[Xxxxxxx Xxxxxxx]
[XX-0123456]
The Lincoln National Life Insurance Company
A Stock Company
Executive Office: 0000 Xxxxx Xxxxxxx Xxxxxx . Fort Xxxxx, Indiana 46801
Administrative Office: P.O. Box 7890, Fort Xxxxx,
Indiana 46801-7890 (000)-000-0000
ANNUITY CONTRACT
Single Premium Immediate Fixed and Variable Annuity
Nonparticipating
The Lincoln National Life Insurance Company ("Lincoln National") agrees to
provide the benefits and other rights described in this Contract in accordance
with the terms of this Contract.
READ THIS CONTRACT CAREFULLY. This is a legal contract between the Owner and
Lincoln National. We want to be sure you understand the features and benefits
contained in this Contract. IT IS THEREFORE IMPORTANT THAT YOU READ YOUR
CONTRACT CAREFULLY. If you have any questions after reading the Contract, we
hope you will contact your representative or the Administrative Office of
Lincoln National.
NOTICE OF RIGHT TO EXAMINE CONTRACT. Within 10 days after this Contract is first
received, it may be cancelled for any reason without penalty by delivering or
mailing it to the representative through whom it was purchased or to the
Administrative Office of Lincoln National. When the Contract is received at the
Administrative Office, Lincoln National will return the Account Value plus an
amount to reflect any deducted daily charges as of the date of cancellation
where permitted by law.
ALL PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT, WHEN BASED ON THE INVESTMENT
EXPERIENCE OF THE VARIABLE ACCOUNT, ARE VARIABLE. THE AMOUNTS MAY INCREASE OR
DECREASE AND ARE NOT GUARANTEED AS TO FIXED DOLLAR AMOUNT.
Signed for The Lincoln National Life Insurance Company at Hartford, Connecticut
/s/ Xxxx X. Xxxxx
President
Table of Contents
Article Page
1 Definitions 1
2 Single Premium 4
3 Variable Account 5
4 DCA Fixed Account 7
5 Interest Adjusted Fixed Account 8
6 Periodic Income Payments 11
7 Guaranteed Income Benefit Option 15
8 Transfers, Withdrawals and Surrenders 17
9 Death Benefits 19
10 Beneficiary 21
11 Suspension or Deferral of Payments or Transfers 22
12 General Provisions 23
ARTICLE 1
DEFINITIONS
ACCESS PERIOD -- The length of time in whole years, measured from the Periodic
Income Commencement Date shown on the Contract Specifications during which an
Owner may elect to surrender the Contract or make Withdrawals from the Contract.
If during the Access Period the payment of the Guaranteed Income Benefit reduces
the Account Value to zero, the Access Period will end and the Lifetime Income
Period, if any, will begin on the Valuation Date the Account Value equals zero.
The Access Period may not be changed by the Owner.
ACCOUNT VALUE -- During the Access Period, on any Valuation Date the sum of the
values of the Variable Subaccounts attributable to the Contract plus the sum of
the values of the Fixed Account(s) attributable to the Contract. State and local
government premium tax, if applicable, will be deducted from the Account Value
when incurred by Lincoln National, or at another time of Lincoln National's
choosing.
ACCUMULATION UNIT -- A unit of measure used in the calculation of the value of a
Variable Subaccount.
ADMINISTRATIVE OFFICE -- The office where servicing of this Contract takes
place, located at 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx, 00000-0000, or
an institution designated by Lincoln National.
ANNUITANT -- The person upon whose life the annuity payments made after the
Periodic Income Commencement Date will be based. The contract allows only one
Annuitant who may not be changed after the Contract Date.
ANNUITY UNIT -- A unit of measure used to calculate the amount of a Variable
Annuity Payment during the Lifetime Income Period.
ASSUMED INTEREST RATE -- The interest rate used in calculating the Initial
Periodic Income Payment. The Assumed Interest Rate is shown on the Contract
Specifications and may not be changed.
BENEFICIARY -- The person or persons or entity designated by the Owner to
receive the Death Benefit, if any.
INTERNAL REVENUE CODE -- The Internal Revenue Code of 1986, as amended.
CONTRACT -- The agreement between Lincoln National and the Owner, in which
Lincoln National provides an annuity as described on the front page of this
Contract.
CONTRACT DATE -- The date this Contract became effective. The Contract Date is
shown on the Contract Specifications.
CONTRACT YEAR -- Each twelve-month period starting with the Contract Date and
each Contract Date anniversary thereafter.
DEATH BENEFIT -- The amount payable upon death of an Owner or an Annuitant.
DCA FIXED ACCOUNT -- A portion of this Contract established by Lincoln National
to accept the Single Premium or transfers of Account Value that may only be used
for the Dollar Cost Averaging program. Funds in the DCA Fixed Account are
invested in the General Account of Lincoln National.
DOLLAR COST AVERAGING (DCA) -- An option that allows the automatic transfer of a
portion of the Account Value in periodic installments from a designated DCA
holding account to one or more of the Variable Subaccounts available under the
Contract. The periodic installments will be over any DCA period made available
by Lincoln National and selected by the Owner.
EXPIRATION DATE -- The date on which a selected Guaranteed Period of the Fixed
Account will end.
FIXED ACCOUNT -- The fixed portion of the Contract that is invested in the
General Account of Lincoln National.
FIXED SUBACCOUNT -- That portion of the Fixed Account which accepts allocations
for a Guaranteed Period at a Guaranteed Interest Rate. There is a separate Fixed
Subaccount for each Guaranteed Period.
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FUND -- Any of the underlying investment options available in the Variable
Account.
GENERAL ACCOUNT -- An account consisting of all assets owned by Lincoln National
other than those assets in segregated investment accounts.
GUARANTEED INTEREST RATE -- The effective annual rate of interest Lincoln
National guarantees to credit on assets in each Fixed Subaccount.
GUARANTEED PERIOD -- The length of the period during which an initial or
subsequent Guaranteed Interest Rate will be credited. The Guaranteed Period is
selected by the Owner from those made available by Lincoln National at the time
of selection.
HOME OFFICE -- The principal office of Lincoln National located at 0000 Xxxxx
Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx, 00000, or an institution designated by
Lincoln National.
LIFETIME INCOME PERIOD -- The period that begins after the Access Period,
provided the Annuitant, or in the case of a joint life payout the Annuitant or
the Secondary Life, is still living and the Contract has not been surrendered.
This period will then continue for as long as the Annuitant, or the case of a
joint life payout the Annuitant or the Secondary Life, is living.
LINCOLN NATIONAL -- The Lincoln National Life Insurance Company.
NET ASSET VALUE PER SHARE -- The market value of a Fund share calculated each
day.
NOTICE -- Any form of communication providing information as required by Lincoln
National, either in signed writing or another manner, that Xxxxxxx National
approves in advance. All Notices must be received by Lincoln National in the
Administrative Office and must include all required information necessary to
process the request. To be effective for any Valuation Date, a Notice must be
received in good order prior to the end of that Valuation Date.
OWNER -- The one person, two persons or entity who exercises rights of ownership
under this Contract. If two persons are named as Owner, all references to Owner
means joint Owner.
PERIODIC INCOME COMMENCEMENT DATE -- The Valuation Date on which the Initial
Periodic Income Payment is calculated. The due date of the Initial Periodic
Income Payment will be no more than 14 calendar days after the Periodic Income
Commencement Date. The Periodic Income Commencement Date is shown on the
Contract Specifications.
PERIODIC INCOME PAYMENT -- The variable, periodic income amounts paid to an
Owner, or an Owner's designee, during the Access Period and the Lifetime Income
Period which vary in amount with the investment experience of each applicable
Variable Subaccount and the Fixed Subaccounts. Prior to the Contract Date an
Owner must select one of the following Periodic Income Payment Modes: monthly,
quarterly, semi-annually or annually. The Initial Periodic Income Payment Mode
is shown on the Contract Specifications.
QUALIFIED CONTRACT -- A contract that is used as a funding vehicle for a
retirement plan qualified for special tax treatment under the Internal Revenue
Code. All other contracts are considered Non-qualified contracts.
SECONDARY LIFE -- A Secondary Life, if any, is the person designated as such on
the Contract Specifications. The Secondary Life is one of the persons upon whose
life the periodic income payments made after the Periodic Income Commencement
Date will be based. The Contract allows only one Secondary Life who may not be
changed after the Contract Date.
SINGLE PREMIUM -- The sum of money received by Xxxxxxx National under this
Contract.
SURRENDER VALUE -- During the Access Period, the Surrender Value is the Account
Value plus or minus any Interest Adjustment.
VALUATION DATE -- Close of the market of each day that the New York Stock
Exchange is open for business.
VALUATION PERIOD -- The period commencing at the close of business on a
particular Valuation Date and
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ending at the close of business on the next succeeding Valuation Date.
VARIABLE ACCOUNT -- The segregated investment account into which Lincoln
National sets aside and invests the assets allocated to the Variable
Subaccount(s) made available by Lincoln National and selected by the Owner. The
Variable Account for this Contract is shown on the Contract Specifications.
VARIABLE SUBACCOUNT -- That portion of the Variable Account which invests in
shares of a particular Fund. There is a separate Variable Subaccount for each
particular Fund.
WITHDRAWALS -- Additional amounts from the Account Value requested by, and paid
to, an Owner during the Access Period.
3
ARTICLE 2
SINGLE PREMIUM
2.01 WHERE PAYABLE
The Single Premium must be made to Lincoln National at its Administrative
Office.
2.02 AMOUNT
The Single Premium made to this Contract is shown on the Contract
Specifications.
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ARTICLE 3
VARIABLE ACCOUNT
3.01 THE VARIABLE ACCOUNT
Any portion of the Single Premium under the Contract may be allocated to the
Variable Account of the Contract. The Variable Account, which is designated on
the Contract Specifications, is for the exclusive benefit of persons entitled to
receive benefits under variable annuity contracts. Income, gains and losses
(whether or not realized) from the assets allocated to the Variable Account
shall be credited to or charged against the Variable Account without regard to
other income, gains or losses of Lincoln National. The Variable Account will not
be charged with the liabilities arising from any other part of Lincoln
National's business.
Subject to any required regulatory approvals, Lincoln National reserves the
right to eliminate the shares of any Fund and substitute the securities of a
different Fund or investment company or mutual fund. Such elimination and
substitution may occur if the shares of a Fund are no longer available for
investment or, if in the judgment of Lincoln National, further investment in any
Fund should become inappropriate in view of the purposes of the Contract.
Lincoln National may close any Variable Subaccount to new transfers of Account
Value. Lincoln National may add new Variable Subaccounts in which the assets of
the Variable Account may be invested. Lincoln National will give the Owner
written notice of the elimination and substitution of any Fund as required by
law after such substitution occurs.
3.02 ALLOCATION OF SINGLE PREMIUM TO A VARIABLE SUBACCOUNT
The Owner may allocate any portion of the Single Premium to any of the available
Variable Subaccounts in accordance with the restrictions on the Contract
Specifications.
The Single Premium allocated to each Variable Subaccount will be invested at Net
Asset Value Per Share. Following receipt of the Single Premium, Lincoln National
will apply the Single Premium to buy Accumulation Units in the Variable
Subaccount(s) selected by the Owner.
3.03 VALUATION OF THE VARIABLE ACCOUNT
The value of the Variable Account, prior to the Lifetime Income Period, is equal
to the sum of the values allocated to the Variable Subaccounts. The value of a
Variable Subaccount, prior to the Lifetime Income Period, is equal to the
Accumulation Units credited to a Variable Subaccount multiplied by the value of
the Accumulation Unit for the respective Variable Subaccount.
Accumulation Units are used to value all amounts allocated to or withdrawn from
a Variable Subaccount as a result of the Single Premium, transfers, Withdrawals,
or fees and charges. Accumulation Units for each Variable Subaccount are valued
separately. The value of an Accumulation Unit may increase or decrease from
Valuation Period to Valuation Period. The number of Accumulation Units is
determined by dividing the amount allocated to or withdrawn from a Variable
Subaccount by the dollar value of one Accumulation Unit of the Variable
Subaccount as of the Valuation Date the transaction becomes effective. The
number of Accumulation Units held for an Owner in a Variable Subaccount will not
be changed by any change in the dollar value of Accumulation Units in the
Variable Subaccount.
The value of an Accumulation Unit was arbitrarily established at the inception
of the Variable Subaccount. The Accumulation Unit value for a Variable
Subaccount for any later Valuation Period is determined as follows:
a. the total value of Fund shares held in the Variable Subaccount is
calculated by multiplying the number of Fund shares owned by the
Variable Subaccount at the beginning of the Valuation Period by the
Net Asset Value Per Share of the Fund at the end of the Valuation
Period, and adding any dividend or other distribution of the Fund if
an ex-dividend date occurs during the Valuation Period; minus
b. the liabilities of the Variable Subaccount at the end of the Valuation
Period (such liabilities include daily charges imposed on the Variable
Subaccount and may include a charge or credit with respect to any
taxes paid or reserved for by Lincoln National that Lincoln National
determines is a result of the operation
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of the Variable Account); the result divided by
c. the outstanding number of Accumulation Units in the Variable
Subaccount at the beginning of the Valuation Period.
The Accumulation Unit value may increase or decrease the dollar value of
benefits under the Contract. Expenses incurred by Lincoln National will not
adversely affect the dollar value of benefits.
3.04 MORTALITY AND EXPENSE RISK AND ADMINISTRATIVE CHARGE
The Mortality and Expense Risk and Administrative charge is a daily charge that
Lincoln National will deduct from the Variable Account as shown on the Contract
Specifications.
3.05 CHANGE IN OPERATION
Lincoln National reserves the right to transfer assets of the Variable Account
to another account, and to modify the structure or operation of the Variable
Account, subject to obtaining any necessary regulatory approvals. Lincoln
National guarantees that such modification will not affect the Account Value.
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ARTICLE 4
DCA FIXED ACCOUNT
4.01 ALLOCATION OF SINGLE PREMIUM INTO THE DCA FIXED ACCOUNT
Any portion of the Single Premium paid into this Contract may be allocated to
the DCA Fixed Account of the Contract. The amount so allocated will be
transferred from the DCA Fixed Account to the designated Variable Subaccount or
any Fixed Account available in the Contract in regular installments over a
period chosen by the Owner. Transfers will occur at the same interval until the
end of the chosen period or, if sooner, until the Account Value in the DCA Fixed
Account has been exhausted.
4.02 CREDITING OF INTEREST ON DCA FIXED ACOUNT
Lincoln National guarantees that at the end of each Valuation Period an
effective annual interest rate, adjusted for the number of days in the Valuation
Period, will be credited to the portion of Account Value, if any, in the DCA
Fixed Account at that time. Lincoln National guarantees that it will credit an
effective annual Minimum Guaranteed Interest Rate during all years as shown on
the Contract Specifications. Lincoln National may credit interest at effective
annual rates in excess of the Minimum Guaranteed Interest Rate at any time.
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ARTICLE 5
INTEREST ADJUSTED FIXED ACCOUNT
5.01 FIXED ACCOUNT
The Fixed Account holds the Fixed Subaccounts for the Guaranteed Period(s).
Lincoln National reserves the right to discontinue accepting transfers to any of
the available Guaranteed Periods at any time. Lincoln National may also add one
or more new Guaranteed Periods at any time.
5.02 ALLOCATION OF SINGLE PREMIUM INTO THE FIXED ACCOUNT
Any portion of the Single Premium made to this Contract may be allocated to the
Fixed Account of the Contract. The portion of the Single Premium allocated to
the Fixed Account of the Contract will be credited to the Fixed Subaccounts(s)
made available by Lincoln National and selected by the Owner.
The minimum amount that may be allocated to any Fixed Subaccount is shown on the
Contract Specifications.
The portion of the Single Premium allocated to a Fixed Subaccount will be
invested at the Guaranteed Interest Rate in effect for the respective Guaranteed
Period on the day the allocation is credited to the Fixed Subaccount.
5.03 VALUATION OF FIXED ACCOUNT
The value of the Fixed Account of this Contract at any time prior to the
Lifetime Income Period is equal to the sum of the then current values of all
Fixed Subaccount(s) with respect to this Contract before any Interest
Adjustment.
5.04 CREDITING OF INTEREST ON FIXED ACCOUNT
Lincoln National will establish the applicable effective annual Guaranteed
Interest Rate for each Fixed Subaccount at the beginning of that Guaranteed
Period. The Guaranteed Interest Rate will be guaranteed for the duration of the
applicable Guaranteed Period. Subsequent Guaranteed Interest Rate(s) will be
determined at the beginning of subsequent Guaranteed Period(s) and may be higher
or lower than the previous interest rate. A Guaranteed Interest Rate will never
be less than the effective annual Minimum Guaranteed Interest Rate shown on the
Contract Specifications. Lincoln National may credit interest at effective
annual rates in excess of the Minimum Guaranteed Interest Rate at any time.
Prior to the earlier of:
a. termination of this Contract upon payment of any Death Benefit; or
b. surrender of this Contract;
Lincoln National guarantees that at the end of each Valuation Period the
applicable effective annual interest rate, adjusted for the number of days in
the Valuation Period, will be credited to the portion of Account Value, if any,
in the Fixed Account at that time.
5.05 GUARANTEED PERIODS
Each individual amount allocated to a Fixed Subaccount will have an associated
Guaranteed Period, Guaranteed Interest Rate and Expiration Date and will be
treated separately from other amounts allocated to the Fixed Subaccount.
Multiple amounts allocated to the same Fixed Subaccount may have different
Guaranteed Interest Rates, and Expiration Dates, and Interest Adjustments. The
Guaranteed Period begins when the amount is allocated to that Fixed Subaccount
and ends on the Expiration Date for the Guaranteed Period selected.
Lincoln National will send written notice to the Owner at the last address known
to Lincoln National regarding an upcoming expiration of a Guaranteed Period.
Lincoln National will send this notice at least 45 but not more than 75 days
prior to the Expiration Date of such Guaranteed Period. The Owner must provide a
Notice, prior to the
8
Expiration Date of a previously selected Guaranteed Period, to transfer all or a
portion of the value of the amount in a Fixed Subaccount at the Expiration Date.
The value may be transferred to one or more of the Fixed Subaccounts or Variable
Subaccounts. Such Notice must be in accordance with the transfer provisions of
the Contract. If no Notice from the Owner is received by Lincoln National prior
to the Expiration Date of a previously selected Guaranteed Period, a subsequent
Guaranteed Period of the same duration, if available, will begin automatically
upon the expiration of the preceding Guaranteed Period.
If the Notice requests only a portion of the value of the Fixed Subaccount to be
transferred, the remaining amount will be automatically invested in a subsequent
Guaranteed Period of the same duration, if available, upon the expiration of the
preceding Guaranteed Period.
In the event the preceding Guaranteed Period is no longer available and no
Notice has been received from the Owner, the value of the Fixed Subaccount will
be transferred to a new Fixed Subaccount for a Guaranteed Period with the
shortest duration currently available.
5.06 INTEREST ADJUSTMENT
An Interest Adjustment will not apply to any Periodic Income Payment.
Any transfer, Withdrawal, or surrender of Account Value from a Fixed Subaccount,
will be increased or decreased by an Interest Adjustment, unless the transfer,
surrender or Withdrawal is effective:
a. During the Right to Examine Contract period (shown on the front
cover).
b. On the Expiration Date of a Guaranteed Period.
c. As a result of the death of the Owner or the death of the Annuitant.
d. Subsequent to the onset of the "permanent and total disability" of the
Owner. "Permanent and total disability" is disability that prevents
the Owner from engaging in any occupation for remuneration or profit,
and which has existed continuously for a period of 12 months prior to
the 65th birthday of the disabled Owner, provided that written proof
of total disability is sent to Lincoln National at its Administrative
Office.
e. Subsequent to the diagnosis of a terminal illness of the Owner.
Diagnosis of the terminal illness must be subsequent to the Contract
Date and result in a life expectancy of less than one year, as
determined by a qualified professional medical practitioner.
f. Subsequent to the admittance of the Owner into an accredited nursing
home or equivalent health care facility. Admittance in such a facility
must be subsequent to the Contract Date and continue for 90
consecutive days prior to the surrender or Withdrawal.
If a non-natural person is the Owner of the Contract, the Annuitant or Secondary
Life will be considered the Owner of the Contract for purposes of this
provision.
The amount of the Interest Adjustment is calculated by multiplying the dollar
amount transferred, withdrawn or surrendered by the following amount:
(1+A)/n/ divided by (1 + B)/n/, the result reduced by 1.0, where:
A = the yield rate determined at the beginning of the Guaranteed Period,
for a U.S. Treasury security with time to maturity equal to the
applicable Guaranteed Period;
B = the yield rate, determined at the time of the transfer, Withdrawal or
surrender, for a U.S. Treasury security with time to maturity equal to
the time remaining in the applicable Guaranteed Period, if greater
than one year. For periods remaining of one year or less, the yield
rate for one-year U.S. Treasury security is used;
n = the number of fractional years remaining in the applicable
Guaranteed Period (e.g. 1 year and 73 days = 1 + (73 divided by 365) =
1.2 years.
9
Straight-line interpolation is used to determine the yield rate for a U.S.
Treasury security with time to maturity for the applicable Guaranteed Period if
such yield rate is not quoted.
A positive Interest Adjustment increases the amount transferred, withdrawn or
surrendered while a negative Interest Adjustment decreases it. A negative
Interest Adjustment, however, will not reduce the amount transferred, withdrawn,
or surrendered below the value it would have had if the Minimum Guaranteed
Interest Rate had been credited to the Fixed Subaccount instead of the actual
Guaranteed Interest Rate.
If such yields are no longer published, Lincoln National will substitute an
appropriate index of publicly traded obligations.
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ARTICLE 6
PERIODIC INCOME PAYMENTS
6.01 DETERMINATION OF THE AMOUNT OF THE INITIAL PERIODIC INCOME PAYMENT
The Initial Periodic Income Payment will be determined by dividing the Account
Value as of the Periodic Income Commencement Date by 1000 and multiplying this
result by an annuity factor. The Initial Periodic Income Payment is shown on the
Contract Specifications.
The annuity factor is based upon, as of the Periodic Income Commencement Date,
the age and sex of the Annuitant; the age and sex of the Secondary Life, if
applicable; the Periodic Income Payment Mode; the length of the Access Period;
the Assumed Interest Rate and when applicable the 1983 'a' Individual Annuity
Mortality Table, modified.
6.02 DETERMINATION OF SUBSEQUENT PERIODIC INCOME PAYMENTS
An Owner must elect to adjust the Periodic Income Payments on a modal basis or
an annual basis. If an election is made to adjust Periodic Income Payments on an
annual basis, the monthly Periodic Income Payment Mode must be chosen. If this
election is not made by the Owner prior to the Contract Date, Periodic Income
Payments will be adjusted on a modal basis.
6.03 DETERMINATION OF SUBSEQUENT PERIODIC INCOME PAYMENTS DURING THE ACCESS
PERIOD
If Periodic Income Payments are being adjusted on a modal basis, then each
subsequent Periodic Income Payment will be determined by dividing the Account
Value as of the Valuation Date for the due date of a Periodic Income Payment by
1000 and multiplying this result by a revised annuity factor.
If Periodic Income Payments are being adjusted on an annual basis, then each
Periodic Income Payment due on the anniversary of the Initial Periodic Income
Payment Date will be determined by dividing the Account Value as of the
Valuation Date for that Periodic Income Payment by 1000 and multiplying this
result by a revised annuity factor. Periodic Income Payments made between
anniversaries of the Initial Periodic Income Payment Date will be equal to the
Periodic Income Payment calculated as of the prior anniversary (this includes
the Initial Periodic Income Payment Date), unless there is a Withdrawal. If a
Withdrawal is taken, the next Periodic Income Payment will be determined by
dividing the Account Value as of the Valuation Date for that Periodic Income
Payment by 1000 and multiplying this result by a revised annuity factor. Any
subsequent Periodic Income Payments due after the Withdrawal and prior to the
next anniversary of the Initial Periodic Income Payment Date will be equal to
the Periodic Income Payment determined immediately following the Withdrawal.
If the Guaranteed Income Benefit Option is in effect, payments equal to the
Guaranteed Income Benefit may reduce the Account Value to zero prior to the end
of the Access Period (See: Guaranteed Income Benefit Option).
If a Secondary Life was not designated, prior to the death of the Annuitant, the
revised annuity factor is based upon, as of the Valuation Date of the Periodic
Income Payment: the age and sex of the Annuitant; the Periodic Income Payment
Mode; the length of time remaining in the Access Period; the Assumed Interest
Rate; and when applicable the 1983 'a' Individual Annuity Mortality Table,
modified. Upon receipt of due proof of the death of the Annuitant, the revised
annuity factor is based upon, as of the Valuation Date of the Periodic Income
Payment, the Periodic Income Payment Mode; an Access Period (See: Death before
the Lifetime Income Period); and the Assumed Interest Rate. Periodic Income
Payments will continue until the end of the Access Period. There will be no
Periodic Income Payments due after the Access Period.
If a Secondary Life was designated, then prior to the death of either the
Annuitant or the Secondary Life, the revised annuity factor is based upon, as of
the Valuation Date of the Periodic Income Payment: the ages and sexes of the
Annuitant and the Secondary Life; the Periodic Income Payment Mode; the length
of time remaining in the Access Period; the Assumed Interest Rate; and when
applicable the 1983 'a' Individual Annuity Mortality Table, modified. Upon
receipt of due proof of the first death of the Annuitant or the Secondary Life,
the next Periodic Income Payment (regardless of whether Periodic Income Payments
are being adjusted on a modal basis or an annual basis) will be compared to a
Periodic Income Payment calculated by substituting the age and sex of
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the survivor for the ages and sexes of the Annuitant and the Secondary Life in
the revised annuity factor described above. If the resulting Periodic Income
Payment is less than or equal to the Periodic Income Payment determined by using
both lives, then both lives will continue to be used in calculating the revised
annuity factor. If the resulting Periodic Income Payment is greater than the
Periodic Income Payment determined by using both lives, then the following will
occur:
1. The age and sex of the survivor will be substituted for the ages and sexes
of the Annuitant and the Secondary Life in calculating subsequent revised
annuity factors to determine Periodic Income Payments subsequent to the
first death of either the Annuitant or Secondary Life.
2. The next Periodic Income Payment due after the first death of either the
Annuitant or Secondary Life, regardless of whether Periodic Income Payments
are being adjusted on a modal basis or an annual basis, will be calculated
using the revised annuity factor. If Periodic Income Payments are being
adjusted on an annual basis, any subsequent Periodic Income Payments due
prior to the next anniversary of the Initial Periodic Income Payment Date
will be equal to the Periodic Income Payment determined immediately
following the first death of either the Annuitant or Secondary Life, unless
there is a Withdrawal.
After the deaths of both the Annuitant and the Secondary Life the revised
annuity factor is based only upon, as of the Valuation Date of the Periodic
Income Payment, the Periodic Income Payment Mode; an Access Period (See:Death
before the Lifetime Income Period); and the Assumed Interest Rate. Periodic
Income Payments will continue until the end of the Access Period. There will be
no Periodic Income Payments due after the Access Period.
6.04 DETERMINATION OF SUBSEQUENT PERIODIC INCOME PAYMENTS DURING THE LIFETIME
INCOME PERIOD
If Periodic Income Payments are being adjusted on a modal basis, then the first
modal Periodic Income Payment from the Fixed Account during the Lifetime Income
Period will be determined by dividing the Account Value, if any, in the Fixed
Account as of the last Valuation Date of the Access Period by 1000 and
multiplying the result by a revised annuity factor (See: Determination of
Subsequent Periodic Income Payments, During the Access Period) based upon the
age(s) and sex(es) of the Annuitant (and Secondary Life); the Periodic Income
Payment Mode; the Assumed Interest Rate; and the 1983 'a' Individual Annuity
Mortality Table, modified. Each subsequent modal Periodic Income Payment from
the Fixed Account during the Lifetime Income Period will be determined by
multiplying the prior modal Periodic Income Payment from the Fixed Account by
'A' divided by 'B', where:
'A' is the 'Interest Adjustment Factor' raised to a power equal to the
number of days since the prior annual or modal Periodic Income Payment
Valuation Date, and the 'Interest Adjustment Factor' is equal to (1 + i)
raised to the power of (1/365), with 'i' equal to an annual effective rate
of interest not less than 0%; and
'B' is the 'Daily Factor' raised to a power equal to the number of days
since the prior annual or modal Periodic Income Payment Valuation Date, and
the 'Daily Factor' is equal to (1 + Assumed Interest Rate) raised to the
power of (1/365).
If Periodic Income Payments are being adjusted on an annual basis, then the
modal Periodic Income Payments from the Fixed Account(s) during the first year
of the Lifetime Income Period will be determined by first dividing the Account
Value, if any, in the Fixed Account(s) by 1000 and multiplying the result by a
revised annuity factor (See: Determination of Subsequent Periodic Income
Payments, During the Access Period) based upon the age(s) and sex(es) of the
Annuitant (and Secondary Life); an annual mode; the Assumed Interest Rate; and
the 1983 'a' Individual Annuity Mortality Table, modified. Then the resulting
annual modal amounts will be converted into modal Periodic Income Payments by
dividing the annual modal amount by 1000 and multiplying by a one year annuity
factor reflecting the age(s) and sex(es) of the Annuitant (and Secondary Life);
the Periodic Income Payment Mode; an annual effective rate of interest not less
than 0%; and the 1983 'a' Individual Annuity Mortality Table, modified.
The modal Periodic Income Payments from the Fixed Account(s) during each
subsequent year of the Lifetime Income Period will be determined by first
multiplying the annual modal amount from the prior Periodic Income Payment Date
Anniversary by 'A' divided by 'B'. The resulting annual modal amount will be
converted into modal Periodic Income Payments by dividing the annual modal
amount by 1000 and multiplying by a one year annuity factor reflecting the
age(s) and sex(es) of the Annuitant (and Secondary Life); the Periodic Income
Payment
12
Mode; an annual effective rate of interest not less than 0%; and the 1983 'a'
Individual Annuity Mortality Table, modified.
If Periodic Income Payments are being adjusted on a modal basis, then the first
modal Periodic Income Payment from the Variable Account during the Lifetime
Income Period will be determined by dividing the Account Value in each Variable
Subaccount as of the last Valuation Date of the Access Period by 1000 and
multiplying the result by a revised annuity factor (See: Determination of
Subsequent Periodic Income Payments, During the Access Period) based upon the
age(s) and sex(es) of the Annuitant (and Secondary Life); the Periodic Income
Payment Mode; the Assumed Interest Rate; and the 1983 'a' Individual Annuity
Mortality Table, modified. The result for each Variable Subaccount will then be
divided by the Annuity Unit value for the respective Variable Subaccount as of
the last Valuation Date of the Access Period to determine the initial number of
Annuity Units per payment per Variable Subaccount for subsequent Periodic Income
Payments. Each subsequent modal Periodic Income Payment will be determined by
multiplying the number of Annuity Units per payment per Variable Subaccount by
the Annuity Unit value for the respective Variable Subaccount on the Valuation
Date for the Periodic Income Payment and summing the results.
If Periodic Income Payments are being adjusted on an annual basis, then the
modal Periodic Income Payments from the Variable Account during the first year
of the Lifetime Income Period will be determined by first dividing the Account
Value in each Variable Subaccount as of the last Valuation Date of the Access
Period by 1000 and multiplying the result by a revised annuity factor (See:
Determination of Subsequent Periodic Income Payments, During the Access Period)
based upon the age(s) and sex(es) of the Annuitant (and Secondary Life); an
annual mode; the Assumed Interest Rate; and the 1983 'a' Individual Annuity
Mortality Table, modified. Then the result for each Variable Subaccount will be
divided by the Annuity Unit value for the respective Variable Subaccount as of
the last Valuation Date of the Access Period to determine the initial number of
Annuity Units per Variable Subaccount reflecting an annual modal amount for
subsequent Periodic Income Payments. Finally, the resulting annual modal amounts
per Variable Subaccount will be summed and transferred to the General Account of
Lincoln National and converted into modal Periodic Income Payments by dividing
the annual modal amount transferred by 1000 and multiplying by a one year
annuity factor reflecting the age(s) and sex(es) of the Annuitant (and Secondary
Life); the Periodic Income Payment Mode; an annual effective rate of interest
not less than 0%; and the 1983 'a' Individual Annuity Mortality Table, modified.
The modal Periodic Income Payments from the Variable Subaccount(s) during each
subsequent year of the Lifetime Income Period will be determined by first
multiplying the number of Annuity Units reflecting an annual modal amount per
Variable Subaccount by the Annuity Unit value for the respective Variable
Subaccount on the Valuation Date for the first modal Periodic Income Payment due
on the anniversary of the initial Periodic Income Payment and summing the
results. Then the resulting annual modal amount will be transferred to the
General Account of Lincoln National and converted into modal Periodic Income
Payments by dividing the annual modal amount by 1000 and multiplying by a one
year annuity factor reflecting the age(s) and sex(es) of the Annuitant (and
Secondary Life); the Periodic Income Payment Mode; an annual effective rate of
interest not less than 0%; and the 1983 'a' Individual Annuity Mortality Table,
modified.
The Annuity Unit value for any Valuation Period for any Variable Subaccount is
determined by multiplying the Annuity Unit value for the immediately preceding
Valuation Period by 'A' divided by 'B', where:
'A' is a Variable Subaccount's Accumulation Unit value as of the end of the
current Valuation Period divided by the Accumulation Unit value of the same
Variable Subaccount as of the end of the immediately preceding Valuation
Period; and
'B' is the 'Daily Factor' raised to a power equal to the number of days in
the current Valuation Period, where the 'Daily Factor' is equal to (1 +
Assumed Interest Rate) raised to the power of 1/365.
6.05 PROOF OF AGE
Periodic Income Payments will be subject to proof of age that Lincoln National
will accept, such as a certified copy of a birth certificate.
6.06 MINIMUM PERIODIC INCOME PAYMENT REQUIREMENTS
Lincoln National reserves the right to reduce the frequency of payments to an
interval which will result in each payment exceeding the minimum Periodic Income
Payment amount shown on the Contract Specifications. Lincoln National will pay
the Account Value in a lump sum if the frequency interval is annual and the
resulting
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annuity payment is less than the minimum annuity payment amount shown on the
Contract Specifications.
6.07 EVIDENCE OF SURVIVAL
Lincoln National has the right to ask for proof that the Annuitant and Secondary
Life, if any, are alive when each Periodic Income Payment is due.
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ARTICLE 7
GUARANTEED INCOME BENEFIT OPTION
7.01 DETERMINATION OF PERIODIC INCOME PAYMENTS WITH THE GUARANTEED INCOME
BENEFIT OPTION
If the Guaranteed Income Benefit Option is selected and shown on the Contract
Specifications, the Periodic Income Payments that Lincoln National will pay will
be equal to the greater of:
a. the subsequent Periodic Income Payment as determined above, and
b. the Guaranteed Income Benefit.
The daily charge when the Guaranteed Income Benefit Option is in effect is shown
under the Mortality and Expense Risk and Administrative Charge on the Contract
Specifications.
During the Access Period, this will result in an amount no less than the
Guaranteed Income Benefit amount being paid from the Account Value, which may
result in a lower Account Value than otherwise would be available in the absence
of the Guaranteed Income Benefit Option. If during the Access Period the payment
of the Guaranteed Income Benefit reduces the Account Value to zero, the Access
Period will end and the Lifetime Income Period, if any, will begin on the
Valuation Date the Account Value equals zero. Each subsequent Periodic Income
Payment during the Lifetime Income Period, if any, will be equal to the
Guaranteed Income Benefit.
During the Lifetime Income Period, if a Periodic Income Payment as determined
above is less than the Guaranteed Income Benefit, the excess of the Guaranteed
Income Benefit over the Periodic Income Payment will reduce the number of
Annuity Units per Variable Subaccount payable in each subsequent Periodic Income
Payment. The reduction to the number of Annuity Units per payment will be
determined by first dividing 'a' by 'b' where:
'a' is the amount of the excess of the Guaranteed Income Benefit over the
Periodic Income Payment; and
'b' is a revised annuity factor (See: Determination of Subsequent Periodic
Income Payments, During the Access Period)
and then dividing this result by the Annuity Unit value as of the Valuation Date
of the Periodic Income Payment.
If payment of the Guaranteed Income Benefit reduces the number of Annuity Units
per payment to zero during the Lifetime Income Period, then each subsequent
Periodic Income Payment during the remainder of the Lifetime Income Period, if
any, will be equal to the Guaranteed Income Benefit.
The Initial Guaranteed Income Benefit is shown on the Contract Specifications.
The Guaranteed Income Benefit will be equal to the Initial Guaranteed Income
Benefit, reduced by Withdrawals, if any. Each Withdrawal will reduce the
Guaranteed Income Benefit in the same proportion as the amount withdrawn reduces
the Account Value on the Valuation Date of the Withdrawal. If the Guaranteed
Income Benefit Option is selected, the Account Value may only be allocated to
the Fixed and/or Variable Subaccount(s) available for use with this benefit
option.
7.02 TERMINATION OF THE GUARANTEED INCOME BENEFIT OPTION
The Guaranteed Income Benefit Option may be terminated by the Owner. Notice of
the termination, either in signed writing or another manner that Xxxxxxx
National approves in advance, must be sent to Lincoln National. The termination
will be effective as of the Valuation Date on the next Periodic Income
Commencement Date anniversary.
The Guaranteed Income Benefit Option will terminate upon the death of the
Annuitant or, if a joint life payout was elected, upon the death of last to die
of the Annuitant and Secondary Life.
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Upon the effective date of the termination of the Guaranteed Income Benefit, the
daily charge imposed in a Variable Subaccount will be the daily charge imposed
for Contracts without the Guaranteed Income Benefit Option and subsequent
Periodic Income Payments will not be subject to the Guaranteed Income Benefit.
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ARTICLE 8
TRANSFERS, WITHDRAWALS AND SURRENDERS
8.01 TRANSFERS
An Owner may direct a transfer between the Variable Subaccounts and/or the Fixed
Account(s) of any portion of the Account Value by providing Notice to transfer.
Transfers will be subject to the Transfer Requirements shown on the Contract
Specifications.
Upon receipt of Notice to transfer, Lincoln National will process the transfer
within the time period required by the Securities and Exchange Commission,
unless the Suspension or Deferral of Payments or Transfers provision is in
effect.
Transfers between the Variable Subaccounts before the Lifetime Income Period
will result in the selling of Accumulation Units from one Variable Subaccount
and the purchase of Accumulation Units from the other Variable Subaccount, at
the current Accumulation Unit values.
Transfers between the Variable Subaccounts during the Lifetime Income Period
will result in the selling of Annuity Units from one Variable Subaccount and the
purchase of Annuity Units from the other Variable Subaccount, at the current
Annuity Unit values. These Annuity Units will then represent the number of
Annuity Units per payment from the Variable Subaccount.
Transfers from the Fixed Account to the Variable Account are not permitted after
the Access Period. Transfers from the Variable Account to the Fixed Account
after the Access Period may occur only on the Valuation Date of a Periodic
Income Payment.
Transfers will be accomplished at the applicable Accumulation Unit values or
Annuity Unit values as of the Valuation Date the Notice to transfer is received.
Each transfer from a Fixed Subaccount will be subject to an Interest Adjustment
unless the transfer is effective on the Expiration Date of the Guaranteed
Period. If a Notice to transfer from a Fixed Subaccount is received during the
45 but not more than 75 day period immediately proceeding the Expiration Date of
that Guaranteed Period, the transfer will be effective as of the Expiration Date
unless an immediate transfer is requested. If an immediate transfer is
requested, the transfer will occur on the Valuation Date the Notice to transfer
is received. If a Notice to transfer is received at any time other than during
this 45 but not more than 75 day period, the transfer will be accomplished as of
the Valuation Date the Notice for transfer is received.
Each transfer to a Fixed Subaccount during the Access Period will have an
associated Guaranteed Period, Guaranteed Interest Rate and Expiration Date and
will be treated separately from other transfers of a portion of the Account
Value to the Fixed Account. The allocation of the Single Premium and transfers
into the same Fixed Subaccount may result in portions of the Account Value
therein having different Guaranteed Interest Rates, Expiration Dates and
Interest Adjustments. The Guaranteed Period begins when the transfer of a
portion of Account Value is credited into that Fixed Subaccount and ends on the
Expiration Date of the Guaranteed Period selected.
If the DCA program is discontinued by the Owner prior to the end of the selected
DCA period, any remaining portion of the Account Value held in a designated DCA
holding account within the DCA Fixed Account will be transferred automatically
to the Variable Subaccount(s) and any Fixed Account the Owner selected under the
DCA program.
Lincoln National reserves, in its sole opinion, the right to limit or modify
transfers that may have an adverse effect on other contract owners. Restrictions
may be applied in any manner reasonably designed to prevent any use of the
transfer right that is considered by Xxxxxxx National to disadvantage other
contract owners.
Lincoln National has the right to waive or modify any of these restrictions.
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8.02 WITHDRAWALS
During the Access Period, an Owner may, upon Notice to Lincoln National, make
Withdrawals of amounts up to the Surrender Value. Withdrawals will be subject to
the Withdrawal and surrender requirements as shown on the Contract
Specifications. Withdrawals are not allowed after the Access Period.
Upon receipt of Notice of Withdrawal, Lincoln National will pay the amount of
any Withdrawal within the time period as required by the Securities and Exchange
Commission unless the Suspension or Deferral of Payments or Transfers provision
is in effect. Withdrawals will be accomplished at Accumulation Unit values as of
the Valuation Date the Notice for Withdrawal is received.
Withdrawals will immediately reduce the Account Value and will reduce subsequent
Periodic Income Payments and the Guaranteed Income Benefit, if elected (See:
Determination of Subsequent Periodic Income Payments During the Access Period).
A Withdrawal will be effective on the Valuation Date that Lincoln National
receives Notice to withdraw. The Notice must specify from which Variable
Subaccount and/or any Fixed Account the Withdrawal will be made. If no
allocation is specified, Lincoln National will withdraw the amount requested on
a pro-rata basis from each Variable Subaccount and/or any Fixed Account.
Withdrawals from a Fixed Subaccount will be subject to an Interest Adjustment
unless the Withdrawal is effective on the Expiration Date of the Guaranteed
Period. If a request for a Withdrawal from a Fixed Subaccount is received during
the 45 but not more than 75 day period immediately preceding the Expiration Date
of that Guaranteed Period, the Withdrawal will be effective as of the Expiration
Date unless an immediate Withdrawal is requested. If an immediate Withdrawal is
requested, the Withdrawal will occur on the Valuation Date the Notice for a
Withdrawal is received. If a Notice for a Withdrawal is received at any time
other than during the 45 but not more than 75 day period, the Withdrawal will be
accomplished as of the Valuation Date the Notice for a Withdrawal is received.
8.03 SURRENDERS
During the Access Period, the Owner may, upon Notice to Lincoln National,
surrender this Contract for its Surrender Value.
Upon receipt of Notice to surrender, Lincoln National will pay the amount of any
surrender within the time period required by the Securities and Exchange
Commission, unless the Suspension or Deferral of Payments or Transfers provision
is in effect.
If the Contract is surrendered, no further Periodic Income Payments will be made
and the Contract will terminate. The surrender will be effective on the
Valuation Date on which Xxxxxxx National receives Notice of surrender.
Surrenders will be subject to the Withdrawal and surrender requirements as shown
on the Contract Specifications.
Surrenders are not allowed after the Access Period.
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ARTICLE 9
DEATH BENEFITS
The Death Benefit provided under this Contract will be paid upon approval by
Xxxxxxx National and after Lincoln National is in receipt of:
a. proof, satisfactory to Lincoln National, of the death;
b. written authorization for payment; and
c. all claim forms, fully completed.
Due proof of death may be a certified copy of a death certificate, a certified
copy of a decree of a court of competent jurisdiction as to the findings of
death, or any other proof of death acceptable to Xxxxxxx National.
All Death Benefit payments will be subject to the laws and regulations governing
death benefits.
Notwithstanding any provision of this Contract to the contrary, the payment of
Death Benefits provided under the Contract must be made in compliance with
Internal Revenue Code Section 72(s), as amended from time to time.
Complete distribution of the Death Benefit will terminate the Contract.
9.01 DEATH BEFORE THE LIFETIME INCOME PERIOD
Death of Owner
If there is a single Owner, then upon the death of the Owner Lincoln National
will pay a Death Benefit to the designated Beneficiary(s). If the designated
Beneficiary of the Death Benefit is the surviving spouse of the deceased Owner,
the spouse may elect to continue the Contract as the new Owner. The Death
Benefit in effect at the time of death of the original Owner will continue,
unless subsequently terminated by the surviving spouse. If there are no
designated Beneficiaries, Lincoln National will pay a Death Benefit to the
Owner's estate. Upon the death of the spouse who continues the Contract as the
new Owner, Xxxxxxx National will pay a Death Benefit to the designated
Beneficiary(s).
If there are two Owners, upon the death of the first Owner, Xxxxxxx National
will pay a Death Benefit to the surviving Owner. If the surviving Owner is the
spouse of the deceased Owner, then the spouse may elect to continue the Contract
as sole Owner. The Death Benefit in effect at the time of death of the original
Owner will continue, unless subsequently terminated by the surviving spouse.
Upon the death of the Owner who continues the Contract, Xxxxxxx National will
pay a Death Benefit to the designated Beneficiary(s).
Upon the death of an Owner, the recipient of the rights of ownership, as
provided for in this Contract, may elect to continue the Contract and receive
any remaining Periodic Income Payments at least as rapidly as they were being
distributed prior to such death, or elect to terminate the Contract and receive
full payment of the Death Benefit.
Death of Annuitant or Secondary Life
If the Annuitant is also an Owner, then the Death Benefit paid upon the death of
the Annuitant will be subject to the Contract provisions regarding death of an
Owner.
Upon notification to Lincoln National of the death of the Annuitant or, if
applicable, the Secondary Life, the Periodic Income Payments may be suspended
until the death claim is approved as described in the Contract. Upon approval,
an Owner (or the recipient of the rights of ownership if any Owner is deceased)
may elect to continue the Contract and receive the Periodic Income Payments or
elect to terminate the Contract and receive full payment of the Death Benefit.
If an election is made to continue the Periodic Income Payments, a lump-sum
payment for the value of any suspended payments, as of the date the death claim
is approved, will be made and the Periodic Income Payments will then continue
for the remainder of the Access Period and then, if there is a surviving
Annuitant or, if applicable, Secondary Life, for the Lifetime Income Period. If
there is not a surviving Annuitant or Secondary Life, an Access Period will be
calculated over which the Periodic Income Payments will
19
continue to be paid (see section 6.03).
In any event, if full payment of the Death Benefit is not made upon the death of
the Annuitant or Secondary Life, Periodic Income Payments will continue to be
paid at least as rapidly as they were being distributed prior to such death.
Determination of Amounts
The Death Benefit that is payable under this Contract is equal to the current
Account Value as of the Valuation Date on which the death claim is approved by
Lincoln National for payment.
If a lump sum settlement is elected, the proceeds will be mailed within the time
period required by the Securities and Exchange Commission following Lincoln
National's approval of the death claim, unless the Suspension or Deferral of
Payments or Transfers provision is in effect.
9.02 DEATH DURING THE LIFETIME INCOME PERIOD
Upon the death of any Owner that is not an Annuitant or Secondary Life, the
Periodic Income Payments will continue for as long as the Annuitant or the
Secondary Life, if applicable, is living.
Upon the death of the Annuitant, if a Secondary Life was not designated or the
Secondary Life is no longer surviving, the Periodic Income Payments will cease
and the Contract will terminate. If a Secondary Life was designated and is still
surviving the Periodic Income Payments may be suspended until the death claim is
approved as described in the Contract. Upon approval, a lump-sum payment for the
value of any suspended payments, as of the date the death claim is approved,
will be made and the Periodic Income Payments will continue for as long as the
Secondary Life continues to live.
Upon the death of the Secondary Life, if the Annuitant is no longer surviving,
the Periodic Income Payments will cease and the Contract will terminate. If the
Annuitant is still surviving the Periodic Income Payments may be suspended until
the death claim is approved as described in the Contract. Upon approval, a
lump-sum payment for the value of any suspended payments, as of the date the
death claim is approved, will be made and the Periodic Income Payments will
continue for as long as the Annuitant continues to live.
20
ARTICLE 10
BENEFICIARY
10.01 DESIGNATION OF BENEFICIARY
The Owner may designate a Beneficiary and a contingent Beneficiary.
Unless otherwise stated in the Beneficiary designation, multiple Beneficiaries
are presumed to share equally.
10.02 CHANGE OF BENEFICIARY
The Owner may change any Beneficiary unless otherwise provided in the previous
designation by providing a Notice to change Beneficiary. A change of Beneficiary
will revoke any previous designation. When a change of Beneficiary is received
by Xxxxxxx National, whether or not the Owner is then alive, it will take effect
as of the date the request was sent. For purposes of determining on which date a
written change of Beneficiary is sent, the postmark date will be used. Any
payment made or action taken or allowed before the change of Beneficiary is
received will be without prejudice to Lincoln National.
Lincoln National reserves the right to request the Contract for endorsement of
the change.
10.03 DEATH OF BENEFICIARY
Unless otherwise provided in the Beneficiary designation, if any Beneficiary
dies before the Owner, that Beneficiary's interest will go to any other primary
Beneficiaries named, according to their respective interests. If there are no
primary Beneficiaries, the Beneficiaries' interest will pass to a contingent
Beneficiary, if any. Prior to the Periodic Income Commencement Date, if no
Beneficiary or contingent Beneficiary survives the Owner, the Death Benefits
will be paid to the Owner's estate.
Unless otherwise provided in the Beneficiary designation, once a Beneficiary is
receiving Death Benefits or annuity payments under an annuity payment option,
the Beneficiary may name his or her own Beneficiary to receive any remaining
benefits due under the Contract, should the original Beneficiary die prior to
receipt of all benefits. If no Beneficiary is named or the named Beneficiary
predeceases the original Beneficiary, any remaining benefits will continue to
the original Beneficiary's estate. A Beneficiary designation must be made by
Notice to Lincoln National.
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ARTICLE 11
SUSPENSION OR DEFERRAL OF PAYMENTS OR TRANSFERS
11.01 SUSPENSION OR DEFERRAL OF PAYMENTS OR TRANSFERS FROM OR WITHIN THE
VARIABLE ACCOUNT
Lincoln National reserves the right to suspend or postpone payments for a
transfer, Withdrawal or surrender for any period when:
1. the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
2. trading on the New York Stock Exchange is restricted;
3. an emergency exists as a result of which disposal of securities held in the
Variable Account is not reasonably practicable or it is not reasonably
practicable to determine the value of the Variable Account's net assets; or
4. during any other period when the Securities and Exchange Commission, by
order, so permits for the protection of the Owner.
The applicable rules and regulations of the Securities and Exchange Commission
will govern as to whether the conditions described in (2) and (3) exist.
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ARTICLE 12
GENERAL PROVISIONS
12.01 THE CONTRACT
The Contract and any amendment(s), endorsement(s), rider(s) or application
attached to this Contract make up the entire Contract. Only the President, a
Vice President, the Secretary or an Assistant Secretary of Lincoln National has
the power, on behalf of Lincoln National, to change, modify, or waive any
provisions of this Contract.
All statements made by or under the authority of the Owner for the issuance of
the Contract are deemed to be representations and not warranties.
Any changes, modifications, or waivers must be in writing. No representative or
person other than the above named officers has authority to change or modify
this Contract or waive any of its provisions. All terms used in this Contract
will have their usual and customary meaning except when specifically defined.
12.02 OWNERSHIP
All Owners will be treated as having equal, undivided interests in the Contract,
including rights of survivorship. Either Owner, independently of the other, may
exercise any ownership rights in the Contract. The existence of a Joint Owner
will not operate to continue the Contract upon the death of the first Owner,
unless the Joint Owner is the spouse of the deceased Owner.
12.03 ASSIGNMENTS
This Contract may not be sold, discounted or pledged as collateral for a loan or
as security for the performance of an obligation or for any other purpose. If
this Contract is used with a Qualified Plan, the Contract will not be
transferable unless allowed under applicable law.
12.04 INCONTESTABILITY
This Contract will not be contested by Lincoln National.
12.05 MISSTATEMENT OF AGE AND/OR SEX
If the age and/or sex of the Annuitant has been misstated, the amount payable
under the Contract will be adjusted to be the amount of income which the actual
premium paid would have purchased for the correct age and/or sex according to
Lincoln National's rates in effect on the Contract Date. Any overpayment by
Lincoln National will be charged against the payments to be made next succeeding
the adjustment. Any underpayment by Lincoln National will be paid in a lump sum.
12.07 NONPARTICIPATING
The Contract is nonparticipating and will not share in the surplus earnings of
Lincoln National.
12.08 OWNERSHIP OF THE ASSETS
Lincoln National will have exclusive and absolute ownership and control of its
assets, including all assets in the Variable Account.
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12.09 REPORTS
Prior to the Lifetime Income Period, Lincoln National will mail a report to the
Owner at least once each Calendar Year. The report will be mailed to the last
address known to Lincoln National. The report will include a statement of the
number of Accumulation Units credited to the Variable Account. The report will
also include the total Account Value, the cash surrender value, and Death
Benefit. Such other information as may be required by law or regulation will
also be included. The information in the report will be as of a date not more
than two months prior to the date of mailing the report. The Owner will have 60
days from the date the report or confirmation is received to notify Lincoln
National of any errors in the report or confirmation, otherwise the report or
confirmation will be deemed to be final and correct.
12.10 PREMIUM TAX
State and local government premium tax, if applicable, will be deducted from the
Single Premium or Account Value when incurred by Lincoln National or at another
time of Lincoln National's choosing.
12.11 LOANS
Loans are not permitted under this Contract.
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The Lincoln National Life Insurance Company
A Stock Company
Executive Office: 0000 Xxxxx Xxxxxxx Xxxxxx . Fort Xxxxx, Indiana 46801
Administrative Office: P.O. Box 7890, Fort Xxxxx,
Indiana 46801-7890 888-916-4900
ANNUITY CONTRACT
Single Premium Immediate Fixed and Variable Annuity
Nonparticipating
If you have any questions concerning this Contract, please contact your Lincoln
National representative or the Administrative Office of Lincoln National.
