XXXX XXXXXXX LIFE INSURANCE COMPANY (U.S.A.) (JohnHancock(R) LOGO)
A STOCK COMPANY
OVERNIGHT MAILING ADDRESS: ANNUITY SERVICE OFFICE: HOME OFFICE
[000 Xxxxxxxxx Xxxxx [P.O. Box 9505 Bloomfield Hills, MI
Portsmouth, NH 03801-6815] Portsmouth, NH 03802-9505]
[0-000-000-0000]
THIS IS A LEGAL CONTRACT - READ IT CAREFULLY.
WE AGREE to pay the benefits of this Contract in accordance with its terms.
THIS CONTRACT is issued in consideration of the Payment.
Xxxx Xxxxxxx Life Insurance Company (U.S.A.) will provide a guaranteed annual
amount for withdrawal beginning on the Lifetime Income Date and continuing for
the life of the Annuitant and any co-Annuitant. We will pay an annuity benefit
beginning on the Annuity Commencement Date to the Annuitant, if living, unless
otherwise directed by the Owner, in accordance with the Annuity Payments section
of this Contract. If the Annuitant dies while this Contract is in effect prior
to the Annuity Commencement Date, we will pay the Contract Value to the
Beneficiary upon receipt of all required claim forms and proof of death of the
Annuitant at the Annuity Service Office.
[TEN] DAY RIGHT TO REVIEW
YOU MAY CANCEL THE CONTRACT BY RETURNING IT TO OUR ANNUITY SERVICE OFFICE OR
REGISTERED REPRESENTATIVE WHO SOLD IT TO YOU AT ANY TIME WITHIN [10] DAYS AFTER
RECEIPT OF THE CONTRACT. DURING THE FIRST 7 DAYS OF THIS [10] DAY PERIOD, WE
WILL RETURN THE GREATER OF (I) THE CONTRACT VALUE COMPUTED AT THE END OF THE
VALUATION PERIOD DURING WHICH THE CONTRACT IS RECEIVED BY US OR (II) AN AMOUNT
EQUAL TO THE PAYMENT. AFTER 7 DAYS, WE WILL PAY THE CONTRACT VALUE COMPUTED AT
THE END OF THE VALUATION PERIOD DURING WHICH THE CONTRACT IS RECEIVED BY US. WE
WILL PAY THE REFUND AMOUNT TO THE OWNER WITHIN 7 DAYS OF RECEIPT OF THE CONTRACT
BY US.
ANNUITY PAYMENTS AND OTHER VALUES PROVIDED BY THIS CONTRACT WHEN BASED ON THE
INVESTMENT EXPERIENCE OF A SEPARATE ACCOUNT ARE VARIABLE AND NOT GUARANTEED AS
TO FIXED DOLLAR AMOUNT.
DETAILS OF VARIABLE ACCOUNT PROVISIONS ON PAGE 6.1
SIGNED FOR THE COMPANY at Boston, Massachusetts, on the Contract Date.
/s/ Xxxxx X. Xxxxx /s/ Xxxxxxx Xxxxx
President Secretary
SINGLE PAYMENT DEFERRED VARIABLE ANNUITY
GUARANTEED LIFETIME WITHDRAWAL BENEFIT
NON-PARTICIPATING
VENTURE.202.10 [NATIONAL]
INTRODUCTION
This is a single payment deferred variable annuity contract. This Contract
provides that, prior to the Annuity Commencement Date, the Contract Value will
accumulate on a variable basis. Subject to the provisions of the Contract, you
may take withdrawals and transfer amounts among the Investment Options. If you
limit withdrawals to the amounts described in the Lifetime Income Benefit
section, we guarantee that the Lifetime Income Amount will be available for
withdrawal each Contract Year after the Lifetime Income Date and during the life
of the Annuitant and any co-Annuitant. After the Annuity Commencement Date,
Annuity Payments may be either fixed or variable, or a combination of fixed and
variable.
The Contract Value will vary with the investment performance of your Investment
Options.
If you select Annuity Payments on a variable basis, the payment amount will vary
with the investment performance of the Variable Account.
You must allocate the Payment among one or more Investment Options. The
Investment Options are identified on the Specifications Page.
TABLE OF CONTENTS PAGE
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SPECIFICATIONS PAGES S.1
PART 1 - DEFINITIONS 1.1
PART 2 - GENERAL PROVISIONS 2.1
PART 3 - OWNER, BENEFICIARY 3.1
PART 4 - PAYMENT 4.1
PART 5 - FEES AND DEDUCTIONS 5.1
PART 6 - VARIABLE ACCOUNT PROVISIONS 6.1
PART 7 - TRANSFERS 7.1
PART 8 - WITHDRAWAL PROVISIONS 8.1
PART 9 - LIFETIME INCOME BENEFIT 9.1
PART 10 - DISTRIBUTIONS DURING ANNUITANT'S LIFE 10.1
PART 11 - DISTRIBUTIONS AFTER ANNUITANT'S DEATH 11.1
PART 12 - ANNUITY PAYMENTS 12.1
PART 13 - ANNUITY OPTIONS 13.1
PART 1 DEFINITIONS
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WE AND YOU "We", "us" and "our" means the Company. "You"
or "your" means the Owner of this Contract.
ACCUMULATION UNIT A unit of measure that is used to calculate the
value of the Variable Account of this Contract
before the Annuity Commencement Date.
ANNUITANT A person whose age and life is used to
determine eligibility for the Lifetime Income
Benefit and the amount and duration of Annuity
Payments involving life contingencies. The
Annuitant is as designated on the
Specifications Page, unless changed.
ANNUITY COMMENCEMENT DATE The date Annuity Payments begin. It is the date
selected by you and specified on the
Specifications Page, unless changed. This date
may not be later than the Maturity Date.
ANNUITY OPTION The method selected by you for Annuity Payments
made by us.
ANNUITY PAYMENT(S) Payment(s) by us to you, in accordance with the
Annuity Option elected under the terms of this
Contract.
ANNUITY SERVICE OFFICE Any office designated by us for the receipt of
Payment and processing of Owner requests.
ANNUITY UNIT A unit of measure that is used after the
Annuity Commencement Date to calculate variable
Annuity Payments.
BENEFICIARY The person, persons or entity to whom certain
benefits are payable following the death of the
Annuitant.
BENEFIT BASE The Benefit Base is the total amount used for
purposes of calculating guaranteed lifetime
withdrawals. The Benefit Base cannot be
withdrawn in a lump sum.
CO-ANNUITANT The second person whose age and life may be
used to determine eligibility for the Lifetime
Income Benefit. The co-Annuitant is designated
on the Specifications Page, unless changed.
Only the spouse of the Annuitant is eligible to
be a co-Annuitant.
COMPANY The insurance company named on the first page
of this Contract (or any successor insurance
company named by endorsement to this Contract)
that will pay benefits in accordance with this
Contract.
CONTRACT ANNIVERSARY The annual anniversary of the Contract
beginning twelve months from the Contract Date
and each year thereafter.
CONTRACT DATE The date of issue of this Contract as
designated on the Specifications Page.
CONTRACT VALUE The total of your Investment Account Values.
CONTRACT YEAR The period of time measured twelve consecutive
months from the Contract Date or any Contract
Anniversary thereafter.
CONTINGENT BENEFICIARY The person, persons or entity who becomes the
Beneficiary if the Beneficiary is not alive.
ENDORSEMENT An Endorsement modifies the contract to which
it is attached. Endorsements must be signed by
an officer of the Company in order to be
effective.
FIXED ANNUITY An Annuity Option with payments which are
predetermined and guaranteed as to dollar
amount.
GENERAL ACCOUNT All the assets of the Company other than assets
in Separate Accounts.
1.1
INTERNAL REVENUE CODE (IRC) The Internal Revenue Code of 1986, as amended
from time to time, and any successor statute of
similar purposes.
INVESTMENT ACCOUNT VALUE The value of your investment in an Investment
Option.
INVESTMENT OPTIONS The investment choices available to you. The
Investment Options available under this
Contract are shown on the Specifications Page.
When you select an Investment Option, we
allocate your Contract Value to a Sub-Account
of the Variable Account that invests in a
corresponding Portfolio.
LIFETIME INCOME AMOUNT (LIA) The Lifetime Income Amount is the amount that
is guaranteed to be available for withdrawal
each Contract Year after the Lifetime Income
Date and during the life of the Annuitant and
any co-Annuitant while this Contract is in
effect. The LIA reduces to zero upon the death
of the last to die of the Annuitant and any
co-Annuitant.
LIFETIME INCOME DATE The Lifetime Income Date is the date on which
the initial LIA is calculated.
LIFETIME INCOME PERCENTAGE The percentage used to determine your Lifetime
Income Amount.
MATURITY DATE The latest date on which annuity benefits may
commence. It is the date specified on the
Specifications Page, unless changed.
NET PAYMENT The Payment less the amount of premium tax, if
any, deducted from the Payment.
OWNER The person, persons or entity entitled to the
ownership rights under this Contract. The Owner
is as designated on the Specifications Page,
unless changed.
PORTFOLIO The investment choices available to the
Variable Account.
PAYMENT An amount paid to us by you as consideration
for the benefits provided by this Contract.
QUALIFIED CONTRACTS Contracts issued under Qualified Plans.
QUALIFIED PLANS Retirement plans which receive favorable tax
treatment under sections 401, 403, 408 or 457,
of the Internal Revenue Code of 1986, as
amended.
RIDER A Rider provides an optional benefit, which may
result in an additional charge to the Contract.
A Rider supplements the contract to which it is
attached. Riders must be signed by an officer
of the Company in order to be effective.
SEPARATE ACCOUNT A segregated account of the Company that is not
commingled with our general assets and
obligations.
SUB-ACCOUNT(S) The Variable Account is divided into
Sub-Accounts. Each Sub-Account is invested in
shares of a different Portfolio.
SURRENDER VALUE The Contract Value on any Valuation Date, less,
if applicable, any contract fees, any rider
charges, and any deduction for premium taxes or
similar taxes.
VALUATION DATE Any date on which the New York Stock Exchange
is open for business and the net asset value of
a Portfolio is determined.
VALUATION PERIOD Any period from one Valuation Date to the next,
measured from the time on each such date that
the net asset value of each Portfolio is
determined.
VARIABLE ACCOUNT The Company's Separate Account as shown on the
Specifications Page.
VARIABLE ANNUITY An Annuity Option with payments which: (1) are
not predetermined or guaranteed as to dollar
amount; and (2) vary in relation to the
investment experience of one or more specified
variable Investment Options.
1.2
WITHDRAWAL AMOUNT The amount deducted from the Contract Value
when you request a withdrawal. This amount is
the total of the amount paid to you plus the
following, if applicable: any contract fees,
any rider charges, any deduction for premium
taxes or similar taxes, and any income taxes
resulting from the withdrawal and withheld by
us. The Withdrawal Amount may not exceed the
Contract Value.
1.3
PART 2 GENERAL PROVISIONS
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ENTIRE CONTRACT The entire Contract consists of this Contract,
Endorsements and Riders, if any, and the
application, if one is attached to this
Contract.
The benefits and values available under this
Contract are not less than the minimum required
by any statute of the state in which this
Contract is delivered. We have filed a detailed
statement of the method used to calculate the
benefits and values with the Department of
Insurance in the state in which this Contract
is delivered, if required by law.
MODIFICATION Only the President, a Vice President, or the
Secretary of the Company has authority to agree
on our behalf to any alteration of the Contract
or to any waiver of our rights or requirements.
The change or waiver must be in writing. We
will not change or modify this Contract without
your consent except as may be required to make
it conform to any applicable law or regulation
or any ruling issued by a government agency; or
unless we have reserved the right to change the
terms herein.
We reserve the right to make any amendments as
may be necessary to comply with the applicable
provisions of the IRC and regulations
thereunder as in effect from time to time. Any
such amendment will be subject to any necessary
regulatory approvals and, where required,
approval of the Owner. We will send you a copy
of any amendment. We will not be responsible
for any adverse tax consequences resulting from
the Owner's rejection of any such amendment.
CHANGE IN ANNUITY Prior to the Annuity Commencement Date, an
COMMENCEMENT DATE Owner may request in writing a change of the
Annuity Commencement Date. Any extension of the
Annuity Commencement Date beyond the Maturity
Date will be subject to our prior approval and
any applicable law or regulation then in
effect.
ASSIGNMENT This Contract is subject to assignment
restrictions for Federal Income Tax purposes.
It is established for the exclusive benefit of
the Annuitant and his or her Beneficiaries. It
shall not be sold, assigned, discounted, or
pledged as collateral for a loan or as security
for the performance of an obligation or for any
other purpose, to any person other than us.
CLAIMS OF CREDITORS All benefits and payments under this Contract
shall be exempt from the claims of creditors to
the extent permitted by law.
MISSTATEMENT AND PROOF OF We may require proof of age, sex or survival of
AGE, SEX OR SURVIVAL any person upon whose age, sex or survival any
Lifetime Income Benefit, Annuity Payments or
other benefits provided by this Contract or any
Rider attached thereto depend. If the age or
sex of the Annuitant or any co-Annuitant has
been misstated, the benefits will be those
which would have been provided for the correct
age and sex. If we have made incorrect benefit
payments, we will immediately pay the amount of
any underpayment. We will deduct the amount of
any overpayment from future benefit payments.
ADDITION, DELETION OR We reserve the right, subject to compliance
SUBSTITUTION OF INVESTMENT with applicable law, to make additions to,
OPTIONS deletions from, or substitutions for the
Portfolio shares that are held by the Variable
Account or that the Variable Account may
purchase. We reserve the right to eliminate the
shares of any of the eligible Portfolios and to
substitute shares of another Portfolio. We will
not substitute any shares attributable to your
interest in a Sub-Account without notice to you
and prior approval of the Securities and
Exchange Commission to the extent required by
the Investment Company Act of 1940. Nothing
contained herein shall prevent the Variable
Account from purchasing other securities for
other series or classes of contracts, or from
effecting a conversion between shares of
another open-end investment company.
2.1
We reserve the right, subject to compliance
with applicable law, to establish additional
Sub-Accounts which would invest in shares of a
new Portfolio. We also reserve the right to
eliminate existing Sub-Accounts, to combine
Sub-Accounts or to transfer assets in a
Sub-Account to another Separate Account
established by us or an affiliated company. In
the event of any such substitution or change,
we may, by appropriate endorsement, make such
changes in this and other Contracts as may be
necessary or appropriate to reflect such
substitutions or change. If deemed by us to be
in the best interests of persons having voting
rights under the Contracts, the Variable
Account may be operated as a management company
under the Investment Company Act of 1940 or it
may be de-registered under such Act in the
event such registration is no longer required.
NON-PARTICIPATING Your Contract is non-participating and will not
share in our profits or surplus earnings. We
will pay no dividends on your Contract.
REPORTS We will send you reports containing information
required by the Investment Company Act of 1940
and applicable state law at least annually
without charge. We will provide annual calendar
year reports concerning the status of the
Contract and such information concerning
required minimum distributions as is prescribed
by the Commissioner of Internal Revenue.
INSULATION The portion of the assets of the Variable
Account equal to the reserves and other
contract liabilities with respect to such
account are not chargeable with liabilities
arising out of any other business we may
conduct. Moreover, the income, gains and
losses, realized or unrealized, from assets
allocated to the Variable Account shall be
credited to or charged against such account
without regard to our other income, gains or
losses.
CURRENCY AND PLACE OF All payments made to or by us shall be made in
PAYMENTS the lawful currency of the United States of
America at the Annuity Service Office or
elsewhere if we consent.
NOTICES AND ELECTIONS To be effective, all notices and elections you
make under this Contract must be in writing,
signed by you and received by us at the Annuity
Service Office. Unless otherwise provided in
this Contract, all notices, requests and
elections will be effective when received by us
at our Annuity Service Office, complete with
all necessary information and your signature.
GOVERNING LAW This Contract will be governed by the laws of
the jurisdiction indicated on the
Specifications Page.
2.2
PART 3 OWNER, BENEFICIARY
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OWNER The Owner must be one natural person who is the
sole Owner of the Contract and the Annuitant,
or a Trust established for the exclusive
benefit of the Annuitant or his or her
Beneficiaries. The Contract is established for
the exclusive benefit of the Annuitant or his
or her Beneficiaries.
BENEFICIARY The Beneficiary is as designated on the
Specifications Page, unless changed. However,
if there is a co-Annuitant, that person will be
treated as the Beneficiary upon death of the
Annuitant. If no such Beneficiary is living,
the Beneficiary is the Contingent Beneficiary.
If no Beneficiary or Contingent Beneficiary is
living, the Beneficiary is the estate of the
deceased Annuitant.
CHANGE OF OWNER, Except as permitted under the "Death Before
ANNUITANT, BENEFICIARY Maturity Date" provision, and otherwise
permitted under applicable federal tax law,
neither the Owner nor the Annuitant may be
changed. The co-Annuitant may be removed from
the Contract, but no change or addition of
co-Annuitant is permitted prior to the Annuity
Commencement Date. Only the spouse of the
Annuitant is eligible to be named as a
co-Annuitant.
Subject to the right of an irrevocable
Beneficiary, you may change the Beneficiary by
written request in a form acceptable to us and
which is received at our Annuity Service
Office. Any change must be approved by us. If
approved, any change of Beneficiary will take
effect on the date the request is signed. We
will not be liable for any payments or actions
we take before the change is approved.
3.1
PART 4 PAYMENT
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GENERAL The Contract is not effective until Payment is
received by us at our Annuity Service Office or
such other place designated by us. The Contract
will be purchased with a single payment.
ALLOCATION OF NET PAYMENT When we receive the Payment, the Net Payment
will be allocated among Investment Options in
accordance with the allocation percentages you
elected as shown on the Specifications Page.
4.1
PART 5 FEES AND DEDUCTIONS
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CONTRACT ASSET FEE To compensate us for assuming certain
administration expenses, expense risks and
mortality risks, we deduct from each variable
Investment Option a fee each Valuation Period
at an annual rate set forth on the
Specifications Page. A portion of this Asset
Fee may also be used to reimburse us for
distribution expenses. This fee is reflected in
the Net Investment Factor used to determine the
value of Accumulation Units and Annuity Units
of the Contract.
ANNUAL CONTRACT FEE To compensate us for assuming certain
administrative expenses, we charge an Annual
Contract Fee as set forth on the Specifications
Page. Prior to the Annuity Commencement Date,
the Annual Contract Fee is deducted on each
Contract Anniversary. We withdraw the Annual
Contract Fee from each Investment Option in the
same proportion that the Investment Account
Value of each Investment Option bears to the
Contract Value.
After the Annuity Commencement Date, we deduct
the Annual Contract Fee on a pro rata basis
from each Annuity Payment.
LIFETIME INCOME BENEFIT FEE To compensate us for assuming risks associated
with the Lifetime Income Benefit, we charge an
annual Lifetime Income Benefit Fee. The
Lifetime Income Benefit Fee is deducted on each
Contract Anniversary. This fee is withdrawn
from each Investment Option in the same
proportion that the Investment Account Value of
each Investment Option bears to the Contract
Value. The amount of the fee is equal to the
Lifetime Income Benefit Fee percentage, shown
on the Specifications Page, multiplied by the
Benefit Base as of the prior Contract
Anniversary.
The Lifetime Income Benefit Fee will not be
deducted during the Settlement Phase. The fee
will not be deducted after the Maturity Date if
an Annuity Option has commenced.
The initial Lifetime Income Benefit Fee
percentage is shown on the Specifications Page.
We reserve the right to increase the Lifetime
Income Benefit Fee percentage if we determine
an increase is required. If the fee is
increased you will receive a 30-day advance
notice of the increase and given the
opportunity to terminate the Lifetime Income
Benefit. If you elect to terminate this benefit
you will need to provide a written request in a
form acceptable to us.
In such a situation, the percentage will never
exceed the Maximum Lifetime Income Benefit Fee
percentage, shown on the Specifications Page.
TAXES We reserve the right to charge certain taxes
against your Payments (either at the time of
payment or liquidation), Contract Value,
payment of death benefit, withdrawals, or
Annuity Payments, as appropriate. Such taxes
may include premium taxes or other taxes levied
by any government entity which we, in our sole
discretion, determine have resulted from the
establishment or maintenance of the Variable
Account, or from the receipt by us of the
Payment, or from the issuance of this Contract,
or from the commencement or continuance of
Annuity Payments under this Contract.
5.1
PART 6 VARIABLE ACCOUNT PROVISIONS
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INVESTMENT ACCOUNT VALUE The Investment Account Value of an Investment
Option is determined by multiplying (a) times
(b) where:
(a) equals the number of Accumulation
Units credited to the Investment
Option; and
(b) equals the appropriate Accumulation
Unit Value.
ACCUMULATION UNITS We will credit the Net Payment to your
Investment Options in the form of Accumulation
Units. The number of Accumulation Units we will
credit to each Investment Option will be
determined by dividing the Net Payment
allocated to that Investment Option by the
Accumulation Unit Value for that Investment
Option.
Accumulation Units will be adjusted for any
transfers and will be canceled on payment of a
death benefit, withdrawal, maturity or
assessment of certain charges based on their
value for the Valuation Period in which such
transaction occurs.
ACCUMULATION UNIT VALUE We will determine the Accumulation Unit Value
for a particular Investment Option for any
Valuation Period by multiplying the
Accumulation Unit Value for the immediately
preceding Valuation Period by the net
investment factor for the corresponding
Sub-Account for the Valuation Period for which
the value is being determined. The Accumulation
Unit Value may increase, decrease or remain the
same from one Valuation Period to the next.
NET INVESTMENT FACTOR The net investment factor is an index that
measures the investment performance of a
Sub-Account from one Valuation Period to the
next. The net investment factor for any
Valuation Period is determined by dividing (a)
by (b) and subtracting (c) from the result
where:
(a) is the net result of:
1) the net asset value per share
of a Portfolio share held in
the Sub-Account determined as
of the end of the current
Valuation Period, plus
2) the per share amount of any
dividend or capital gain
distributions made by the
Portfolio on shares held in the
Sub-Account if the ex-dividend
date occurs during the current
Valuation Period, and
(b) the net asset value per share of a
Portfolio share held in the
Sub-Account determined as of the end
of the immediately preceding
Valuation Period, and
(c) is the Contract Asset Fee shown on
the Specifications Page.
The net investment factor may be greater or
less than, or equal to, one.
6.1
PART 7 TRANSFERS
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TRANSFERS BEFORE MATURITY Before the Maturity Date or the Annuity
DATE Commencement Date, if earlier, you may transfer
amounts among Investment Options of the
Contract. Amounts will be canceled from the
Investment Options from which amounts are
transferred and credited to the Investment
Options to which amounts are transferred. We
will effect such transfers so that the Contract
Value on the date of transfer will not be
affected by the transfer.
TRANSFERS ON OR AFTER Once variable Annuity Payments have begun, you
MATURITY DATE may transfer all or part of the investment upon
which your variable Annuity Payments are based
from one Investment Option to another. To do
this, we will convert variable Annuity Units
you hold in the Investment Option from which
you are transferring to variable Annuity Units
of the Investment Option to which you are
transferring. We will determine the number of
Annuity Units to transfer so that if the next
Annuity Payment were made at that time, it
would be the same amount that it would have
been without the transfer. You must give us
notice at least 30 days before the due date of
the first variable Annuity Payment to which the
transfer will apply. Transfer charges and
limitations are identified on the
Specifications Page.
After the Annuity Commencement Date, transfers
will not be allowed from a fixed to a variable
Annuity Option, or from a variable to a fixed
Annuity Option.
DEFERRAL, MODIFICATION OR We reserve the right to defer, modify or
TERMINATION OF TRANSFER terminate the transfer privilege at any time
PRIVILEGE that we are unable to purchase or redeem shares
of the Portfolios or when a portfolio requires
us to impose restrictions due to violation of
its short term trading policy. Transfer charges
and limitations are identified on the
Specifications Page and in the "Suspension of
Payments" provision in the Withdrawals
Provisions section.
7.1
PART 8 WITHDRAWAL PROVISIONS
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PAYMENTS OF WITHDRAWALS You may withdraw part or all of the Surrender
Value, at any time before the earlier of the
death of the Annuitant, the Annuity
Commencement Date or the Maturity Date, by
sending us a written request. We will pay all
withdrawals within seven days of receipt at the
Annuity Service Office subject to postponement
in certain circumstances, as specified below.
SUSPENSION OF PAYMENTS We may defer the right of withdrawal from, or
postpone the date of payments from, the
variable Investment Options 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) the Securities and
Exchange Commission, by order, so permits for
the protection of security holders; provided
that applicable rules and regulations of the
Securities and Exchange Commission shall govern
as to whether the conditions described in (2)
and (3) exist.
TOTAL WITHDRAWAL Upon receipt of your request to withdraw the
entire Contract Value, we will terminate the
Contract and pay you the Surrender Value.
At the time of the total withdrawal, we will
deduct the total amount of the Annual Contract
Fee from the Contract Value in determining the
Surrender Value. We will also deduct a pro rata
share of the Lifetime Income Benefit Fee. A pro
rata share of the fee is equal to the Lifetime
Income Benefit Fee percentage, shown on the
Specifications Page, multiplied by the Benefit
Base, and then multiplied by the number of days
that have elapsed since the previous Contract
Anniversary and divided by 365. For purposes of
determining the Lifetime Income Benefit Fee, a
total withdrawal will be deemed to have been
taken on the date the death benefit is
determined and once an Annuity Option has been
elected.
PARTIAL WITHDRAWAL If you request to withdraw an amount less than
the Surrender Value, we will pay you the amount
requested and deduct the Withdrawal Amount from
the Contract Value. Unless you specify the
amount to be withdrawn from each Investment
Option, the Withdrawal Amount will be withdrawn
from each Investment Option on a pro rata
basis.
Any withdrawals prior to the Lifetime Income
Date, or withdrawals after the Lifetime Income
Date that exceed the Lifetime Income Amount,
may reduce the Lifetime Income Benefit.
FREQUENCY OF PARTIAL You may make as many partial withdrawals as you
WITHDRAWALS wish.
8.1
PART 9 LIFETIME INCOME BENEFIT
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GENERAL This benefit guarantees that each Contract Year
after the Lifetime Income Date and during the
life of the Annuitant and any co-Annuitant you
may take withdrawals up to an amount equal to
the Lifetime Income Amount (LIA), even if your
Contract Value reduces to zero. The LIA is
described below in the "Lifetime Income Amount
(LIA)" provision.
The Lifetime Income Date is the Contract
Anniversary on or after the later of (a) the
date the younger of the Annuitant or any
co-Annuitant reaches the Lifetime Income Age or
(b) the Minimum Holding Period Expiration date
as shown on the Specifications Page.
BENEFIT BASE - INITIAL AND The initial Benefit Base equals the greater of
MAXIMUM the Payment or the Benefit Base Percentage
multiplied by the Transferred Benefit Base. The
Benefit Base is available only for the purpose
of the Lifetime Income Benefit. It can not be
withdrawn as a lump sum.
The Benefit Base shall not exceed the Maximum
Benefit Base amount shown on the Specifications
Page.
BENEFIT BASE - IMPACT OF On the first Contract Anniversary and each
BENEFIT ENHANCEMENT Contract Anniversary on and prior to the first
withdrawal after the Lifetime Income Date, we
will determine a Benefit Enhancement amount and
apply it to the Benefit Base, provided no
withdrawals are taken during the previous
Contract Year. The Benefit Enhancement amount
is equal to the Benefit Enhancement Percentage
multiplied by the Benefit Base as of the
beginning of the previous Contract Year.
The Benefit Enhancement Percentage is shown on
the Specifications Page.
BENEFIT BASE - IMPACT OF At the time of the first withdrawal on or after
STEP-UP the Lifetime Income Date, if the Contract Value
on the Contract Anniversary prior to that
withdrawal on or after the Lifetime Income Date
is greater than the Benefit Base including any
Benefit Enhancement we will automatically
Step-Up the Benefit Base to the greater amount.
9.1
BENEFIT BASE - IMPACT OF Prior to the Lifetime Income Date, the Benefit
WITHDRAWALS Base will decrease as a result of any
withdrawals. The amount deducted in connection
with the withdrawal will be equal to the
greater of the following:
(a) An amount equal to A multiplied by
(B divided by C) where:
A equals the amount of the
withdrawal,
B equals the Benefit Base prior to
the withdrawal,
C equals the Contract Value prior to
the withdrawal, or
(b) The amount of the withdrawal.
Beginning on the Lifetime Income Date, the
Benefit Base will not reduce if total
withdrawals during a Contract Year are less
than or equal to the LIA.
If a withdrawal after the Lifetime Income Date
causes total withdrawals during a Contract Year
to exceed the LIA or if total withdrawals
during a Contract Year already exceeded the
LIA, then the Benefit Base will be decreased as
a result of the withdrawal. The amount deducted
in connection with the withdrawal will be equal
to the greater of the following:
(a) An amount equal to A multiplied by
(B divided by C) where:
A equals the amount of the
withdrawal,
B equals the Benefit Base prior to
the withdrawal,
C equals the Contract Value prior to
the withdrawal, or
(b) The amount of the withdrawal.
Notwithstanding the discussion above, the
Benefit Base will not be reduced when all
withdrawals during the Contract Year and after
the Lifetime Income Date are Life Expectancy
Distributions elected under an automatic
distribution program, provided by us, even if
such Life Expectancy Distributions exceed the
LIA for the Contract year. (See the "Life
Expectancy Distributions" provision.)
LIFETIME INCOME AMOUNT (XXX) The initial LIA will be determined at the time
of the first withdrawal on or after the
Lifetime Income Date. The initial LIA is equal
to the Lifetime Income Percentage shown on the
Specifications Page multiplied by the Benefit
Base on the date of that withdrawal.
Each time the Benefit Base is changed after the
Lifetime Income Date, then the new LIA will
equal the Lifetime Income Percentage shown on
the Specifications Page multiplied by the new
Benefit Base.
LIFE EXPECTANCY For purposes of this benefit, Life Expectancy
DISTRIBUTIONS Distributions are distributions within a
calendar year that:
(a) are part of a series of
substantially equal periodic
payments over the Annuitant's Life
Expectancy (or, if applicable, the
joint Life Expectancy of the
Annuitant and the Annuitant's
spouse); and are paid to the Owner
as required or contemplated by Code
Section 401(a)(9), Section
408(b)(3), or Section 408A(c), as
the case may be ("Qualified Death
Benefit Stretch Distributions" and
"Required Minimum Distributions");
and
(b) are the Contract's proportional
share of all such distributions as
determined by the Company and based
on the Company's understanding of
the Code.
For purposes of this "Life Expectancy
Distributions" provision, references to Owner
or Annuitant also include the Beneficiary, as
applicable.
We reserve the right to make any changes
necessary to comply with the Code and Treasury
Regulations.
9.2
SETTLEMENT PHASE
The Contract will enter its Settlement Phase if
the Contract Value reduces to zero, withdrawals
during the Contract Year do not exceed the LIA,
and the Benefit Base is still greater than
zero. When the Contract enters its Settlement
Phase the Lifetime Income Benefit will
continue, however all other rights and benefits
under the Contract, including death benefits,
will terminate. You will automatically receive
settlement payments equal to the LIA each
Contract Year of the Settlement Phase during
the life of the Annuitant and any co-Annuitant.
If the Settlement Phase is entered prior to the
Lifetime Income Date, then settlement payments
will begin on or after the Lifetime Income
Date. The settlement payments will be paid no
less frequently than annually. The Lifetime
Income Benefit Fee will not be deducted during
the Settlement Phase.
If the last of the Annuitant and any
co-Annuitant dies during the Settlement Phase,
then the Lifetime Income Benefit terminates and
no additional settlement payments will be paid.
9.3
PART 10 DISTRIBUTIONS DURING ANNUITANT'S LIFE
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GENERAL Notwithstanding any provision of this Contract
to the contrary, the distribution of the
Annuitant's interest in the Contract shall be
made in accordance with the requirements of IRC
Sections 401(a)(9) and 408(b)(3) and the
regulations thereunder, the provisions of which
are herein incorporated by reference. If
distributions are not made in the form of an
annuity on an irrevocable basis (except for
acceleration), then distribution of the
interest in the Contract, as described below,
must satisfy the requirements of IRC Section
408(a)(6) and the regulations thereunder,
rather than this Part and paragraphs (b) and
(c) of Part 11 of this Contract. The required
minimum distribution for this Contract may be
withdrawn from another Individual Retirement
Account in accordance with Q&A- 9 of Section
1.408-8 of the Income Tax Regulations.
There is no required distribution during the
life of the Annuitant if this Contract is
issued as a Xxxx XXX as indicated in the Type
of Contract on the Specifications Page.
INTEREST IN THE CONTRACT Unless otherwise provided under applicable
federal tax law, the "interest" in the Contract
includes the amount of any outstanding
rollover, transfer, and recharacterization
under Q&As-7 and -8 of Section 1.408-8 of the
Income Tax Regulations. Also, prior to the date
that Annuity Payments commence on an
irrevocable basis (except for acceleration),
the "interest" in the Contract includes the
actuarial value of any other benefits provided
under the Contract, such as guaranteed death
benefits or the Lifetime Income Benefit.
REQUIRED BEGINNING DATE The "required beginning date" means April 1 of
the calendar year following the calendar year
in which the Annuitant attains age 70 1/2, or
such later date provided by applicable tax law.
DISTRIBUTIONS Unless otherwise permitted under applicable
federal tax law, the entire interest will
commence to be distributed no later than the
required beginning date over (i) the life of
the Annuitant or the lives of the Annuitant and
his or her designated Beneficiary (within the
meaning of IRC Section 401(a)(9)), or (ii) a
period certain not extending beyond the life
expectancy of the Annuitant, or joint life and
last survivor expectancy of the Annuitant and
his or her designated Beneficiary.
If the interest in the Contract is to be
distributed over a period greater than one
year, the amount to be distributed by December
31 of each year (including the year in which
the required beginning date occurs) shall be
determined in accordance with the requirements
of IRC Section 401(a)(9) and the regulations
thereunder. Payments must be made in periodic
payments at intervals of no longer than one
year. Unless otherwise provided by applicable
federal tax law, payments must be either
nonincreasing or they may increase only as
provided in Q&As-1 and -4 of Section
1.401(a)(9)-6 of the Income Tax Regulations. In
addition, any distribution must satisfy the
incidental benefit requirements specified in
Q&A-2 of Section 1.401(a)(9)-6.
The distribution periods described above cannot
exceed the periods specified in Section
1.401(a)(9)-6 of the Income Tax Regulations
(except as otherwise provided by applicable
federal tax law).
If Annuity Payments commence on or before the
required beginning date, the first required
payment can be made as late as the required
beginning date and must be the payment that is
required for one payment interval. The second
payment need not be made until the end of the
next payment interval.
10.1
PART 11 DISTRIBUTIONS AFTER ANNUITANT'S DEATH
--------------------------------------------------------------------------------
DEATH BENEFIT BEFORE MATURITY If the Annuitant dies prior to the Maturity
DATE Date or Annuity Commencement Date, if earlier,
the interest in the Contract will be
distributed to the Beneficiary as follows.
Written notice and proof of death and all
required claim forms must be received at the
Company's Annuity Service Office prior to any
distribution.
The Contract Value may be withdrawn by the
Beneficiary in one sum immediately, in which
case the Contract will terminate. If the
Contract Value is not taken in one sum
immediately, the Contract will continue subject
to the following provisions:
(a) The Beneficiary becomes the Owner.
(b) If the Beneficiary is not the
deceased Annuitant's spouse, the
Lifetime Income Benefit will no
longer be available and the entire
interest in the Contract must be
distributed under one of the
following options:
(i) the entire interest in the
Contract must be distributed
over the life of the
Beneficiary, or over a period
not extending beyond the life
expectancy of the Beneficiary,
with distributions beginning by
the end of the calendar year
following the calendar year of
the Annuitant's death; or
(ii) the entire interest in the
Contract must be distributed by
the end of the calendar year
containing the fifth
anniversary of the Annuitant's
Death; or
(iii) the entire interest in the
Contract must be distributed as
Annuity Payments under one of
the options described in the
Annuity Options section.
An irrevocable election of the method
of distribution must be made no later
than the end of the calendar year
immediately following the calendar
year in which the Annuitant died. If
no election is made, the interest in
the Contract will be distributed as
described in (ii) above.
The life expectancy of the
Beneficiary is determined using the
age of the Beneficiary as of his or
her birthday in the year following
the year of the Annuitant's death.
If the Beneficiary dies before the
distributions required by (i) or (ii)
are complete, the entire remaining
Contract Value must be distributed at
least as rapidly as under the
distribution option chosen.
(c) The following options apply if the
sole Beneficiary is the Annuitant's
spouse.
If the sole Beneficiary is the
deceased Xxxxxxxxx's spouse and is
the co- Annuitant, the surviving
spouse may elect to continue the
Contract as the new Owner/Annuitant
and the Lifetime Income Benefit will
be available during the life of the
surviving spouse.
If the sole Beneficiary is the
deceased Xxxxxxxxx's spouse, but is
not the co-Annuitant, the surviving
spouse may elect to continue the
Contract as the new Owner/Annuitant
but the Lifetime Income Benefit will
no longer be available.
The surviving spouse may name a new
Beneficiary (and, if no Beneficiary
is so named, the surviving spouse's
estate will be the Beneficiary).
11.1
The spouse may also elect
distributions under one of the
following options:
(i) the entire interest in the
Contract may be distributed
over the life of the
Beneficiary, or over a period
not extending beyond the life
expectancy of the Beneficiary,
with distributions beginning by
the end of the calendar year
following the calendar year of
the Annuitant's death (or by
the end of the calendar year in
which the Annuitant would have
attained age 70 1/2, if later);
or
(ii) the entire interest in the
Contract may be distributed by
the end of the calendar year
containing the fifth
anniversary of the Annuitant's
Death; or
(iii) as Annuity Payments under one
of the options described in the
Annuity Options section.
Such election must be made no later
than the earlier of the date
distributions are scheduled to begin
under (i) above or December 31 of the
year containing the fifth anniversary
of the Annuitant's death. If no
election is made, the entire interest
in the Contract will be distributed
as described in (ii) above.
If the surviving spouse dies before
required distributions commence, the
remaining interest will be
distributed, starting by the end of
the calendar year following the
calendar year of the spouse's death,
over the designated Beneficiary's
life expectancy determined using the
Beneficiary's ages as of his or her
birthday in the year following the
death of the spouse. If elected, the
interest may be distributed as
described in (ii) above.
If there is no Beneficiary, the entire interest
in the Contract will be distributed by the end
of the calendar year containing the fifth
anniversary of the Annuitant's death.
Life expectancies are determined using the
Single Life Table in Q&A-1 of Section
1.401(a)(9)-9 of the Income Tax Regulations. If
distributions are made to a surviving spouse as
the sole designated Beneficiary, such spouse's
life expectancy for a year is the number in the
Single Life Table corresponding to such
spouse's age in the year. In all other cases,
remaining life expectancy for a year is the
number in the Single Life Table corresponding
to the Beneficiary's age in the year
distributions must begin, reduced by 1 for each
subsequent year.
We will permit the Owner to limit the option(s)
offered to any named Beneficiary, if the Owner
provides written notice to the Company prior to
death and the desired option(s) is one provided
for in this Contract and it satisfies the
applicable requirements of IRC Sections
401(a)(9) and 408(b)(3) and the regulations
thereunder.
If the Annuitant dies after required
distributions commence, the remaining portion
of his or her interest in the Contract, if any,
will be distributed at least as rapidly as
under the distribution option chosen. If there
is more than one Beneficiary, the foregoing
provisions will independently apply to each
Beneficiary, to the extent of that
Beneficiary's share.
11.2
DEATH BENEFIT ON OR AFTER If Annuity Payments have been selected based on
MATURITY DATE an Annuity Option providing for payments for a
guaranteed period, and the Annuitant dies on or
after the Annuity Commencement Date, we will
make the remaining guaranteed payments to the
Beneficiary. Any remaining payments will be
made at least as rapidly as under the method of
distribution being used as of the date of the
Annuitant's death. If no Beneficiary is living,
we will commute any unpaid guaranteed payments
to a single sum (on the basis of the interest
rate used in determining the payments) and pay
that single sum to the estate of the last to
die of the Annuitant and the Beneficiary.
PROOF OF DEATH We will require proof of death upon the death
of the Annuitant or the Owner. Proof of death
is one of the following received at the Annuity
Service Office:
(a) A certified copy of a death
certificate.
(b) A certified copy of a decree of a
court of competent jurisdiction as to
the finding of death.
(c) Any other proof satisfactory to us.
11.3
PART 12 ANNUITY PAYMENTS
--------------------------------------------------------------------------------
GENERAL Benefits payable under this Contract may be
applied in accordance with one or more of the
Annuity Options described below, subject to any
restrictions of Internal Revenue Code sections
401(a)(9) and 408(b)(3). If guaranteed payments
are to be made, the period over which the
guaranteed payments are made may not exceed the
period permitted under Section 1.401(a)(9)-6 of
the Income Tax Regulations. Once Annuity
Payments commence, the Annuity Option may not
be changed.
We will send you information about Annuity
Options before the Annuity Commencement Date.
If by the Maturity Date, you do not choose an
Annuity Option, make a total withdrawal of the
Surrender Value, or ask us to change the
Maturity Date, we will automatically pay you
Annuity Payments under the Annuity Option shown
on the Specifications Page and the Annuity
Commencement Date is considered to be the
Maturity Date. You can change the Annuity
Option at any time before Annuity Payments
commence.
You may select a Fixed or Variable Annuity. We
will provide variable Annuity Payments unless
otherwise elected. Once Annuity Payments
commence, the Annuity Option may not be
changed.
The method used to calculate the amount of the
initial and subsequent Annuity Payments is
described below.
If the monthly income is less than $20, we may
pay the greater of the Contract Value or the
commuted value of the Lifetime Income Benefit
in one lump sum on the Maturity Date, or the
Annuity Commencement Date if earlier.
VARIABLE ANNUITY PAYMENTS We will determine the amount of the first
variable Annuity Payment by applying the
portion of the Contract Value used to effect a
Variable Annuity (minus any applicable premium
taxes) to the Annuity Option elected based on
the mortality table and assumed interest rate
shown on the Specifications Page. We will
provide a table of the annuity factors upon
request. If the current rates in use by us on
the Annuity Commencement Date are more
favorable to you, we will use the current
rates. The portion of the Contract Value used
to effect a Variable Annuity will be measured
as of a date not more than 10 business days
prior to the Annuity Commencement Date.
Subsequent payments will be based on the
investment performance of the Investment
Options you elected. The amount of each
subsequent variable Annuity Payment is
determined by multiplying the number of Annuity
Units credited for each Investment Option you
elect by the appropriate Annuity Unit value on
each subsequent determination date, which is a
uniformly applied date not more than 10
business days before the payment is due. The
number of Annuity Units is determined by
dividing the portion of the first payment
allocated to an Investment Option by the
Annuity Unit value for that Investment Option
determined as of the same date that the
Contract Value used to effect Annuity Payments
was determined. The portion of the first
payment allocated to an investment Option will
be determined in the same proportion that the
Investment Account Value of each Investment
Option bears to the Contract Value used to
effect the Variable Annuity, unless you elect a
different allocation.
MORTALITY AND EXPENSE We guarantee that the dollar amount of each
GUARANTEE variable Annuity Payment will not be affected
by changes in mortality and expense experience.
12.1
ANNUITY UNIT VALUE The value of an Annuity Unit for each
Investment Option for any Valuation Period is
determined as follows:
(a) The net investment factor for the
corresponding Sub-Account for the
Valuation Period for which the
Annuity Unit value is being
calculated is multiplied by the
value of the Annuity Unit for the
preceding Valuation Period; and
(b) The result is adjusted to compensate
for the interest rate used to
determine the first variable Annuity
Payment.
The dollar value of Annuity Units may increase,
decrease or remain the same from one Valuation
Period to the next.
FIXED ANNUITY PAYMENTS We will determine the amount of each fixed
Annuity Payment by applying the portion of the
Contract Value used to effect a Fixed Annuity
measured as of a date not more than 10 business
days prior to the Annuity Commencement Date
(minus any applicable premium taxes) to the
Annuity Option elected based on the mortality
table and interest rate shown on the
Specifications Page. The fixed Annuity Payment
will not be less than that available by
applying the Contract Value to purchase a
single premium immediate annuity then offered
to the same class of annuitants by us or a
company affiliated with us.
We guarantee the dollar amount of fixed Annuity
Payments.
12.2
PART 13 ANNUITY OPTIONS
--------------------------------------------------------------------------------
DESCRIPTION OF ANNUITY OPTIONS Option 1: Life Annuity
Life 5-Year Certain. We will make Annuity
Payments for 5 years and after that during the
lifetime of the Annuitant. No payments are due
after the death of the Annuitant or, if later,
the end of the 5-year period.
Option 2: Joint Life Annuity
Joint Life 5-Year Certain. We will make Annuity
Payments for 5 years and after that during the
joint lifetime of the Annuitant and
co-Annuitant. No payments are due after the
death of both the Annuitant and co-Annuitant
or, if later, the end of the 5-year period.
Option 3: Fixed Life Annuity
Life Annuity with Cash Refund: This option is
available if only one of the Annuitant or
co-Annuitant is living at the Annuity
Commencement Date. We will make payments during
the lifetime of the Annuitant or co-Annuitant.
After the death of the Annuitant or
co-Annuitant, we will pay the Beneficiary a
lump sum amount equal to the excess, if any, of
the Contract Value at the election of this
option over the sum of the Annuity Payments
made under this option. This option is
available on or after the later of the
Annuitant's 90th birthday or the tenth Contract
Anniversary.
The annual amount of the Annuity Payments will
equal the greater of:
(a) the Lifetime Income Amount, or
(b) the annual amount determined by
applying the Contract Value to a
Cash Refund Annuity Option based on
the Mortality Table and Fixed
Annuity Payment Interest Rate listed
on the Specifications Page.
Option 4: Fixed Joint Life Annuity
Joint Life Annuity with Cash Refund: This
option is available if both the Annuitant and
co-Annuitant are living at the Annuity
Commencement Date. We will make payments during
the lifetime of the Annuitant and co-Annuitant.
After the death of both the Annuitant and
co-Annuitant, we will pay the Beneficiary a
lump sum amount equal to the excess, if any, of
the Contract Value at the election of this
option over the sum of the Annuity Payments
made under this option. This option is
available only if the co-Annuitant is the
co-Annuitant listed on the Specifications Page
at issue of the Contract. This option may be
elected on or after the earlier of the
Annuitant's or co-Annuitant's 90th birthday or
the tenth Contract Anniversary, if later.
The annual amount of the Annuity Payments will
equal the greater of:
(a) the Lifetime Income Amount, or
(b) the annual amount determined by
applying the Contract Value to a
Joint Life Cash Refund Annuity
Option based on the Mortality Table
and Fixed Annuity Payment Interest
Rate listed on the Specifications
Page.
ALTERNATE ANNUITY OPTIONS Instead of settlement in accordance with the
Annuity Options described above, you may choose
an alternate form of settlement acceptable to
us. Once Annuity Payments commence, the form of
settlement may not be changed.
13.1
XXXX XXXXXXX LIFE INSURANCE COMPANY (U.S.A.) (JohnHancock(R) LOGO)
A STOCK COMPANY
