unless that was a Purchase Payment
you directed us to allocate on a one-time-only basis.) Assuming that all other
requirements are received in Good Order, we reserve the right to allocate your
initial Invested Purchase Payment to the Money Market Subaccount until we
receive your allocation selection. All allocations of Invested Purchase Payments
are subject to the Allocation Guidelines shown on the Contract Data pages.
Currently, you may select as many of the available Allocation Options as you
wish. However, we reserve the right to limit this in the future, if necessary,
in order to comply with federal or state law, subject to regulatory approval. If
the Purchase Payment and forms required to issue a Contract are in Good Order,
the initial Invested Purchase Payment will be credited to your Contract within
two (2) Business Days after receipt at the Annuity Service Center. Additional
Invested Purchase Payments will be credited to your Contract as of the Business
Day they are received.
CREDITS
We add a Credit amount to your Contract Value with each Invested Purchase
Payment. Each Credit amount is allocated to the Contract Value when the
applicable Invested Purchase Payment is credited to your Contract Value. The
Credit is allocated to the Variable Investment Options in the same percentages
as the Invested Purchase Payment to which it relates.
The Credit percentage may be determined by the amount of the Purchase Payment.
The Credit percentage for your initial Purchase Payment is shown on the Contract
Data pages. The Credit percentage on subsequent Purchase Payments will vary, but
is guaranteed to be at least 3% of the Purchase Payment.
Each Credit is subject to its own vesting schedule which is shown on the
Contract Data pages. If you make a withdrawal of all or part of a Purchase
Payment, the non-vested portion of the Credit attributable to that Purchase
Payment will be recaptured in accordance with the vesting schedule. Withdrawals
of Purchase Payments are taken on a first-in, first-out basis. The Credit
recapture is in addition to any Withdrawal Charges that may be applicable.
If you exercise your Right to Cancel the Contract, the entire Credit will be
recaptured.
VBON-2000--NY Page 6
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CONTRACT VALUE
Your Contract Value is the total of all amounts credited to your Contract as
of any Business Day as a result of your initial Invested Purchase Payment and
the increases and decreases described below.
On the Contract Date, the Contract Value is equal to the initial Invested
Purchase Payment and the Credit amount. After that, the Contract Value as of
any Business Day is determined by starting with the Contract Value at the end
of the previous day and adjusting it for items that increase it or decrease
it.
Items that increase the Contract Value are: Invested Purchase Payments, Credit
amounts and positive investment performance in a Subaccount.
Items that decrease the Contract Value are: withdrawals and the charges and
credit recaptures associated with them; negative investment performance in a
Subaccount; Insurance Charge; Contract Maintenance Charge; if applicable;
Transfer Charge; and charges for any type of tax (or component thereof)
measured by or based on the amount of Purchase Payment we receive.
Investment results are credited daily and the Insurance Charge is deducted
daily. The Contract Maintenance charge is deducted annually as of the Contract
Anniversary and upon a total withdrawal. Other charges are assessed only if
the appropriate event occurs.
To determine the value of your Contract, we use a unit of measure called an
accumulation unit. Each day we determine the value of an accumulation unit for
each of the Variable Investment Options. We do this by: (1) adding up the
total amount of money allocated to a specific investment option; (2)
subtracting from that amount insurance charges and any other applicable
charges, such as for taxes; and (3) dividing this amount by the number of
outstanding accumulation units.
When you make a Purchase Payment, we credit your contract with accumulation
units of the subaccount or subaccounts selected. The number of accumulation
units credited to your Contract is determined by dividing the amount of the
Purchase Payment allocated to an investment option by the unit price of the
accumulation unit for that investment option. We calculate the unit price for
each investment option after the New York Stock Exchange closes each day and
then credit your Contract. The value of the accumulation units can increase,
decrease, or remain the same from day to day.
VARIABLE SEPARATE ACCOUNT
THE VARIABLE SEPARATE ACCOUNT: The Variable Separate Account is designated on
the Contract Data pages. It consists of assets we have set aside and have kept
separate from the rest of our assets and those of our other separate accounts.
The assets of the Variable Separate Account, equal to reserves and other
liabilities of your Contract and those of other owners, will not be charged
with liabilities arising out of any other business we may conduct. The
operation of the Variable Separate Account is subject to the laws of the state
in which the Contract is delivered.
The Variable Separate Account assets are divided into Subaccounts. The assets
of the Subaccount are allocated to the Variable Investment Option(s) shown on
the Contract Data pages. We may restructure, eliminate or combine Subaccounts
or add to or eliminate Variable Investment Option(s) from those shown. You may
be permitted to transfer your Contract Value or allocate Invested Purchase
Payments to the additional Subaccount(s). However, the right to make such
transfers or allocations will be limited by any terms and conditions imposed
to comply with federal or state law, subject to regulatory approval.
Should the shares of any Variable Investment Option(s) become unavailable for
investment by the Variable Separate Account, we deem further investment in the
shares inappropriate, or if required for tax reasons, we may limit further
purchase of such shares or substitute shares of another Variable Investment
Option for shares already purchased.
VALUATION OF ASSETS: The value of the shares held by the Subaccounts in the
Variable Investment Options will be based on the net asset value of the
Investment Option on each Business Day.
INSURANCE CHARGE: Each Business Day, we deduct an Insurance Charge from the
Subaccounts of the Variable Separate Account which is equivalent, on an annual
basis, to the amount shown on the Contract Data pages. The amount of the
Insurance Charge is based on whether you have elected the GMDB.
CONTRACT MAINTENANCE CHARGE
We deduct an annual Contract Maintenance Charge shown on the Contract Data
pages. We determine your Contract Value as of your Contract Anniversary and
make any deductions required on a pro-rata basis from all Allocation Options
to which your Contract Value is allocated. If a total withdrawal is made on
other than a Contract Anniversary, we will determine your Contract Value and
make a deduction for the Contract Maintenance Charge the same as we would if
it were a Contract Anniversary.
VBON-2000--NY Page 7
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TRANSFERS
TRANSFERS DURING THE ACCUMULATION PERIOD: A transfer is subject to the
following:
1. the maximum number of transfers which may be made, the maximum number
of transfers which are not subject to a Transfer Charge and the
minimum amount which may be transferred are shown on the Contract Data
pages;
2. a Transfer Charge is deducted if a transfer exceeds the maximum number
of free transfers. The Transfer Charge is shown on the Contract Data
pages. The Transfer Charge is deducted from the amount which is
transferred;
3. a transfer will be effected as of the end of the Business Day when we
receive a request in Good Order;
4. we are not responsible for the consequences resulting from a transfer
made in accordance with your instructions.
No transfers are permitted after the Annuity Date.
WITHDRAWALS
WITHDRAWALS: During the Accumulation Period, you may, upon a request in Good
Order, make a total or partial withdrawal of the Contract Surrender Value. You
may specify the Allocation Option(s) from which a withdrawal will be taken. If
you do not so specify, we will take the withdrawal on a pro-rata basis from
all Allocation Option(s) to which your Contract Value is allocated.
We will pay the amount of any withdrawal within 7 days of receipt of request
in Good Order unless the "Suspension or Deferral of Payments Provision" is in
effect. If we postpone payment of a withdrawal for more than 7 days after we
receive your withdrawal request, we will pay interest. The interest will be
calculated daily from the date we receive your request, at the effective
annual rate of 3%. No interest will be paid if the amount of interest
calculated is less than $25.
Each partial withdrawal must be for an amount which is not less than the
amount shown on the Contract Data pages. The minimum Contract Value which must
remain in the Contract after a partial withdrawal in order to keep the
Contract inforce is shown on the Contract Data pages. If the amount of the
withdrawal requested would reduce the Contract Value below this minimum, we
will give you the maximum amount available that, with the Withdrawal Charge,
would not reduce the Contract Value below such minimum. Special rules may
apply for IRAs.
WITHDRAWAL CHARGE: A Withdrawal Charge may apply if you make a withdrawal
during the Withdrawal Charge Period for a Purchase Payment. The amount of the
Withdrawal Charge varies with the number of Contract Anniversaries that have
elapsed since each Purchase Payment was made, and is a percentage, shown on
the Contract Data pages, of the amount withdrawn that is subject to the
charge. If a withdrawal is effective on the day before a Contract Anniversary,
the Withdrawal Charge percentage used will be the one as of the following
Contract Anniversary. If you request a partial withdrawal, we will deduct an
amount from the Contract Value that is sufficient to pay the Withdrawal
Charge, and recapture any Credit subject to recapture under the vesting
schedule, and provide you the amount requested.
In determining the Withdrawal Charge, Purchase Payments will be taken out
before Earnings, on a first-in, first-out basis. Purchase Payments that are
not subject to Withdrawal Charges, are withdrawn first from the Contract.
Purchase Payments that are subject to Withdrawal Charges are withdrawn next,
on a first-in, first-out basis, and the Charge Free Amount is applied to these
Purchase Payments. Once all Purchase Payments have been withdrawn, further
withdrawals will be taken from any Earnings. Earnings are not subject to
Withdrawal Charges.
Withdrawal Charges will never be greater than that permitted by any applicable
law or regulation.
VBON-2000--NY Page 8
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PROTECTED VALUE
The Protected Value is the amount which is applied to provide a Guaranteed
Minimum Death Benefit ("GMDB") for your beneficiaries.
If you elect the GMDB feature, as shown on the Contract Data pages, the GMDB
Protected Value is calculated daily and is equal to the "Step-Up". Before the
first Contract Anniversary, the Step-Up is the initial Invested Purchase
Payment increased by subsequent Invested Purchase Payments and proportionally
reduced by the effect of withdrawals. The Step-Up on each Contract Anniversary
will be reset to the greater of the previous Step-Up and the Contract Value as
of such Contract Anniversary. Between Contract Anniversaries, the Step-Up will
be increased by Invested Purchase Payments and proportionally reduced by the
effect of withdrawals.
After the Contract Anniversary coinciding with or next following the Owner's
80th birthday, we stop increasing the GMDB Protected Value. This means that we
do not increase the Step-Up by any appreciation in the Contract Value. But
when you make a withdrawal on or after such Contract Anniversary, we still
reduce the GMDB Protected Value proportionally by the effect of that
withdrawal.
Where the words "proportionally reduced by the effect of withdrawals" are
used, the withdrawal reduces those values in the same proportion as it reduces
the Contract Value. We calculate the proportion by dividing the Contract Value
after the withdrawal (including Withdrawal Charges) by the Contract Value
immediately prior to the withdrawal. The resulting percentage is multiplied by
the applicable values (before the withdrawal) in determining the GMDB
Protected Value.
VBON-2000--NY Page 9
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GUARANTEED MINIMUM DEATH BENEFIT
The GMDB is a feature providing for the option to receive an enhanced death
benefit upon the death of the Owner during the Accumulation Period. If
available at that time, the GMDB feature must be elected when you purchase
your Contract. The amount of the GMDB is based on the GMDB Protected Value
(see Protected Value section above). For purposes of calculating the death
benefit, the Contract Value will not be adjusted to recapture any unvested
portion of the Credit.
If you have elected the GMDB feature, and if the Owner dies before the Annuity
Date, the death benefit payable to your beneficiary will be as described
below:
Upon receipt of due proof of death and any other documentation we need,
the beneficiary is entitled to receive a death benefit equal to the
greater of:
(a) the Contract Value, adjusted as described above, as of the date
we receive due proof of death and any other documentation we
need; and
(b) the GMDB Protected Value as of the date we receive due proof of
death and any other documentation we need.
If you do not elect the GMDB feature, upon receipt of due proof of death and
any other documentation we need, the beneficiary is entitled to receive a base
death benefit equal to the greater of:
(a) the Contract Value, adjusted as described above, as of the date
we receive due proof of death and any other documentation we
need; and
(b) the initial Invested Purchase Payment increased by subsequent
Invested Purchase Payments and proportionally reduced by the
effect of withdrawals.
Where the words "proportionally reduced by the effect of withdrawals" are used
in this provision, the withdrawal reduces those values in the same proportion
as it reduces the Contract Value. We calculate the proportion by dividing the
Contract Value after the withdrawal (including Withdrawal Charges) by the
Contract Value immediately prior to the withdrawal. The resulting percentage
is multiplied by the applicable values (before the withdrawal) in determining
the base death benefit.
If the ownership of the Contract changes as a result of an assignment, the
value of the death benefit will be reset to the Contract Value as of the date
of the assignment. Such value will be treated as a Purchase Payment made on
that date for purposes of computing the death benefit.
The Beneficiary may, within 60 days of providing proof of death, elect to take
the death benefit under one of the death benefit payout options listed below,
provided that any payout option shall not include a period certain that
exceeds the life expectancy of the Beneficiary. The Beneficiary will be the
sole measuring life in determining the amount of any such payout option. If no
payout option is selected within the 60 days, the death benefit will be
payable as a lump sum.
If a Beneficiary of the Owner having priority to be paid a death benefit is
the spouse of the Owner at the time of the Owner's death, the Contract will
continue and the spouse will become the Owner. The spouse may, within 60
calendar days of providing proof of death, elect to take the death benefit
under any of the payout options available under this Contract. If the contract
continues, and the new Annuitant is older than the prior Annuitant, the
Annuity Date will be based on the age of the new Annuitant.
VBON-2000--NY Page 10
15
The death benefit payout options are:
Choice 1 -- lump sum payment of the death benefit; or
Choice 2 -- the payment of the entire death benefit within 5 years of the
Owner's date of death; or
Choice 3 -- payment of the death benefit under an Annuity or Settlement
Option over the lifetime of the Beneficiary or over a period not
extending beyond the life expectancy of the Beneficiary with distribution
beginning within one year of the Owner's date of death.
Any portion of the death benefit not applied under Choice 3 within one year of
the Owner's date of death must be distributed within five years of the Owner's
date of death.
Once a death benefit becomes payable, the Payee's interest in any Annuity
Benefit under the Contract will cease.
If a lump sum payment is requested, the amount will be paid within seven (7)
days of receipt of proof of death and the election, unless the Suspension or
Deferral of Payments Provision is in effect.
DEATH OF ANNUITANT DURING THE ACCUMULATION PERIOD: If the Annuitant dies
before the Annuity Date, the Co-Annuitant, if applicable, becomes the
Annuitant. If there is no surviving Co-Annuitant, and the Annuitant was not
the Owner, the Owner becomes the Annuitant. You have the right to name a new
Annuitant within 60 days. If the Owner is a non-natural person, the death of
the Annuitant will be treated as the death of the Owner, a new Annuitant may
not be designated, and the Annuitant will be deemed to be the Owner for
purposes of determining the death benefit.
DEATH OF ANNUITANT DURING THE ANNUITY PERIOD: If the Annuitant dies on or
after the Annuity Date, the Settlement Option then in effect will govern
whether or not we will continue to make any payments. The death of a
non-Annuitant Owner has no effect on the payout during the Annuity Period.
PAYMENT OF DEATH BENEFIT: We will require due proof of death and any other
documentation we request in Good Order before any death benefit is paid. All
death benefits will be paid in accordance with applicable law or regulations
governing death benefit payments.
SPECIAL TAX CONSIDERATIONS: There are special tax rules that apply to IRA and
other qualified contracts during both the Accumulation Period and Annuity
Period governing distributions upon the death of the Owner. These rules are
contained in provisions in the attached endorsements and supersede any other
distribution rules contained in the Contract.
The preceding provisions regarding the death of the Owner are intended to
satisfy the distribution at death requirements of section 72(s) of the
Internal Revenue Code of 1986, as amended. We reserve the right to amend this
Contract by subsequent endorsement as necessary to comply with applicable tax
requirements, if any, which are subject to change from time to time. Such
additional endorsements, if necessary to comply with amended tax requirements,
will be mailed to you and become effective within 30 days of mailing, unless
you notify us in writing, within that time frame, that you reject the
endorsement.
If the Internal Revenue Service determines that the deductions for one or more
benefits under this Contract, including, without limitation, the GMDB feature
and any supplemental benefit added by endorsement, are taxable withdrawals,
then the Owner may cancel the affected benefit(s) within 90 days after written
notice from us.
VBON-2000--NY Page 11
16
ANNUITY AND SETTLEMENT OPTIONS
GENERAL: On the Annuity Date, the Adjusted Contract Value will be applied under
the Annuity or Settlement Option you have selected. If the Adjusted Contract
Value is less than $2,000, or if the payment under any option selected would be
less than $20 per month, we reserve the right to pay out the Adjusted Contract
Value in a lump sum. We guarantee that the dollar amount of each payment, once
determined, will not be affected by variations in mortality or expense
experience.
SELECTION OF AN ANNUITY OR SETTLEMENT OPTION: You may select an Annuity or
Settlement Option by notifying us of the selected option in Good Order. If no
Annuity or Settlement Option is selected, or if the chosen Option is not
received in Good Order, Option 2, Life Income Annuity Option, will automatically
be applied. You may, at any time prior to the Annuity Date, by a request in Good
Order 30 days in advance, select and/or change the Annuity or Settlement Option.
If an annuity option is selected, the payment amount will be calculated using
the Annuity Settlement Tables shown on Page 15. This payment amount will never
be less than what the amount of your Contract Value would purchase under any
comparable single premium immediate annuity we are then offering for sale to a
similar class of annuitants.
ANNUITY AND SETTLEMENT OPTIONS: This Contract provides for payments under one of
the Annuity or Settlement Options described below. Any other Annuity or
Settlement Option acceptable to us may be selected.
OPTION 1 - FIXED PERIOD ANNUITY OPTION. We will make equal payments for a period
you choose, from 10 years up to 25 years. At your choice, we will make such
payments annually, semi-annually, quarterly or monthly. The Option 1 Table shows
the minimum amounts we will pay.
OPTION 2 - LIFE INCOME ANNUITY OPTION. We will make payments for as long as the
Annuitant lives, with payments certain for 120 months. At your choice, we will
make such payments annually, semi-annually, quarterly or monthly. Table 2 shows
the minimum amounts we will pay.
OTHER ANNUITY OR SETTLEMENT OPTIONS: We may offer or consent to other settlement
options, including life income annuity options with payments certain for a
period of other than 120 months. Contact the representative who sold you the
Contract or call the toll-free number listed on your quarterly statement for
information.
ANNUITY: Unless you designate another Payee, you will be the Payee of the
Annuity Payments. The Adjusted Contract Value will be applied to the applicable
Annuity Table contained in this Contract based upon the Annuity Option you have
selected. The amount of the first payment for each $1,000 of Adjusted Contract
Value is shown in the Annuity Tables. If when Annuity Payments begin we are
using tables of annuity rates for these Contracts which result in larger Annuity
Payments, we will use those tables instead. Annuity Payments will depend on the
age and sex of the Annuitant, where permitted.
ANNUITY BENEFITS NOT SUBJECT TO WITHDRAWAL CHARGES: The Annuity Benefit will not
be subject to a Withdrawal Charge if you choose Option 1 or Option 2. In
addition to the methods of payment described in this Contract, you may choose
from other methods of payment which are not subject to a Withdrawal Charge.
VBON-2000--NY Page 12
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BENEFICIARY
BENEFICIARY: The Beneficiary designation in effect on the Contract Date will
remain in effect until changed. The Beneficiary is entitled to receive the
benefits to be paid at the death of the Owner during the Accumulation Period.
When a Beneficiary is designated, any relationship shown is to the Owner unless
otherwise specified.
To show priority among Beneficiaries, we will label the classes, so that the
class with first priority is called the primary class, the class with next
priority is called the secondary class, and so on. The following statements
apply to Beneficiaries unless the Contract Data pages, Contract endorsement or
any change request that we have processed specifies otherwise:
One who survives the Owner will have the right to be paid only if no one
in a prior class survives the Owner.
One who has the right to be paid will be the only one paid if no one
else in the same class survives the Owner.
Two or more in the same class who have the right to be paid will be paid
in equal shares.
If no one survives the Owner, we will pay in one sum to the Owner's
estate.
Unless you notify us otherwise in writing received in Good Order, when
there is insufficient evidence to determine the order of death, we will
deem the Owner to be the last survivor and make payment to the Owner's
Beneficiary.
Before we make a payment, we have the right to decide what reasonable
proof we need of the identity, age or any other facts about any persons
designated as Beneficiaries. If Beneficiaries are not designated by name
and we make payment(s) based on that proof, we will not have to make the
payment(s) again.
CHANGE OF BENEFICIARY: To initiate a change of Beneficiary, call the toll-free
number listed on your statement or contact the representative who sold you the
Contract. We will send you a change request form. We may also ask you to send us
the Contract. The change of beneficiary will take effect on the date you sign
the change request form, provided such request is received in Good Order. Then,
any previous Beneficiary's interest will end as of the date the change request
is signed and we receive it in Good Order, even if the Owner is not living when
we process the change request.
SUSPENSION OR DEFERRAL OF PAYMENTS OR TRANSFERS
FROM THE SEPARATE ACCOUNT
We reserve the right to suspend or postpone payments from the Separate Account
for a withdrawal or transfer for any period when:
1. the New York Stock Exchange is closed (other than customary
weekend and holiday closings);
2. trading on the New York Stock Exchange is restricted;
3. an emergency exists as a result of which disposal of shares of
the Investment Options held in the Separate Account is not
reasonably practicable or it is not reasonably practicable to
determine the value of such shares; or
4. during any other period when the Securities and Exchange
Commission, by order, so permits for the protection of Owners;
provided that applicable rules and regulations of the Securities and Exchange
Commission will govern as to whether the conditions described in (2) and (3)
exist.
VBON-2000--NY Page 13
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GENERAL PROVISIONS
THE CONTRACT: The entire Contract consists of this Contract, and any attached
application, endorsements or riders. This Contract may be changed or altered
only by our President or Secretary. Any change, modification or waiver must be
made in writing. This Contract may not be modified by us without your consent
except as may be required by applicable law, including changes necessary to
comply with IRS requirements for annuity contracts, or as set forth in this
Contract.
ASSIGNMENT OF A CONTRACT: A request in Good Order specifying the terms of an
assignment of a Contract must be provided to the Annuity Service Center. We are
under no obligation to verify the assignment's validity or sufficiency. We will
not be liable for any payment made or action taken before we record the
assignment. If any Owner is living on the Annuity Date and an assignment is in
effect on that date, we have the right to pay the Contract Surrender Value in
one lump sum to the assignee where notice in Good Order is received. Partial
assignments, collateral or otherwise, are not allowed without our approval. We
reserve the right to restrict or refuse any assignment.
An assignment which results in a change of ownership will affect the value of
the death benefit. Please see the section of the Contract entitled, "Guaranteed
Minimum Death Benefit," for more information.
We will not be responsible for the validity or tax consequences of any
assignment. Any assignment made after the death benefit has become payable will
be valid only with our consent.
If the Contract is assigned, your rights may only be exercised with the consent
of the assignee of record.
NON-PARTICIPATING IN SURPLUS: This Contract does not share in any distribution
of our profits or surplus.
INCONTESTABILITY: We will not contest this Contract. We consider all statements
made in the application for this Contract to be representations, not warranties.
MISSTATEMENT OF AGE OR SEX: We may require proof of age of the Annuitant before
making any life contingent Annuity Payment provided for by this Contract. If the
age or sex of the Annuitant has been misstated, the amount payable will be the
amount that the Contract Value would have provided at the true age or sex.
Once Annuity Payments have begun, any underpayments, with interest at 5%, will
be made up in one sum with the next Annuity Payment, and overpayments, with
interest at 5%, will be deducted from the future Annuity Payments until the
total is repaid.
CONTRACT SETTLEMENT: This Contract must be returned to us upon any settlement.
REPORTS: We will send you a report four times each calendar year until the
Annuity Date showing your Contract Value and other relevant information about
your Contract. We will also furnish an annual report of the Separate Account.
These reports will be sent to your last known address.
TAXES: Any taxes, including any type of tax (or component thereof) measured by
or based upon any portion of the Purchase Payment we receive, paid to any
governmental entity will be charged against the Contract Value, unless a
deduction was made for this tax in calculating the Invested Purchase Payment
amount. We will, in our sole discretion, determine when taxes have resulted
from: the investment experience of the Separate Account; receipt by us of the
Purchase Payment(s); or commencement of Annuity Payments. We may, at our
discretion, pay taxes when due and deduct that amount from the Contract Value at
a later date. Payment at an earlier date does not waive any right we may have to
deduct amounts at a later date. We reserve the right to establish a provision
for federal income taxes if we determine, in our sole discretion, that we will
incur a tax as a result of the operation of the Separate Account. We will deduct
for any income taxes incurred by it as a result of the operation of the Separate
Account whether or not there was a provision for taxes and whether or not it was
sufficient. We will deduct any withholding taxes required by applicable law.
EVIDENCE OF SURVIVAL: Before we make a payment, we have the right to require
reasonable proof of continued life and any other documentation we need to make a
payment. We can require this proof for any person whose life or death determines
whether or to whom we must make the payment.
PROTECTION OF PROCEEDS: No Beneficiary may commute, encumber, alienate or assign
any payments under this Contract before they are due. To the extent permitted by
law, no payments will be subject to the debts, contracts or engagements of any
Beneficiary or to any judicial process to levy upon or attach the same for
payment thereof.
VBON-2000--NY Page 14
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VALUES AND BENEFITS
Any cash values, paid up annuities and death benefits that may be available
under this Contract are not less than the minimum benefits required by the law
of any state in which this Contract is delivered.
ANNUITY SETTLEMENT TABLES
Tables 1 and 2 below are applied to the Adjusted Contract Value to compute the
minimum amount of the annuity payment. Table 1 is used to compute the minimum
annuity payment under Option 1 (Fixed Period Annuity Option). Table 2 is used to
compute the minimum annuity payment under Option 2 (Life Income Annuity Option).
The rates in Tables 1 and 2 are applied per $1000 of Adjusted Contract Value.
The annuity payments in Table 2 are based on the Annuitant's Adjusted Age and
sex. The Adjusted Age is the Annuitant's age last birthday prior to the date on
which the first Annuity payment is due, adjusted as shown in the "Translation of
Adjusted Age" Table.
When we computed the amounts shown in Table 2, we adjusted the Annuity 2000
Mortality Table to an age last birthday basis, less two years, with projected
mortality improvements (modified Scale G), and an interest rate of 3% per year.
We will calculate annuities for other certain periods using the same interest
and mortality assumptions as in Table 2.
VBON-2000--NY Page 15
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-------------------------------
Table 1
-------------------------------
Number Monthly
of Years Payment
-------------------------------
10 9.61
11 8.86
12 8.24
13 7.71
14 7.26
15 6.87
16 6.53
17 6.23
18 5.96
19 5.73
20 5.51
21 5.32
22 5.15
23 4.99
24 4.84
25 4.71
-------------------------------
Multiply the monthly amount
by 2.993 for quarterly,
5.963 for semi-annual or
11.839 for annual
-------------------------------
--------------------------------------
Table 2
--------------------------------------
Adjusted
Age Male Female
--------------------------------------
41 $3.40 $3.25
42 3.44 3.29
43 3.48 3.32
44 3.53 3.35
45 3.57 3.39
46 3.62 3.43
47 3.67 3.47
48 3.72 3.51
49 3.77 3.56
50 3.83 3.61
51 3.88 3.66
52 3.95 3.71
53 4.01 3.76
54 4.08 3.82
55 4.15 3.88
56 4.22 3.94
57 4.30 4.01
58 4.38 4.08
59 4.47 4.16
60 4.56 4.24
61 4.66 4.32
62 4.76 4.41
63 4.87 4.50
64 4.98 4.60
65 5.10 4.71
66 5.23 4.82
67 5.36 4.94
68 5.49 5.06
69 5.64 5.19
70 5.78 5.33
71 5.94 5.48
72 6.10 5.63
73 6.26 5.79
74 6.43 5.96
75 6.60 6.14
76 6.78 6.33
77 6.95 6.52
78 7.13 6.71
79 7.31 6.92
80 7.49 7.12
--------------------------------------
TRANSLATION OF ADJUSTED AGE
Calendar Year in Which
First Payment is Due Adjusted Age
-------------------- ------------
Prior to 2010 Actual Age
2010 Through 2019 Actual Age minus 1
2020 Through 2029 Actual Age minus 2
2030 Through 2039 Actual Age minus 3
2040 Through 2049 Actual Age minus 4
2050 Through 2059 Actual Age minus 5
2060 Through 2069 Actual Age minus 6
2070 Through 2079 Actual Age minus 7
2080 Through 2089 Actual Age minus 8
2090 Through 2099 Actual Age minus 9
VBON-2000--NY Page 16
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INDIVIDUAL FLEXIBLE PREMIUM DEFERRED VARIABLE ANNUITY CONTRACT.
NON-PARTICIPATING. ANNUITY PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN
BASED ON THE INVESTMENT EXPERIENCE OF THE SEPARATE ACCOUNT, ARE VARIABLE AND ARE
NOT GUARANTEED AS TO DOLLAR AMOUNT.
VBON-2000--NY Page 17
