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EXHIBIT 4A
FIRST SUNAMERICA LIFE INSURANCE COMPANY
A STOCK COMPANY NEW YORK, NEW YORK
CERTIFICATE NUMBER P9999999999
PARTICIPANT XXXX XXX
EXECUTIVE OFFICE ANNUITY SERVICE CENTER
1 SUNAMERICA CENTER 000 XXXXX XXX., 0XX XXXXX
XXX XXXXXXX, XX 00000 XXX XXXX, XX 00000
FIRST SUNAMERICA LIFE INSURANCE COMPANY ("We", "Us" or the "Company" or "First
SunAmerica") agrees to provide benefits to the Participant in the Group
Contract, subject to the provisions set forth in this Certificate and in
consideration of the Participant's Enrollment Form and Purchase Payments We
receive.
THIS CERTIFICATE IS EVIDENCE OF COVERAGE UNDER THE GROUP CONTRACT IF A
PARTICIPANT ENROLLMENT FORM IS ATTACHED. THE COVERAGE WILL BEGIN AS OF THE
CERTIFICATE DATE, SHOWN ON THE CERTIFICATE DATA PAGE.
THE VALUE OF AMOUNTS ALLOCATED TO THE SEPARATE ACCOUNT DURING THE ACCUMULATION
AND ANNUITY PERIODS IS NOT GUARANTEED, AND WILL INCREASE OR DECREASE BASED UPON
THE INVESTMENT EXPERIENCE OF THE FUND UNDERLYING THE SEPARATE ACCOUNT. THE VALUE
OF THE CASH SURRENDER BENEFIT OF THE FIXED ACCOUNT INCREASES OR DECREASES BASED
ON THE APPLICATION OF THE MARKET VALUE ADJUSTMENT. THE UNADJUSTED CASH SURRENDER
BENEFIT IS AVAILABLE FOR 30 DAYS AFTER THE END OF THE GUARANTEE PERIOD.
THE VALUE OF BENEFITS ANNUITIZED FROM THE SEPARATE ACCOUNT IS NOT GUARANTEED,
AND WILL INCREASE OR DECREASE BASED UPON THE INVESTMENT EXPERIENCE OF THE FUND
UNDERLYING THE SEPARATE ACCOUNT. THE ASSUMED INVESTMENT RATE OF 3.50% IS THE
SMALLEST NET ANNUAL RATE OF INVESTMENT RETURN WHICH WOULD HAVE TO BE EARNED ON
ASSETS SO THAT THE DOLLAR AMOUNT OF VARIABLE ANNUITY PAYMENTS WILL NOT DECREASE.
THE CHARGES AGAINST THE ASSETS OF THE SEPARATE ACCOUNT ARE THE EXPENSE RISK
CHARGE, THE DISTRIBUTION EXPENSE RISK CHARGE AND THE MORTALITY RISK CHARGE.
THESE CHARGES ARE, ON AN ANNUAL BASIS, 0.35%, 0.15%, AND 0.90%, RESPECTIVELY, OF
THE AVERAGE DAILY TOTAL NET ASSET VALUE OF THE SEPARATE ACCOUNT.
TEN DAY RIGHT TO EXAMINE CERTIFICATE - YOU MAY RETURN THIS CERTIFICATE TO OUR
ANNUITY SERVICE CENTER WITHIN 10 DAYS AFTER YOU RECEIVE IT. THE COMPANY WILL
REFUND ALL PURCHASE PAYMENTS ALLOCATED TO THE FIXED ACCOUNT, PLUS THE VALUE OF
AMOUNTS IN THE VARIABLE ACCOUNTS EFFECTIVE THE DAY THAT THE CERTIFICATE IS
MAILED OR DELIVERED TO THE EXECUTIVE OR ANNUITY SERVICE CENTER. UPON SUCH
REFUND, THE CERTIFICATE SHALL BE VOID.
THIS IS A LEGAL CONTRACT. READ IT CAREFULLY.
/s/ XXXXX X. XXXXXX /s/ XXX XXXXX
----------------------------- -----------------------------
Xxxxx X. Xxxxxx Xxx Xxxxx
Sectetary President
ALLOCATED FIXED AND
VARIABLE GROUP ANNUITY CERTIFICATE
Nonparticipating
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TABLE OF CONTENTS
CERTIFICATE DATA PAGE.....................................................PAGE 3
DEFINITIONS...............................................................PAGE 5
GENERAL PROVISIONS........................................................PAGE 8
Conformity With State Laws; Changes in Law; Assignment; Misstatement of Age or
Sex; Written Notice; Proof of Age, Sex or Survival; Non-Participating; Periodic
Reports; Premium Taxes; Change of Annuitant; Deferment of Payments; Suspension
of Payments; Purchase Payments; Substitution of Fund; Separate Account
ACCUMULATION PROVISIONS................................................. PAGE 11
Separate Account Accumulation Value Number of Accumulation Units; Accumulation
Unit Value (AUV); Fixed Account Accumulation Value; Fixed Account Guarantee
Period Options; Market Value Adjustment
CHARGES AND DEDUCTIONS ..................................................PAGE 13
Contract Administration Charge; Contingent Deferred Sales Charge; Expense Risk
Charge; Distribution Expense Charge; Mortality Risk Charge
TRANSFER PROVISION ......................................................PAGE 14
Transfers of Accumulation Units Between Variable Accounts; Transfers of
Accumulation Units To and From the Fixed Account
WITHDRAWAL PROVISION ....................................................PAGE 15
Contingent Deferred Sales Charge
DEATH BENEFIT PROVISION .................................................PAGE 17
Proof of Death; Amount of Death Benefit; Beneficiary; Death of Participant
ANNUITY PROVISIONS ......................................................PAGE 19
Payments to Participant; Xxxxx Xxxxxxx Payments; Amount of Fixed Annuity
Payments; Amount of Variable Annuity Payments
ANNUITY OPTIONS .........................................................PAGE 21
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CERTIFICATE DATA PAGE
CERTIFICATE NUMBER: ANNUITY SERVICE CENTER:
P9999999999 000 XXXXX XXXXXX
0XX XXXXX
XXX XXXX, XX 00000
PARTICIPANT:
XXXX XXX
ANNUITANT:
XXXX XXX
BENEFICIARY: DATE OF ISSUE:
DECEMBER 09, 1992
ANNUITY DATE: FIRST PURCHASE PRICE
SEPTEMBER 01, 2048 ($10,000.00)
MINIMUM SUBSEQUENT PURCHASE
PAYMENT: $250.00
AGE AT ISSUE:
35 MAXIMUM PURCHASE PAYMENT:
$500,000.00
FUNDS UNDERLYING VARIABLE SEPARATE ACCOUNT: FIXED ACCOUNT -
MUTUAL FUND VARIABLE Minimum Subsequent Guarantee
ANNUITY TRUST Rate:
3.0%
ANNUAL CONTRACT ADMINISTRATION CHARGE: LATEST ANNUITY DATE:
$30.00 Age 85
SEPARATE ACCOUNTS: FOR INQUIRIES CALL:
FS VARIABLE ANNUITY ACCOUNT TWO (000) 000-0000
MARKET VALUE ADJUSTMENT
All payments and values based on the Fixed Account are subject to a Market Value
Adjustment formula, the operation of which may result in upward and downward
adjustments in amounts payable. The Market Value Adjustment formula will not be
applied:
(1) for the payment of the Death Benefit,
(2) for the amounts withdrawn to pay fees or charges,
(3) for amounts withdrawn within 30 days after the end of the Guarantee Period,
(4) for annuitizations on the latest Annuity Date,
(5) in connection with the Automatic Dollar Cost Averaging Program.
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PURCHASE PAYMENT ALLOCATION
Variable Account Options Fixed Account Options
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Initial
Mutual Fund Variable Interest Guarantee
Annuity Trust Rate Period
100.00% International Equity 0.00% 1 Year Fixed
0.00% Capital Growth 0.00% 3 Year Fixed
0.00% Growth and Income 0.00% 5 Year Fixed
0.00% Asset Allocation 0.00% 7 Year Fixed
0.00% U.S. Treasury Income 0.00% 10 Year Fixed
0.00% Money Market
Number of Full Contribution Years Elapsed Contingent
Between Contribution Year of Withdrawal Deferred
and Contribution Year of Purchase Payment Sales Charge
----------------------------------------- ------------
0 6%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
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DEFINITIONS
ACCUMULATION UNIT
A unit of measurement used to compute the Certificate Value in a Variable
Account prior to the Annuity Date.
ANNUITANT
The natural person on whose life the annuity benefit for the Certificate is
based.
ANNUITY DATE
The date on which annuity payments to the Payee are to start. The latest
possible Annuity Date will be set by Us.
ANNUITY SERVICE CENTER As specified on the Certificate Data Page.
ANNUITY UNIT
A unit of measurement used to compute annuity payments in a Separate Account.
CERTIFICATE
This form which describes Your interest in the Group Contract. Nothing in the
Group Contract invalidates or impairs any right granted to You by this
Certificate.
CERTIFICATE DATE
The date Your Certificate is issued, shown on the Certificate Data Page.
CERTIFICATE VALUE
The sum of Your share of the Variable Accounts' Accumulation Values and Fixed
Account Accumulation Values.
CERTIFICATE YEAR
A year starting from the Certificate Date in one calendar year and ending on the
day preceding the Certificate Date in the succeeding calendar year.
CONTRIBUTION YEAR
A year stating from the date of the Purchase Payment in one calendar year and
ending on the day preceding the anniversary of such date in the succeeding
calendar years. The Contribution Year in which a Purchase Payment is made is
"Contribution Year 0", subsequent Contribution Years are successively numbered
beginning with Contribution Year 1.
CURRENT INTEREST RATE
The sum of the Subsequent Guarantee Rate and the Excess Interest Rate declared
by Us for any Guarantee Period.
DEFERRED ANNUITY
An annuity Contract under which the start of annuity payments is deferred to a
future date.
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EXCESS INTEREST RATE
A rate of interest declared by Us in excess of the Subsequent Guarantee Rate for
any Guarantee Period.
FIXED ACCOUNT
The Fixed Account is composed of the Participant's Certificate Values allocated
to the Company's general asset account under one or more of the Fixed Account
Options under the Certificate. The general asset account contains all of the
assets of the Company except for the Separate Account and other segregated asset
accounts. Amounts in the Fixed Account are guaranteed by the Company.
FIXED ANNUITY
A series of periodic payments for the benefit of the Participant of
predetermined amounts that do not vary with investment experience. Such payments
are made out of the general account assets of the Company.
FUND
A collective term used to represent an investment entity, a portfolio of which
may be selected by the Participant to be an underlying investment of the
Participant's Certificate.
GUARANTEE PERIOD
The period(s) for which the Initial Interest Rate(s) listed on the Purchase
Payment Allocation page is (are) credited.
IRC
The Internal Revenue Code of 1986, as amended, as the same may be amended or
superseded.
PARTICIPANT
The person named in the Certificate who is entitled to exercise all rights and
privileges of ownership under the Certificate.
PAYEE
Any person receiving payment of annuity benefits under this Certificate during
the Annuity Period.
PORTFOLIO
A separate investment portfolio of a Fund which has distinct investment
objectives. Each Portfolio serves as an underlying investment medium for
Purchase Payments and allocations made to one of the Variable Accounts of the
Separate Account.
PURCHASE PAYMENTS
Payments made by or on behalf of the Participant to the Company for the
Certificate.
SEPARATE ACCOUNT
A segregated asset account named on the Certificate Data Page, established by
the Company in accordance with California law. The Separate Account consists of
several Variable Accounts, each investing in a Portfolio of a Fund. The
Prospectus should be read for complete details regarding Separate Account
contracts.
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SUBSEQUENT GUARANTEE RATE
The rate of interest established by the Company for the applicable Subsequent
Guarantee Period, but in no event less than the rate specified on the
Certificate Data Page.
SUBSEQUENT GUARANTEE PERIOD
The period for which the Current Interest Rate is credited. The contract may
have several overlapping Subsequent Guarantee Periods, as a result of new
Subsequent Guarantee Periods beginning because of new purchase payments,
transfers from the Variable Account and expirations of existing Subsequent
Guarantee Periods.
VALUATION PERIOD
The period beginning at the close of the New York Stock Exchange on each day
that the New York Stock Exchange is open for regular trading and ending at the
close of the next succeeding business day of the New York Stock Exchange.
VARIABLE ACCOUNT
The Variable Account is composed of the Participant's Certificate Values
allocated to the Separate Account, the assets of which consist of shares of a
specified Portfolio of a Fund. The available Variable Account Options are shown
on the Certificate Data Page.
VARIABLE ANNUITY
A series of periodic payments which vary in amount according to the investment
experience of a one or more Variable Accounts.
WE, OUR, US, THE COMPANY
First SunAmerica Life Insurance Company.
YOU, YOUR
The Participant.
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GENERAL PROVISIONS
CONFORMITY WITH STATE LAWS
This Certificate will be interpreted under the law of the state in which it is
delivered. Any provision which, on the Certificate Date, is in conflict with the
law of such state is amended to conform to the minimum requirements of such law.
CHANGES IN LAW
If laws governing this Certificate or the taxation of benefits under the
Certificate change, We will amend the Group Contract and this Certificate to
comply with these changes.
ASSIGNMENT
The Participant may assign this Certificate before the Annuity Date, but We will
not be bound by an assignment unless it is in writing and We have received it.
Participant's rights and those of any other person referred to in this
Certificate will be subject to the assignment. We assume no responsibility for
the validity or tax consequences of any assignment.
MISSTATEMENT OF AGE OR SEX
If the age or sex of any Annuitant has been misstated, future payments will be
adjusted using the correct age and sex, according to Our rates in effect on the
date that annuity payments were determined. Any overpayment from the Fixed
Account, plus interest at the rate of 4% per year, will be deducted from the
next payment(s) due. Any underpayment from the Fixed Account, plus interest at
the rate of 4% per year, will be paid in full with the next payment due. Any
overpayment from the Variable Accounts will be deducted from the next payment(s)
due. Any underpayment from the Variable Accounts will be paid in full with the
next payment due.
WRITTEN NOTICE
Any notice We send to the Participant will be sent to the Participant's address
shown in the Application unless the Participant requests otherwise. Any written
request or notice to Us must be sent to Our Annuity Service Center, as specified
on the Certificate Data Page.
PROOF OF AGE, SEX OR SURVIVAL
The Company may require satisfactory proof of correct age or sex at any time. If
any payment under this Certificate depends on the Annuitant being alive, the
Company may require satisfactory proof of survival.
NON-PARTICIPATING
This Certificate does not share in Our surplus.
PERIODIC REPORTS
The Company will furnish the Participant with an annual report of the Variable
and Fixed Account balances. This report will show the number of accumulation
units and the dollar value of such units. The report will also show the
remaining contingent deferred sales charge, the cash surrender value, the death
benefit and the method used to derive the market value adjustment.
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PREMIUM TAXES
The Company may deduct from the Certificate Value any applicable premium or
other taxes payable to a state or other government entity. Should We advance any
amount so due, We are not waiving any right to collect such amounts at a later
date. The Company will deduct any withholding taxes required by applicable law.
CHANGE OF ANNUITANT
Prior to the Annuity Date, the Participant may change the Annuitant. To be
effective, such a change must be received by Us in a written form acceptable to
Us.
DEFERMENT OF PAYMENTS
We may defer making payments from the Fixed Account for up to 6 months.
Interest, subject to state requirements, will be credited during the deferral
period.
SUSPENSION OF PAYMENTS
We may suspend or postpone any payments from the Variable Accounts if any of the
following occur:
(a) the New York Stock Exchange is closed,
(b) trading on the New York Stock Exchange is restricted,
(c) an emergency exists such that it is not reasonably practical to dispose of
securities in the Separate Account or to determine the value of its assets,
or
(d) the Securities and Exchange Commission, by order, so permits for the
protection of security holders.
Conditions in (b) and (c) will be decided by or in accordance with rules of the
Securities and Exchange Commission.
PURCHASE PAYMENTS
Purchase Payments are flexible. This means that You, subject to Company declared
minimums and maximums, may change the amounts, frequency or timing of Purchase
Payments. Purchase Payments may be allocated to the Fixed Account and one or
more Variable Accounts in accordance with instructions from You.
SUBSTITUTION OF FUND
If the shares of any of the Funds or any Portfolio of a Fund should no longer be
available for investment by the Separate Account or if, in the judgment of the
Company's Board of Directors, further investment in the shares of a Fund is no
longer appropriate in view of the purpose of the Contract, the Company may
substitute shares of another mutual fund or separate investment series thereof,
for Fund shares already purchased or to be purchased in the future by Purchase
Payments under the Contract. No substitution of securities may take place
without prior approval of the Securities and Exchange Commission, the
Superintendent of the Insurance Department, and under such requirements as they
may impose.
SEPARATE ACCOUNT
The Separate Account is a separate investment account of the Company. It is
shown on the Certificate Data Page. The assets of the Separate Account are the
property of the Company. However, they are not chargeable with the liabilities
arising out of any other business the Company may conduct. Each Variable Account
is not chargeable with liabilities arising out of any other Variable Account.
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AUTOMATIC DOLLAR COST AVERAGING PROGRAM
Participants who wish to purchase units of the Portfolios over a period of time
may be able to do so through the Automatic Dollar Cost Averaging ("DCA")
Program. Under this program, the Participant may authorize the automatic
transfer of a fixed dollar amount ($100 minimum) of his or her choice at regular
intervals from a source account to one or more of the portfolios (other than the
source account) at the unit values determined on the dates of the transfers. The
interval between transfers may be monthly, quarterly, semiannually or annually,
at the option of the Participant.
Another option under the DCA Program is the periodic transfer of a selected
percentage of the value of the source account to one of the Portfolios (other
than the source account). A third option is to transfer the entire Certificate
Value in the source account in a stated number of transfers as selected by the
Participants.
The participant may elect to increase, decrease or change the frequency or
amount of Purchase Payments under a DCA Program. The DCA application and any
Purchase Payments should be sent to the Company at its Annuity Service Center.
The Participant should contact the Company for a list of available source
accounts under the program.
SYSTEMATIC WITHDRAWAL PROGRAM
Participants may choose to withdraw amounts which in the aggregate add up to a
maximum of 10% of their Purchase Payments annually without the application of
any contingent deferred sales charge. The minimum systematic withdrawal amount
is $250 per withdrawal. Participants must complete a Systematic Withdrawal
application and send it to the Company at its Annuity Service Center.
Participation in the Systematic Withdrawal Program may be elected at the time
the Certificate is issued or on any date thereafter, prior to the Annuity Date.
TERMINATION OF GROUP CONTRACT
In the event that the group contract is terminated, the Participant may either
elect to receive the Certificate Value or apply such Certificate Value to one of
the Annuity Options.
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ACCUMULATION PROVISIONS
SEPARATE ACCOUNT ACCUMULATION VALUE
The Separate Account Accumulation Value under the Certificate shall be the sum
of the values of the Accumulation Units held in the Variable Accounts for the
Participant.
NUMBER OF ACCUMULATION UNITS
For each Variable Account, the number of Accumulation Units is the sum of:
Each Purchase Payment and transfer allocated to the Variable Account, reduced by
applicable premium taxes, if any:
Divided by
The Accumulation Unit Value for that Variable Account as of the Valuation Period
in which the Purchase Payment or transfer amount is received.
The number of Accumulation Units will be similarly adjusted for withdrawals,
annuitizations, transfers, and charges. Adjustments will be made as of the end
of the Valuation Period in which We receive all requirements for the
transaction, as appropriate.
ACCUMULATION UNIT VALUE (AUV)
The AUV of a Variable Account for any Valuation Period is calculated by
subtracting (2) from (1) and dividing the result by (3) where:
(1) is the total value at the end of the given Valuation Period of the assets
attributable to the Accumulation Units of the Variable Account minus the
total liabilities;
(2) is the cumulative unpaid charge for assumption of mortality expense and
distribution expense risks (See CHARGES AND DEDUCTIONS);
(3) is the number of Accumulation Units outstanding at the end of the given
Valuation Period.
FIXED ACCOUNT ACCUMULATION VALUE
Under a Certificate, the Fixed Account Accumulation Value shall be the sum of
all monies allocated or transferred to the Fixed Account, reduced by any
applicable premium taxes, plus all interest credited on the Fixed Account during
the period that the Certificate has been in effect. This amount shall be
adjusted for withdrawals, annuitizations, transfers, and charges.
FIXED ACCOUNT GUARANTEE PERIOD OPTIONS
For any amounts allocated to the Fixed Account, the Participant will select the
duration of the Guarantee Period(s) from those listed on the Certificate Data
Page. Such amounts will earn interest at the Current Interest Rate for the
chosen duration, compounded annually during the entire Guarantee Period. In no
event will the Current Interest Rate be less than the Subsequent Guarantee Rate
specified on the Certificate Data Page. Each deposit allocated to the Fixed
Account will have its own Guarantee Period and Current Interest Rate.
You may allocate Purchase Payments, or make transfers from the Variable Account
Options, to the Fixed Account at any time prior to the Annuity Date. However, no
Guarantee Period other than one year may be chosen which extends beyond the
Annuity Date. For thirty (30) days following the date of expiration
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of the current Guarantee Period, You may renew for the same or any other
Guarantee Period at the then Current Interest Rate or may transfer all or a
portion of the amount to the Variable Accounts. Transfers from the Fixed Account
may take place thirty (30) days following the end of a Guarantee Period without
being subject to a Market Value Adjustment (MVA).
A notice will be mailed at least fifteen (15), but not more than forty-five (45)
days prior to the beginning of the thirty (30) day Guarantee Period expiration
date, notifying You that You may renew the same Guarantee Period or select a new
one. This notice will provide a telephone number to call to get the Current
Interest Rates available.
If the Participant does not specify a Guarantee Period at the time of renewal,
We will select the same Guarantee Period as has just expired, so long as such
Guarantee Period does not extend beyond the Annuity Date. If a renewal occurs
within one year of the latest Annuity Date We will credit interest up to the
Annuity Date at the then Current Interest Rate for the one year Guarantee
Period.
MARKET VALUE ADJUSTMENT
Any amount withdrawn, transferred or annuitized from the Fixed Account prior to
the end of that Guarantee Period may be subject to a MVA. The MVA will be
calculated by multiplying the amount withdrawn, transferred or annuitized by the
formula described below:
(N/12)
{(1 + I)/(1+J+0.0025)} - 1
I = The interest rate currently in effect for that Guarantee Period.
J = The Current Interest Rate available for the Guarantee Period equal to the
number of years (rounded up to an integer) remaining in the current Guarantee
Period at the time of withdrawal, transfer or annuitization. In the
determination of J, if the Company currently does not offer the applicable
Guarantee Period, then the rate will be determined by linear interpolation of
the current rates for the nearest two Guarantee Periods that are available.
N = The number of full months remaining in the current Guarantee Period at the
time the withdrawal or annuitization request is processed.
If a Contingent Deferred Sales Charge (CDSC) is applied to a withdrawal, then
the Market Value Adjustment (MVA) will be applied to the Net Withdrawal Amount.
The Net Withdrawal Amount is the Accumulated Value, less CDSC.
There will be no Market Value Adjustment on withdrawals from the Fixed Account
in the following situations: (1) Death Benefit paid upon death of the
Participant; (2) amounts withdrawn to pay fees or charges; (3) amounts withdrawn
from the Fixed Account within thirty (30) days after the end of the Guarantee
Period; (4) annuitizations on the latest Annuity Date; (5) in connection with
the Automatic Dollar Cost Averaging Program. A detailed description has been
filed with the Department of Insurance.
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CHARGES AND DEDUCTIONS
We will deduct the following charges from the Certificate:
CONTRACT ADMINISTRATION CHARGE
The charge specified on the Certificate Data Page will be deducted on each
Certificate anniversary that occurs on or prior to the Annuity Date. It will
also be deducted when the Certificate Value is withdrawn in full if withdrawal
is not on a Certificate anniversary. We reserve the right to assess a charge on
a class basis which is less than the charge specified on the Certificate Data
Page.
CONTINGENT DEFERRED SALES CHARGE
This charge may be deducted upon withdrawal of the Certificate Value, in whole
or in part. See WITHDRAWAL PROVISIONS.
EXPENSE RISK CHARGE
On an annual basis this charge equals 0.35% of the average daily total net asset
value of the Variable Accounts. This charge is to compensate Us for assuming the
expense risks under the Certificate.
DISTRIBUTION EXPENSE CHARGE
On an annual basis this charge equals 0.15% of the average daily total net asset
value of the Variable Account. This charge is to compensate Us for all
distribution expenses associated with the Certificate.
MORTALITY RISK CHARGE
On an annual basis this charge equals 0.9% of the average daily total net asset
value of the Variable Account. This charge is to compensate Us for assuming the
mortality risks under the Certificate.
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TRANSFER PROVISION
Prior to the Annuity Date, You may transfer all or part of Your Certificate
Value to any of the Variable Accounts or the Fixed Account. We will charge a $25
transfer fee for each transfer that exceeds the annual Certificate Year limit of
15.
Transfers will be effected at the end of the Valuation Period in which We
receive Your request for the transfer.
TRANSFERS OF ACCUMULATION UNITS BETWEEN VARIABLE ACCOUNTS
Both prior to and after the Annuity Date, You may transfer all or a portion of
Your investment in one Variable Account to another Variable Account. A transfer
will result in the purchase of Accumulation Units in a Variable Account and the
redemption of Accumulation Units in the other Variable Account.
The minimum amount which can be transferred between Variable Accounts is $100.
The amount that must remain in the Variable Account is $100. If the remaining
amount in the Variable Account is less than $100, then the entire amount of the
Variable Account will be transferred.
TRANSFERS OF ACCUMULATION UNITS TO AND FROM THE FIXED ACCOUNT
Both prior to and after the Annuity Date, You may transfer all or any part of
the Certificate Value from the Variable Account(s) to the Fixed Account of the
Certificate. After the Annuity Date no transfers from the Fixed Account to the
Variable Account are allowed. For transfers from the Fixed Account prior to the
Annuity Date see ACCUMULATION PROVISIONS - FIXED ACCOUNT ACCUMULATION VALUE.
During the Annuity Period, the amount transferred to the Fixed Account from a
Variable Account will be equal to the annuity reserve for the Payee's interest
in that Variable Account. The annuity reserve is the product of (a) multiplied
by (b) multiplied by (c), where
(a) is the number of Annuity Units representing the Participant's interest in
the Variable Account;
(b) is the Annuity Unit Value for the Variable Account; and
(c) is the present value of $1.00 per payment period as of the age of the
Annuitant at the time of transfer for the Annuity Option, determined using
the 1983a Annuity Mortality Tables with interest at 3.5% per year.
Xxxxxxx transferred to the Fixed Account will be applied under the Annuity
Option at the age of the Annuitant at the time of the transfer. All amounts and
Annuity Unit Values will be determined as of the end of the Valuation Period
preceding the effective date of the transfer.
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WITHDRAWAL PROVISION
Prior to the Annuity Date while the Annuitant is living, You may withdraw all or
part of the Certificate Value amounts under this Certificate by informing Us at
Our Annuity Service Center. For full withdrawal, this Certificate must be
returned to Our Annuity Service Center.
Absent written notification to the contrary, withdrawals and any applicable
charge will be deducted from the Certificate Value in proportion to its
allocation among the Fixed Account and the Variable Accounts. Withdrawals will
be based on values at the end of the valuation Period in which the request for
withdrawal and the Certificate (in the case of a full withdrawal), are received
at the Annuity Service Center. Unless the SUSPENSION OF PAYMENTS or DEFERMENT OF
PAYMENTS sections are in effect, payment of withdrawals will be made within
seven days.
CONTINGENT DEFERRED SALES CHARGE
Withdrawal of all or part of the Certificate Value may be subject to a Continent
Deferred Sales Charge (CDSC). However, no CDSC is made on an amount withdrawn
which is considered to be a withdrawal of earnings.
In addition, for the first withdrawal during a Certificate Year, after the first
Certificate Year, no Contingent Deferred Sales Charge is applied to such part of
the withdrawal which does not exceed the greater of (a) earnings in the
Certificate or (b) the Free Corridor. The Free Corridor is equal to 10% of the
sum of Purchase Payments made more than one year prior to the date of withdrawal
still subject to CDSC, and are not yet withdrawn. The portion of a free
withdrawal, which exceeds the sum of earnings attributable to the Participant
and premiums which are both no longer subject to CDSC and not yet withdrawn, is
assumed to be a withdrawal against future earnings. We reserve the right to
allow the Free Corridor to include all Purchase Payments still subject to CDSC
which are not yet withdrawn. If this is done, it will apply to all Participants,
and Participants will be notified of such change.
For the purpose of determining the CDSC, a withdrawal will be attributed to
amounts in the following order: (1) earnings in the Certificate, (2) Purchase
Payments which are both no longer subject to CDSC and are not yet withdrawn, and
(3) Purchase Payments subject to CDSC. Purchase Payments, when withdrawn, are
assumed to be withdrawn on a first-in first-out (FIFO) basis. The charge applied
to any withdrawal subject to CDSC will depend on the age of the Purchase Payment
to which the withdrawal is attributed.
Number of Full Contribution Years Elapsed Contingent
Between Contribution Year of Withdrawal Deferred
and Contribution Year of Purchase Payment Sales Charge
----------------------------------------- ------------
0 6%
1 6%
2 5%
3 4%
4 3%
5 2%
6 1%
7+ 0%
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The CDSC will be assessed against the Variable Accounts and the Fixed Account in
the same proportion as the remaining Certificate Value is allocated unless the
allocation is specified by the Participant. If the remaining Certificate Value
is insufficient to cover the Contingent Deferred Sales Charge, any remaining
balance will be deducted from the dollar amount requested.
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DEATH BENEFIT PROVISION
We will pay a Death Benefit to the Beneficiary upon Our receiving due proof that
the Participant died prior to the Annuity Date. The Death Benefit shall be
reduced by premium taxes incurred by the Company, if any. The Beneficiary's
options are described in the Death of Participant section. If a single sum
payment is requested, payment will be in accordance with any applicable laws and
regulations governing payments on death. If an Annuity Option is desired, an
Option must be elected within 60 days of Our receipt of due proof of the
Participant's death at Our Annuity Service Center; otherwise a single sum
payment will be made at the end of such 60 day period. Funds will remain
allocated pursuant to the last allocation and instructions in effect at the
Participant's death until Our Annuity Service Center receives new written
instructions.
PROOF OF DEATH Due
Proof of Death means:
1. a certified copy of a death certificate; OR
2. a certified copy of a decree of a court of competent jurisdiction as to the
finding of death; OR
3. a written statement by a medical doctor who attended the deceased
Participant at the time of death; OR
4. any other proof satisfactory to Us.
AMOUNT OF DEATH BENEFIT
In the case of a Participant less than age 70 on the Certificate Date, the Death
Benefit shall be the greatest of :
1. 100% of the total amount of Purchase Payments, less any partial withdrawals
and partial annuitizations made; OR
2. the Certificate Value at the end of the Valuation Period during which We
receive at Our Annuity Service Center due proof of the Participant's death
and an election of the type of payment to be made; OR
3. the Certificate Value realized on that anniversary of the Certificate Date
prior to death, increased by Purchase Payments made since such anniversary,
and reduced by any partial withdrawals and partial annuitizations since
such anniversary, which will yield the greatest result.
In the case of a Participant age 70 or greater on the Certificate Date, the
Death Benefit shall be the Certificate Value at the end of the Valuation Period
during which We receive at Our Annuity Service Center due proof of the
Participant's death and an election of the type of Payment to be made.
BENEFICIARY
The Beneficiary is as stated in the Application unless later changed by the
Participant. If two or more persons are named, those surviving the Participant
will share equally unless otherwise stated. If the Annuitant survives the
Participant, and there are no surviving Beneficiaries, the Annuitant will be
deemed the Beneficiary. If the Participant is also the Annuitant and there are
no surviving Beneficiaries at the death of the Participant, the Death Benefit
will be paid to the estate of the Participant.
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While the Participant is living and before the Annuity Date, the Participant may
change the Beneficiary by written notice in a form satisfactory to Us. The
change will take effect on the date We receive the notice.
DEATH OF PARTICIPANT
If the Participant dies before the Annuity Date, the Beneficiary will have the
following options:
1. Collect the Death Benefit in a lump sum payment, OR
2. Collect the Death Benefit in the form of one of the Annuity Options. The
payments must be over the life expectancy of the Beneficiary or over a
period of not extending beyond the life of the Beneficiary. This option
must be selected and payments must commence within one year after
Participant's death, OR
3. Collect the entire Death Benefit at any time or from time to time within 5
years of the date of death of the Participant, OR
4. If the Beneficiary is the Participant's spouse, the Beneficiary may
continue the Certificate in force.
If there is no surviving Beneficiary, the Death Benefit will be paid in a lump
sum to Participant's estate. If there is more than one surviving Beneficiary,
the Beneficiaries must choose to receive their respective portions of the Death
Benefit according to either (1), (2) or (3) above.
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ANNUITY PROVISIONS
ANNUITY DATE
The Participant selects an Annuity Date (the date on which the payments are to
begin) at the time of application. The Annuity Date must always be the first day
of the calendar month and must be at least two years after the Issue Date, but
in any event will be no later than the latest Annuity Date. Annuity payments
will begin no later than the latest Annuity Date, as set by the Company. If no
Annuity Date is selected, the Annuity will be the latest Annuity Date, as set by
the Company. The Participant may change the Annuity Date at any time at least
seven days prior to the Annuity Date then indicated on the Company's records by
written notice to the Company at its Annuity Service Center.
PAYMENTS TO PARTICIPANT
Unless otherwise requested by the Participant, the Company will make annuity
payments to the Participant. If the Participant wants the annuity payments to be
made to some other Payee, We will make such payments subject to the following:
(a) A written request must be filed at the Annuity Service Center.
(b) Such request must be filed not later than thirty (30) days before the due
date of the first annuity payment.
Any such request is subject to the rights of any assignee. No payments available
to or being paid to the Payee while the Annuitant is alive can be transferred,
commuted, anticipated or encumbered.
ELECTION OF FIXED AND VARIABLE ANNUITY PAYMENTS
The Participant may elect to have fixed annuity payments only, variable annuity
payments only, or a combination of fixed and variable annuity payments. The type
of annuity payments will be determined by where the Certificate Values are
allocated on the Annuity Date. If a Participant has Certificate Values allocated
to both Fixed and Variable Accounts on the Annuity Date, then the Participant
will receive a combination of fixed and variable annuity payments. If a
Participant desires to have only fixed annuity payments, then the Participant
must transfer, prior to the Annuity Date, all Certificate Values allocated to
the Variable accounts to one of the Fixed Accounts. If a Participant desires to
have only variable annuity payments, then the Participant must transfer, prior
to the Annuity Date, all Certificate Values allocated to the Fixed Accounts to
one of more of the Variable Accounts.
FIXED ANNUITY PAYMENTS
The fixed annuity benefits at the time of their commencement will not be less
than those that would be provided by the application of an amount, hereinafter
defined, to purchase any single consideration immediate annuity contract offered
by the Company at the time to the same class of annuitants. Prior to the Latest
Annuity Date, such amount will be the Certificate Value allocated to the Fixed
Account options, adjusted for any market value adjustment. In the Latest Annuity
Date, such amount will be the Certificate Value allocated to the Fixed Account
options. In no event will the fixed annuity payments be changed.
AMOUNT OF VARIABLE ANNUITY PAYMENTS
(a) FIRST VARIABLE PAYMENT: The dollar amount of the first monthly annuity
payment will be determined by applying the portion of the Certificate Value
allocated to Variable Annuity accounts, less any applicable premium taxes
or other charges, to the annuity table applicable to
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the Annuity Option chosen. If more than one Variable Account has been
selected, the value of the Participant's interest in each Variable Account
is applied separately to the annuity table to determine the amount of the
first annuity payment attributable to the Variable Account.
(b) NUMBER OF VARIABLE ANNUITY UNITS: The number of Annuity Units for each
applicable Variable Account is the amount of the first annuity payment
attributable to that Variable Account divided by the value of the
applicable Annuity Unit for that Variable Account as of the Annuity Date.
The number will not change as a result of investment experience.
(c) VALUE OF EACH VARIABLE ANNUITY UNIT: The initial value of an Annuity Unit
of each Variable Account was arbitrarily set at $10 when the Variable
Accounts were established. The value may increase or decrease from one
Valuation Period to the next. For any Valuation Period, the value of an
Annuity Unit of a particular Variable Account is the value of that Annuity
Unit during the last Valuation Period, multiplied by the Net Investment
Factor for that Variable Account for the current Valuation Period.
The Net Investment Factor for any Variable Account for any Valuation Period is
determined by dividing (a) by (b) and then subtracting (c) from the result
where:
(a) is the net result of:
(1) the net asset value of a Portfolio of the Fund share held in the
Variable Account determined as of the end of the Valuation
Period, plus
(2) the per share amount of a dividend or other distribution
declared by the Portfolio of the Fund on the shares held in the
Variable Account if the "ex-dividend" date occurs during the
Valuation Period, plus or minus
(3) a per share credit or charge with respect to any taxes paid or
reserved for by the Company during the Valuation Period which
are determined by the Company to be attributable to the
operation of the Variable Account (no federal income taxes are
applicable under present law);
(b) is the net asset value of a Portfolio of the Fund share held in the
Variable Account determined as of the end of the preceding Valuation
Period; and
(c) is the asset charge factor determined by the Company for the
Valuation Period to reflect the Expense Risk Charge, Distribution
Expense Charge and Mortality Risk Charge.
The result is then multiplied by a factor that neutralizes the Assumed
Investment Rate.
(d) SUBSEQUENT VARIABLE ANNUITY PAYMENTS: After the first Variable
Annuity payment, payments will vary in amount according to the
investment performance of the applicable Variable Accounts. The
amount may change from month to month. The amount of each subsequent
payment is the product of:
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The number of Annuity Units for each Variable Account as determined for the
first annuity payment
Multiplied by
The value of an Annuity Unit for that Variable Account at the end of the
Valuation Period immediately preceding in which payment is due.
The Company guarantees that the amount of each Variable Annuity payment will not
be affected by variations in expenses or mortality experience. The Assumed
Invested Rate of 3.50% is the smallest net annual rate of investment return
which would have to be earned on assets so that the dollar amount of variable
annuity payments will not decrease.
ANNUITY OPTIONS
Upon written election filed with the Company at its Annuity Service Center, all
or part of the Contract Value may be applied to provide one of the following
options or any Annuity Option that is mutually agreeable.
OPTION 1 - LIFE ANNUITY, LIFETIME MONTHLY PAYMENTS GUARANTEED
Monthly payments payable to the Payee during the lifetime of the Annuitant. No
further payments are payable after the death of the Annuitant and there is no
provision for a Death Benefit payable to the Beneficiary.
OPTION 2 - JOINT AND SURVIVOR LIFE ANNUITY
Monthly payments payable to the Payee during the joint lifetime of the Annuitant
and a designated second person and during the lifetime of the survivor.
If a reduced payment to the survivor is desired, Variable Annuity payments to
the survivor will be determined using either one-half or two-thirds of the
number of each type of Annuity Unit credited to the Certificate. Fixed monthly
payments to the survivor will be equal to either one-half or two-thirds of the
fixed monthly payment payable during the joint lifetime of the Annuitant and the
designated second person.
OPTION 3 - JOINT AND SURVIVOR LIFE ANNUITY - 120 MONTHLY PAYMENTS GUARANTEED
Monthly payments payable to the Payee during the joint lifetime of the Annuitant
and designated second person and continuing during the remaining lifetime of the
survivor, with the guarantee that if, at the death of the survivor, payments
have been made for less than 120 monthly periods, any remaining guaranteed
annuity payments will be continued to the Beneficiary named on the Annuity
Option Selection Form. In the event of death of the Annuitant and the designated
second person under this option, the Company shall in most instances, calculate
the discounted value of the remaining guaranteed annuity payments and pay them
in one sum.
OPTION 4 - LIFE ANNUITY WITH 120 OR 240 MONTHLY PAYMENTS GUARANTEED
An annuity payable monthly to the Payee during the lifetime of the Annuitant
with the guarantee that if, at the death of the Annuitant, payments have been
made for less than the 120 or 240 monthly periods, as selected, payments will be
made in the same manner as provided under OPTION 3 above. In the event
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of death of the Annuitant under this option, the Company shall in most
instances, calculate the discounted value of the remaining guaranteed annuity
payments and pay them in one sum.
OPTION 5 - FIXED PAYMENTS FOR A SPECIFIED PERIOD CERTAIN
Fixed monthly payments payable to the Payee for any specified period of time
five (5) years or more, but not exceeding thirty (30) years), as elected. The
election must be made for full twelve month periods. In the event of death of
the Payee under this option, the Company shall in most instances, calculate the
discounted value of the remaining guaranteed annuity payments and pay them in
one sum.
BASIS OF COMPUTATION
The actuarial basis for the Table of Guaranteed Annuity Rates is the 1983a
Annuity Mortality Table, without projection with interest at 3.5%. The Table of
Guaranteed Annuity Rates does not include any applicable premium tax.
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OPTIONS 1 & 4 - TABLE OF MONTHLY INSTALLMENTS
(Monthly installments for ages not shown will be furnished upon request.)
OPTION 1 OPTION 4 OPTION 4
AGE OF LIFE ANNUITY LIFE ANNUITY
PAYEE LIFE ANNUITY (W/120 PAYMENTS GUARANTEED) (W/240 PAYMENTS GUARANTEED)
MALE FEMALE MALE FEMALE MALE FEMALE
55 4.99 4.54 4.91 4.51 4.66 4.38
56 5.09 4.62 5.00 4.58 4.72 4.44
57 5.20 4.71 5.10 4.66 4.78 4.51
58 5.32 4.80 5.20 4.75 4.85 4.57
59 5.44 4.90 5.31 4.84 4.91 5.64
60 5.57 5.00 5.42 4.93 4.97 4.70
61 5.71 5.11 5.54 5.03 5.04 4.77
62 5.86 5.23 5.67 5.14 5.10 4.84
63 6.02 5.36 5.80 5.25 5.16 4.91
64 6.20 5.49 5.94 5.37 5.22 4.98
65 6.38 5.64 6.08 5.50 5.28 5.05
66 6.58 5.79 6.23 5.63 5.33 5.12
67 6.79 5.95 6.38 5.77 5.38 5.19
68 7.02 6.13 6.54 5.91 5.43 5.25
69 7.26 6.32 6.71 6.07 5.48 5.32
70 7.52 6.53 6.87 6.23 5.52 5.37
71 7.80 6.75 7.04 6.41 5.55 5.43
72 8.09 6.99 7.22 6.58 5.59 5.48
73 8.41 7.26 7.39 6.76 5.62 5.52
74 8.75 7.54 7.57 6.95 5.64 5.56
75 9.12 7.85 7.75 7.14 5.66 5.60
76 9.51 8.18 7.92 7.34 5.68 5.63
77 9.92 8.54 8.09 7.54 5.70 5.66
78 10.37 8.94 8.26 7.74 5.71 5.68
79 10.85 9.36 8.42 7.94 5.72 5.70
80 11.37 9.82 8.57 8.13 5.73 5.71
81 11.92 10.32 8.71 8.32 5.74 5.72
82 12.50 10.87 8.85 8.50 5.74 5.73
83 13.12 11.46 8.97 8.67 5.75 5.74
84 13.78 12.09 9.09 8.83 5.75 5.74
85 14.47 12.78 9.20 8.97 5.75 5.75
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OPTION 3 - TABLE OF MONTHLY INSTALLMENTS
(MONTHLY INSTALLMENTS FOR AGES NOT SHOWN WILL BE FURNISHED UPON REQUEST.)
JOINT & 100% SURVIVOR ANNUITY
AGE OF
MALE
PAYEE AGE OF FEMALE PAYEE
55 60 65 70 75 80 85
55 4.16 4.34 4.51 4.66 4.78 4.86 4.92
60 4.27 4.51 4.76 4.99 5.19 5.33 5.44
65 4.35 4.66 4.99 5.34 5.66 5.92 6.11
70 4.42 4.78 5.20 5.67 6.16 6.60 6.96
75 4.47 4.86 5.35 5.95 6.63 7.33 7.95
80 4.50 4.92 5.46 6.17 7.04 8.04 9.02
85 4.52 4.95 5.53 6.31 7.34 8.63 10.05
OPTION 5 - TABLE OF MONTHLY INSTALLMENTS
FIXED PAYMENT FOR SPECIFIED PERIOD
NUMBER MONTHLY NUMBER MONTHLY NUMBER MONTHLY NUMBER MONTHLY
OF YEARS PAYMENT OF YEARS PAYMENT OF YEARS PAYMENT OF YEARS PAYMENT
5 18.12 12 8.46 19 5.97 26 4.84
6 15.35 13 7.94 20 5.75 27 4.73
7 13.38 14 7.49 21 5.56 28 4.63
8 11.90 15 7.10 22 5.39 29 4.53
9 10.75 16 6.76 23 5.24 30 4.45
10 9.83 17 6.47 24 5.09
11 9.03 18 6.20 25 4.96
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