Exhibit 99-b.4.1
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[Aetna Logo] Aetna
Home Office: 000 Xxxxxxxxxx Xxx
Xxxxxxxx, XX 00000
(000) 000-0000
You may call the toll-free number shown
above to get answers to questions or help
to resolve a complaint.
Group Combination Annuity Contract (Nonparticipating)
This contract sets forth all the rights and obligations of
Aetna Life Insurance and Annuity Company (Aetna) and the
Contract Holder(s) (you) named on the cover. This contract
constitutes the entire contract.
Specifications
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Plan
SPECIMEN
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Type of Plan
SPECIMEN
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Contract Holder
SPECIMEN1
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Contract No.
SPECIMEN
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Effective Date
SPECIMEN
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This contract is Delivered in YOUR STATE and is Subject to the
Laws of that
Jurisdiction
Please read this contract carefully. It sets forth, in
detail, your rights and obligations and also those of Aetna
Life Insurance and Annuity Company
Right to Cancel
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The Contract Holder may cancel this Contract within 10 days of
receiving it by returning this Contract along with a written
notice to Aetna at the above address or to the agent from whom
it was purchased. Within 7 days after it receives the notice
of cancellation and this Contract at its Home Office, Aetna
will return the entire consideration paid plus any increase or
minus any decrease in the current value of any funds allocated
to the Separate Account.
2
Signed at the Home Office on the
Effective Date..
/s/Xxxxxx X. Xxxxxxx /s/Xxxxx X. Xxxxxxxxx
President Secretary
ALL PAYMENTS AND VALUES PROVIDED BY THE CONTRACT, WHEN BASED
ON INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT, ARE VARIABLE
AND ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. THIS
CONTRACT CONTAINS A MARKET VALUE ADJUSTMENT FORMULA.
APPLICATION OF A MARKET VALUE ADJUSTMENT MAY RESULT IN EITHER
AN INCREASE OR DECREASE IN THE CURRENT VALUE. THE MARKET
VALUE ADJUSTMENT FORMULA DOES NOT APPLY TO A GUARANTEED TERM
AT THE TIME OF ITS MATURITY.
Specifications
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Guaranteed There is a guaranteed interest rate for
Contributions(s) held
Interest Rate in the Fixed Plus Account and the GA Account
(see Contract Schedule I).
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Deductions There will be deductions for mortality and
expense risks and
from the administrative fees (see 3.07 and 5.07).
Separate
Account
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Deductions Contribution(s) are subject to a deduction for
premium taxes,
from if any (see 3.02).
Contribution(s)
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Withdrawal There may be a charge deducted upon withdrawal
(see Contract
Fee Schedule I).
This Contract is a legal contract. This Contract and any
attached document and subsequent endorsements constitutes the
entire legal relationship between Aetna and the Contract
Holder.
READ THIS CONTRACT CAREFULLY. This Contract sets forth, in
detail, all of the rights and obligations of both you and
Aetna. IT IS THEREFORE IMPORTANT THAT YOU READ THIS CONTRACT
CAREFULLY.
3
Table of Contents
Separate Account . . . . . . . . . . . . . . . . . . . . . 7
Separate Account: . . . . . . . . . . . . . . . . . . 7
Charges to Separate Account: . . . . . . . . . . . . . 7
Fixed Plus Account . . . . . . . . . . . . . . . . . . . . 7
Minimum Guaranteed Interest Rate: . . . . . . . . . . 7
Partial Withdrawal: . . . . . . . . . . . . . . . . . 7
Full Withdrawal: . . . . . . . . . . . . . . . . . . . 7
Guaranteed Accumulation Account (GA Account) . . . . . . . 8
Minimum Guaranteed Interest Rate: . . . . . . . . . . 8
Separate Account and GA Account . . . . . . . . . . . . . . 8
Withdrawal Fee: . . . . . . . . . . . . . . . . . . . 8
Separate Account, GA Account and Fixed Plus Account . . . . 9
Transfers: . . . . . . . . . . . . . . . . . . . . . . 9
Maintenance Fee: . . . . . . . . . . . . . . . . . . . 9
Systematic Withdrawal Option (SWO): . . . . . . . . . 9
Loan Interest Rate: . . . . . . . . . . . . . . . . . 9
Separate Account . . . . . . . . . . . . . . . . . . . . . 11
Charges to Separate Account: . . . . . . . . . . . . . 11
Variable Annuity Assumed Annual Net Return Rate: . . . 11
Annuity Option 2: . . . . . . . . . . . . . . . . . . 11
Xxxxx Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . 11
Minimum Guaranteed Interest Rate: . . . . . . . . . . 11
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 13
1.01 Accumulation Period: . . . . . . . . . . . . . . 13
1.02 Adjusted Current Value: . . . . . . . . . . . . . 13
1.03 Annuitant: . . . . . . . . . . . . . . . . . . . 13
1.04 Annuity: . . . . . . . . . . . . . . . . . . . . 13
1.05 Beneficiary: . . . . . . . . . . . . . . . . . . 13
1.06 Code: . . . . . . . . . . . . . . . . . . . . . 13
1.07 Contract Holder: . . . . . . . . . . . . . . . . 13
1.08 Contribution: . . . . . . . . . . . . . . . . . . 13
1.09 Current Value: . . . . . . . . . . . . . . . . . 13
1.10 Deposit Period: . . . . . . . . . . . . . . . . . 14
1.11 Fixed Plus Account: . . . . . . . . . . . . . . . 14
1.12 Fixed Plus Account Guaranteed Interest Rate: . . 14
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1.13 Fixed Annuity: . . . . . . . . . . . . . . . . . 14
1.14 Fund(s): . . . . . . . . . . . . . . . . . . . . 14
1.15 General Account: . . . . . . . . . . . . . . . . 14
1.16 Guaranteed Accumulation Account (GA Account): . . 14
1.17 GA Account Guaranteed Interest Rate: . . . . . . 14
1.18 Guaranteed Term (Term): . . . . . . . . . . . . . 15
1.19 Individual Account: . . . . . . . . . . . . . . . 15
1.20 Loan Account: . . . . . . . . . . . . . . . . . . 15
1.21 Loan Effective Date: . . . . . . . . . . . . . . 15
1.22 Loan Interest Rate: . . . . . . . . . . . . . . . 15
1.23 Maintenance Fee: . . . . . . . . . . . . . . . . 15
1.24 Market Value Adjustment (MVA): . . . . . . . . . 15
1.25 Matured Term Value: . . . . . . . . . . . . . . . 15
1.26 Matured Term Value Transfer: . . . . . . . . . . 16
1.27 Maturity Date: . . . . . . . . . . . . . . . . . 16
1.28 Monthly Average Corporates: . . . . . . . . . . . 16
1.29 Net Contribution: . . . . . . . . . . . . . . . . 16
1.30 Nonunitized Separate Account: . . . . . . . . . . 16
1.31 Participant: . . . . . . . . . . . . . . . . . . 16
1.32 Plan: . . . . . . . . . . . . . . . . . . . . . . 16
1.33 Reinvestment: . . . . . . . . . . . . . . . . . . 16
1.34 Separate Account: . . . . . . . . . . . . . . . . 17
1.35 Transfer: . . . . . . . . . . . . . . . . . . . . 17
1.36 Transferred Assets: . . . . . . . . . . . . . . 17
1.37 Valuation Period: . . . . . . . . . . . . . . . . 17
1.38 Variable Annuity: . . . . . . . . . . . . . . . . 17
1.39 Withdrawal Fee: . . . . . . . . . . . . . . . . . 17
II. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . 17
2.01 Change of Contract: . . . . . . . . . . . . . . . 17
2.02 Change of Fund: . . . . . . . . . . . . . . . . . 18
2.03 Nonparticipating Contract: . . . . . . . . . . . 18
2.04 Payments: . . . . . . . . . . . . . . . . . . . . 18
2.05 State Laws: . . . . . . . . . . . . . . . . . . . 18
2.06 Control of Contract: . . . . . . . . . . . . . . 18
2.07 Designation of Beneficiary: . . . . . . . . . . . 19
2.08 Misstatements and Adjustments: . . . . . . . . . 19
2.09 Incontestability: . . . . . . . . . . . . . . . . 20
2.10 Grace Period: . . . . . . . . . . . . . . . . . . 20
2.11 Individual Certificates: . . . . . . . . . . . . 20
2.12 Aggregation of Contracts: . . . . . . . . . . . . 20
III. CONTRIBUTIONS, CURRENT VALUE, AND WITHDRAWAL PROVISIONS 20
3.01 Individual Account: . . . . . . . . . . . . . . . 20
3.02 Net Contribution(s): . . . . . . . . . . . . . . 20
3.03 Limitation on Contributions: . . . . . . . . . . 21
3.04 Experience Credits: . . . . . . . . . . . . . . . 21
3.04 Fund Record Units: . . . . . . . . . . . . . . . 21
3.05 Fund Record Unit Value: . . . . . . . . . . . . 21
3.06 Fund Net Return Factors: . . . . . . . . . . . . 21
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3.07 Market Value Adjustment (MVA): . . . . . . . . . 22
3.08 Transfer(s): . . . . . . . . . . . . . . . . . . 23
3.09 Notice to the Contract Holder: . . . . . . . . . 23
3.10 Loans: . . . . . . . . . . . . . . . . . . . . . 24
3.11 Xxxxxx and Timing of Distributions: . . . . . . . 25
3.12 Withdrawal: . . . . . . . . . . . . . . . . . . . 26
3.13 Withdrawal Value: . . . . . . . . . . . . . . . . 26
3.14 Withdrawal Restrictions: . . . . . . . . . . . . 26
3.15 Withdrawals from the GA Account: . . . . . . . . 27
3.16 Withdrawal Fee Applicable to Funds and GA Account: 27
3.17 Payment of Fixed Plus Account Full Withdrawal: . 28
3.18 Reinstatement: . . . . . . . . . . . . . . . . . 28
3.19 Payment of Minimum Current Value: . . . . . . . . 28
3.20 Amount Payable at Death (Before Annuity Payments
Start): . . . . . . . . . . . . . . . . . . . . . . . 28
IV. NON-ANNUITY DISTRIBUTION OPTIONS . . . . . . . . . . . 29
4.01 Distribution Options: . . . . . . . . . . . . . . 29
4.02 Estate Conservation Option: . . . . . . . . . . . 29
4.03 Systematic Withdrawal Option: . . . . . . . . . . 30
V. ANNUITY PROVISIONS . . . . . . . . . . . . . . . . . . . 32
5.01 Choices: . . . . . . . . . . . . . . . . . . . . 32
5.02 Terms of Annuity Options: . . . . . . . . . . . . 33
5.03 Annuity Payments to Annuitant: . . . . . . . . . 33
5.04 Death Provision: . . . . . . . . . . . . . . . . 33
5.05 Fund Annuity Units: . . . . . . . . . . . . . . . 34
5.06 Fund Annuity Unit Value: . . . . . . . . . . . . 34
5.07 Fund Annuity Net Return Factor: . . . . . . . . . 34
5.08 Annuity Options: . . . . . . . . . . . . . . . . 34
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Contract Schedule I
Level A
Accumulation Period
Separate Account
______________________________________________________________
Separate Account:
Variable Annuity Account C
Charges to Separate Account:
A daily charge is deducted from any portion of the
Current Value allocated to the Separate Account. The
charge is determined by the value of total assets held by
Aetna under this Contract and other Aetna contracts of
the same class, on each anniversary date of this
Contract. The daily charge for Annuity mortality and
expense risk and profit (M & E) will be adjusted (up or
down) no less often than annually to reflect changes in
the Current Value of all Plan Accounts. The charge will
include a daily administrative charge which will not
exceed [0.25%] on an annual basis.
Total Assets M & E Administrative Charge
(annual effective rate)(annual effective rate)
_______________________________________________________
Less than $500,000 1.25%0.25%
500,000 - 1,000,000 1.25%0.25%
1,000,001 - 5,000,000 1.25%0.25%
5,000,001 - 15,000,000 1.25%0.25%
Greater than 15,000,000 1.25%0.25%
Initial Charges will be based on Aetna's estabed year
end asset level for the Contract Holder
Fixed Plus Account
______________________________________________________________
Minimum Guaranteed Interest Rate:
[3%] (effective annual rate of return).
Beginning on the tenth anniversary of the effective
date of an Individual Account, Aetna will credit
amounts with an interest rate that is at least 0.25%
higher than the then declared interest rate for
Individual Accounts before the tenth anniversary.
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Partial Withdrawal:
The [20%] annual limit applicable to a partial
withdrawal from the Fixed Plus Accounts will be waived
when the withdrawal is:
a) due to the Participant's death (within [six (6)]
months of the Participant's date of death), before
Annuity benefit payments begin; or
b) used to purchase Annuity benefits.
Full Withdrawal:
The Payment of Fixed Plus Account Full Withdrawal
provision will be waived when the withdrawal is:
a) Due to the Participant's death before Annuity
payments begin and request for payment is received
within six (6) months after the Participant's date
of death;
b) Used to purchase Annuity benefits; or
c) When the amount in the Fixed Plus Account is
$3,500 or less and no amount has been surrendered,
transferred, taken as a loan or used to purchase
Annuity benefits during the prior 12 months.
Guaranteed Accumulation Account (GA Account)
______________________________________________________________
Minimum Guaranteed Interest Rate:
[3%] (effective annual rate of return).
Separate Account and GA Account
______________________________________________________________
Withdrawal Fee:
Length of Time from Individual
Account(s) Effective Date (Years)Withdrawal Fee
Fewer than 5 5%
5 or more, but fewer than 7 5%
7 or more, but fewer than 9 5%
9 or more, but fewer than 10 5%
10 or more 5%
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The withdrawal fee will not be deducted from any
portion of the Individual Account(s) Current Value
which is paid:
- Due to the Participant's death before Annuity
payments begin;
- Used to purchase Annuity benefits;
- Due to the election of the Estate Conservation
Option (ECO) or the Systematic Withdrawal Option
(SWO) (see Section IV);
- In an amount equal to or less than [10%] of the
Individual Account Current Value, as part of the
first partial withdrawal request in a calendar
year to a Participant who is at least age 59 1/2
and less than 70 1/2. The Individual Account
Current Value is calculated as of the date the
partial withdrawal request is received in good
order at Aetna's Home Office. Any outstanding
loans from the Individual Account are excluded
when calculating the Individual Account Current
Value. This provision does not apply to partial
withdrawal due to loan defaults made from the
Individual Account and does not apply to full
withdrawal requests. This provision may not be
exercised if SWO is elected;
- When the Individual Account(s) Current Value is
[$3,500] or less and no amount has been withdrawn,
taken as a loan or used to purchase Annuity
benefits during the prior [12] months;
- To relieve a Participant's "financial hardship,"
as may be allowed for annuity contracts under
Section 403(b) of the Code or other applicable
Internal Revenue Service rules or regulations; or
- On account of a Participant's separation from
service. The Contract Holder must submit
documentation satisfactory to Aetna to confirm
that the Participant is no longer providing
services to the employer.
- The withdrawal fee will never exceed 8 1/2% of the
total Contributions made to the Individual
Account.
Separate Account, GA Account and Fixed Plus Account
______________________________________________________________
Transfers:
An unlimited number of Transfers may be made during the
Accumulation Period.
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Maintenance Fee:
An annual Maintenance Fee may be charged, as determined
by the value of total assets held by Aetna under this
Contract and other Aetna contracts of the same class,
on each anniversary date of this Contract. The
Maintenance Fee may go up or down each year. Where
applicable, the Maintenance Fee will be charged for
each Participant in the Contract.
Total Assets Maintenance Fee
______________________________________________________________
Less than $500,000 $25.00
500,000 - 1,000,000 $25.00
1,000,001 - 5,000,000 $25.00
5,000,001 - 15,000,000 $25.00
Greater than 15,000,000 $25.00
Initial charges will be based on Aetna's estimated year
end asset level for the Contract Holder
Systematic Withdrawal Option (SWO):
The Specified Payment or Specified Percentage may not
be greater than 20% of the Individual Account's Current
Value at the time of election. The Specified Period may
not be less than 5 years.
Loan Interest Rate:
a) Plans subject to ERISA: a Loan Interest Rate is
set on the first business day of each month. For
each loan, the initial Loan Interest Rate is equal
to the Monthly Average Corporates for the calendar
month beginning two months before the calendar
month in which the Loan Effective Date occurs.
The initial Loan Interest Rate is effective for a
period of not less than three months and not more
than one year. The period is specified in the
loan agreement. For each period, the Loan
Interest Rate is adjusted if the new rate is at
least [0.5%] higher or lower than the previous
rate. The Participant will receive reasonable
notification of any change to the Loan Interest
Rate.
b) Plans not subject to ERISA: [6%] on an annual
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basis.
See Section I. - DEFINITIONS for explanations.
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Contract Schedule II
Annuity Period
Separate Account
______________________________________________________________
Charges to Separate Account:
A daily charge at an annual effective rate of 1.25% for
mortality and expense risk and profit (M&E) is deducted
from any portion of the Current Value allocated to a
Variable Annuity. The administrative charge is
established upon election of an Annuity option. This
charge will not exceed [0.25%].
Variable Annuity Assumed Annual Net Return Rate:
If a Variable Annuity is chosen, an assumed annual net
return rate of [5.0%] may be elected. If [5.0%] is not
elected, Aetna will use an assumed annual net return
rate of [3.5%].
The daily net return rate factor for an assumed annual
net return rate [3.5%] per year is [0.9999058].
The daily net return rate factor for an assumed annual
net return ate [5.0%] per year is [0.9998663].
If the portion of a Variable Annuity payment for any
Fund is not to decrease, the Annuity return factor
under the Separate Account for that Fund must be:
a) [4.75%] on an annual basis plus an annual return
of up to [0.25%] to offset the administrative
charge set at the time Annuity payments commence
if an assumed annual net return rate of [3.5%] is
chosen; or
b) [6.25%] on an annual basis plus an annual return
of up to [0.25%] to offset the administrative
charge set at the time Annuity payments commence,
if an assumed annual net return rate of [5%] is
chosen.
Annuity Option 2:
For amounts invested in the GA Account or one or more
of the Fund(s), the number of years must be at least
[five (5)] and not more than [thirty (30)] and the
Annuity may be a Fixed or Variable Annuity.
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For amounts invested in the Fixed Plus Account, the
number of years must be at least [five (5)] and not
more than [thirty (30)] and the Annuity must be a Fixed
Annuity.
Fixed Annuity
______________________________________________________________
Minimum Guaranteed Interest Rate:
[3.0%] (effective annual rate of return).
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Definitions
______________________________________________________________
1.01 Accumulation Period:
The period during which Net Contribution(s) are
applied to an Individual Account.
1.02 Adjusted Current Value:
The Current Value (See 1.09) of an Individual
Account (See 1.19 and 3.01) plus or minus any
applicable aggregate GA Account Market Value
Adjustment, if applicable (See 3.08).
1.03 Annuitant:
A person on whose life an Annuity payment is based
under this Contract.
1.04 Annuity:
Payment of an income under the Annuity Provisions
of Section V:
a) For the life of one or two persons;
b) For a stated period; or
c) For some combination of (a) and (b).
Upon certification by the employer of the
Participant's total disability, acceptance of
retirement or termination of employment, the
Participant has the right to elect an Annuity
Option. Upon written direction from the Employer,
Aetna will pay annuity benefits directly to the
Participant and as payor, Aetna will be
responsible for withholding any applicable federal
or state taxes and reporting such sums and filing
any related forms with the Internal Revenue
Service and/or to any applicable state taxing
authorities. In the event of the death of the
Participant, Aetna will distribute the accumulated
balance of the deceased Participant's Individual
Account, without surrender charges, as previously
directed by the electing Participant, or in the
absence of such directions, as directed by the
Participant's beneficiary.
1.05 Beneficiary:
The person named to receive any benefits which
remain under the Contract after the Participant's
death. The Contract Holder is the Contract
Beneficiary. Participants designate a Plan
beneficiary for their Individual Accounts.
1.06 Code:
The Internal Revenue Code of 1986, as amended.
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1.07 Contract Holder:
The entity, named on the cover of this Contract,
to which the Contract is issued.
1.08 Contribution:
A payment received at Aetna's Home Office and
allocated to this Contract.
1.09 Current Value:
For an Individual Account (See 1.19), the Current
Value is the total of:
a) The amount, if any, in the Fixed Plus
Account, with interest earned to date;
b) The amount, if any, in the GA Account, with
interest earned to date; and
c) The value of all Fund Record Units (See
3.05), if any, as of the most recent
Valuation Period; plus
d) Any amount due to experience credits; less
e) Any Maintenance Fee(s) due.
1.10 Deposit Period:
A calendar month, a calendar quarter, or any other
period of time specified by Aetna during which Net
Contribution(s), Transfers and Reinvestments are
accepted into the GA Account for one or more
Terms.
1.11 Fixed Plus Account:
An accumulation option with a guaranteed minimum
interest rate. Aetna may credit a higher rate
which is not guaranteed. No withdrawal fee
applies. However, the portion that may be
withdrawn or transferred in a 12 month period is
restricted (See 3.09, 3.18 and 3.19).
1.12 Fixed Plus Account Guaranteed Interest Rate:
Aetna will add interest daily at an annual rate no
less than that shown on Contract Schedule I on any
Net Contribution(s) to the Fixed Plus Account.
Aetna may add interest daily at a higher rate
determined by its Board of Directors.
1.13 Fixed Annuity:
An Annuity with payments that do not vary in
amount.
1.14 Fund(s):
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The open-end registered management investment
companies (mutual funds) in which the Separate
Account invests.
1.15 General Account:
The account holding the assets of Aetna, other
than those assets held in Aetna's Separate
Account(s) and Nonunitized Separate Account(s).
1.16 Guaranteed Accumulation Account (GA Account):
An accumulation option where Aetna guarantees
stipulated rate(s) of interest for a specified
period of time. All assets of Aetna, including
amounts in the Nonunitized Separate Account, are
available to meet the guarantees for the GA
Account.
1.17 GA Account Guaranteed Interest Rate:
Aetna will declare the interest rate(s) applicable
to a specific Guaranteed Term at the start of the
Deposit Period for that Guaranteed Term. The
rate(s) are guaranteed by Aetna for that Deposit
Period and the ensuing Guaranteed Term. The
Guaranteed Interest Rates are annual effective
yields. That is, interest is credited daily at a
rate that will produce the Guaranteed Interest
Rate over the period of a year. No Guaranteed
Interest Rate will ever be less than the Minimum
Guaranteed Interest Rate shown on Contract
Schedule I.
For Guaranteed Terms of one year or less, one
Guaranteed Interest Rate is credited for the full
Guaranteed Term. For longer Guaranteed Terms, an
initial Guaranteed Interest Rate is credited from
the date of deposit to the end of a specified
period within the Guaranteed Term. There may be
different Guaranteed Interest Rate(s) declared for
subsequent specified time intervals throughout the
Guaranteed Term.
1.18 Guaranteed Term (Term):
The period of time for which GA Account Guaranteed
Rates are guaranteed on Net Contributions,
Transfers and Reinvestments made into a current
Deposit Period for the GA Account. Such period
begins on the day following the close of the
Deposit Period and ends on the designated Maturity
Date. Guaranteed Terms are offered at Aetna's
19
discretion for various lengths of time ranging up
to and including ten years and are classified as
follows:
Short Term: Three (3) or fewer years. Amounts
allocated to a short Term are held in the General
Account.
Long Term: More than three (3) years, but not more
than ten (10). Amounts allocated to a long Term
are held in the Nonunitized Separate Account.
During a Deposit Period, Aetna may make available
any number of Guaranteed Terms. The Contract
Holder, or Participant, if authorized in writing
by the Contract Holder, may allocate Net
Contributions and Transfers into any or all of the
available Guaranteed Terms.
1.19 Individual Account:
Account(s) established, as directed by the
Contract Holder, for each Participant to keep a
record of Current Value (See 1.09) and
transactions.
1.20 Loan Account:
For each loan taken by a Participant, the loan
amount transferred from the investment options is
credited to the Loan Account.
1.21 Loan Effective Date:
The date of on which Aetna receives a loan
agreement in good order at its Home Office.
1.22 Loan Interest Rate:
The interest rate Aetna charges on a loan(see
Contract Schedule I).
1.23 Maintenance Fee:
The Maintenance Fee will be deducted during the
Accumulation Period from the sum of the Current
Value of Participant's Individual Accounts (see
2.12 Aggregation of Contracts) and upon full
surrender of the Participant's Individual
Accounts, unless otherwise directed by the
Contract Holder. The Maintenance Fee for
Individual Accounts will be as established for the
Contract on Contract Schedule I. The Maintenance
Fee is deducted on a pro rata basis from all
20
options used under a Participant's Individual
Account. However, the Maintenance Fee does not
apply to each separate Individual Account
established for purposes of a lump sum
Contribution.
1.24 Market Value Adjustment (MVA):
An adjustment to the amount prematurely withdrawn
or Transferred from a GA Account Guaranteed Term
prior to the end of that Guaranteed Term. The
adjustment reflects the change in the value of the
investment due to changes in interest rates since
the date of deposit and is computed using the
formula given in 3.08. The adjustment is expressed
as a percentage of each dollar being withdrawn.
1.25 Matured Term Value:
The amount payable on a GA Account Guaranteed
Term's Maturity Date.
1.26 Matured Term Value Transfer:
During the calendar month following a GA Account
Maturity Date, the Contract Holder, or Participant
if authorized in writing by the Contract Holder,
may notify Aetna's Home Office in writing to
Transfer or withdraw all or part of the Matured
Term Value, plus interest at the new Guaranteed
Interest Rate accrued thereon, from the GA Account
without an MVA. This provision only applies to the
first such written request received from the
Contract Holder, or Participant if authorized in
writing by the Contract Holder, during this period
for any Matured Term Value.
1.27 Maturity Date:
The last day of a GA Account Guaranteed Term.
1.28 Monthly Average Corporates:
Moody's Corporate Bond Yield Average-Monthly
Average Corporates published by Xxxxx'x Investors
Service, or its successor, or a substantially
similar average as may be allowed by law or
regulation.
1.29 Net Contribution:
A Contribution less any applicable premium taxes.
21
1.30 Nonunitized Separate Account:
An account established by Aetna under Section 38a-
433 of the Connecticut General Statutes that holds
assets for GA Account Terms (See 1.18) greater
than three years. The Contract Holder and/or
Participant does not participate in the investment
gain or loss from the assets held in the
Nonunitized Separate Account. Such gain or loss is
borne entirely by Aetna. Assets in this account
may be charged with liabilities arising out of any
other Aetna business.
1.31 Participant:
A person who participates in the Plan of the
Contract Holder named on the cover of this
Contract.
1.32 Plan:
The Plan, named on the cover of this Contract,
established under Code Section 403(b). The Plan is
not a part of the Contract and Aetna is not bound
by its terms.
1.33 Reinvestment:
Aetna will mail a notice to the Contract Holder,
or Participant if applicable, at least eighteen
(18) calendar days before a Guaranteed Term's
Maturity Date. This notice will contain the Terms
available during the current Deposit Periods with
their Guaranteed Interest Rate(s) and projected
Matured Term Value. If no specific direction is
given by the Contract Holder or Participant, if
applicable, prior to the Maturity Date, each
Matured Term Value will be reinvested in the
current Deposit Period for a Guaranteed Term of
the same duration. If a Guaranteed Term of the
same duration is unavailable, each Matured Term
Value will automatically be reinvested in the
current Deposit Period for the next shortest
Guaranteed Term available in the same
classification. If no shorter Guaranteed Term is
available, the next longer Guaranteed Term will be
used. Aetna will mail a confirmation statement to
the Contract Holder or Participant, if applicable,
the next business day after the Maturity Date.
This notice will state the Guaranteed Term and
Guaranteed Interest Rate(s) which will apply to
22
the reinvested Matured Term Value.
1.34 Separate Account:
An account, established by Aetna under Section
38a-433 of the Connecticut General Statutes, that
buys and holds shares of the Fund(s) available
under this Contract. Income, gains or losses,
realized or unrealized are credited or charged to
the Separate Account without regard to other
income, gains or losses of Aetna. Aetna owns the
assets held in the Separate Account and is not a
trustee of such amounts. Amounts in the Separate
Account are not generally guaranteed and are held
at market value. The assets of the Separate
Account, to the extent of reserves and other
contract liabilities of the Account, cannot be
charged with other Aetna liabilities arising out
of any other Aetna business.
1.35 Transfer:
The movement of invested amounts among the
available Fund(s); the Fixed Plus Account and the
GA Account during the Accumulation Period.
1.36 Transferred Assets:
Transferred Assets are the value of prior
contributions with another carrier into an
existing Plan which are deposited into this
Contract as of the date the amount is received in
good order by Aetna. Transferred Assets, less any
premium tax, will be allocated to Participant
Individual Accounts in amounts authorized by the
Contract Holder.
1.37 Valuation Period:
The period of time commencing at the end of one
valuation date and ending at the end of the next
valuation date.
1.38 Variable Annuity:
An Annuity with payments that vary with the net
investment results of the Funds available during
the Annuity period.
1.39 Withdrawal Fee:
If all or any portion of an Individual Account
23
Value is withdrawn during the Accumulation Period,
a percentage of the amount withdrawn may be
deducted so that the Aetna may recover sales and
administrative related expenses.
II. GENERAL PROVISIONS
______________________________________________________________
2.01 Change of Contract:
Only an authorized officer of Aetna may change the
terms of this Contract. Aetna reserves the right
to modify this Contract to meet the requirements
of applicable state and federal laws or
regulations. Aetna will notify the Contract Holder
and Certificate Holder in writing of any changes.
Aetna may change the tables for determining the
amount of Annuity benefit payments without
Contract Holder consent. Such a change will not
become effective earlier than twelve months after
(1) the effective date of the Contract, or (2) the
effective date of a previous change. Aetna will
notify the Contract Holder in writing at least
thirty (30) days before the effective date of the
change. The change will apply to all current and
future Individual Accounts.
2.02 Change of Fund:
Aetna, or the Separate Account may:
a) Change the Fund(s) in which the Separate
Account invests; and/or
b) Replace the shares of any Fund(s) held in the
Separate Account with shares of any other
Fund(s).
Changes must be:
a) Approved by a majority vote in the Separate
Account with respect to the Fund(s) whose
shares are to be replaced
b) Deemed necessary by Aetna under the
Investment Company Act of 1940; or
c) Deemed necessary by Aetna to accomplish the
purpose of the Separate Account.
Aetna will notify the Contract Holder of any such
change.
24
2.03 Nonparticipating Contract:
The Contract Holder, Participants, or
Beneficiaries will not have a right to share in
the earnings of Aetna.
2.04 Payments:
a) Aetna will make distributions as directed by
the Contract Holder. Aetna will determine the
amount of payments based on the Individual
Account Current Value as of the date on which
a request is received in good order at
Aetna's Home Office. Payments will be made
within seven (7) calendar days of receipt of
a written request in good order at Aetna's
Home Office.
b) Aetna may defer payments:
1) for a period of up to six (6) months
(unless not allowed by state law); and
2) as allowed by federal law.
2.05 State Laws:
This Contract complies with the laws of the state
in which it is delivered. Any cash, death or
Annuity payments are equal to or greater than the
minimum required by such laws. Annuity tables for
legal reserve valuation shall be as required by
state law. Such tables may be different from
Annuity tables used to determine Annuity payments.
2.06 Control of Contract:
The Contract Holder, or authorized designee of the
Contract Holder, may make any choices allowed
under this Contract with respect to Individual
Accounts. Any choices made under this Contract
must be in writing. Until receipt of any such
written choice at its Home Office, Aetna may rely
on any prior choices made. Neither the Contract
nor any Individual Account is subject to the
claims of Participants' creditors, except to the
extent permitted by law.
With respect to Transfers and allocation of Net
Contributions, the Contract Holder may authorize
Aetna in writing to accept written directions
directly from Participants. The Contract Holder
may also authorize Transfers and allocation
25
changes to be made by Participants over the
telephone services made available by Aetna.
The Contract Holder may, by written direction to
Aetna, allow Participants to select the investment
options of the Employer Account and/or the
Employee Account. No distributions will be made
from the Employer Account or the Employee Account
without the Contract Holder's and Participant's
written direction to Aetna, unless otherwise
directed by the Plan. An in-service transfer
pursuant to IRS Revenue Ruling 90-24, subject to
any applicable withdrawal fee, may be made only by
written direction from the Contract Holder and
Participant to Aetna, unless otherwise specified
by the Plan. Checks for in-service transfers will
be made payable only to the acquiring investment
provider. Participants have no rights to direct
Aetna as to payments under the Contract unless
countersigned by the Contract Holder.
a) Nontransferable and Nonassignable:
This Contract and any Individual Accounts are
nontransferable and nonassignable, except to
Aetna in the event of a loan or pursuant to a
"qualified domestic relations order" as set
forth under the Retirement Equity Act of 1984
(REA). In the event a loan is requested, the
Current Value of the Employee Account
necessary to cover the loan amount plus
interest must be assigned to Aetna.
b) ERISA/REA Requirements:
The Contract Holder shall notify Aetna in
writing of the applicability of Title I of
the Employee Retirement Income Security Act
of 1974 (ERISA), as amended by subsequent law
including XXX, to the Plan. Aetna shall rely
on the Contract Holder's determination and
representation of applicability. With respect
to any distribution made from an Employee or
Employer Account from a Contract subject to
ERISA, the Contract Holder must certify in
writing that all the appropriate REA
requirements have been met and that the
distribution is in accordance with the terms
of the Plan.
c) Participant Rights/Employee Account:
The Participant has a nonforfeitable right to
the value of his or her Employee Account
pursuant to Code Section 403(b) and the terms
of the Plan as interpreted by the Contract
Holder (see 1.07). The Contract Holder and
Participant will jointly make all choices
26
under the Contract for the Employee Account.
d) Participant Rights/Employer Account:
The Participant has a nonforfeitable right to
the value of his or her Employer Account
pursuant to the terms of, and to the extent
of his or her vested percentage under, the
Plan as interpreted by the Contract Holder.
It is the Contract Xxxxxx's responsibility to
maintain records of the Participant's vesting
percentages. Aetna will not maintain such
records. The Contract Holder will make all
choices under the Contract for the Employer
Account, except as otherwise provided in this
Contract.
The Contract Holder and each Participant
hereunder have agreed in writing to the above
terms and conditions, except as otherwise
provided, to have the Contract Holder make
all choices under the Contract, except as
otherwise provided, and to be bound by the
Contract Holder's directions to Aetna. The
Contract Xxxxxx's and Participant's
signatures are required for each request for
a distribution.
2.07 Designation of Beneficiary:
The Contract Holder is the Beneficiary under this
Contract. The Participant designates a beneficiary
with the employer, pursuant to the terms of the
Plan.
2.08 Misstatements and Adjustments:
If Aetna finds the age of any payee to be
misstated, the correct facts will be used to
adjust payments.
2.09 Incontestability:
Aetna cannot cancel this Contract because of any
error of fact on the application.
2.10 Grace Period:
This Contract will remain in effect even if
Contributions are not continued except as provided
in 3.21.
2.11 Individual Certificates:
Aetna shall issue certificates to the Contract
Holder or Participants as required by the state in
which this Contract is delivered. The certificate
will summarize certain provisions of the Contract.
27
Certificates are for information only and are not
a part of the Contract.
2.12 Aggregation of Contracts:
The Charges to the Separate Account and
Maintenance Fee described in Contract Schedule I
vary by the Current Value of Individual Accounts.
In determining such Current Value, Individual
Accounts of the following contracts will be
aggregated:
a) this Contract, and
b) Aetna contracts of the same class as this
Contract covering employees of the employer
maintaining the Plan.
For purposes of determining the Daily Asset Charge
and Maintenance Fee under this Contract, where
such other contract comes into existence after the
Effective Date, the aggregation will commence no
later than the first day of the next succeeding
anniversary date. Where such other contract is in
existence prior to, or on the Effective Date, the
aggregation will commence on the Effective Date.
III. CONTRIBUITIONS, CURRENT VALUE, AND WITHDRAWAL PROVISIONS
______________________________________________________________
3.01 Individual Account:
Aetna will maintain Individual Accounts for Plan
Participants as directed by the Contract Holder.
The Individual Accounts may be as follows:
a) Employer Account: This Individual Account
will be credited with employer Contributions;
and
b) Employee Account: This Individual Account
will be credited with employee Contributions,
specifically employee salary reduction
contributions.
The Contract Holder may make one or more lump sum
Contribution(s) on behalf of one or more
Participants. Aetna will establish a separate
Individual Account for each lump sum Contribution
made, of more than a minimum amount stated by
Aetna, on behalf of a Participant for whom an
Individual Account exists at the time the lump sum
Contribution is made. Such Individual Account(s)
will be designated as Employer Accounts or
28
Employee Accounts as instructed by the Contract
Holder.
Aetna reserves the right not to accept any
contibution.
3.02 Net Contribution(s):
The Net Contribution equals the actual
Contribution less any applicable premium tax.
Generally, Aetna will deduct the premium tax when
Annuity benefits are purchased (See Section V). If
Aetna determines that under applicable state law,
it must pay a premium tax when the Contribution is
received, or at any other time, it may deduct the
tax at that time. The Net Contribution(s) may be
allocated among the following investment options:
a) The Fixed Plus Account; and
b) The current Deposit Period(s) for Guaranteed
Terms under the GA Account; and
c) The Fund(s) in which the Separate Account
invests.
The Contract Holder must tell Aetna the percentage
of all Net Contributions to allocate to one or
more of the investment options. The Contract
Holder or, if permitted by the Contract Holder,
the Participant may change the allocation of
future Net Contributions at any time, without
charge. Aetna reserves the right to require a
minimum Contribution amount per Individual
Account.
3.03 Limitation on Contributions:
The Contribution(s) made to a Participant's
Individual Account(s) in any year cannot exceed
the lesser of the amount determined under the
exclusion allowance of Code Section 403(b)(2) or
the annual additions limitation of Code Section
415(c)(1).
In addition, in no event may the Contribution(s)
attributable to elective deferrals as defined in
Code Section 402(g) exceed $9,500 (or, such larger
amount as adjusted by the Secretary of the
Treasury) during any calendar year, unless the
alternate limitation of Code Section 402(g)(8)
applies.
29
3.04 Experience Credits:
Aetna may apply experience credits under this
Contract. Any such credits will be computed as
decided by Aetna.
3.04 Fund Record Units:
The portion of the Net Contribution(s) applied to
each Fund under the Separate Account will
determine the number of Fund Record Units credited
to the Individual Account for that Fund. This
number is equal to the Net Contribution applied to
the Fund divided by the Fund Record Unit Value
(See 3.06) for the Valuation Period in which the
Contribution is received in good order.
3.05 Fund Record Unit Value:
A Fund Record Unit Value is computed by
multiplying the Net Return Factor (See 3.07) for
the current Valuation Period by the Fund Record
Unit Value for the previous Period. The dollar
value of a Fund Record Unit, Separate Account
assets, and Variable Annuity payments may go up or
down due to investment gain or loss.
3.06 Fund Net Return Factors:
The Net Return Factor(s) are used to compute all
Separate Account record units for any Fund. The
Net Return Factor for each Fund is equal to
1.0000000 plus the Net Return Rate.
The Net Return Rate is equal to:
a) The value of the shares of the Fund held by
the Separate Account at the end of a
Valuation Period; minus
b) The value of the shares of the Fund held by
the Separate Account at the start of the
Valuation Period; plus or minus
c) Taxes (or reserves for taxes) on the Separate
Account (if any);
d) Divided by the total value of the Fund Record
Units and Fund Annuity Units of the Separate
Account at the start of the Valuation Period;
e) Minus a Separate Account charge at an annual
effective rate as shown on Contract Schedule
I for Annuity mortality and expense risks and
30
profit and a daily administrative charge
which will not exceed the amount shown on
Contract Schedule I on an annual basis. The
administrative charge may be changed annually
except for amounts which have been used to
purchase an Annuity.
A net return rate may be more or less than 0%.
The value of a share of the Fund is equal to the
net assets of the Fund divided by the number of
shares outstanding.
3.07 Market Value Adjustment (MVA):
a) An MVA will be applied to any withdrawal from
a GA Account Term before the Maturity Date
due to:
1) A Transfer;
2) A full or partial withdrawal;
3) A payment of a premium for Annuity
Option 2.
The amount of the withdrawal will be adjusted to a
market value amount as described in
b) Market value adjusted amounts will be equal
to the amount withdrawn multiplied by the
following ratio:
x
______
365
(1 + 1)
________________
x
______
365
(1 + j)
Where:
i is the Deposit Period Yield
j is the Current Yield
x is the number of days remaining, (computed from
Wednesday of the week of withdrawal) in the Term.
c) The Deposit Period Yield and Current Yield
will be determined as follows:
1) At the close of the last business day of
each week of the Deposit Period, a yield
will be computed as the average of the
yields on that day of U.S. Treasury
31
Notes which mature in the last three
months of the Term.
2) The Deposit Period Yield is the average
of those yields for the Deposit Period.
If withdrawal is made prior to the close
of the Deposit Period, it is the average
of those yields on each week preceding
withdrawal.
3) The Current Yield is the average of the
yields on the last business day of the
week preceding withdrawal on the same
U.S. Treasury Notes included in the
Deposit Period Yield.
4) In the event that no U.S. Treasury Notes
which mature in the last three months of
the Term exist, Aetna reserves the right
to use the U.S. Treasury Notes that
mature in a following quarter.
d) Full and partial withdrawals as well as
Transfers made
1) within six (6) months after the
Participant's date of death under the
Amount Payable at Death provision (See
3.22) will be the greater of:
(a) The aggregate MVA amount which is
the sum of all market value
adjusted amounts calculated due to
a withdrawal of amounts (for
withdrawal or Transfer) from Terms
prior to the end of those Terms.
The aggregate MVA may be either
positive or negative; or
(b) The applicable portion of the
Current Value in the GA Account.
2) After the six month period following
death, the withdrawal or Transfer will
be the aggregate MVA amount (i.e.,
including all MVAs).
e) The greater of the aggregate MVA amount or
the applicable portion of the Current Value
in the GA Account is applied to amounts
withdrawn from the GA Account for payment of
a premium under Annuity Options 3 or 4.
3.08 Transfer(s):
Before an Annuity option is elected, all or any
portion of the Adjusted Current Value of the
32
Individual Account may be transferred from any
Fund, the Fixed Plus Account or the GA Account:
a) To any other allowable Fund; or
b) To the Fixed Plus Account; or
c) To any Guaranteed Term of the GA Account with
a different classification available in the
Current Deposit Period.
Transfer requests can be submitted as a percentage
or as a dollar amount. Aetna may establish a
minimum transfer amount. Within a Guaranteed Term
classification, the amount transferred will be
withdrawn from the oldest Deposit Period, then
from the next oldest, and so on until the amount
requested is satisfied.
Amounts applied to Guaranteed Terms of the GA
Account may not be transferred to the Funds, the
Fixed Plus Account or to another Guaranteed Term
during the Deposit Period or 90 days after the
close of the Deposit Period except for Matured
Term Value(s) during the calendar month following
the Term's Maturity Date.
Transfers from Guaranteed Terms of the GA Account
are subject to the MVA provisions of 3.08.
During each rolling twelve (12) month period, up
to 20% of the Current Value held in the Fixed Plus
Account may be transferred to one or more of the
Fund(s), and/or the GA Account's then-current
Deposit Period. The 20% limit is reduced by any
partial withdrawals, loans or amounts used to
purchase an Annuity during the twelve (12) month
period. Aetna reserves the right to include
amounts paid under ECO and SWO provisions for
purposes of applying this 20% limit. This limit is
waived when the balance in the Fixed Plus Account
is $1,000 or less on the date the Transfer request
is received in good order at Aetna's Home Office.
The Contract Holder, or Participant if authorized
in writing by the Contract Holder, may make an
unlimited number of Transfers during the
Accumulation Period.
3.09 Notice to the Contract Holder:
Each year, Aetna will notify the Contract Holder
of:
a) The value of any amounts held in:
33
1) The Fixed Plus Account,
2) The GA Account,
3) The Fund(s) for the Separate Account;
b) The number of any Fund Record Units;
c) The Fund Record Unit Value(s);
d) The Loan Account balance; and
e) The amount available for withdrawal.
This information will be as of a date no more than
sixty (60) days before the date of the notice.
3.10 Loans:
During the accumulation period, loans are granted
(1) as permitted under applicable law; (2) subject
to the terms and conditions of the loan agreement;
and, (3) in accordance with the following
provisions.
a) Amount available for loan: The amount
available for loan is limited to the vested
individual account current value attributable
to Participant contributions, plus any
amounts allowed by the employer's plan.
Amounts available from some investment
options may be subject to limitations
specified in the loan agreement. To obtain
the loan amount requested, these limitations
may require the Participant to transfer
funds. A market value adjustment may apply
to amounts transferred.
The minimum loan amount is $1,000. The
maximum loan amount is the lesser of:
1) Fifty percent (50%) of the vested
individual account current value,
including any Loan Account, reduced by
the amount of any outstanding loan
balance on the Loan Effective Date; or
2) Fifty thousand dollars ($50,000) reduced
by the highest outstanding loan balance
for the preceding 12 months.
The amount of all outstanding loans cannot
exceed $50,000.
b) Loan Interest Rate: A Loan Interest Rate is
set on the first business day of each month.
For each loan, the initial Loan Interest Rate
is the rate for the calendar month in which
the Loan Effective Date occurs. The initial
34
Loan Interest Rate is effective for a period
of not less than three months and not more
than one year. The period is specified in
the loan agreement. For each period, the
Loan Interest Rate is adjusted if the new
rate is at least 0.5% higher or lower than
the previous rate. The Participant will
receive reasonable notification of any change
to the Loan Interest Rate. As applicable,
the Loan Interest Rate is:
1) Plans subject to ERISA: equal to the
Monthly Average Corporates for the
calendar month beginning two months
before the Loan Interest Rate is
effective.
2) Plans not subject to ERISA: not greater
than 8% on an annual basis.
c) Earned interest: The Loan Account is
credited with interest at a rate which is not
less than the Loan Interest Rate, less 3%, on
an annual basis. Interest credited to the
Loan Account will never be less than 3%.
d) Loan repayment: Repayment is as set forth in
the loan agreement, or a Participant may
repay a loan in full at any time.
e) Surrenders while a loan is outstanding: If
the Participant requests a surrender from the
vested individual account current value while
a loan is outstanding, one of the following
occurs:
1) If the amount of the vested individual
account current value available for
distribution is sufficient to repay (a)
the outstanding loan balance, plus (b)
any applicable Fixed Plus Account
default charge, and (c) any surrender
fee due on the outstanding loan balance,
that amount, minus the Loan Account
balance, is deducted from the vested
individual account current value and the
loan is canceled.
2) If the amount of the vested individual
account current value available for
distribution is not sufficient to repay
the (a) the outstanding loan balance,
plus (b) any applicable Fixed Plus
35
Account default charge, and (c) any
surrender fee due on the outstanding
loan balance, the surrender amount
cannot exceed the vested individual
account current value, including the
Loan Account, reduced by 125% of the
outstanding loan balance.
f) Electing an annuity option while a loan is
outstanding: Before all or any portion of the
vested individual account current value is
applied to an annuity option, the Participant
may repay any outstanding loan balance, or
the vested individual account current value
is adjusted as described in (e).
g) Death of the Participant while a loan is
outstanding: If a death benefit claim is
submitted for an individual account with an
outstanding loan, the individual account
current value, including the amount of the
Loan Account, is reduced by the amount of the
outstanding loan balance before the death
benefit amount is determined.
h) Loan default: If Aetna does not receive a
loan payment when due, the outstanding loan
balance becomes due. If applicable, a 5%
default charge may apply to the portion in
excess of 20%, if any, of the amount
transferred from the Fixed Plus Account. The
defaulted loan is treated as follows:
1) If the amount of the vested individual
account current value available for
distribution is sufficient to repay (a)
the outstanding loan balance, plus (b)
any applicable Fixed Plus Account
default charge, and (c) any surrender
fee due on the outstanding loan balance,
that amount, minus the Loan Account
balance, is deducted from the vested
individual account current value and the
loan is canceled.
2) If the amount of the vested individual
account current value available for
distribution is not sufficient to repay
(a) the outstanding loan balance, plus
(b) any applicable Fixed Plus Account
default charge, and (c) any surrender
fee due on the outstanding loan balance,
36
until such time that the amount due can
be distributed, the Loan Account
continues to earn interest, and interest
is charged on the outstanding loan
balance. At that time, the amount
described in (h)(1) is surrendered from
the vested individual account current
value and the loan is canceled.
3.11 Xxxxxx and Timing of Distributions:
a) As directed by the Contract Holder, a
distribution to a Participant may be made in
a lump sum, as one of the Distribution
Options described in Section IV, or as one of
the Annuity options in Section V.
b) Generally, the distribution of benefits
accrued after December 31, 1986, must begin
by April 1 of the calendar year following the
calendar year in which the Participant
attains age 70 1/2. However, for a
Participant who attained age 70 1/2 before
January 1, 1988, the distribution of such
benefits must be made or must begin not later
than the April 1 of the calendar year
following the calendar year in which the
Participant retires.
The above does not apply if the Contract
Holder is a governmental entity or a church.
For Participants of such an employer, the
distribution of benefits accrued after
December 31, 1986, must be made or must begin
not later than April 1 of the calender year
following the calendar year in which the
Participant attains age 70 1/2 or retires,
whichever occurs later.
c) The required distribution must be made over
the life of the Participant (or the joint
lives of the Participant and the Plan
beneficiary) or over a period not exceeding
the life expectancy of the Participant (or
the joint life expectancies of the
Participant and the Plan beneficiary).
d) If the Contract Holder does not request
commencement of benefits as described above,
Aetna will not be responsible for compliance
with the Code Section 401(a)(9) minimum
distribution requirements or for any adverse
tax or other consequences that may result.
3.12 Withdrawal:
a) The Contract Holder may withdraw any portion
37
or all of an Individual Account Current Value
by submitting a written request to Aetna.
b) Except as described in Section 3.19, unless
the Contract Holder specifies otherwise,
partial withdrawals are satisfied by
withdrawing amounts on a pro rata basis from
each of the investment options in which the
Individual Account is invested.
c) When amounts are withdrawn from the GA
Account, amounts in Short-Term and Long-Term
Classifications are treated as separate
investment options and amounts are taken on a
pro rata basis. Within a Classification,
amounts will be withdrawn starting with the
Term still in effect with the oldest Deposit
Period.
3.13 Withdrawal Value:
After deduction of the Maintenance Fee (if any),
the amount payable by Aetna upon the withdrawal of
any portion of an Individual Account from the
Fund(s) or the GA Account shall be reduced by a
Withdrawal Fee, if applicable. The Withdrawal Fee
will be in accordance with the Withdrawal Fee
table in Contract Schedule I.
No Withdrawal Fee is deducted from any portion of
the Current Value which is paid from the Fixed
Plus Account.
For a partial or full withdrawal from any
Individual Account, Aetna must receive written
direction from the Contract Holder on a form
acceptable to Aetna. If the Contract is subject to
ERISA, this direction must include certification
that all of the REA waiver and spousal consent
requirements have been satisfied. Aetna may defer
payment of the withdrawal value until appropriate
Contract Holder certification is received.
3.14 Withdrawal Restrictions:
Limitations apply to full and partial withdrawals
of the "restricted amount" from this Contract, as
required by Code Section 403(b)(11). The
restricted amount is the sum of:
a) Net Contributions attributable to a
Participant's salary reduction contributions
made on and after January 1, 1989; plus
b) The net increase, if any, in the December 31,
1988 value attributable to a Participant's
38
salary reduction contributions due to
investment gains and losses and creditied
interest.
The restricted amount may be fully or partially
withdrawn only if one or more of the following
conditions are met.
a) The Participant has reached age 59 1/2;
b) The Participant has separated from service;
c) The Participant has died;
d) The Participant has become disabled, within
the meaning of Code Section 72(m)(7); or
e) The withdrawal is otherwise allowed by
federal law, regulations or rulings.
A full or partial withdrawal is also allowed if
the Participant incurs a "hardship" as that term
is defined in the Code or regulations under Code
Section 403(b). However, the amount available for
hardship is limited to the lesser of the amount
necessary to satisfy the need or the Net
Contributions attributable to the Participant's
salary reduction contributions made on or after
January 1, 1989.
The Contract Holder must certify that one of these
conditions has been met before a withdrawal
request will be considered to be in good order.
The Contract Holder must notify Aetna in writing
when a lump sum payment is to be made or Annuity
payments are to commence.
If, pursuant to Revenue Ruling 90-24, Aetna agrees
to accept under this Contract amounts transferred
from a Code Section 403(b)(7) custodial account,
such amounts will be subject to the withdrawal
restrictions set forth in Code Section
403(b)(7)(A)(ii).
3.15 Withdrawals from the GA Account:
Full or partial withdrawals may be requested at
any time from the GA Account. However, amounts
withdrawn prior to the Maturity Date of a Term may
be subject to a Market Value Adjustment (See
3.08).
Full and partial withdrawals are satisfied by
39
withdrawing amounts from each of the investment
options in which the Individual Account is
invested (the Funds, the Fixed Plus Account, the
GA Account Short-Term Classification and the GA
Account Long-Term Classification) on a pro rata
basis. However, the Contract Holder may specify a
particular order in which investment options will
be liquidated in order to satisfy a partial
surrender request.
3.16 Withdrawal Fee Applicable to Funds and GA Account:
A withdrawal fee (Deferred Sales Charge) may apply
to withdrawals from the GA Account and/or Funds.
The fee will vary according to the length of time
elapsed from the effective date of an Individual
Account to the date when the withdrawal request is
received. For each withdrawal, the withdrawal fee
will be determined as shown on Contract Schedule
I.
During each rolling 12-month period, up to 20% of
the Current Value in the Fixed Plus Account may be
withdrawn as a partial surrender. This 20% limit
is reduced by any amount(s) transferred, taken as
a loan or used to purchase an Annuity during the
12 month period. The 20% limit applicable to
partial surrenders from the Fixed Plus Account
will be waived when the partial surrender is due
to one of the conditions set forth in Contract
Schedule 1. The waiver will apply provided the
partial surrender is taken pro-rata from the Fixed
Plus Account, the GA Account, and the Fund(s).
Aetna reserves the right to include amounts paid
under the ECO and SWO provisions for purposes of
applying the 20% limit. However, the SWO provision
is not available if the Contract Holder on behalf
of the Participant requested a Fixed Plus Account
transfer or surrender within the current 12 month
period.
3.17 Payment of Fixed Plus Account Full Withdrawal:
No withdrawal fee is deducted from any portion of
the Current Value which is paid from the Fixed
Plus Account. When Aetna receives a full
withdrawal request, no additional partial
withdrawals or Transfers from the Fixed Plus
Account are permitted during the payout period. If
a full withdrawal is requested, Aetna will pay any
Current Value, including accrued interest, from
the Fixed Plus Account in five payments as
follows:
40
a) One-fifth of the Current Value on the day the
request is received in good order at Aetna's
Home Office, reduced by any amount from the
Fixed Plus Account that was transferred,
withdrawn or used for a loan or to purchase
Annuity benefits during the prior twelve
months;
b) One-fourth of the then remaining Current
Value twelve months later;
c) One-third of the then remaining Current Value
twelve months later;
d) One-half of the then remaining Current Value
twelve months later; and
e) The balance of the then Current Value twelve
months later.
The Fixed Plus Account full withdrawal payment
provision may also be waived under certain
conditions (See Contract Schedule I).
Any full withdrawal from the Fixed Plus Account
may be cancelled by the Participant with Contract
Xxxxxx's consent at any time before the end of the
payment period.
3.18 Reinstatement:
All or a portion of the proceeds of a full
withdrawal of this Contract may be reinvested
within 30 days after the withdrawal if allowed by
law. Any Maintenance Fee and Withdrawal Fee
charged at the time of the withdrawal on the
amount being reinvested will be included in the
reinstatement. Any Market Value Adjustment
deducted from GA Account withdrawals will not be
included in the reinstatement. Amounts will be
reinstated among the Fixed Plus Account, the GA
Account, and/or the Fund(s) for the Separate
Account in the same proportion as they were at the
time of withdrawal. Any amounts reinstated to the
GA Account will be credited to terms available
during the then-current Deposit Period. The number
of Record Units reinstated will be based on the
Record Unit Value(s) next computed after receipt
in good order at Aetna's Home Office of the
reinstatement request and the amount to be
reinvested.
Any Maintenance Fee which falls due after the
withdrawal and before the reinstatement will be
deducted from the amount reinstated.
Reinstatement is permitted only once for an
41
Individual Account.
3.19 Payment of Minimum Current Value:
If the sum of the Individual Account(s) Current
Value(s) is less than $3,500, and no Contributions
have been received for three (3) years, Aetna may
close the account(s) and pay the Current Value(s)
to the Contract Holder in one lump sum.
3.20 Amount Payable at Death (Before Annuity Payments
Start):
Aetna will pay the Individual Account Current
Value, as directed by the Contract Holder in
accordance with the Plan, when:
a) The Participant dies before Annuity payments
start; and
b) The certified copy of the death certificate
is received.
Amounts in the GA Account will be payable as
described in Section 3.08(d).
IV. NON-ANNUITY DISTRIBUTION OPTIONS
______________________________________________________________
4.01 Distribution Options:
The Contract Holder may elect one of the two
following distribution options on behalf of:
1) the Participant; or
2) the Participant's spouse provided the spouse
is the designated beneficiary under the Plan
and the Participant had died before electing
an Annuity option and before the date for
required minimum distributions.
4.02 Estate Conservation Option.
a) With the Estate Conservation Option (ECO) a
portion of the Individual Account Current Value is
automatically surrendered and distributed each
year without incurring a withdrawal fee. Each
payment will be withdrawn from the Individual
Account in the same proportion as assets are held
in the Funds, the GA Account, and the Fixed Plus
Account on the date the payment is made.
b) Payments under XXX will comply with the incidental
death benefit test set forth in Code Section
401(a)(9).
c) Distribution Amount: Each year that ECO is in
effect, Aetna will calculate and distribute an
amount equal to the minimum distribution required
42
under the Code. The annual distribution will be
determined by dividing the Individual Account
Current Value as of December 31 of the year prior
to the payment year, by a single or joint life
expectancy factor. If joint life expectancy is
elected, the beneficiary under ECO must be the
same as the beneficiary of any death benefits
under the Plan.
An exception will be made if Aetna maintains a
separate record of a Participant's Individual
Account Value as of December 31, 1986. In this
instance, payments made in or after the year in
which the Participant attains age 70 1/2, but
before the year in which the Participant attains
age 75, will be calculated only on amounts
contributed after December 31, 1986 and any
earnings after that date. If age 70 1/2 was
attained prior to 1988, the Participant must be
retired in order to qualify for this exception.
The method under this rule is elected by the
Contract Holder and will not apply if the
Participant has received any distribution from his
or her Individual Account, other than distribution
amounts required under Code minimum distribution
rules.
Aetna will maintain separate records if the
Contract Holder has not requested any withdrawals
from the Participant's Individual Account since
December 31, 1986.
d) Life Expectancy Factor: For the Participant, the
life expectancy factor is either single life or
joint life expectancy as elected by the Contract
Holder on behalf of the Participant, based on
tables in Code Section 401(a)(9) or related
regulations. For a spouse beneficiary, only a
single life expectancy is available. Life
expectancy factors will be recalculated each year,
unless prohibited by the Code or regulations.
The joint life expectancy factor will be based on
the joint life expectancy of the Participant and
his or her beneficiary and such beneficiary of any
death benefits under the Plan while ECO is in
effect. Any change in the beneficiary designation
under the Plan must be immediately communicated to
Aetna so that subsequent distributions can be
calculated as required by IRS regulations.
If joint life expectancy is elected and the
43
Participant or spouse dies, payments will be based
on the survivor's life expectancy. If the
beneficiary is not the spouse and the beneficiary
dies first, the joint life expectancy continues to
be used to determine payments.
If a single life expectancy is elected, at the
death of the Participant (or the spouse who is the
designated beneficiary electing ECO after the
Participant's death), the entire value must be
distributed no later than the December 31 of the
year following the year of the Participant's (or
spouse's) death. If a joint life expectancy is
elected, and both the Participant and spouse have
died, any remaining Current Value must be
distributed no later than the December 31 of the
year following the year of the second death. If a
joint life expectancy is elected and both the
Participant and non-spouse beneficiary have died,
any remaining Current Value will be distributed as
instructed by the Contract Holder in accordance
with the Code and the terms of the Plan.
These calculations may be changed as necessary to
comply with Code minimum distribution rules. Any
mode of payment elected upon the Participant's
death must provide payments to be made at least as
rapidly as those made prior to the Participant's
death.
e) Minimum Current Value: At its discretion, Aetna
may require a minimum initial Current Value for
election of this option. If after election of this
option the Current Value is insufficient to make a
scheduled ECO payment, Aetna will distribute the
entire balance of the Individual Account.
f) Distribution Date: The Contract Holder shall
specify an annual distribution date. For a
Participant, the earliest date is the first day of
the calendar year in which he or she attains age
70 1/2. For a spouse beneficiary electing ECO
after the Participant's death, the earliest date
is the date of the Participant's death. The first
distribution date may be the 15th of any month, or
such other date as Aetna may designate or allow.
Subsequent distributions will be made on the
anniversary of that date. At its option, Aetna may
allow payments to be made more frequently than
annually.
g) Election and Revocation: The Contract Holder may
44
elect ECO by submitting a completed and signed
election form to Aetna's Home Office. If the
Contract Holder has notified Aetna that the Plan
is subject to Title I of the Employee Retirement
Income Security Act of 1974 as amended, the
Contract Holder must also certify in writing that
all the appropriate REA requirements have been met
and that the distribution is in accordance with
the terms of the Plan. Once ECO is elected, the
Contract Holder may revoke it by submitting a
written request to Aetna at its Home Office. Any
revocation will apply only to amounts not yet
paid. ECO may be elected only once per
Participant.
4.03 Systematic Withdrawal Option:
a) With the Systematic Withdrawal Option (SWO) a
portion of the Individual Account Current Value is
automatically distributed each year without
incurring a Withdrawal Fee. A SWO payment will be
calculated on the Individual Account's Current
Value. Each payment will be withdrawn from the
Individual Account in the same proportion as
assets are held in the Funds, the GA Account, and
the Fixed Plus Account on the date the payment is
made. SWO payments may not be elected if a loan is
outstanding under an Individual Account.
b) Payments under SWO will comply with the incidental
death benefit test set forth in Code Section
401(a)(9).
c) Distribution Amounts: The Contract Holder may
elect one of the three payment methods described
below. These calculations may be changed as
necessary to comply with the Code minimum
distribution rules. If joint life expectancy is
elected, the beneficiary under SWO must be the
same as the beneficiary of any death benefits
under the Plan.
1) Specified Payment: Payments of a designated annual
dollar amount. The annual amount may not be
greater than the percentage of the Current Value
at time of election as shown on Contract Schedule
I. This amount will remain constant unless a
higher amount is required under Code minimum
distribution rules. Each year that the Specified
Payment is in effect, Aetna will calculate the
minimum required distribution by dividing the
Individual Account Current Value as of December 31
45
of the year prior to the payment year by a life
expectancy factor, and distribute this amount if
it is larger than the Specified Payment.
2) Specified Period: Payments are made over a period
of time. The number of years selected may not be
less than the number of years shown on Contract
Schedule I, unless otherwise required by Code
minimum distribution rules. The maximum specified
period will be limited by the life expectancy
factor. The amount paid each year is calculated by
dividing the Individual Account Current Value as
of December 31 of the prior year by the number of
payment years remaining.
3) Specified Percentage: Payments made as a specified
percentage of the Individual Account. The
specified percentage chosen cannot be greater than
as shown on Contract Schedule I. The Contract
Holder on behalf of a Participant may change the
specified percentage elected every six months.
Each annual distribution is determined by
multiplying the Individual Account Current Value
by the percentage chosen. The value to be used in
this calculation is the value on the December 31st
prior to the year for which the payment is being
made. For payments made more often than annually,
the annual payment result (calculated above) is
divided by the number of payments due each year.
Payments will be made each year until the year the
Participant attains age 70 1/2.
d) Life Expectancy Factor: For the Participant, the
life expectancy factor for the initial
distribution year is either single life or joint
life expectancy as elected by the Contract Holder,
based on tables in Section 401(a)(9) of the Code
or related regulations. For a spouse beneficiary,
only a single life expectancy is available. With
each subsequent year, the life expectancy factor
will be the life expectancy factor for the initial
distribution year, reduced by one. These
calculations may be changed as necessary to comply
with the Code minimum distribution rules. If the
joint life expectancy is selected and the
Participant or the beneficiary dies on or after
the required beginning date for minimum
distributions to the Participant, the joint life
expectancy factor will continue to be reduced by
one for each distribution year. Payments will
continue unless the Contract Holder elects an
alternate payment mode on behalf of the survivor.
Any payment mode elected on behalf of the Plan
beneficiary must provide payments to be made at
least as rapidly as those made prior to the
46
Participant's death.
If the Participant dies before the required beginning
date for minimum distributions, SWO payments will
cease and the Contract Holder on behalf of the
beneficiary may claim the death benefit in accordance
with the terms of this Contract. If the beneficiary
is not the Participant's spouse, the entire death
benefit must be either applied to an Annuity option
within one (1) year of the Participant's death, or be
paid within five (5) years of the Participant's
death. If the beneficiary is the Participant's
spouse, the distribution is not required to begin
earlier than when the Participant would have attained
age 70 1/2.
If joint life expectancy is elected and the
beneficiary dies before the required beginning date
for minimum distributions to the Participant,
payments to the Participant will continue to be based
on joint life expectancy reduced by one for each
distribution year.
e) Minimum Current Value: At its discretion, Aetna
may require a minimum initial Current Value for
election of this option. If after election of this
option the Current Value is insufficient to make a
scheduled SWO payment, Aetna will distribute the
entire balance of the Individual Account.
f) Distribution Date: The Contract Holder, on behalf
of the Participant, or spouse beneficiary, shall
specify the initial distribution date. The
earliest date is the first day of the calendar
year in which the Participant attains age 59 1/2,
or age 55, if separated from service with the
Contract Holder at or after age 55. SWO payments
will be made monthly, quarterly, semi-annually or
annually on the 15th of any month, or such other
date as Aetna may designate or allow. If payments
are made more frequently than annually, the annual
amount payable each year is divided by the number
of payments due per year. At its discretion Aetna
may require a minimum initial payment amount.
g) Election and Revocation: The Contract Holder may
elect SWO by submitting a completed and signed
election form to Aetna's Home Office. If the
Contract Holder has notified Aetna that the Plan
is subject to Title I of the Employee Retirement
Income Security Act of 1974 as amended, the
Contract Holder must also certify in writing that
all the appropriate REA requirements have been met
47
and that the distribution is in accordance with
the terms of the Plan. Once SWO is elected, the
Contract Holder may revoke it by submitting a
written request to Aetna's Home Office. Any
revocation will apply only to amounts not yet
paid. Generally, SWO may be elected only once,
however, if XXX is elected on behalf of a
Participant and then revoked before the date
distributions were required to begin under Code
Section 401(a)(9), SWO may be elected on behalf of
a spouse beneficiary after the death of the
Participant.
V. ANNUITY PROVISIONS
______________________________________________________________
5.01 Choices:
a) The Contract Holder, on behalf of the Participant
may elect an Annuity option by telling Aetna to
pay all or any portion of the Individual
Account(s) Current Value (minus any applicable
premium tax if not previously deducted) as a
premium for an Annuity under option 2, 3, or 4
(See 5.08). Any election of an Annuity option must
comply with the minimum distribution requirements
of Code Section 401(a)(9), including the
incidental death benefit rule, and the regulations
thereunder. This restriction does not apply if
option 4 is chosen and the second Annuitant is the
spouse of the Participant.
b) Generally, the first Annuity payment must be made
by April 1 of the calendar year following the year
in which the Participant turns age 70 1/2 or such
later date as may be allowed under federal law or
regulations (see 3.12) For distributions taken in
a lump sum, see Withdrawal Value (3.14).
For any election of an Annuity Option, the
Contract Holder must provide certification that
the REA requirements, as applicable, and Code
Section 403(b)(11) withdrawal restrictions have
been satisfied.
When an Annuity option is chosen the Contract
Holder must designate whether the Annuity will be
Fixed or Variable and whether the underlying
investment will be:
1) The General Account;
2) One or more of the available Fund(s); or
3) A combination of (1) and (2).
48
If a Fixed Annuity is chosen, the Annuity purchase
rate for the option chosen reflects at least the
Minimum Guaranteed Interest Rate (See Contract
Schedule II), but may reflect a higher interest
rate.
If a Variable Annuity is chosen, the initial
Annuity payment for the option chosen reflects the
assumed annual return rate elected (See Contract
Schedule II).
d) Payments will be made on a monthly basis unless
the Contract Holder requests otherwise.
e) Once elected, an Annuity option may not be
revoked, except for option 2 when elected on a
variable basis.
5.02 Terms of Annuity Options:
a) No choice of any Annuity option may be made if the
first payment would be less than $20 or if the
total payments in a year would be less than $100.
b) For purposes of calculating the guaranteed first
payment of a Variable Annuity or the payments for
a Fixed Annuity, the Annuitant's and second
Annuitant's adjusted age will be used. The
Annuitant's and second Xxxxxxxxx's adjusted age is
his or her age as of the birthday closest to the
Annuity commencement date reduced by one year for
Annuity commencement dates occurring during the
period of time from July 1, 1992 through December
31, 1999. The Annuitant's and second Xxxxxxxxx's
age will be reduced by two years for Annuity
commencement dates occurring during the period of
time from January 1, 2000 through December 31,
2009. The Annuitant's and second Annuitant's age
will be reduced by one additional year for Annuity
commencement dates occurring in each succeeding
decade.
The Annuity rates for options 3 and 4 are based on
mortality from 1983 Table a.
d) Assumed Annual Net Return Rate is the interest
rate used to determine the amount of the first
Annuity payment under a Variable Annuity. The
Separate Account must earn this rate plus enough
to cover the mortality and expense risks charges
(which may include profit) and administrative
charges if future Variable Annuity Payments are to
remain level.
5.03 Annuity Payments to Annuitant:
49
In no event may any payments to the Annuitant under any
Annuity Option extend beyond:
a) The life of the Annuitant;
b) The lives of the Annuitant and the Plan
beneficiary;
c) A period certain greater than the Annuitant's life
expectancy according to regulations under Code
Section 401(a)(9), determined as of the date
payments are to commence; or
d) A period certain greater than the life
expectancies of the Annuitant and the Plan
beneficiary according to regulations under Code
Section 401(a)(9) determined as of the date
payments are to begin.
5.04 Death Provision:
When an Annuitant dies under options 3 and 4, the
present value of any remaining guaranteed payments will
be paid in one sum or payments will continue at the
direction of the Contract Holder, in accordance with
the Plan. If a Plan beneficiary dies while receiving
Annuity payments, the present value of any remaining
payments will be paid in one lump sum as directed by
the Contract Holder. The interest rate used to
determine the present value for a lump sum payment will
be the rate used to determine the first Annuity
payment.
In no event may any payments to the Plan beneficiary
under an Annuity Option extend beyond:
a) The life of the payee determined as of the date
payments are to commence; or
b) Any certain period greater than the payee's life
expectancy as determined by regulations under Code
Section 401(a)(9) as of the date payments are to
begin.
However, if a Plan beneficiary dies while under Option
1 or while receiving Annuity payments, the present
value of any remaining payments will be paid in one
lump sum to the estate of the Plan beneficiary. The
interest rate used to determine the first payment will
be used to calculate the present value.
5.05 Fund Annuity Units:
The number of Fund(s) Annuity Units is based on the
amount of the first Variable Annuity payment which is
equal to:
a) The portion of the Current Value including any
50
applicable MVA (see 3.08) or premium tax, applied
to pay a Variable Annuity; divided by
b) 1,000; multiplied by
c) The payment rate for the option chosen.
Such amount, or portion, of the variable payment will
be divided by the appropriate Fund(s) Annuity Unit
Value (See 5.06) on the tenth Valuation Period before
the due date of the first payment to determine the
number of each Fund Annuity Units. The number of each
Fund Annuity Units remains fixed. Each future payment
is equal to the sum of the products of each Fund
Annuity Unit Value multiplied by the appropriate number
of Units. The Fund Annuity Unit Value on the tenth
Valuation Period prior to the due date of the payment
is used.
5.06 Fund Annuity Unit Value:
For any Valuation Period, a Fund(s) Annuity Unit Value
is equal to:
a) The Value for the previous Period; multiplied by
b) The Annuity net return factor(s) (See 5.07) for
the Period; multiplied by
c) A factor to reflect the assumed annual net return
rate. (See Contract Schedule II).
The dollar value of a Fund Annuity Unit and Annuity
payments may go up or down due to investment gain or
loss.
Payments shall not be changed due to changes in the
mortality or expense results or administrative charges.
5.07 Fund Annuity Net Return Factor.
The Annuity Net Return Factor(s) is used to compute all
Separate Account Annuity payments for any Fund.
The Annuity Net Return Factor(s) for each Fund is equal
to 1.0000000 plus the net return Rate.
The Net Return Rate is equal to:
a) The value of the shares of the Fund held by the
Separate Account at the end of a Valuation Period;
minus
b) The value of the shares of the Fund held by the
Separate Account at the start of the Valuation
Period; plus or minus
c) Taxes (or reserves for taxes) on the Separate
51
Account (if any);
d) Divided by the total value of the Fund(s) Record
Units and Fund(s) Annuity Units of the Separate
Account at the start of the Valuation Period;
minus
e) Minus a daily charge for Annuity mortality and
expense risks, which may include profit, and a
daily administrative charge (at the annual rate as
shown on Contract Schedule II).
A Net Return Rate may be more or less than 0%.
The value of a share of the Fund is equal to the net
assets of the Fund divided by the number of shares
outstanding.
5.08 Annuity Options:
The Contract Holder may direct Aetna to make payments
according to one of the following options.
Option 1 -- Payments of Interest on Sum Left with Aetna
-- This Option may be used only by the Plan beneficiary
when the Participant dies before Aetna has started
paying an Annuity. A portion or all of the sum paid
upon death may be held under this Option and will be
held in the General Account of Aetna at interest. The
Contract Holder, on behalf of the Plan beneficiary, may
later tell Aetna to:
a) Pay a portion or all of the sum held by Aetna; or
b) Apply a portion or all of the sum held by Aetna to
any Annuity Option below.
If the Plan beneficiary is the Participant's surviving
spouse, the lump-sum payment may be deferred to a date
not later than when the Participant would have attained
age 70 1/2.
If the Plan beneficiary is not a spouse, the Contract
Holder must tell Aetna to pay the full sum within 5
years after the death of the Participant.
Option 2 -- Payments for a Stated Period of Time -- An
Annuity will be paid for the number of years chosen
(See Contract Schedule II).
If payments for this option are made under a Variable
Annuity, the present value of any remaining payments
may be withdrawn at any time. If a withdrawal is
requested prior to the minimum number of years
52
specified on Contract Schedule II, it will be subject
to any withdrawal fee, if applicable (See Contract
Schedule I).
Option 3 -- Life Income -- An Annuity will be paid for
the life of the Annuitant. Aetna may also guarantee
payments for 60, 120, 180, or 240 months if so directed
by the Contract Holder.
Option 4 -- Life Income based upon the lives of two
Annuitants -- An Annuity will be paid during the lives
of the Annuitant and a second Annuitant. Payments will
continue until both Annuitants have died. When this
option is chosen, a choice of the following must be
made:
a) 100% of the payment to continue after the first
death;
b) 66 2/3% of the payment to continue after the first
death;
c) 50% of the payment to continue after the first
death;
d) Payments for a minimum of 120 months, with 100% of
the payment to continue after the first death; or
e) 100% of the payment to continue at the death of
the second Annuitant and 50% of the payment to
continue at the death of the Annuitant.
Other Options -- Aetna may make other options available
as allowed by the laws of the state in which this
Contract is delivered.
53
OPTION 2
Payments for a Stated Period of Time
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Fixed Annuity with Guaranteed Interest Rate of
3.0%
Guaranteed Monthly Quarterly Semi-Annual Annual
Years Rate Payment Payment Payment Payments
5 3.00% $17.91 $53.59 $106.78 $211.99
6 3.00% 15.14 45.30 90.27 179.22
7 3.00% 13.16 39.39 78.49 155.83
8 3.00% 11.68 34.96 69.66 138.31
9 3.00% 10.53 31.52 62.81 124.69
10 3.00% 9.61 28.77 57.33 113.82
11 3.00% 8.86 26.52 52.85 104.93
12 3.00% 8.24 24.65 49.13 97.54
13 3.00% 7.71 23.08 45.98 91.29
14 3.00% 7.26 21.73 43.29 85.95
15 3.00% 6.87 20.56 40.96 81.33
16 3.00% 6.53 19.54 38.93 77.29
17 3.00% 6.23 18.64 37.14 73.74
18 3.00% 5.96 17.84 35.56 70.59
19 3.00% 5.73 17.13 34.14 67.78
20 3.00% 5.51 16.50 32.87 65.26
21 3.00% 5.32 15.92 31.72 62.98
22 3.00% 5.15 15.40 30.68 60.92
23 3.00% 4.99 14.92 29.74 59.04
24 3.00% 4.84 14.49 28.88 57.33
25 3.00% 4.71 14.09 28.08 55.76
26 3.00% 4.59 13.73 27.36 54.31
54
27 3.00% 4.47 13.39 26.68 52.97
28 3.00% 4.37 13.08 26.06 51.74
29 3.00% 4.27 12.79 25.49 50.60
30 3.00% 4.18 12.52 24.95 49.53
55
OPTION 2
Payments for a Stated Period of Time
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate of
3.5%
Years Monthly Quarterly Semi-Annual Annual
Payment Payment Payment Payment
5 $18.12 $54.19 $107.92 $213.99
6 15.35 45.92 91.44 181.32
7 13.38 40.01 79.69 158.01
8 11.90 35.59 70.88 140.56
9 10.75 32.16 64.05 127.00
10 9.83 29.42 58.59 116.18
11 9.09 27.18 54.13 107.34
12 8.46 25.32 50.42 99.98
13 7.94 23.75 47.29 93.78
14 7.49 22.40 44.62 88.47
15 7.10 21.24 42.31 83.89
16 6.76 20.23 40.29 79.89
17 6.47 19.34 38.51 76.37
18 6.20 18.55 36.94 73.25
19 5.97 17.85 35.54 70.47
20 5.75 17.22 34.28 67.98
21 5.56 16.65 33.15 65.74
22 5.39 16.13 32.13 63.70
23 5.24 15.66 31.19 61.85
24 5.09 15.24 30.34 60.17
25 4.96 14.85 29.56 58.62
26 4.84 14.49 28.85 57.20
56
27 4.73 14.15 28.19 55.90
28 4.63 13.85 27.58 54.69
29 4.53 13.57 27.02 53.57
30 4.45 13.30 26.49 52.53
57
OPTION 2
Payments for a Stated Period of Time
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate Rate
of 5.0%
Years Monthly Quarterly Semi-Annual Annual
Payment Payment Payment Payment
5 $18.74 $56.00 $111.33 $219.98
6 15.99 47.77 94.96 187.64
7 14.02 41.90 83.30 164.59
8 12.56 37.52 74.58 147.35
9 11.42 34.11 67.81 133.99
10 10.51 31.40 62.42 123.34
11 9.77 29.19 58.03 114.66
12 9.16 27.36 54.38 107.45
13 8.64 25.81 51.31 101.39
14 8.20 24.50 48.69 96.21
15 7.82 23.36 46.44 91.75
16 7.49 22.37 44.47 87.88
17 7.20 21.51 42.75 84.48
18 6.94 20.74 41.23 81.47
19 6.71 20.06 39.88 78.80
20 6.51 19.46 38.68 76.42
21 6.33 18.91 37.59 74.28
22 6.17 18.42 36.62 72.35
23 6.02 17.98 35.73 70.61
24 5.88 17.57 34.93 69.02
25 5.76 17.20 34.20 67.57
26 5.65 16.87 33.53 66.25
27 5.54 16.56 32.92 65.04
58
28 5.45 16.28 32.35 63.93
29 5.36 16.01 31.83 62.90
30 5.28 15.77 31.35 61.95
59
OPTION 3
Life Income
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Fixed Annuity with Guaranteed Interest Rate of
3.0%
Payments Guaranteed for a Stated Period of Months
Adjusted
Age of
Annuitant None 60 120 180 240
50 $4.05 $4.05 $4.03 $3.99 $3.93
51 4.12 4.11 4.09 4.05 3.99
52 4.19 4.19 4.16 4.11 4.04
53 4.27 4.26 4.23 4.18 4.10
54 4.35 4.34 4.31 4.25 4.16
55 4.44 4.42 4.39 4.32 4.22
56 4.53 4.51 4.47 4.40 4.29
57 4.62 4.61 4.56 4.48 4.35
58 4.72 4.71 4.65 4.56 4.42
59 4.83 4.81 4.75 4.64 4.49
60 4.95 4.93 4.86 4.73 4.55
61 5.07 5.05 5.97 4.83 4.62
62 5.20 5.17 5.08 4.92 4.69
63 5.34 5.31 5.20 5.02 4.76
64 5.49 5.45 5.33 5.12 4.83
65 5.65 5.61 5.47 5.22 4.89
66 5.82 5.77 5.61 5.33 4.96
67 6.01 5.94 5.75 5.44 5.02
60
68 6.20 6.13 5.91 5.54 5.08
69 6.41 6.33 6.07 5.65 5.14
70 6.64 6.54 6.23 5.76 5.19
71 6.88 6.76 6.41 5.86 5.24
72 7.14 7.00 6.59 5.97 5.28
73 7.43 7.26 6.77 6.06 5.32
74 7.73 7.53 6.96 6.16 5.35
75 8.06 7.82 7.14 6.25 5.38
Rates are based on mortality from 1983 Table a. The rates do
not differ by
sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
61
OPTION 3
Life Income
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate of
3.5%
Payments Guaranteed for a Stated Period of Months
Adjusted
Age of
Annuitant None 60 120 180 240
50 $4.34 $4.34 $4.31 $4.27 $4.22
51 4.41 4.40 4.38 4.33 4.27
52 4.48 4.47 4.45 4.40 4.32
53 4.56 4.55 4.52 4.46 4.38
54 4.64 4.63 4.59 4.53 4.44
55 4.72 4.71 4.67 4.60 4.50
56 4.81 4.80 4.75 4.67 4.56
57 4.91 4.89 4.84 4.75 4.62
58 5.01 4.99 4.93 4.83 4.69
59 5.12 5.10 5.03 4.92 4.75
60 5.23 5.21 5.13 5.00 4.82
61 5.36 5.33 5.24 5.09 4.88
62 5.49 5.45 5.35 5.19 4.95
63 5.63 5.59 5.47 5.28 5.02
64 5.78 5.73 5.60 5.38 5.08
65 5.94 5.89 5.73 5.48 5.15
66 6.11 6.05 5.87 5.58 5.21
67 6.29 6.22 6.02 5.69 5.27
68 6.49 6.41 6.17 5.79 5.33
62
69 6.70 6.60 6.33 5.90 5.38
70 6.92 6.81 6.49 6.00 5.43
71 7.17 7.04 6.66 6.10 5.48
72 7.43 7.27 6.84 6.20 5.52
73 7.71 7.53 7.02 6.30 5.55
74 8.02 7.80 7.20 6.39 5.59
75 8.35 8.08 7.38 6.48 5.62
Rates are based on mortality from 1983 Table a. The rates do
not differ by
sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
63
OPTION 3
Life Income
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate of
5.0%
Payments Guaranteed for a Stated Period of Months
Adjusted
Age of
Annuitant None 60 120 180 240
50 $5.26 $5.25 $5.22 $5.17 $5.11
51 5.33 5.32 5.28 5.23 5.15
52 5.40 5.38 5.34 5.29 5.20
53 5.47 5.45 5.41 5.35 5.26
54 5.54 5.53 5.48 5.41 5.31
55 5.63 5.61 5.56 5.47 5.36
56 5.71 5.69 5.63 5.54 5.42
57 5.80 5.78 5.72 5.61 5.47
58 5.90 5.88 5.81 5.69 5.53
59 6.01 5.98 5.90 5.77 5.59
60 6.12 6.09 6.00 5.85 5.65
61 6.24 6.21 6.10 6.93 5.71
62 6.37 6.33 6.21 6.02 5.77
63 6.51 6.46 6.33 6.11 5.83
64 6.66 6.60 6.45 6.20 5.89
65 6.82 6.75 6.57 6.30 5.95
66 6.99 6.91 6.71 6.39 6.01
67 7.17 7.08 6.85 6.49 6.06
68 7.36 7.27 6.99 6.59 6.12
64
69 7.57 7.46 7.15 6.69 6.17
70 7.80 7.67 7.30 6.78 6.21
71 8.05 7.89 7.47 6.88 6.25
72 8.31 8.13 7.64 6.97 6.29
73 8.59 8.38 7.81 7.06 6.33
74 8.90 8.64 7.99 7.15 6.36
75 9.23 8.93 8.16 7.23 6.38
Rates are based on mortality from 1983 Table a. The rates do
not differ by
sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
65
OPTION 4
Life Income for Two Payees
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Fixed Annuity with Guaranteed Interest Rate of
3.0%
Payments Guaranteed for a Stated Period of Months
Adjusted Ages
Annuitant Second Option Option Option Option Option
Annuitant 4a 4b 4c 4d4e
55 50 $3.69 $4.05 $4.27 $3.69 $4.03
55 55 3.88 4.25 4.47 3.87 4.14
55 60 4.06 4.47 4.71 4.06 4.20
60 55 3.99 4.44 4.71 3.98 4.42
60 60 4.24 4.71 4.99 4.23 4.57
60 65 4.49 5.01 5.32 4.48 4.64
65 60 4.38 4.97 5.32 4.38 4.93
65 65 4.72 5.33 5.70 4.71 5.14
65 70 5.07 5.75 6.17 5.05 5.26
70 65 4.93 5.68 6.15 4.91 5.66
70 70 5.40 6.21 6.70 5.36 5.96
70 75 5.89 6.82 7.40 5.81 6.12
75 70 5.69 6.68 7.32 5.62 6.67
75 75 6.37 7.45 8.15 6.23 7.12
75 80 7.07 8.34 9.16 6.78 7.36
66
Rates are based on mortality from 1983 Table a. The rates do
not differ by
sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
67
OPTION 4
Life Income for Two Payees
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate of
3.5%
Adjusted Ages
Annuitant Second Option Option Option Option Option
Annuitant 4a 4b 4c 4d4e
55 50 $3.97 $4.35 $4.56 $3.97 $4.31
55 55 4.16 4.54 4.76 4.15 4.42
55 60 4.27 4.73 5.00 4.26 4.48
60 55 4.27 4.73 5.00 4.26 4.70
60 60 4.51 4.99 5.27 4.50 4.84
60 65 4.66 5.25 5.61 4.65 4.93
65 60 4.66 5.25 5.61 4.65 5.22
65 65 4.99 5.61 5.99 4.98 5.42
65 70 5.19 5.97 6.44 5.17 5.54
70 65 5.19 5.97 6.44 5.17 5.93
70 70 5.67 6.49 6.99 5.62 6.23
70 75 5.95 6.96 7.61 5.87 6.40
75 70 5.95 6.96 7.61 5.87 6.95
75 75 6.64 7.73 8.43 6.48 7.40
75 80 7.04 8.39 9.29 6.79 7.64
Rates are based on mortality from 1983 Table a. The rates do
68
not differ by
Sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
69
OPTION 4
Life Income for Two Payees
Amount of First Monthly Payment for Each $1,000
After Deduction of any Charge for Premium Taxes
Rates for a Variable Annuity with Assumed Net Return Rate of
5.0%
Adjusted Ages
Annuitant Second Option Option Option Option Option
Annuitant 4a 4b 4c 4d4e
55 50 $4.88 $5.26 $5.48 $4.88 $5.23
55 55 5.04 5.44 5.66 5.04 5.32
55 60 5.15 5.63 5.91 5.14 5.38
60 55 5.15 5.63 5.91 5.14 5.59
60 60 5.37 5.87 6.16 5.37 5.72
60 65 5.52 6.14 6.51 5.51 5.80
65 60 5.52 6.14 6.51 5.51 6.10
65 65 5.83 6.49 6.87 5.82 6.29
65 70 6.04 6.84 7.34 6.00 6.41
70 65 6.04 6.84 7.34 6.00 6.81
70 70 6.49 7.35 7.87 6.44 7.08
70 75 6.77 7.84 8.51 6.68 7.25
75 70 6.77 7.84 8.51 6.68 7.81
75 75 7.45 8.60 9.33 7.27 8.25
75 80 7.86 9.28 10.20 7.57 8.49
Rates are based on mortality from 1983 Table a. The rates do
not differ by
70
sex.
Rates for ages not shown will be provided on request and will
be computed
on a basis consistent with the rates in the above tables.
71
Aetna Life Insurance and Annuity Company
TRANSFER CREDIT ENDORSEMENT
The Contract or Certificate is hereby endorsed as follows:
Add the following statement to the end of Section 3.02
entitled Net Contribution(s):
Transferred Assets are the value of prior contributions into
an existing Plan which are deposited into this Contract as of
the date the amount is received in good order by Aetna.
Transferred Assets, less any premium tax, will be allocated to
Participant Individual Accounts in amounts authorized by the
Contract Holder.
Where Aetna is the exclusive 403(b) Plan provider, Aetna will
apply a Transfer Credit equal to [2%] of Transferred Assets
deposited into the Contract and allocated to Individual
Accounts. The Transfer Credit amount is calculated as of the
one year anniversary of a Participant's first Net Contribution
to the Contract. The calculation for any Transfer Credit
amount will be based on the total amount of Transferred Assets
remaining in Individual Accounts as of the calculation date.
The Transfer Credit amount will be allocated to the Fixed Plus
Account. The amount will include the Transfer Credit plus any
interest that would have accrued had the Transfer Credit
actually been deposited into the Fixed Plus Account on the
first business day of the calendar month following
calculation.
Transfer Credit will not be applied to assets transferred into
the Contract from existing Aetna Contracts. Only Net
Contributions not previously held by Aetna Life Insurance and
Annuity Company are eligible for Transfer Credit.
72
Endorsed and made a part of the Contract or Certificate on the
effective date of the Contract.
73
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74
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75
[Aetna Logo]
Aetna Life Insurance and Annuity Company
Home Office: 000 Xxxxxxxxxx Xxxxxx
Hartford, Connecticut 06156
(000) 000-0000
Group Combination Annuity Contract
Nonparticipating
ALL PAYMENTS AND VALUES PROVIDED BY THE CONTRACT, WHEN BASED
ON INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT, ARE VARIABLE
AND ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT. THIS
CONTRACT CONTAINS A MARKET VALUE ADJUSTMENT FORMULA.
APPLICATION OF A MARKET VALUE ADJUSTMENT MAY RESULT IN EITHER
AN INCREASE OR DECREASE IN THE CURRENT VALUE. THE MARKET
VALUE ADJUSTMENT FORMULA DOES NOT APPLY TO A GUARANTEED TERM
AT THE TIME OF ITS MATURITY.
76
