RIVERSOURCE LIFE INSURANCE COMPANY
00000 Xxxxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
0-000-000-0000
GROUP DEFERRED 403(b) ANNUITY CONTRACT
This is a group deferred annuity contract. It is a legal contract between the
Contract Holder, as the owner, and Us, RiverSource Life Insurance Company, a
stock company, Minneapolis, Minnesota. PLEASE READ YOUR CONTRACT CAREFULLY.
RiverSource Life Insurance Company agrees to provide benefits to or on behalf of
Participants or beneficiaries according to the terms and conditions provided in
this contract and described in Certificates provided to each Participant. We
issue this contract in consideration of the payment of the purchase payments for
allocation to each Participant's Certificate Account as directed.
ACCUMULATION VALUES AND ANNUITY PAYMENTS, WHEN BASED ON THE INVESTMENT RESULTS
OF THE VARIABLE SUBACCOUNTS, ARE VARIABLE AND NOT GUARANTEED AS TO FIXED DOLLAR
AMOUNT. SEE THE ACCOUNTS: FIXED AND VARIABLE SECTION FOR VARIABLE ACCOUNT
PROVISIONS.
OPTIONAL RIDER CHARGES MAY REDUCE A PARTICIPANT'S DEATH BENEFIT AMOUNT TO LESS
THAN THE CERTIFICATE ACCOUNT VALUE. SEE THE PAYMENTS TO BENEFICIARIES
PROVISIONS.
NOTICE OF THE PARTICIPANTS' RIGHT TO EXAMINE THE CERTIFICATE FOR TEN DAYS. If
for any reason a Participant is not satisfied with the Certificate, he or she
may cancel enrollment in this contract by returning the Certificate to Us or Our
agent within ten Days after receiving it. Upon such cancellation We will refund
an amount equal to the sum of: (1) any purchase payments allocated to the
Certificate Account, plus or minus any change in value, at the end of the
Valuation Period during which We receive the Certificate; and (2) any premium
tax charges paid. The Participant's enrollment under the contract will then be
considered void from the start.
Signed for and issued by RiverSource Life Insurance Company of Minneapolis,
Minnesota, as of the Contract Date.
ABCD ABCD
Secretary President
- Employer Plan
- Group Deferred Annuity Individual Participant Allocation
- Variable Accumulation Values
- Optional Fixed Dollar or Variable Annuity Payments
- This Contract is Nonparticipating -- Dividends Are Not Payable
411333 Page 1 (1/2012)
GUIDE TO CONTRACT PROVISIONS
CONTRACT DATA Page 3
Important contract specifications, fund allocations,
fees and charges
DEFINITIONS Pages 4-6
Important words and meanings
GENERAL PROVISIONS Pages 7-9
Entire Contract
Annuity Tax Qualification
Contract Modification
Plan Limitations
Discontinuance of Enrollment under this Contract
Incontestable
Benefits Based on Incorrect Data
State Laws
Reports to Participants
Evidence of Survival
Protection of Proceeds
Payments by Us
Voting Rights
Nonforfeitable
Contract Not Intended for Use with ERISA Plans
Optional Retirement Plan Provisions
Military Personnel Rights
IRS Levy
OWNERSHIP AND BENEFICIARIES Page 10
Contract Holder and Participant Rights
Change of Ownership
Beneficiary
Change of Beneficiary
Pre-election of an Annuity Payment Plan
PAYMENTS TO BENEFICIARIES Pages 11-13
Spouse's Option to Maintain Certificate Account
Death of a Participant Before the Annuitization Start
Date/Amount Payable Before the Annuitization
Start Date
Death of a Participant or a Beneficiary Receiving
Payments After the Annuitization Start Date
PURCHASE PAYMENTS Pages 14-17
Purchase Payments
Additional Purchase Payments
Payment Limits
Allocation of Purchase Payments
Contributions/Excess Deferrals and Excess
Contributions/Vesting/Rollover Contributions into
Certificate Accounts/Plan to Plan Transfers to
Certificate Accounts/Contract Exchanges to
Certificate Accounts/Mistaken Contributions/
Nondiscrimination Requirements
Discontinuance of Purchase Payments under this
Contract
Privacy Policy
ACCOUNTS: FIXED AND VARIABLE Pages 18-19
The Fixed Account/Interest to be Credited
TheVariable Account/Investments of the Variable
Account/Valuation of Assets/Variable Account
Accumulation Units/Variable Account Accumulation
Unit Value/Net Investment Factor/ Mortality and
Expense Risk Charge/Variable Account
Administrative Charge/Annuity Unit Value
CERTIFICATE ACCOUNT VALUE Pages 20-22
Certificate Account Value
Certificate Account Value in the Variable Account
Certificate Account Value in the Special DCA Fixed Account
Certificate Account Value in the Loan Account
Certificate Administrative Charge
Premium Tax Charges
Transfers of Certificate Account Values
Dollar Cost Averaging
Special DCA Fixed Account
SURRENDER PROVISIONS Pages 23-26
Surrender
Rules for Surrender of this Contract
Distributions from Certificate Accounts
Rules for Surrender of Certificate Accounts
Surrender Value
Surrender Value
Suspension or Delay in Payment of Surrender Amount
Surrender Restrictions Before a Participant's Age 59
1/2/Financial Hardship Distributions/ Additional
Restrictions on Distributions of Designated 403(b)
Xxxx Accounts/Direct Rollover Distributions
Required Minimum Distributions/Multiple 403(b)
Annuity Contracts and 403(b)(7) Custodial
Accounts/Annuity Payment Plan Options
Qualified Domestic Relations Orders
Permissive Service Credit Transfers
Distributions Due to Termination of the Plan
CERTIFICATE ACCOUNT LOANS Pages 27-29
Loan Account
Loan Balance
Loan Payments/Military Service/Leave of Absence
Loan Defaults
ANNUITY PROVISIONS Pages 30-31
Annuity Payment
Change of Annuitization Start Date
Annuity Payment Plans
Plan Selection
Allocation of Certificate Account Values to Provide
Fixed and Variable Payments
Fixed Annuity Payments
Variable Annuity Payments/Determination of the
First Variable Annuity Payment/Variable Annuity
Payments After the First Payment
Exchange of Annuity Units
TABLES OF ANNUITY PAYOUT RATES Pages 32-33
411333 Page 2 (1/2012)
Tables showing amount of first Variable Annuity payment and the
guaranteed Fixed Annuity payments for the various payment plans
411333 Page 3 (1/2012)
DEFINITIONS
The following words are used often in this contract. When We use these words,
this is what We mean:
ACCUMULATION UNIT
An Accumulation Unit is an accounting unit of measure. It is used to calculate
each Participant's Certificate Account Value in the Variable Account prior to
the application of amounts to an annuity payment plan.
ANNUITANT, JOINT ANNUITANT
The Annuitant is the Participant named in each Certificate on whose life
periodic annuity payments depend. A Joint Annuitant can be named by a
Participant when selecting a payment plan to apply on the Annuitization Start
Date.
ANNUITIZATION START DATE
For each Participant, the Annuitization Start Date is the date on which annuity
payments begin as described in the Annuity Payment provision. This date is
either as shown under Participants' Certificate Data or the date as changed as
provided in this contract. Participants will be notified prior to the
Annuitization Start Date.
ANNUITY UNIT
An Annuity Unit is an accounting unit of measure. It is used to calculate the
value of annuity payments from the variable subaccounts on and after each
Participant's Annuitization Start Date.
ATTAINED AGE
Attained Age is the number of whole years since birth, which is the same as the
age as of a person's latest birthday, unless born on February 29.
CERTIFICATE
The document for each Participant which describes the Participant's coverage
under this contract. Each Certificate is a summary of a Participant's rights and
obligations under the contract.
CERTIFICATE ACCOUNT
We establish an account for each Participant under this contract to maintain a
record of purchase payments, transactions and values.
CERTIFICATE ACCOUNT VALUE
The value for each Certificate Account under this contract is the sum of the
Participant's Certificate Account Value in the Special DCA Fixed Account, the
Loan Account and the Variable Account.
CERTIFICATE ANNIVERSARY
The Certificate Anniversary is the same Day and month as the Certificate Date
each year that a Certificate Account remains in force under this contract.
CERTIFICATE DATA
Certificate Data is the section of each Certificate that contains information
specific to that Participant and his or her Certificate.
CERTIFICATE DATE
The Certificate Date is the date from which Certificate Anniversaries and
certificate years are determined. The Certificate Date is shown under each
Participant's Certificate Data.
CODE
The Code is the Internal Revenue Code of 1986, as amended, its regulations
thereunder and/or promulgations of the Internal Revenue Service, as applicable.
CONTRACT DATA
The Contract Data pages contain information specific to You and Your contract.
CONTRACT DATE
The Contract Date is the date from which Contract Anniversaries and contract
years are determined. Your Contract Date is shown under Contract Data.
CONTRACT HOLDER, YOU, YOUR
"Contract Holder," "You" and "Your" refer to the employer that owns this
contract and has established and sponsors the Plan. The Contract Holder, as the
employer, accommodates Elective Deferral Contributions and Nonelective
Contributions made by or on behalf of Participants.
DAY
Unless specified otherwise, a Day is a calendar day.
DESIGNATED BENEFICIARY
Designated Beneficiary is a beneficiary who meets the requirements of the term
as defined under Section 401(a)(9) of the Code and any supporting regulations.
For example, a non-natural person generally cannot be a designated beneficiary
under these requirements.
411333 Page 4 (1/2012)
ELECTIVE DEFERRAL CONTRIBUTIONS
This refers to the aggregate of amounts a Participant or the Contract Holder,
acting on the Participant's behalf, contributes to an elective deferral plan
under any salary reduction agreement that conforms to Section 402(g) of the Code
("Pre-tax Contributions") and, if permitted under the Plan and accepted by Us,
after-tax contributions that satisfy the requirements of Section 402A of the
Code ("403(b) Xxxx Contributions"). To qualify as 403(b) Xxxx Contributions,
such amounts must:
a. be irrevocably designated as 403(b) Xxxx Contributions;
b. not be excludable from gross income; and
c. be accounted for separately from all other contract contributions
along with related gains and losses ("Designated 403(b) Xxxx
Account").
ERISA
Employee Retirement Income Security Act of 1974, as amended, and regulations
thereunder.
FIXED ACCOUNT
The Fixed Account is part of our general account, which is made up of all Our
assets other than those in any unitized separate account.
FIXED ANNUITY
A Fixed Annuity is an annuity with payments which are guaranteed by Us as to
dollar amount during the annuity payment period.
IRS
The Internal Revenue Service, United States Department of the Treasury.
LOAN ACCOUNT
The Loan Account is the Certificate Account Value needed to collateralize a loan
from a Participant's Certificate Account.
LOAN BALANCE
The Loan Balance is the remaining principal amount plus any unpaid accrued
interest charges.
NONELECTIVE CONTRIBUTIONS
Any contributions made on a Participant's behalf under the Plan to this contract
(or to other 403(b) funding instruments authorized under the Plan) that do not
qualify as Elective Deferral Contributions or Xxxx 403(b) Contributions. Any
corrective contributions made by the Contract Holder as part of a voluntary
compliance program will not be a Nonelective Contribution unless specifically
identified as such as part of the correction process.
PARTICIPANT
An eligible employee or other person named in the Certificate who is accepted
for enrollment under the contract and is entitled to benefits under the Plan as
determined and reported to Us by the Contract Holder.
PLAN
Plan refers to the written plan document established by the Contract Holder
which meets the requirements of Section 403(b) of the Code.
QDRO
A qualified domestic relations order as defined in Section 414(q) of the Code.
REQUIRED BEGINNING DATE
The date distributions under each Participant's Certificate Account must
commence as described in the Required Minimum Distributions provision.
SPECIAL DCA FIXED ACCOUNT
The Special DCA Fixed Account is an option within the Fixed Account to which
Participants may allocate purchase payments. Purchase payment amounts
Participants allocate to the Special DCA Fixed Account must be transferred
within a specified period of time to selected variable subaccounts. The amounts
allocated to the Special DCA Fixed Account earn a specified rate of interest
until transferred out of the Special DCA Fixed Account.
TAX SHELTERED ANNUITY
A tax sheltered annuity as described in Section 403(b) of the Code.
VALUATION DATE
A Valuation Date is each Day the New York Stock Exchange is open for trading. At
the New York Stock Exchange close of business, the next Valuation Date begins.
VALUATION PERIOD
A Valuation Period is the interval of time commencing at the New York Stock
Exchange close of business on each Valuation Date and ending at the close of
business on the next Valuation Date.
VARIABLE ACCOUNT
The Variable Account consists of separate variable subaccounts to which each
Participant may allocate Certificate Account Values including purchase payments.
Each subaccount invests in shares of one fund. The variable subaccounts
available on the Contract Date are shown under Contract Data. The value of a
Participant's investment in each variable subaccount changes with the
performance of the particular fund.
411333 Page 5 (1/2012)
VARIABLE ANNUITY
A Variable Annuity is an annuity with payments which are not predetermined or
guaranteed as to dollar amount and vary in amount with the investment experience
of one or more of the variable subaccounts.
WE, US, OUR
Any reference to "We," "Us" or "Our" means RiverSource Life Insurance Company.
WRITTEN REQUEST
A Written Request is a request in writing, on a form acceptable to Us, signed by
You or a Participant, as applicable, and delivered to Us at Our corporate
office.
411333 Page 6 (1/2012)
GENERAL PROVISIONS
ENTIRE CONTRACT
This contract form and any attached endorsements or riders are the entire
contract between You and Us.
The Plan is not part of this contract. This contract is subject to the terms of
the Plan to the extent that the terms of the Plan are consistent with the terms
of this contract and do not provide benefits for Participants or impose
responsibilities or duties on RiverSource Life greater than those described in
this contract.
No one except one of Our corporate officers (President, Vice President,
Secretary or Assistant Secretary) can change or waive any of Our rights or
requirements under this contract. That person must do so in writing. None of Our
other representatives or other persons has the authority to change or waive any
of Our rights or requirements under this contract.
ANNUITY TAX QUALIFICATION
This contract is intended to qualify as an annuity contract under Section 72 and
other relevant sections of the Code for federal income tax purposes. It is also
intended to qualify as a 403(b) Tax Sheltered Annuity under Section 403(b) of
the Code. To that end, the provisions of this contract are to be interpreted to
ensure or maintain such tax-qualification, despite any other provisions to the
contrary. We reserve the right to unilaterally amend this contract as may be
needed or is appropriate to maintain such tax qualification, subject to any
necessary regulatory approval. We will send You a copy of any such amendments.
CONTRACT MODIFICATION
Except as set forth in the Annuity Tax Qualification provision above, this
contract may be modified at any time by mutual agreement between You and Us. The
modification must be signed by one of Our corporate officers (President, Vice
President, Secretary or Assistant Secretary).
For a modification We initiate that requires Your consent, We will notify You 60
Days in advance and consider that You have agreed to the modification unless We
receive written notice that You do not agree at least 30 Days before the date
the modification becomes effective.
PLAN LIMITATIONS
The provisions of this contract and the exercise of Participants' rights
hereunder are subject to any conditions and/or limitations imposed by the Plan.
We shall rely on representations made by the Contract Holder regarding the
content and meaning of any provision of the Plan. Except with respect to
contract fees and charges, where the terms of the Plan are inconsistent with
this contract, the terms of the Plan shall govern unless such interpretation
would cause this contract to fail to qualify as an annuity that satisfies the
requirements of Section 403(b) of the Code.
DISCONTINUANCE OF ENROLLMENT UNDER THIS CONTRACT
We may notify You that no new Participants will be enrolled under this contract
on and after a specified date not earlier than 60 days after the date of the
notice. Thereafter, only purchase payments for persons who are Participants on
the specified date will be accepted under this contract, subject to any payment
limitations in the contract. In all other respects this contract will continue
to operate according to its terms.
INCONTESTABLE
This contract and Certificates are incontestable from their date of issue.
BENEFITS BASED ON INCORRECT DATA
If benefit amounts are determined by incorrect information regarding a person's
age, payments under this contract will be adjusted. They will be based on what
would have been provided at the correct birth date. Any underpayments made by Us
will be made up promptly without interest. We reserve the right to recover any
amounts overpaid from the Participant or the Participant's estate. If there are
any future payments from the Certificate Account, overpayments made by Us will
be subtracted, without interest, and/or as otherwise legally permissible.
411333 Page 7 (1/2012)
STATE LAWS
This contract is governed by the law of the state in which it is delivered. The
values and benefits of this contract are at least equal to those required by
such state. Any paid up annuity, cash surrender or death benefits available
under this contract are not less than the minimum benefits required by any law
of the state in which this contract is delivered.
REPORTS TO PARTICIPANTS
At least once a year as of a date not more than four months previous to the date
of mailing, We will send each Participant, without charge, statements showing
(1) the Certificate Account Value as of the beginning and end dates of the
period, (2) the Certificate Account's surrender value and any outstanding loan
value as of the end date of the period, and (3) amounts credited or debited
during the period, identified by type. These statements will also show any other
information required under state or federal law.
We will also send a Participant, without charge, notice of current or other
values upon request.
EVIDENCE OF SURVIVAL
Where any payments under this contract depend on the recipient or Annuitant
being alive on a certain date, We may require proof satisfactory to Us that such
condition has been met. Such proof may be required prior to making the payments.
PROTECTION OF PROCEEDS
Subject to any QDRO requirements, payments under this contract are not
assignable by any beneficiary prior to the time they are due. To the extent
allowed by law, payments are not subject to the claims of creditors or to legal
process.
PAYMENTS BY US
All sums payable by Us are payable at Our corporate office. Any payment or
surrender from a variable subaccount is based on the variable subaccount value.
VOTING RIGHTS
If federal law requires, We will give certain voting rights to contract owners.
If You have voting rights, We will send You a notice telling You the time and
place of a shareholder meeting. The notice will also explain matters to be voted
upon and how many votes to which You are entitled.
NONFORFEITABLE
This contract is established for the exclusive benefit of Participants and/or
Participants' beneficiaries. Their interest is nonforfeitable and
nontransferable and may not be waived, relinquished, or assigned, except as may
be permitted under the Code, by law or applicable court order.
CONTRACT NOT INTENDED FOR USE WITH ERISA PLANS
This contract is not intended for use in connection with an employer sponsored
plan that is subject to ERISA. We are not responsible for any obligations and
requirements that arise under ERISA and any regulations or applicable guidance
issued thereunder.
OPTIONAL RETIREMENT PLAN PROVISIONS
The provisions of this section are applicable only if the Plan is part of an
Optional Retirement Program and/or state retirement system ("ORP") offered by
certain governmental employers and You notify Us, in writing, that an ORP will
modify Your Contract. For contracts that are not established in conjunction with
an ORP, this section shall have no effect.
You agree that this contract shall be interpreted, to the extent possible, to
comply with the terms and conditions of the ORP and any guidance provided
thereunder, provided that We will not be responsible for complying with the
requirements of any ORP until You notify Us, in writing that this contract is
subject to an ORP, and provide information on the ORP to Us. The ORP often
includes restrictions on certain contract features, such as imposing a vesting
schedule on Nonelective Contributions, restricting the availability of loans or
"in service" distributions and prohibiting contract or Certificate exchanges and
distributions prior to a Participant's termination of employment or retirement.
Rights and features of this contract will be restricted in accordance with the
ORP to the extent required by applicable law.
411333 Page 8 (1/2012)
MILITARY PERSONNEL RIGHTS
The Uniformed Services Employment and Reemployment Rights Act (USERRA),
prohibits discrimination against persons because of their service in the Armed
Forces Reserve, the National Guard, or other uniformed services. The Heroes
Earning Assistance and Relief Act of 2008 (HEART) created additional rights for
qualifying employees who leave employment or return to employment due to
qualifying military service. Notwithstanding any other provisions in this
contract, this contract may be interpreted to conform to the requirements of
USERRA and HEART, as amended from time to time and as may be required by the
Plan.
IRS LEVY
We may direct payment from a Participant's Certificate Account in accordance
with a lawfully issued tax levy issued by the Internal Revenue Service with
respect to the Participant.
411333 Page 9 (1/2012)
OWNERSHIP AND BENEFICIARIES
CONTRACT HOLDER AND PARTICIPANT RIGHTS
You may exercise all rights and privileges provided to the Contract Holder in
this contract or allowed by Us.
Participants' rights under this contract are subject to the terms of this
contract and the Contract Holder's Plan.
CHANGE OF OWNERSHIP
This contract may not be sold, assigned, transferred, 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 as may be required or permitted under
Section 403(b) of the Code. This restriction shall not apply to any rights to a
contract established by a QDRO.
BENEFICIARY
Except as otherwise provided in this contract, beneficiaries are those
designated by Participants, in accordance with applicable provisions of the Plan
and the Code, to receive the death benefit described in the Certificate if a
Participant dies while he or she is covered under this contract.
Only those beneficiaries who are living as of the date of death may share in the
benefits, if any. Benefits will be paid to all primary beneficiaries surviving a
Participant, in accordance with his or her last beneficiary designation on file.
If none survive, proceeds will be paid to all surviving contingent
beneficiaries. If there is no valid beneficiary designation or if no beneficiary
survives, We will pay the benefits as follows:
- to the Participant's spouse, if living;
- if no spouse is living, to the Participant's lawful children per
stirpes;
- if a Participant has no spouse or direct descendents, to his or her
parents equally or the survivor, if living, otherwise to the
Participant's estate.
CHANGE OF BENEFICIARY
Unless otherwise restricted by the Plan, beneficiaries may be changed as
described below.
BY PARTICIPANT: Participants may change their beneficiary at any time by Written
Request or other method agreed to by Us. Once We receive a change, it will take
effect as of the date of the request. However, We are not liable for any payment
made by Us before the receipt.
BY BENEFICIARY: If a death benefit provided under this contract becomes payable
to a Participant's beneficiary (recipient) under an annuity payment plan, that
recipient shall have the right to name, or later change, their own beneficiary
by Written Request. If there is no valid beneficiary designation or if no
beneficiary survives the recipient, We will pay any benefits due under the
annuity payment plan following the death of the original beneficiary as follows:
- to the recipient's spouse, if living;
- if no spouse is living, to the recipient's lawful children per
stirpes;
- if the recipient has no spouse or direct descendents, to the
recipient's parents equally or the survivor, if living, otherwise to
the recipient's estate.
PRE-ELECTION OF AN ANNUITY PAYMENT PLAN
Subject to the requirements of Section 401(a)(9) of the Code and if agreed to by
Us, Participants may elect how their death benefit under this contract is to be
paid in the event of a Participant's death before the Annuitization Start Date.
A Participant must make the election by Written Request or other method agreed
to by Us. In this event the death benefit shall be payable as so elected by the
Participant, rather than as requested by the beneficiary. If for any reason such
election does not satisfy Section 72 of the Code or related distribution
requirements, the election will be void and the beneficiary will then be
permitted to elect payment pursuant to the provisions of the contract.
411333 Page 10 (1/2012)
PAYMENTS TO BENEFICIARIES
SPOUSE'S OPTION TO MAINTAIN CERTIFICATE ACCOUNT
In the event of a Participant's death, his or her spouse can take the death
benefit or continue to maintain the Certificate Account, if eligible to become a
Participant under this contract.
Election by the spouse to maintain the Certificate Account under this contract
must be made by Written Request, or other method agreed to by Us, at the time We
receive due proof of death. Upon spousal continuation the Certificate Account
Value shall be equal to the death benefit that would otherwise have been paid.
The spouse may make additional purchase payments to the Certificate Account
subject to the provisions of this contract.
DEATH OF A PARTICIPANT BEFORE THE ANNUITIZATION START DATE
A death benefit is payable to the beneficiary if a Participant dies with a
Certificate Account Value greater than zero and if the death occurs before the
Participant's Annuitization Start Date.
Any amounts payable or applied by Us as described in this section will be based
on the Participant's Certificate Account Value as of the Valuation Date on or
next following the date on which We receive due proof of death at Our corporate
office. Due proof of death includes all documents needed to complete a
beneficiary's claim.
The death benefit for each beneficiary will be payable in a lump sum on the
Valuation Date We receive due proof of death from that beneficiary. The
beneficiary may elect to receive payment anytime within five years after the
date of death.
Designated Beneficiaries may have additional options. In lieu of a lump sum, a
Participant's Designated Beneficiary may elect to receive regular installment
payments under one of the following options:
a. Any of the irrevocable annuity payment plans (A through E) described under
Annuity Provisions in this contract, provided:
(i) The Designated Beneficiary elects the payment plan within 60 Days
after We receive notification of a Participant's death; and
(ii) The payment plan provides payments over a period which does not exceed
the life or life expectancy of the Designated Beneficiary and/or the
payment plan selected provides for a period certain not extending
beyond the life expectancy of the Designated Beneficiary; and
(iii)The sole Designated Beneficiary is the Participant's surviving spouse,
and the Participant's death occurs prior to his or her Required
Beginning Date, payments will irrevocably commence by the later of
December 31 of the calendar year following the calendar year of the
Participant's death or December 31 of the calendar year in which he or
she would have attained age 70 1/2; or
The Designated Beneficiary is someone other than the surviving spouse,
or the Participant's death occurs on or after his or her Required
Beginning Date, payments will irrevocably commence no later than
December 31 of the calendar year following the year of his or her
death.
If the Designated Beneficiary elects an annuity payment plan, such
beneficiary shall be the Annuitant for purposes of a lifetime payment plan.
b. If, upon a Participant's death, the Designated Beneficiary does not elect
one of the irrevocable annuity payment plans (A through E) described in the
Annuity Provisions, or a single sum distribution, then the Designated
Beneficiary may elect to receive payments according to an alternative plan
as agreed to by Us provided:
(i) the Designated Beneficiary elects the plan at the time We receive due
proof of death;
(ii) if the Participant's sole Designated Beneficiary is his or her
surviving spouse, the Participant's entire interest will be
distributed, beginning no later than the later of December 31 of the
calendar year following the calendar year of his or her death or
December 31 of the calendar year in which the Participant would have
attained age 70 1/2, over the life of the surviving spouse or over a
period not extending beyond the life expectancy of the surviving
spouse (If the surviving spouse dies before distributions commence,
the remaining interest will be distributed, beginning no later
411333 Page 11 (1/2012)
than December 31 following the calendar year of the surviving spouse's
death, over the spouse's Designated Beneficiary's remaining life
expectancy determined using such beneficiary's age as of his or her
birthday in the year following the death of the spouse.); or
if the Participant's sole Designated Beneficiary is someone other than
his or her surviving spouse, the Participant's entire interest will be
distributed, beginning no later than the end of the calendar year
following the calendar year of his or her death, over the remaining
life expectancy of the Designated Beneficiary, with such life
expectancy determined using the age of such beneficiary as of his or
her birthday in the year following the year of the Participant's death
and reduced by 1 for each subsequent year;
(iii)if the Participant dies before his or her Required Beginning Date and
there is no Designated Beneficiary, or if elected by the Designated
Beneficiary, the Participant's entire interest will be distributed by
December 31 of the calendar year containing the fifth anniversary of
his or her death (or of the spouse's death if the Designated
Beneficiary was the Participant's surviving spouse and the spouse dies
before distributions are required to begin);
(iv) if a Participant dies on or after his or her Required Beginning Date
and there is no Designated Beneficiary, the Participant's entire
interest will be distributed, beginning no later than December 31 of
the calendar year following the calendar year of the Participant's
death, over his or her remaining life expectancy determined using the
Participant's age in the year of his or her death and reduced by 1 for
each subsequent year; and
(v) life expectancy is determined using the Single Life Table in Treasury
Regulation Section 1.401(a)(9)-9, Q&A-1.
AMOUNT PAYABLE BEFORE THE ANNUITIZATION START DATE
IF A PARTICIPANT IS THE XXXX BENEFIT AGE (SHOWN UNDER CONTRACT DATA) OR YOUNGER
ON THE CERTIFICATE DATE and if the Participant dies prior to their Annuitization
Start Date with a Certificate Account Value greater than zero; then We will pay
the beneficiary the greater of the following amounts:
1. the Certificate Account Value, after any rider charges have been
deducted, minus any Loan Balance; or
2. the Return of Purchase Payment Value, minus any Loan Balance.
IF A PARTICIPANT IS OLDER THAN THE XXXX BENEFIT AGE (SHOWN UNDER CONTRACT
DATA) ON THE CERTIFICATE DATE and if the Participant dies prior to their
Annuitization Start Date with a Certificate Account Value greater than
zero; then We will pay the beneficiary the Certificate Account Value, after
any rider charges have been deducted, minus any Loan Balance.
After a Participant's spouse elects to maintain the Certificate Account
under the Spouse's Option to Maintain Certificate Account provision, he or
she will have a death benefit as determined above based on the spouse's
Attained Age at time of continuation.
RETURN OF PURCHASE PAYMENT (XXXX) VALUE DEFINITION: On the Certificate Date
the XXXX value is established as the total purchase payments made to the
Certificate Account.
Adjustments are made to the XXXX value in the following circumstances:
1. Additional purchase payments will be added to the XXXX value.
2. Partial surrenders will result in "adjustments for partial surrenders"
subtracted from the XXXX value.
3. After a Participant's spouse elects to maintain the Certificate
Account, the XXXX value is reset to the Certificate Account Value on
the date of continuation after any rider charges have been deducted
and after any increases to the Certificate Account Value due to the
death benefit that would otherwise have been paid.
ADJUSTMENTS FOR PARTIAL SURRENDERS DEFINITION:
"Adjustments for partial surrenders" are calculated for each partial surrender
using the following formula:
A X B where:
-------
C
A = the amount a Participant's Certificate Account Value is reduced by
the partial surrender
B = the Participant's XXXX value on the date of (but prior to) the
partial surrender
C = the Participant's Certificate Account Value on the date of (but
prior to) the partial surrender.
411333 Page 12 (1/2012)
DEATH OF A PARTICIPANT OR A BENEFICIARY RECEIVING PAYMENTS AFTER THE
ANNUITIZATION START DATE
A Participant's death may produce a death benefit after his or her Annuitization
Start Date. Payments cease for lifetime only payment plans. Payments continue to
the Participant's beneficiaries for the remainder of any guarantee period or for
the lifetime of a surviving Joint Annuitant, if any. The amount payable, if any,
will depend on the annuity payment plan then in effect.
If a beneficiary elects an annuity payment plan as provided under the Payment
Options provision above and dies after payments begin, payments continue to
beneficiaries named by the deceased beneficiary as provided under the Change of
Beneficiary provision for the remainder of any guarantee period.
In either circumstance, amounts remaining payable must be paid at least as
rapidly as payments were being made at the time of such death.
411333 Page 13 (1/2012)
PURCHASE PAYMENTS
PURCHASE PAYMENTS
Purchase payments are the payments made by or on behalf of Participants under
this contract for the benefits it provides. Purchase payments must be paid or
mailed to Us at Our corporate office or to an authorized agent. If requested,
We'll give You or the Participant, as appropriate, a receipt for the purchase
payments.
ADDITIONAL PURCHASE PAYMENTS
Subject to the Payment Limits provision below, additional purchase payments may
be made until the earlier of:
1. the date a Participant's enrollment under this contract terminates
by surrender or otherwise; or
2. the Participant's Annuitization Start Date.
Subject to the Payment Limits Provision, each Participant may:
1. stop and/or restart purchase payments; or
2. increase or decrease the amount of his or her purchase payments; or
3. change the interval of his or her purchase payments.
PAYMENT LIMITS
Maximum Purchase Payments - For each Participant, the maximum purchase payments
in the first or later years may not exceed the lesser of:
1. amounts shown under Contract Data, based on the Participant's
Attained Age at the time of payment, or
2. applicable limits allowed under the Code as described under the
Contributions provision below and the Plan.
For item 1 above, We reserve the right to increase the maximums.
Additional Purchase Payments - The Contract Holder or Participant, as
appropriate, may make additional purchase payments of at least the minimum
amount shown under Contract Data. We reserve the right to increase the minimums.
Participants cannot allocate purchase payments to the Special DCA Fixed Account
for six months following a partial surrender from or termination of automated
transfers from the Special DCA Fixed Account prior to the end of the elected
Special DCA time period.
ALLOCATION OF PURCHASE PAYMENTS
Participants instruct Us on how purchase payments are to be allocated among the
available accounts.
Each Participant's allocation instructions as of the Certificate Date are shown
under the Participant's Certificate Data. Unless any restrictions apply, a
Participant may, by Written Request or other method agreed to by Us, change his
or her choice of accounts or percentages. If the current allocation instructions
include a fund to which allocations are restricted and the Participant does not
provide new instructions, We will apply payments pro rata according to the valid
portion of his or her allocation instructions. A Participant's first purchase
payment will be allocated as of the end of the Valuation Period during which We
make an affirmative decision to issue the Certificate. Purchase payments after
the first will be allocated as of the end of the Valuation Period during which
We receive the payment at Our corporate office.
CONTRIBUTIONS
Elective Deferral Contributions and Nonelective Contributions are purchase
payments made to each Participant's Certificate Account subject to the
applicable annual contribution limits. A Participant may not make Elective
Deferral Contributions and/or Xxxx 403(b) Contributions to the Certificate
Account which, when added to contributions that are made by the Participant or
on his or her behalf to any other salary reduction arrangement that is subject
to Section 402(g) of the Code, exceed the annual contribution limitations of
Section 402(g) of the Code for each calendar year. If the Plan permits, this
annual limit may be increased, however, if Participants are eligible for the
special "catch up" limitations under Section 414(v) of the Code for Participants
that are age 50 or older and the special limits applicable under Section
402(g)(7) of the Code for certain employees with long term service with the
411333 Page 14 (1/2012)
Employer, subject to the ordering rule of IRS Treas. Reg. 1.403(b)-4(c)(3)(iv).
For any Participant, the sum of Elective Deferral Contributions (including Xxxx
403(b) Contributions) and Nonelective Contributions, if any, made during any
year cannot exceed the limitations of Section 415(c) of the Code. If the Plan
uses a plan year other than the calendar year, then the limitations under
Section 415(c) of the Code shall apply to contributions made during the plan
year as defined under the Plan. We are not responsible for tracking the
aforementioned limits.
Notwithstanding the preceding, the limitations on contributions described in
this provision shall not apply with respect to any purchase payment that
qualifies as an "Eligible Rollover Distribution," as defined in Sections
403(b)(8) and 402(c)(4) of the Code, from another "Eligible Retirement Plan" as
defined in Section 402(c)(8)(B) of the Code, or that is a plan to plan transfer
of assets to a Participant's Certificate Account, or that is an exchange of
contracts under applicable IRS guidance. A "Rollover" is a contribution by the
Participant from an Eligible Retirement Plan that qualifies as an "eligible
rollover distribution" under Section 402(c)(4) of the Code. A Rollover may also
be made by means of a Direct Rollover. A "Direct Rollover" is a Rollover in
which the proceeds of a distribution from another Eligible Retirement Plan are
made directly into a Participant's Certificate Account and are not paid, in cash
or in kind, to the Participant.
EXCESS DEFERRALS AND EXCESS CONTRIBUTIONS
Excess Elective Deferral Contributions may be removed from a Participant's
Certificate Account by April 15th of the calendar year following the year in
which the excess Elective Deferral Contribution occurred, provided that You or
the Participant notify Us of the excess no later than the March 31st immediately
preceding such date. In the absence of such notice, We are not required to
return any such excess to the Participant. If the excess includes both Xxxx
403(b) Contributions and pre-tax Elective Deferral Contributions, We will follow
the Participant's instructions on which type of contributions to refund unless
You provide contrary instructions for correcting Excess Deferrals that include
both Xxxx 403(b) Contributions and pre-tax Elective Deferral Contributions.
Excess Nonelective Contributions will be treated as segregated from the balance
in a Certificate Account and treated as if held in a separate Certificate
Account solely for the purpose of reporting it as a contribution under Section
403(c) of the Code. We may distribute these amounts at any time. To the extent
that the IRS permits alternative corrections for excess Nonelective
Contributions, such amounts may be corrected in accordance with permitted
correction methodology and with the Plan. Notwithstanding the preceding, nothing
in this contract shall prohibit Us from making corrective distributions in
accordance with Your efforts to satisfy voluntary compliance programs
established by the IRS to comply with 403(b) plan requirements.
VESTING
Elective Deferral Contributions are always fully vested and nonforfeitable.
Nonelective Contributions are generally fully vested and nonforfeitable;
however, the terms of the Plan may impose a vesting schedule on Nonelective
Contributions and, in such instance, a Participant's vesting rights in the
Certificate Account will be determined in accordance with the Plan. You are
responsible for tracking vesting and for providing Us with appropriate
information at the time of distribution.
If We accept unvested Nonelective Contributions, such unvested amounts shall be
treated as if held in a separate account from Participants' vested contributions
in the Certificate Account solely for purposes of complying with the final IRS
regulations applicable to such contributions to an annuity contract. According
to Treas. Reg. 1.403(b) -3(d)(2), the portion of the Certificate Account that is
vested and the portion of the Certificate Account that is unvested are treated
as separate Certificate Accounts.
ROLLOVER CONTRIBUTIONS INTO CERTIFICATE ACCOUNTS
Certificate Accounts may accept Rollovers from any Eligible Retirement Plan as
defined in Section 402(c)(8)(B) of the Code to the extent the Certificate
Account can accommodate such Rollovers in accordance with applicable
requirements.
If this is a 403(b) Xxxx contract, Certificate Accounts may also accept Direct
Rollovers into the designated 403(b) Xxxx account only from another designated
403(b) Xxxx account of a 403(b) annuity or 403(b)(7) custodial account, from a
Xxxx 401(k) plan, or, if a Rollover by a Participant, the amount of the 403(b)
Xxxx distribution that is includable in the Participant's gross income.
411333 Page 15 (1/2012)
PLAN TO PLAN TRANSFERS TO CERTIFICATE ACCOUNTS
If permitted by the Plan, a Certificate Account may accept a plan to plan
transfer of a Participant's interest in a 403(b) annuity contract and/or
403(b)(7) custodial account issued to the Participant under another employer's
403(b) plan only if:
a. the other 403(b) plan permits plan-to-plan transfers; and
b. the Participant is Your employee or former employee covered by the
Plan under which this contract was issued; and
c. the Participant's accumulated benefit immediately after the transfer
is at least equal to their accumulated benefit immediately before
the transfer, without regard to normal contract fees, charges and
expenses; and
d. the amount transferred into the Certificate Account must remain
subject to distribution restrictions no less stringent than imposed
by the transferring contract.
We may require any documentation from the other 403(b) plan as We deem necessary
to process the transfer in accordance with Treas. Reg. section 1.403(b)-10(b)(3)
and other applicable IRS guidance and to confirm that the other plan is a plan
that satisfies section 403(b) of the Code.
CONTRACT EXCHANGES TO CERTIFICATE ACCOUNTS
If permitted by the Plan, this contract may accept an exchange of 403(b)
contracts and/or 403(b)(7) custodial accounts to a Participant's Certificate
Account. Any such exchange is permitted only if:
a. the accumulated benefit of the Certificate Account immediately after
the exchange is at least equal to the accumulated benefit of his or
her 403(b) contract or 403(b)(7) custodial account immediately
before the exchange; and
b. the Certificate Account remains subject to distribution restrictions
no less stringent than those imposed by the 403(b) contract or
403(b)(7) custodial account sending the exchange; and
c. either We are included as an authorized 403(b) product provider
under the Plan or We and the Contract Holder enter into an agreement
to share information for 403(b) compliance purposes, including, but
not limited to information on employment status, hardship
distributions, loans, distributions, transfers and exchanges, 403(b)
Xxxx contributions and contributions made to other authorized 403(b)
product providers.
MISTAKEN CONTRIBUTIONS
If any amount is contributed into a Certificate Account under the Plan by a good
faith mistake of fact, the mistaken contribution will be voided from the start
and refunded to the party that made the contribution if a request is made by You
or the administrator of the Plan and such request is received within one year
after receipt of the mistaken contribution.
NONDISCRIMINATION REQUIREMENTS
Purchase payments made by or on the Participants' behalf into the Plan are
subject to the applicable nondiscrimination requirements of Section 403(b)(12)
of the Code. You are responsible for monitoring the nondiscrimination
requirements and resolving any failures to such requirements in accordance with
the Plan and IRS guidance. Amounts contributed for a Participant that cause the
403(b) Plan to fail to satisfy such requirements may be refunded to You, in
accordance with the Plan and IRS guidance.
DISCONTINUANCE OF PURCHASE PAYMENTS UNDER THIS CONTRACT
We reserve the right to discontinue accepting purchase payments under this
contract with respect to all Participants after 60 Days written notice. In all
other respects this contract will continue to operate according to its terms.
411333 Page 16 (1/2012)
PRIVACY POLICY
We have a written privacy policy that governs disclosure of confidential
information about You, Participants, Certificates and the contract. All Contract
Holders and Certificate holders regularly receive a copy of that policy either
by mail or electronically. However, as required by applicable law, We may be
required to share certain information on Certificate Accounts, contracts, or
Participants that may be necessary to ensure compliance with the terms of your
Employer's Plan document, and/or IRS regulations. This information may be
shared, as appropriate, with a plan administrator providing services to the
Plan, other 403(b) product providers authorized under the Plan, the IRS,
Department of Labor, internal and external auditors (as authorized by the
Contract Holder) and other organizations as may be necessary under applicable
law or regulatory guidance. Only information necessary to ensure compliance will
be shared and only with the appropriate party.
411333 Page 17 (1/2012)
ACCOUNTS: FIXED AND VARIABLE
THE FIXED ACCOUNT
The Fixed Account is part of Our general account. It is made up of all Our
assets other than those in:
1. The Variable Account; and
2. Any other segregated asset accounts.
The Fixed Account consists of the Loan Account and Special DCA Fixed Account.
We back the principal and interest guarantees relating to the Fixed Account.
Purchase payments, interest credited and transfers allocated to the Fixed
Account become part of Our general account.
INTEREST TO BE CREDITED
We will credit interest to the Fixed Account daily. We may credit interest to
each Special DCA Fixed Account at higher promotional rates. All interest rates
We quote are effective annual interest rates - this refers to the rate that
results after interest has been credited and compounded daily for a full year.
Interest will begin to accrue at Our current crediting rate on the date each
purchase payment, which is received in Our corporate office, becomes available
to Us for use. The current crediting rate is determined by Us and at Our
discretion but will never be less than the Fixed Account Minimum Interest Rate
shown under Contract Data.
THE VARIABLE ACCOUNT
The Variable Account is a separate investment account of Ours. It consists of
variable subaccounts which are named under Contract Data. We have allocated a
part of Our assets for this and other contracts to the Variable Account. Such
assets remain Our property. However, the portion of the assets which equals the
reserves and other liabilities of the account(s) shall not be charged with
liabilities arising out of any other business in which We may take part. Income,
gains, and losses, whether or not realized from assets allocated to the Variable
Account, are credited or charged to such account without regard to other income,
gains or losses of the company.
INVESTMENTS OF THE VARIABLE ACCOUNT
Purchase payments and transfer amounts applied to the variable subaccounts will
be allocated as specified by the Participants. Each variable subaccount will
buy, at net asset value, shares of the fund for that variable subaccount shown
under Contract Data or as later added or changed as described below.
We may change the funds from which the variable subaccounts buy shares if laws
or regulations change, the existing funds become unavailable or, in Our
judgment, the funds are no longer suitable for the variable subaccounts. We have
the right to substitute any funds for those shown under Contract Data.
We may also:
- add additional variable subaccounts investing in other funds,
- combine any two or more variable subaccounts,
- transfer assets to and from the variable subaccounts or the Variable
Account, and
- eliminate or close any variable subaccounts.
When required, We would first seek approval of the Securities and Exchange
Commission and the insurance regulator of the state where this contract is
delivered.
VALUATION OF ASSETS
Fund shares in the variable subaccounts will be valued at their net asset value.
VARIABLE ACCOUNT ACCUMULATION UNITS
The number of Accumulation Units for each variable subaccount chosen by a
Participant is found by:
1. adding the number of accumulation units resulting from
a. purchase payments allocated to the variable subaccount; and
b. transfers to the variable subaccount;
2. and subtracting the number of Accumulation Units resulting from
a. transfers from the variable subaccount; and
b. surrenders from the variable subaccount; and
c. Certificate Administrative Charge or any rider charge deductions
from the variable subaccount.
411333 Page 18 (1/2012)
The number of a Participant's Accumulation Units added or subtracted for each of
the above transactions is found by dividing (1) by (2) where:
1. is the amount allocated to or deducted from the variable subaccount; and
2. is the Accumulation Unit value for the variable subaccount for the
respective Valuation Period during which We received the purchase payment
or transfer value, or during which We deducted transfers, surrenders,
rider charges or Certificate Administrative Charges.
VARIABLE ACCOUNT ACCUMULATION UNIT VALUE
The value of an Accumulation Unit for each of the variable subaccounts was
arbitrarily set at $1 when the first fund shares were bought. The value for any
later Valuation Period is found as follows:
The Accumulation Unit value for each variable subaccount for the last
prior Valuation Period is multiplied by the net investment factor for the
same variable subaccount for the next following Valuation Period for which
the Accumulation Unit value is being calculated. The result is the
Accumulation Unit value.
NET INVESTMENT FACTOR
The net investment factor is an index applied to measure the investment
performance of a variable subaccount from one Valuation Period to the next. The
net investment factor may be greater or less than one; therefore, the value of
an accumulation or Annuity Unit may increase or decrease.
The net investment factor for any such variable subaccount for any Valuation
Period is determined by: dividing (1) by (2) and subtracting (3) and (4) from
the result. This is done where:
1. is the sum of:
a. the net asset value per share of the fund held in the variable
subaccount determined at the end of the current Valuation Period;
plus
b. the per share amount of any dividend or capital gain distribution
made by the fund held in the variable subaccount, if the
"ex-dividend" date occurs during the current Valuation Period; and
2. is the net asset value per share of the fund held in the variable
subaccount, determined at the end of the last prior Valuation Period; and
3. is a factor representing the mortality and expense risk charge; and
4. is a factor representing the variable account administrative charge
described below.
MORTALITY AND EXPENSE RISK CHARGE
In calculating unit values We will deduct a mortality and expense risk charge
from the Participants' variable subaccounts which is equal, on an annual basis,
to a percentage of the daily net asset value. This percentage is the Annual
Mortality and Expense Risk Fee shown under Contract Data. The deduction is made
to compensate Us for assuming the mortality and expense risks under contracts of
this type. The deduction will be:
1. made from each variable subaccount; and
2. computed on a daily basis.
Fees for certain optional riders and features, if available and if elected by a
Participant, will be added to the Participant's Annual Mortality and Expense
Risk Fee shown under Contract Data.
VARIABLE ACCOUNT ADMINISTRATIVE CHARGE
In calculating unit values, We will deduct a variable account administrative
charge, as shown under Contract Data, from the variable subaccounts. This
deduction is made to compensate Us for certain administrative and operating
expenses for contracts of this type. The deduction will be:
1. made from each of the Participants' variable subaccounts; and
2. computed on a daily basis.
ANNUITY UNIT VALUE
The value of an Annuity Unit for each variable subaccount was arbitrarily set at
$1 when the first fund shares were bought. The value for any later Valuation
Period is found as follows:
1. the Annuity Unit value for each variable subaccount for the last prior
Valuation Period is multiplied by the net investment factor for the same
variable subaccount for the next following Valuation Period for which the
Annuity Unit value is being calculated.
2. the result is multiplied by an interest factor, which on an annualized
basis is equal to .952381. This is done to offset the assumed 5%
investment return which is built into Table A under the Tables of Annuity
Payout Rates section.
411333 Page 19 (1/2012)
CERTIFICATE ACCOUNT VALUE
CERTIFICATE ACCOUNT VALUE
A Participant's Certificate Account Value at any time is the sum of:
1. Certificate Account Value in the Variable Account;
2. Certificate Account Value in the Special DCA Fixed Account; and
3. Certificate Account Value in the Loan Account.
For surrenders and charges, a number of Accumulation Units and dollar amounts
will be deducted from the Variable Account and Special DCA Fixed Account to
equal any amounts surrendered or charges made against the Certificate Account
Value.
Unless the surrender is used to pay off a Certificate loan, Participants may
specify from which of the above accounts, other than the Loan Account, that the
deduction will be taken. Otherwise, the deduction will be taken from the above
accounts, other than the Loan Account, in the same proportion that their
interest in each bears to the total Certificate Account Value less any amount in
the Loan Account.
CERTIFICATE ACCOUNT VALUE IN THE VARIABLE ACCOUNT
A Participant's Certificate Account Value in the Variable Account at any time
will be the total of the value of the units in any variable subaccount resulting
from:
1. purchase payments allocated to a variable subaccount; plus
2. any amounts transferred to a variable subaccount; less
3. any amounts transferred from a variable subaccount; less
4. any amounts deducted from a variable subaccount for surrenders,
Certificate Administrative Charges or any rider charges.
CERTIFICATE ACCOUNT VALUE IN THE SPECIAL DCA FIXED ACCOUNT
A Participant's Certificate Account Value in the Special DCA Fixed Account at
any time will be the total of:
1. purchase payments allocated to the Special DCA Fixed Account, plus
interest credited; less
2. any amounts transferred from the Special DCA Fixed Account; less
3. any amounts deducted from the Special DCA Fixed Account for surrenders,
Certificate Administrative Charges or any rider charges.
CERTIFICATE ACCOUNT VALUE IN THE LOAN ACCOUNT
A Participant's Certificate Account Value in the Loan Account at any time will
be the total of:
1. any amounts transferred to the Loan Account, plus interest credited; less
2. any amounts transferred from the Loan Account less
3. any amounts deducted from the Loan Account for surrenders.
CERTIFICATE ADMINISTRATIVE CHARGE
We charge a fee for establishing and maintaining Our records for each
Certificate Account. The charge per year is shown under Contract Data and is
deducted from each Certificate's Account Value at the end of each certificate
year or, if earlier, when the Certificate Account is fully surrendered. The
charge deducted will be prorated among all accounts, but not the Loan Account,
in the same proportion a Participant's interest in each bears to his or her
total Certificate Account Value less any amount in the Loan Account.
411333 Page 20 (1/2012)
We reserve the right to adjust this charge after the first Certificate
Anniversary but the charge will never exceed the amount shown under Contract
Data. We waive or reduce the annual Certificate Administrative Charge for any
certificate year where the Certificate Account Value immediately prior to the
deduction of the charge equals or exceeds the amount shown under Contract Data.
If a Participant makes a full surrender of their Certificate Account, We deduct
the full Certificate Administrative Charge at the time of full surrender
regardless of Certificate Account Value.
The charge does not apply to the amount applied to an annuity payment plan or to
a Participant's death benefit.
PREMIUM TAX CHARGES
We reserve the right to assess a charge against Participants' Certificate
Account Value for any premium tax assessed to Us by a federal, state or local
government. This charge could be deducted when You or Participants, as
applicable, make purchase payments, or make a full surrender of a Participant's
Certificate Account Value or on a Participant's Annuitization Start Date.
TRANSFERS OF CERTIFICATE ACCOUNT VALUES
While a Certificate Account Value is greater than zero prior to a Participant's
Annuitization Start Date, transfers of Certificate Account Values may be made as
outlined below unless Certificate Account Values are required to be allocated to
certain accounts or variable subaccounts under the terms of certain optional
benefit riders, if available and if attached to his or her Certificate.
1. Subject to provisions of the Plan, Participants may transfer all or a part
of the values held in one or more of their variable subaccounts to another
one or more of the variable subaccounts.
2. Subject to provisions of the Plan, Participants may transfer from the
Special DCA Fixed Account to the variable subaccounts as explained in the
Special DCA Fixed Account provision, shown below. Participants may not
transfer values from any account into the Special DCA Fixed Account.
Participants may make a transfer by Written Request. Telephone transfers may
also be made according to telephone procedures or automated transfer procedures
that are then currently in effect, if any. There is no fee or charge for these
transfers. However, the minimum transfer amount is $250, or if less, the entire
value in the account from which the transfer is being made. Smaller minimums may
apply to automated transfer procedures.
We may suspend or modify a Participant's transfer privileges at any time. The
right to transfer Certificate Account Values among the variable subaccounts and
between the variable subaccounts and other accounts is also subject to
modification or restriction if We determine, at Our sole discretion, that the
exercise of that right by a Participant is, or would be, to the disadvantage of
other contract owners and Participants. Additionally, We reserve the right to
modify or restrict transfer privileges for any Participant if required to comply
with the written instructions of a fund. Any modification or restriction could
be applied to transfers to or from some or all of the variable subaccounts and
other accounts.
These modifications could include, but are not limited to:
1. the requirements of a minimum time period between each transfer,
2. suspending or terminating automatic transfer programs, or
3. limiting the dollar amount that each Participant may transfer between the
variable subaccounts and other accounts at any one time.
We may apply these modifications or restrictions in any manner reasonably
designed to prevent any use of the transfer right We consider to be to the
disadvantage of other contract owners and Participants.
DOLLAR COST AVERAGING (DCA)
Participants may authorize the automated transfer of specified amounts,
according to the rules then currently in effect, at the interval they select,
from any variable subaccount to any other variable subaccount other than the
source account. Participants may terminate automated transfers at any time.
411333 Page 21 (1/2012)
SPECIAL DCA FIXED ACCOUNT
Participants may also allocate new purchase payments to the Special DCA Fixed
Account. Participants may authorize the automatic transfer of amounts on a
monthly basis from the Special DCA Fixed Account to any of the variable
subaccount(s). All amounts allocated to the Special DCA Fixed Account will be
transferred out within the specified Special DCA Fixed Account time period they
elect from the time periods We make available.
If a Participant terminates automated transfers from the Special DCA Fixed
Account, his or her entire Special DCA Fixed Account balance will immediately be
transferred according to his or her Special DCA Fixed Account allocation
instructions that are then in effect. If a Participant's current Special DCA
allocation instructions include a fund to which allocations are restricted and
new instructions are not provided, We will transfer amounts pro rata according
to the valid portion of the Participant's allocation instructions.
411333 Page 22 (1/2012)
SURRENDER PROVISIONS
SURRENDER
Subject to the rules below, the Contract Holder may surrender this contract for
the full surrender value of all Certificate Accounts to be paid to the
Participants.
Subject to requirements under the Plan and the rules below, Participants may:
1. surrender all of his or her Certificate Account Value for a full
surrender; or
2. surrender part of his or her Certificate Account Value for a partial
surrender.
RULES FOR SURRENDER OF THIS CONTRACT
A surrender will have the following conditions.
1. The Contract Holder must send Us a Written Request, or other method agreed
to by Us, while this contract remains in force.
2. For surrenders from the variable subaccounts, the amount surrendered, less
any charges, will be paid to Participants within seven Days of the receipt
of the Written Request, unless subject to the Suspension or Delay in
Payment of Surrender provision.
For surrenders from the Fixed Account, the amount surrendered, less any
charges, will normally be paid to Participants within seven Days of the
receipt of the Written Request and the return of the contract, if
required. Following any required regulatory approval, We have the right to
defer payment for up to six months from the date We receive the request.
In such circumstance, We will notify the Contract Holder of the reason for
the delay, the effective date of the surrender, and the surrender value as
of the date of the request.
3. If a Participant dies following a surrender request, payment will be made
to the Participant's estate.
4. Any amounts surrendered, including any related charges, cannot be repaid.
Upon surrender for the full surrender value of all Participants' Certificate
Accounts, this contract will terminate. We may require that the Contract Holder
return the contract to Us before We pay the full surrender value.
DISTRIBUTIONS FROM CERTIFICATE ACCOUNTS
Any distribution from a Certificate Account will be treated as a surrender or
partial surrender from the Certificate Account.
At time of distribution, any Loan Balance will reduce the amounts available for
surrender, amounts applied to an annuity payment plan, or death benefits
payable.
RULES FOR SURRENDER OF CERTIFICATE ACCOUNTS All surrenders will have the
following conditions.
1. Participants must send Us a Written Request (or other method agreed to by
Us):
a. while their Certificate Account remains in force under the contract;
and
b. while the Participant is living; and
c. prior to the Participant's Annuitization Start Date.
2. Unless We agree otherwise, Participants must surrender an amount equal to
at least $250. The Certificate Account Value after a partial surrender
must be at least the Loan Balance, if any, plus $500.
3. For surrenders from the variable subaccounts, the amount surrendered, less
any charges, will be paid to Participants within seven Days of the receipt
of a Written Request, unless subject to the Suspension or Delay in Payment
of Surrender provision.
For surrenders from the Fixed Account, the amount surrendered, less any
charges, will normally be paid to Participants within seven Days of the
receipt of a Written Request and the return of the Certificate, if
required. Following any required regulatory approval, We have the right to
defer payment for up to six months from the date We receive the request.
In such circumstance, We will notify the Participant of the reason for the
delay, the effective date of the surrender, and the surrender value as of
the date of the request.
4. For partial surrenders, if a Participant does not specify from which
account the surrender is to be made, the surrender will be made from all
accounts other than the Loan Account in the same proportion as his or her
interest in each bears to the Certificate Account Value less amounts in
the Loan Account.
411333 Page 23 (1/2012)
5. If a Participant dies following a surrender request, payment will be made
to the Participant's estate.
6. Any amounts surrendered, including any related charges, cannot be repaid.
Upon a surrender for the full surrender value, a Participant's enrollment under
this contract will terminate. We may require that the Participant return the
Certificate to Us before We pay the full surrender value.
SURRENDER VALUE
For each Participant, the full surrender value at any time will be:
1. his or her Certificate Account Value immediately prior to the surrender;
2. minus the Loan Balance, if any; and
3. minus the Certificate Administrative Charge and any rider charges that are
deducted for a full surrender.
SUSPENSION OR DELAY IN PAYMENT OF SURRENDER AMOUNT
We have the right to suspend or delay the date of any surrender payment from the
variable subaccounts for any period:
1. when the New York Stock Exchange is closed; or
2. when trading on the New York Stock Exchange is restricted; or
3. when an emergency exists as a result of which:
a. disposal of securities held in the variable subaccounts is not
reasonably practical; or
b. it is not reasonably practical to fairly determine the value of the
net assets of the variable subaccounts; or
4. during any other period when the Securities and Exchange Commission, by
order, so permits for the protection of security holders.
Rules and regulations of the Securities and Exchange Commission will govern as
to whether the conditions set forth in 2 and 3 exist.
SURRENDER RESTRICTIONS BEFORE A PARTICIPANT'S AGE 59 1/2
Except for amounts held in the contract on behalf of Participants on December
31, 1988, no amounts, including 403(b) Xxxx Contributions, may be distributed
from the Certificate Accounts unless one or more of the following conditions has
been satisfied:
a. the Participant has attained age 59 1/2;
b. the Participant is disabled within the meaning of Section 72(m)(7) of the
Code;
c. the Participant's death has occurred;
d. the Participant has severed employment with the Contract Holder; or
e. if permitted under the Plan, Elective Deferral Contributions may be
surrendered if the Participant has satisfied the requirements for a
"financial hardship" under Section 403(b)(11)(B) of the Code.
If permitted by the Plan, multiple distributions can be taken under these rules.
FINANCIAL HARDSHIP DISTRIBUTIONS
If the Plan has established independent criteria for financial hardship
distributions, then any financial hardship distributions made from this contract
under the Plan shall adhere to the rules set forth in the Plan, subject to the
approval of the Contract Holder or the Plan administrator. If the Plan has not
established independent criteria for financial hardship distributions, then, in
the event of a financial hardship that satisfies the requirements of Section
403(b)(11)(B) of the Code, the Participant may receive a distribution of only
Elective Deferral Contributions, including 403(b) Xxxx Contributions.
Certificate Account distributions of Nonelective Contributions and/or earnings
on Contributions are not permitted for financial hardships.
No hardship distribution is permitted from the Certificate Account unless the
"safe harbor" standards with respect to establishing an immediate and heavy
financial need (under Treas. Reg. Section 1.401(k)-1(d)(3)(iii)(B)) are
satisfied. For purposes of satisfying the lack of other resources requirement,
any method acceptable under Treas. Reg. Section 1.401(k)-1(d)(3)(iv)(E) is
permitted, however, the Participant must suspend elective deferrals to any plan
sponsored by the Contract Holder for a period of six months following the date
of the hardship distribution. We will notify You of any hardship distributions
made to a Participant; however, We assume that you are monitoring whether a
Participant has suspended elective deferrals and that all future contributions
are eligible to be deferred.
411333 Page 24 (1/2012)
ADDITIONAL RESTRICTIONS ON DISTRIBUTIONS OF DESIGNATED 403(b) XXXX ACCOUNTS
Distributions to a Participant made from Designated 403(b) Xxxx Accounts that
are not "Qualified 403(b) Xxxx Distributions" may contain earnings that are
includable in the Participant's income. Distributions from Designated 403(b)
Xxxx Accounts are Qualified 403(b) Xxxx Distributions if they are made no
earlier than the fifth year following the year in which the first 403(b) Xxxx
Contribution was made to any 403(b) annuity or 403(b)(7) custodial account
(provided proof of establishment of said Xxxx 403(b) contract/account is
provided); and
a. the Participant has attained age 59 1/2; or
b. the distribution is made after the Participant has become disabled as
defined under Section 72(m) of the Code; or
c. the distribution is made after the Participant's death.
DIRECT ROLLOVER DISTRIBUTIONS
Notwithstanding any other provision of this contract, a Distributee may elect to
have any portion of an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan specified by the Distributee in a Direct Rollover.
If provided in the Plan and if allowed by Us, a Direct Rollover of amounts in a
403(b) Account may be made to a designated 403(b) Xxxx account of a 403(b)
annuity/403(b)(7) custodial account or a Xxxx XXX.
A Direct Rollover of amounts in a Designated 403(b) Xxxx Account may be made
only to another designated 403(b) Xxxx account of a 403(b) annuity/403(b)(7)
custodial account, a Xxxx 401(k) plan, or a Xxxx XXX.
For purposes of this section, a "Distributee" is any Participant (or former
Participant) entitled to receive a distribution from this contract, a surviving
spousal Beneficiary and any spouse or former spouse that qualifies as an
alternate payee under a QDRO.
In addition, a nonspouse beneficiary may make a direct rollover of all or any
portion of an Eligible Rollover Distribution to a new inherited XXX contract
only. No other rollover options are available to a beneficiary who is not a
spouse.
REQUIRED MINIMUM DISTRIBUTIONS
In accordance with Sections 403(b)(10) and 401(a)(9) of the Code and supporting
regulations, Participants must begin receiving distributions, including
distributions of 403(b) Xxxx contributions and earnings, by their Required
Beginning Date. Unless a later date is authorized under the Code or applicable
regulations, a Participant's Required Beginning Date is April 1 of the calendar
year following: (1) the calendar year in which he or she attains age 70 1/2 or,
if later, (2) the calendar year in which the Participant retires from employment
with the Contract Holder. Participants' Certificate Accounts shall be
distributed (both in determining the timing of subsequent distributions and the
amount of all required distributions) in a manner consistent with Sections
403(b)(10) and 401(a)(9) of the Code. For purposes of determining required
minimum distributions, each Certificate Account will be valued considering the
Participant's accumulated benefit plus the actuarial present value of any
additional benefits provided. Distributions from a Certificate Account,
including distributions from a Participant's Designated 403(b) Xxxx Account,
shall be made in the Annuity Payment Plan Option selected by the Participant or
his or her beneficiary on or before the date which is at least 30 days before
the Participant's Required Beginning Date.
MULTIPLE 403(b) ANNUITY CONTRACTS AND 403(b)(7) CUSTODIAL ACCOUNTS
If a Participant has multiple 403(b) annuity contracts, Certificates and/or
403(b)(7) custodial accounts, the required minimum distribution requirements may
be satisfied by receiving a distribution from one 403(b) annuity or 403(b)(7)
custodial account that is equal to the amount required to satisfy the required
minimum distribution requirements for all of the Participants' 403(b) annuity
contracts, certificates and 403(b)(7) custodial accounts. Under this method, a
Participant must still calculate the required minimum distribution requirements
separately for each 403(b) annuity or 403(b)(7) custodial account, even though
the Participant can satisfy the minimum requirements by taking a distribution
from one or more annuity contract, certificate or custodial account.
411333 Page 25 (1/2012)
ANNUITY PAYMENT PLAN OPTIONS
Participants can schedule receipt of irrevocable annuity payments according to
one of the plans (A through E) described in the Annuity Provisions below, or
another plan agreed to by Us, provided:
a. the plan selected provides for payments that satisfy the Required Minimum
Distribution rules described above;
b. payments are made in periodic payments at intervals of no longer than 1
year;
c. the first required payment must be the payment that is required for one
payment interval, and the second payment need not be made until the end of
the next payment interval, and
d. once payments have begun under the Required Minimum Distribution rules
over a period certain, the period certain will not be changed even if the
period certain is shorter than the maximum permitted.
For purposes of this section, required distributions are considered to commence
on a Participant's Required Beginning Date, or if applicable, on the date
distributions are required to begin to a Participant's surviving spouse.
However, if a Participant begins receipt of payments pursuant to an irrevocable
annuity payment plan that meets the requirements of Treasury Regulation Section
1.401(a)(9)-6T, Required Minimum Distributions are considered to commence on the
Participant's Annuitization Start Date.
QUALIFIED DOMESTIC RELATIONS ORDERS
Any distribution subject to required minimum distributions described above,
including distributions under this contract, properly made to an alternate payee
pursuant to a QDRO will be permitted even though the timing of the distribution
might otherwise be prohibited under the distribution restrictions described
previously.
PERMISSIVE SERVICE CREDIT TRANSFERS
If permitted by the Plan and if a Participant contributes to a tax-qualified
defined benefit governmental plan (as defined in Section 414(d) of the Code)
that accepts plan-to-plan transfers for the purchase of permissive service
credits under Section 415(n)(3)(A) of the Code, the Participant may elect to
have any portion of his or her Certificate Account transferred to the defined
benefit governmental plan at any time.
DISTRIBUTIONS DUE TO TERMINATION OF THE PLAN
Nothing in this contract shall prohibit Us from making a distribution of the
contract to the Participants following written notification by You (or Your
representative) of the termination of the Plan with instructions from You to
distribute the Certificate Accounts to the Participants.
The Certificate Accounts may not be distributed unless the instructions to
distribute the Certificate Accounts conform to the requirements of Treas. Reg.
1.403(b)-10(a) and any other applicable guidance issued by the IRS. Nothing
herein shall prevent Us from treating the Certificate Accounts as fully paid
annuities upon termination of the Plan provided they would otherwise qualify for
such status.
411333 Page 26 (1/2012)
CERTIFICATE ACCOUNT LOANS
If permitted by the Plan and if allowed by Us, Participants may take loans from
their Certificate Accounts in accordance with the terms and conditions set forth
in the Plan and as described in this section. Any Certificate Account loan is
subject to the requirements of Section 72(p) of the Code and applicable
regulations in addition to any terms and conditions that the Plan may impose.
We must receive satisfactory confirmation from a Plan representative that loans
are permitted. To the extent that the Plan has its own loan policies or
procedures, You are responsible for determining the non-taxable loan amounts,
and You authorize Us to follow the instructions of the Plan administrator or
such other representative designated by You.
If a Participant elects any guaranteed living benefit rider or death benefit
rider available under the contract, loans may not be permitted while the rider
is in effect.
The following terms and conditions will also apply:
a. All loans shall be evidenced by a written loan agreement.
b. No actual distributions to repay loans shall be made which would be
in violation of Section 403(b)(7) or 403(b)(11) of the Code.
c. We reserve the right to specify a minimum loan amount, even if the
Plan has not established a minimum.
d. For each Participant, only one outstanding Certificate Account loan
is allowed at any given time.
e. The maximum amount of a Certificate Account loan cannot exceed the
surrender value of the Certificate Account and shall not exceed the
least of:
i. the maximum amount permitted by the Plan, if applicable;
ii. fifty percent (50%) of the Participant's Certificate Account
Value;
iii. $50,000 minus the highest outstanding balance of loans for the
Participant from any plans the Contract Holder sponsors during
the year prior to the loan effective date, or
iv. the Participant's Certificate Account Value minus the value of
any Special DCA Fixed Accounts (SDCAs).
f. On a Participant's Annuitization Start Date, any Certificate Account
loan shall become immediately due and payable in full and, if not
repaid, the Loan Balance will be treated as a partial surrender and
will be reported as taxable to the Participant.
g. An active loan may be prepaid in whole at any time.
h. If a Certificate Account is surrendered while a loan is outstanding,
the Certificate Account's surrender value will be reduced by the
Loan Balance.
i. Unless the Certificate Account is continued as provided by the
Spouse's Option to Maintain Certificate Account provision, the death
benefit will be reduced by any Loan Balance.
j. While a Participant has an outstanding Certificate Account loan, the
following transactions may not be permitted under the contract:
i. exchanges from the Certificate Account,
ii. plan to plan transfers, and
iii. additional loans.
k. Loans may also be subject to additional limitations or restrictions
under the terms of the Plan.
l. Loans permitted under this contract may still be taxable in whole or
in part if a Participant has additional loans from other plans or
contracts. We will calculate the maximum nontaxable loan based
solely on the information provided to Us by You or the Participant,
in writing.
LOAN ACCOUNT
Loans shall be secured, to the extent necessary to adequately collateralize the
loan, by the Participant's vested interest in the Certificate Account. The
Certificate Account will be the sole security for the loan. At the time a loan
is taken, the loan amount is subtracted pro rata from all accounts in which the
Participant is invested, but not SDCAs, and transferred to a Loan Account.
The Loan Account will earn interest daily. The current crediting rate will never
be less than the Fixed Account Minimum Interest Rate shown under Contract Data.
LOAN BALANCE
At any point in time, a Participant's Loan Balance will be the principal amount
owed plus unpaid accrued interest charges. Loans will be made at an interest
rate determined by Us at the time the loan is taken and will be fixed for the
life of the loan. The maximum interest rate for loans will not exceed 8%.
411333 Page 27 (1/2012)
All current loan interest rates We quote are effective annual interest rates -
this refers to the rate that results after interest has been credited and
compounded daily for a full year. Interest will begin to accrue at Our current
interest rate for loan accounts on the date the loan is taken. Upon receipt of
proper notice and to the extent required by law, loan rates and terms will
conform to requirements for loans to Participants who are eligible qualified
military personnel.
LOAN PAYMENTS
Loans must be repaid in substantially equal payments, not less frequently than
quarterly unless paid in full. Loans must be repaid within a maximum of 5 years.
If permitted by Us and the Plan, loans used to construct or purchase a
Participant's principal residence may be extended for longer periods, but not to
exceed 30 years. Loan payments are not purchase payments, and contract
provisions related to purchase payments do not apply to loan payments. Loan
payments will consist of principal and accrued interest charges and will be
applied first to interest charges. The payment amounts are set forth at the time
the loan is taken. Any excess payment reduces the Loan Balance and shortens the
length of the loan. It does not change future payment amounts.
On the date of each loan payment:
1. the Participant's Loan Balance is reduced by the amount of the loan
payment, and
2. a transfer is made from the Participant's Loan Account to all accounts in
which the Participant is investing according to existing purchase payment
allocations, but not any SDCA. The amount to be transferred is determined
by subtracting the Participant's Loan Balance after the loan payment from
the Participant's Loan Account prior to the loan payment (but not less
than zero).
MILITARY SERVICE
If We are notified in advance, loan payments can be delayed during time of
service. Interest charges on a Participant's Loan Balance will continue to
accrue. Payments continue after service ends, and the maturity date of the loan
is extended. Payment amounts may be recalculated.
LEAVE OF ABSENCE
If We are notified in advance, loan payments can be delayed during qualified
leaves. Interest charges on the Loan Balance will continue to accrue. Payments
continue after the leave ends, however, the maturity date of the loan does not
change. Payment amounts may be recalculated.
LOAN DEFAULTS
Unless a different grace period is provided for in the Plan, a grace period of
at least thirty (30) days will be available for loan payments under the terms of
the loan agreement. If a loan payment is not made by the end of the applicable
grace period, a Participant's Loan Balance will be in default.
If the Participant is eligible for distributions from the Certificate Account,
the loan is canceled. The Participant's Loan Balance will be treated as a
partial surrender to pay off the loan. The partial surrender will first be
deducted from the Participant's Loan Account followed by any remainder deducted
pro rata from all accounts in which he or she is invested. The partial surrender
will be reported as taxable to the Participant.
If the Participant is not eligible for distributions from the Certificate
Account, the loan is considered a deemed distribution at that time in order to
secure the loan to the extent necessary to adequately collateralize the loan.
The difference between the Participant's Loan Balance and his or her Loan
Account is transferred pro rata from all accounts in which the Participant is
invested, but not any SDCA, to the Participant's Loan Account. Transfers will be
made from SDCA accounts if insufficient amounts are available from other
accounts in which the Participant is invested. Additional interest on the
Participant's Loan Account will continue to accrue and will be credited only if
the loan is repaid. The Participant's Loan Balance will be reported as taxable
to the Participant. Additional interest owed on the Participant's Loan Balance
will continue to accrue for repayment purposes only. The Participant's Loan
Account and Loan Balance remain in the Certificate Account until one of the
following occurs.
1. The Loan Balance, as of the date the loan was deemed distributed, is
treated as a partial surrender of the Certificate Account in these
circumstances:
a. the Participant is eligible for distributions from the Certificate
Account. This will occur automatically if the Participant's
eligibility is based on his or her age.
b. on the Participant's Annuitization Start Xxxx,
x. a full surrender of the Certificate Account,
d. a "Rollover" into another Eligible Retirement Plan, or
e. upon the Participant's death.
The Participant's Loan Account and Loan Balance will be zero.
411333 Page 28 (1/2012)
2. The Participant repays the full amount of the Loan Balance. On the date of
repayment, the Participant's Loan Account, plus credited interest on the
Loan Account since the date the loan was deemed, is then transferred to
all accounts in which the Participant is investing according to existing
purchase payment allocations, but not any SDCA. After such repayment, the
Participant's Loan Account and Loan Balance will be zero.
If We agree, Loan Balance repayments may be made for less than the full
amount.
A Participant may not take another Certificate Account loan until his or
her Loan Balance is repaid or deducted from his or her Certificate Account
Value.
411333 Page 29 (1/2012)
ANNUITY PROVISIONS
ANNUITY PAYMENT
For each Participant, the Annuitization Start Date is the date shown under the
Participant's Certificate Data. It can be changed by the Participant as provided
below. On the Annuitization Start Date, the amount applied to an annuity payment
plan will be the Certificate Account Value after any rider charges are deducted.
The first payment will be made as provided by the selected plan. Before the
first payment is sent, We will require satisfactory proof of the Annuitant's age
and that the Annuitant is alive. We may also require that the Participant
exchange the Certificate for a supplemental contract which provides the annuity
payments.
CHANGE OF ANNUITIZATION START DATE
A Participant may change the Annuitization Start Date shown for their
Certificate Account by Written Request or other method agreed to by Us. If a
Participant selects a new date, it must be at least 30 Days after We receive
their request.
The Annuitization Start Date must be on or before the latest of:
1. The Participant's 95th birthday, or
2. the 10th Certificate Anniversary, or
3. such other date as agreed upon by Us.
ANNUITY PAYMENT PLANS
Annuity payments may be made on a fixed dollar basis, a variable basis or a
combination of both. Participants can schedule receipt of annuity payments
according to one of the Plans A through E below or another plan agreed to by Us.
PLAN A -- LIFE INCOME NON-REFUND. This provides monthly annuity payments during
the lifetime of the Annuitant. No payments will be made after the Annuitant
dies.
PLAN B -- LIFE INCOME WITH GUARANTEED PERIOD.
This provides monthly annuity payments during the lifetime of the Annuitant with
a guarantee by Us that payments will be made for at least a period certain of
five, 10 or 15 years whether or not the Annuitant is living. You must select a
guaranteed period, and the minimum period certain is five years.
PLAN C -- LIFE INCOME WITH INSTALLMENT REFUND.
This provides monthly annuity payments during the lifetime of the Annuitant with
a guarantee by Us that payments will be made at least for a certain number of
months whether or not the Annuitant is living. We determine the number of months
by dividing the amount applied under this plan by the amount of the first
monthly annuity payment.
PLAN D -- JOINT AND SURVIVOR LIFE INCOME NON-REFUND. This provides monthly
annuity payments during the lifetime of the Annuitant and Joint Annuitant. When
either the Annuitant or the Joint Annuitant dies We will continue to make
monthly payments during the lifetime of the survivor. No payments will be made
after the death of both the Annuitant and Joint Annuitant.
PLAN E -- TERM CERTAIN INSTALLMENT. This provides monthly annuity payments for a
period of years. The period of years may be no less than 10 nor more than 30.
PLAN SELECTION
Participants may select the plan by Written Request, or other method agreed to
by Us, at least 30 Days before their Annuitization Start Date. If We have not
received a Written Request to select a plan, the first annuity payment will be
made 30 Days after their Annuitization Start Date according to Plan B with
monthly payments guaranteed for ten years.
After the Annuitization Start Date, Participants cannot change to a different
plan.
If the amount to be applied to a plan is less than $2,000 or would not provide
an initial monthly payment of at least $20, We have the right to change the
frequency of the payment or to make a lump sum payment of the amount that would
have been applied to a plan.
ALLOCATION OF CERTIFICATE ACCOUNT VALUES TO PROVIDE FIXED AND VARIABLE PAYMENTS
On the Annuitization Start Date, Participants use the value described under the
Annuity Payment provision above, to provide Fixed Annuity and/or Variable
Annuity payments.
411333 Page 30 (1/2012)
Unless We agree otherwise, each Participant may use a maximum of ten variable
subaccounts at any one time. The Special DCA Fixed Account is not available on
and after the Annuitization Start Date.
FIXED ANNUITY PAYMENTS
A Fixed Annuity is an annuity with payments which:
1. are guaranteed as to dollar amount; and
2. do not vary in amount based on the investment performance of the variable
subaccounts.
When annuity payments begin, amounts allocated to provide fixed dollar payments
will be applied to the applicable Annuity Payout Rates Table. This will be done
in accordance with the payment plan chosen. The minimum amount payable for each
$1,000 so applied is shown in Table B under the Tables of Annuity Payout Rates
section.
VARIABLE ANNUITY PAYMENTS
A Variable Annuity is an annuity with payments which:
1. are not predetermined or guaranteed as to dollar amount; and
2. vary in amount based on the investment performance of the variable
subaccounts.
DETERMINATION OF THE FIRST VARIABLE ANNUITY PAYMENT
When a Participant's annuity payments begin, the amounts allocated to provide
Variable Annuity payments will be applied to the applicable Annuity Payout Rates
Table. This will be done:
1. on the Participant's Annuitization Start Date; and
2. in accordance with the payment plan chosen. The amount payable for the
first payment for each $1,000 so applied is shown in Table A under the
Tables of Annuity Payout Rates section.
VARIABLE ANNUITY PAYMENTS AFTER THE FIRST PAYMENT
Variable annuity payments after the first payment vary in amount. The amount
changes with the investment performance of the variable subaccounts. The dollar
amount of Variable Annuity payments after the first is not fixed. It may change
from month to month. The dollar amount of such payments is determined as
follows.
1. The dollar amount of the first annuity payment is divided by the value of
an Annuity Unit as of the Valuation Date on or next preceding the seventh
Day before a Participant's Annuitization Start Date. This result
establishes the fixed number of Annuity Units for each monthly annuity
payment after the first payment. This number of Annuity Units remains
fixed during the annuity payment period unless exchanged for units of any
of the other variable subaccounts as provided below.
2. The fixed number of Annuity Units is multiplied by the Annuity Unit value
as of the Valuation Date on or next preceding the seventh Day before the
date the payment is due. The result establishes the dollar amount of the
payment.
In order for the dollar amount of variable annuity payments not to decrease, the
assets of the variable account must have a 5% annualized investment return.
We guarantee that the dollar amount of each payment after the first will not be
affected by variations in expenses or mortality experience.
EXCHANGE OF ANNUITY UNITS
After a Participant's Annuitization Start Date, Annuity Units of any variable
subaccount may be exchanged for units of any of the other variable subaccounts.
This may be done no more than once in any contract year. Unless We agree
otherwise Participants may use a maximum of ten variable subaccounts at any one
time. No exchanges may be made to or from any Fixed Annuity after the
Annuitization Start Date.
411333 Page 31 (1/2012)
TABLES OF ANNUITY PAYOUT RATES
Table A below shows the amount of the first monthly Variable Annuity payment,
based on a 5% assumed investment return, for each $1,000 of value applied under
any payment plan. The amount of the first and all subsequent monthly fixed
dollar annuity payments for each $1,000 of value applied under any payment plan
will be based on Our fixed dollar Table of Annuity Payout Rates in effect on a
Participant's Annuitization Start Date.
Such rates are guaranteed to be not less than those shown in Table B. The amount
of such annuity payments under Plans A, B and C will depend upon the Attained
Age of the Annuitant on the Annuitization Start Date. The amount of such annuity
payments under Plan D will depend upon the Attained Age of the Annuitant and the
Joint Annuitant on the Annuitization Start Date.
TABLE A - DOLLAR AMOUNT OF FIRST MONTHLY VARIABLE ANNUITY PAYMENT
PER $1,000 APPLIED
PLAN A PLAN B PLAN C PLAN D
----------- ---------------------------------------- ----------- ----------------
Age at Life Income with Joint &Survivor
Annui- Beginning Life Income Five Years Ten Years Fifteen Years Installment Non-Refund
tization in Year Non-Refund Certain Certain Certain Refund Same Age
-------- --------- ----------- ---------- --------- ------------- ----------- ----------------
Age 65 2015 5.84 5.82 5.76 5.65 5.66 5.20
2020 5.77 5.75 5.70 5.60 5.61 5.16
2025 5.71 5.69 5.64 5.55 5.55 5.12
2030 5.65 5.63 5.59 5.51 5.51 5.09
2035 5.59 5.58 5.54 5.47 5.46 5.05
2040 5.54 5.52 5.49 5.42 5.42 5.03
Age 75 2015 7.56 7.45 7.14 6.68 6.97 6.31
2020 7.41 7.32 7.04 6.62 6.87 6.23
2025 7.28 7.19 6.94 6.56 6.78 6.15
2030 7.16 7.08 6.85 6.50 6.69 6.07
2035 7.04 6.97 6.76 6.45 6.61 6.00
2040 6.93 6.87 6.68 6.39 6.53 5.94
Age 85 2015 11.39 10.65 9.06 7.58 9.45 8.83
2020 11.07 10.41 8.96 7.56 9.28 8.64
2025 10.77 10.19 8.87 7.53 9.11 8.46
2030 10.50 9.98 8.77 7.51 8.95 8.29
2035 10.24 9.78 8.67 7.48 8.80 8.14
2040 10.01 9.59 8.58 7.46 8.67 8.00
Age 95 2015 19.49 15.13 10.34 7.82 14.05 14.34
2020 18.97 14.97 10.33 7.82 13.87 14.03
2025 18.48 14.82 10.32 7.81 13.69 13.75
2030 18.03 14.67 10.31 7.81 13.52 13.50
2035 17.61 14.53 10.30 7.81 13.37 13.26
2040 17.22 14.39 10.29 7.81 13.23 13.05
Age 100 2015 27.60 17.28 10.49 7.82 18.14 19.97
2020 27.41 17.26 10.49 7.82 18.10 19.87
2025 27.22 17.25 10.49 7.82 18.06 19.77
2030 27.04 17.24 10.49 7.82 18.02 19.68
2035 26.86 17.22 10.49 7.82 17.98 19.59
2040 26.69 17.21 10.49 7.82 17.94 19.50
Table A above is based on the "Annuity 2000 Mortality Table" with 100%
Projection Scale G and a 5% assumed investment return. Annuity Payment rates for
any year, age, or any combination of year and age not shown above, will be
calculated on the same basis as those rates shown in the Table above. Such rates
will be furnished by Us upon request. Amounts shown in the Table below are based
on a 5% assumed investment return.
PLAN E - DOLLAR AMOUNT OF FIRST MONTHLY VARIABLE ANNUITY PAYMENT
PER $1,000 APPLIED
MONTHLY MONTHLY MONTHLY
YEARS PAYABLE PAYMENT YEARS PAYABLE PAYMENT YEARS PAYABLE PAYMENT
------------- ------- ------------- ------- ------------- -------
10 10.51 17 7.20 24 5.88
11 9.77 18 6.94 25 5.76
12 9.16 19 6.71 26 5.65
13 8.64 20 6.51 27 5.54
14 8.20 21 6.33 28 5.45
15 7.82 22 6.17 29 5.36
16 7.49 23 6.02 30 5.28
411333 Page 32 (1/2012)
Fixed Dollar annuity payments will not be less than those shown in Table B. In
addition, the amount of such payments will not be less than that which would be
provided if a single payment immediate annuity contract then offered by Us to
Annuitants in the same class were to be purchased with the surrender value of a
Participant's Certificate Account.
TABLE B - DOLLAR AMOUNTS OF EACH MONTHLY FIXED DOLLAR ANNUITY PAYMENT
PER $1,000 APPLIED
PLAN A PLAN B PLAN C PLAN D
----------- ------------------------------------------- ----------- ----------
Age at Beginning Life Income with Life Income Joint &
Annuiti- In Life Income Five Years Ten Years Fifteen Years Installment Survivor
zation Year Non-Refund Certain Certain Certain Refund Non-Refund
-------- --------- ----------- ---------- --------- ------------- ----------- ----------
Age 65 2015 3.59 3.58 3.55 3.49 3.16 3.03
2020 3.53 3.52 3.49 3.43 3.13 2.98
2025 3.47 3.46 3.43 3.38 3.09 2.94
2030 3.41 3.40 3.38 3.33 3.05 2.91
2035 3.35 3.35 3.33 3.28 3.02 2.88
2040 3.30 3.30 3.28 3.24 2.99 2.85
Age 75 2015 5.30 5.24 5.03 4.66 4.19 4.22
2020 5.16 5.11 4.92 4.60 4.13 4.14
2025 5.04 4.99 4.83 4.53 4.07 4.06
2030 4.92 4.88 4.73 4.46 4.01 3.99
2035 4.82 4.78 4.65 4.40 3.96 3.92
2040 4.71 4.68 4.56 4.34 3.91 3.86
Age 85 2015 9.02 8.48 7.14 5.71 6.02 6.76
2020 8.72 8.25 7.04 5.68 5.92 6.57
2025 8.44 8.03 6.93 5.66 5.83 6.40
2030 8.19 7.83 6.83 5.63 5.74 6.24
2035 7.95 7.63 6.73 5.60 5.66 6.10
2040 7.73 7.45 6.63 5.57 5.59 5.97
Age 95 2015 17.02 13.23 8.56 5.97 9.50 12.25
2020 16.52 13.07 8.55 5.97 9.41 11.96
2025 16.06 12.91 8.54 5.97 9.33 11.70
2030 15.64 12.76 8.53 5.97 9.26 11.46
2035 15.25 12.62 8.52 5.97 9.19 11.24
2040 14.89 12.48 8.51 5.97 9.11 11.04
Age 100 2015 25.09 15.53 8.73 5.98 12.56 17.86
2020 24.91 15.51 8.73 5.98 12.54 17.77
2025 24.74 15.50 8.73 5.98 12.52 17.68
2030 24.57 15.48 8.73 5.98 12.50 17.59
2035 24.40 15.47 8.73 5.98 12.48 17.50
2040 24.24 15.46 8.73 5.98 12.46 17.42
Table B above is based on the "Annuity 2000 Mortality Table" with 100%
Projection Scale G at 1.0% annual effective interest rate. Annuity Payment rates
for any year, age, or any combination of year and age not shown above, will be
calculated on the same basis as those rates shown in the Table above. Such rates
will be furnished by Us upon request. Amounts shown in the Table below are based
on a 1.0% annual effective interest rate.
PLAN E - DOLLAR AMOUNT OF EACH MONTHLY FIXED DOLLAR ANNUITY PAYMENT
PER $1,000 APPLIED
YEARS PAYABLE MONTHLY PAYMENT YEARS PAYABLE MONTHLY PAYMENT YEARS PAYABLE MONTHLY PAYMENT
------------- --------------- ------------- --------------- ------------- ---------------
10 8.75 17 5.33 24 3.90
11 7.99 18 5.05 25 3.76
12 7.36 19 4.81 26 3.64
13 6.83 20 4.59 27 3.52
14 6.37 21 4.40 28 3.41
15 5.98 22 4.22 29 3.31
16 5.63 23 4.05 30 3.21
411333 Page 33 (1/2012)
GROUP DEFERRED ANNUITY CONTRACT
RIVERSOURCE LIFE [LOGO]
INSURANCE COMPANY
Offices:
00000 Xxxxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
- Employer Plan
- Group Deferred Annuity - Individual Allocation
- Variable Accumulation Values
- Optional Fixed Dollar or Variable Annuity Payments
- This Contract is Nonparticipating - Dividends Are Not Payable
CONTRACT DATA
Group Deferred 403(b) Annuity Contract: RiverSource(R)
Retirement Group Annuity I
Contract Number: [GRAPHIC] Contract Date: [GRAPHIC]
Contract Owner: [GRAPHIC]
Application Signed State/Contract Delivery State: [GRAPHIC]
Contract Type: Contributory Qualified Plan (Tax Sheltered Annuity)
The amounts, ages, interest rates, charges and fees shown on these Contract Data
pages apply to each Participant's Certificate Account.
Maximum Purchase Payments Permitted:
1st Certificate Year and Total*:
- Under age 86: $1,000,000
- Age 86 or older and under age 91: $ 100,000
- Age 91 or older: $ 0
Each Certificate Year thereafter:
- Under age 86: $ 100,000
- Age 86 or older and under age 91: $ 50,000
- Age 91 or older: $ 0
* The 1st Certificate year and Total amount applies to all deferred annuity
contracts and/or Certificates We have issued to a Participant.
Minimum Additional Purchase Payment: $50
We reserve the right to change this amount for Participants who enroll
under this contract on or after the date of any change. The amount will
never be less than $10 nor greater than $100.
Minimum Purchase Payment or Transfer Amount
to any Guarantee Period Account: $1,000
As of the Contract Date, accounts available for allocation of purchase payments
are the Fixed Account, Guarantee Period Accounts and variable subaccounts
investing in funds as shown below.
FIXED ACCOUNT
6-month Special DCA Fixed Account
12-month Special DCA Fixed Account
GUARANTEE PERIOD ACCOUNTS (GPA)
1 Year Guarantee Period Account
2 Year Guarantee Period Account
3 Year Guarantee Period Account
4 Year Guarantee Period Account
5 Year Guarantee Period Account
6 Year Guarantee Period Account
7 Year Guarantee Period Account
8 Year Guarantee Period Account
9 Year Guarantee Period Account
10 Year Guarantee Period Account
SUBACCOUNT FUNDS
AllianceBernstein VPS Lg Cap Gr Por Cl B
American Century VP Value Class II
Columbia VP Balanced Fund Cl 3
Columbia VP Cash Management Fund Cl 2
Columbia VP Div Equity Income Fd Cl 2
Columbia VP Diversified Bond Fund Class 2
Columbia VP Dynamic Equity Fund Class 2
Columbia VP Emerging Mkts Opport Fd Cl 2
Columbia VP Global Bond Fund Class 2
Columbia VP Global Infl Prot Sec Fd Cl 2
Columbia VP High Income Fd Cl 2
Columbia VP High Yield Bond Fund Cl 2
Columbia VP Income Opportunities Fd Cl 2
Columbia VP Intl Opportunity Fund Cl 2
Columbia VP Large Cap Growth Fund Cl 2
Columbia VP Limited Dur Credit Fd Cl 2
Columbia XX Xxxxxxx Intl Xxx Xx 2
Columbia VP Mid Cap Grwth Opport Fd Cl 2
Columbia VP Mid Cap Val Opport Fd Cl 2
Columbia VP S&P 500 Index Fund Cl 3
Columbia VP Select Lg Cap Value Fd Cl 2
Columbia VP Select Sm Cap Value Fd Cl 2
Columbia VP Short Dur US Govt Fund Cl 2
Columbia VP Strategic Income Fund Cl 2
Fidelity VIP Contrafund Port Serv Cl 2
Fidelity VIP Mid Cap Port Service Cl 2
411333-DPTSA1 Page 3.0 A(01/2012)
CONTRACT DATA - Continued
Contract Number: [GRAPHIC] Contract Date: [GRAPHIC]
SUBACCOUNT FUNDS (CONTINUED)
FTVIPT Xxxxxxxx Xx Cap Xxx Sec Fd Cl 2
FTVIPT Mutual Shares Sec Fd Cl 2
Janus Aspen Srs Janus Port Svc Shs
MFS Utilities Series Service Class
Xxxxxx Xxxxxxx UIF Mid Cap Gr Port Xx XX
Xxxxxxxxx Xxxxxx Adv Mgt Tr Soc Res Xx X
Xxxxxxxxxxx Glbl Sec Fund/VA Srv Shs
Xxxxxxxxxxx MainSt Sm&Md Cap Fund/VA SvsSh
PIMCO VIT All Asset Port Advisor Shs Cl
VP - Aggressive Portfolio Class 2
VP - Conservative Portfolio Class 2
VP - Moderate Portfolio Class 2
VP - Moderately Aggressive Port Cl 2
VP - Moderately Conservative Port Cl 2
VP AllianceBernstein Intl Val Fd Cl 2
VP American Century Div Xxxx Xx Cl 2
VP American Century Growth Fd Cl 2
VP Columbia Xxxxxx Intl Equities Fd Cl 2
VP Columbia Xxxxxx U.S. Equities Fd Cl 2
XX Xxxxx New York Venture Fund Cl 2
VP Xxxxx Xxxxx Floating-Rate Inc Fd Cl 2
XX Xxxxxxx Xxxxx Mid Cap Val Fd Cl 2
VP Invesco Intl Growth Fund Cl 2
VP X.X. Xxxxxx Core Xxxx Xx Cl 2
XX Xxxxxxxx Mid Cap Growth Fd Cl 2
XX Xxxxxxx Growth Fund Cl 2
VP MFS Value Fund Class 2
XX Xxxxxx Xxxxxxx Glbl Real Est Fd Cl 2
VP NFJ Dividend Value Fd Cl 2
VP Nuveen Xxxxxxx Xx Cap Growth Fd Cl 2
VP Partners Small Cap Growth Fd Cl 2
VP Partners Small Cap Value Fd Cl 2
VP PIMCO Mort-Backed Sec Fd Cl 2
VP Pyramis Intl Equity Fund Cl 2
XX Xxxxx Fargo Short Dur Govt Fd Cl 2
WF Advantage VT Opportunity Fd Cl 2
WF Advantage VT Small Cap Growth Fd Cl 2
Fixed Account Minimum Interest Rate: 1.00%
We reserve the right to change this percentage for Participants who enroll
under this contract on or after the date of any change. The percentage
will never be less than 1.00% nor greater than 3.00%.
MVA Risk Factor: 0.001
See Guarantee Period Accounts endorsement, MVA formula.
XXXX Benefit Age: 79
See Payments to Beneficiaries provision. We reserve the right to change
this age for Participants who enroll under this contract on or after the
date of any change. The age will never be less than 70 nor greater than
90.
Annual Mortality and Expense Risk Fee: 0.60% of the daily net asset value
We reserve the right to change this percentage for Participants who enroll
under this contract on or after the date of any change. The percentage
will never be less than 0.45% nor greater than 0.75%.
Annual Variable Account Administrative Charge: 0.00% of the daily net asset
value
We reserve the right to change this percentage for Participants who enroll
under this contract on or after the date of any change. The percentage
will not be greater than 0.20%.
Certificate Administrative Charge:
Initial Annual Charge $0
We reserve the right to adjust this charge after the first
Certificate Anniversary, but the charge will never exceed $50.
We also reserve the right to change the Initial Annual Charge
for Participants who enroll under this contract on or after
the date of any change. The minimum amount is $0, and it will
not be greater than $50.
Initial Annual Charge if contract value equals or exceeds $50,000 $0
We reserve the right to charge up to $20 after the first
Certificate Anniversary. We also reserve the right to change
the Initial Annual Charge under this waiver for Participants
who enroll under this contract on or after the date of any
change. The minimum amount is $0, and it will not be greater
than $20.
411333-DPTSA1 Page 3.1 A(01/2012)
