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EXHIBIT 4(b)(iii)
[SAGE LIFE ASSURANCE OF AMERICA, INC. LOGO]
MEMBER OF SAGE INSURANCE GROUP
SIMPLE INDIVIDUAL RETIREMENT ANNUITY RIDER
GENERAL
This Rider is made part of the Contract to which it is attached. The Contract as
amended is intended to qualify as a SIMPLE individual retirement annuity under
Section 408(b) of the Internal Revenue Code of 1986, as amended (the "Code").
APPLICABLE PROVISIONS
The following provisions apply and replace any contrary provisions of the
Contract:
1. You shall be the Owner. Any provision of the Contract that would
allow joint ownership, or that would allow more than one person to
share distributions, is deleted.
2. The Contract is not transferable or assignable (other than pursuant
to a divorce decree in accordance with applicable law) and is
established for the exclusive benefit of you and your Beneficiaries.
It may not be sold, assigned, alienated, or pledged as collateral
for a loan or as security.
3. Your entire interest in the Contract shall be nonforfeitable.
4. This Contract will accept only cash premium payments made on your
behalf pursuant to the terms of a SIMPLE IRA plan described in Code
Section 408(p). A rollover contribution or a transfer of assets from
another of your SIMPLE IRAs will also be accepted.
You shall have the sole responsibility for determining whether any
premium payment meets applicable income tax requirements.
If contributions made on your behalf pursuant to a SIMPLE IRA plan
maintained by your employer are received directly by us from the
employer, we will provide the employer with the summary description
required by Code Section 408(l)(2).
5. This Contract does not require fixed premium payments. Any refund of
premiums (other than those attributable to excess contributions)
will be applied before the close of the calendar year following the
year of the refund toward the payment of additional premiums or the
purchase of additional benefits.
6. The Income Date is the date your entire Account Value will be
distributed or commence to be distributed to you. Your Income Date
shall be no later than April 1 of the calendar year following the
calendar year in which you attain age 70 1/2. You shall have the
sole responsibility for electing a distribution that complies with
this Rider and applicable law.
7. With respect to any amount which becomes payable under the Contract
during your lifetime, such payment shall commence on or before the
Income Date and shall be payable in substantially equal amounts, no
less frequently than annually. Payments shall be made in the
following manner:
a. in a lump sum; or
b. over your life; or
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c. over the lives of you and your designated beneficiary; or
d. over a period certain not exceeding your life expectancy; or
e. over a period certain not exceeding the joint and last
survivor expectancy of you and your designated beneficiary.
If your entire interest is to be distributed in other than a lump
sum, then the minimum amount to be distributed each year (commencing
with the calendar year following the calendar year in which you
attain age 70 1/2 and each year thereafter) shall be determined in
accordance with Code Sections 408(b)(3) and 401(a)(9), including the
incidental death benefit requirements of Code Section 401(a)(9)(G),
and the regulations thereunder including the minimum distribution
incidental benefit requirement of Proposed Treasury Regulation
Section 1.401(a)(9)-2. Payments must be either nonincreasing or may
increase only as provided in Proposed Treasury Regulation Section
1.401(a)(9)-1, Q&A F-3.
8. If you die after distribution of your interest has commenced, the
remaining portion of such interest will continue to be distributed
at least as rapidly as under the method of distribution being used
prior to your death.
If you die before distribution has begun, your entire interest in
the Contract must be distributed no later than December 31 of the
calendar year in which the fifth anniversary of your death occurs.
However, proceeds which are payable to a named beneficiary who is a
natural person may be distributed in substantially equal
installments over the lifetime of the beneficiary or a period
certain not exceeding the life expectancy of the beneficiary
provided such distribution begins not later than December 31 of the
calendar year in which the first anniversary of your death occurs.
If the beneficiary is your surviving spouse, the surviving spouse
may elect not later than December 31 of the calendar year in which
the fifth anniversary of your death occurs to receive equal or
substantially equal payments over the life or life expectancy of the
surviving spouse commencing at any date prior to the date on which
you would have attained age 70 1/2. Minimum payments will be
calculated in accordance with Code Sections 408(b)(3) and the
regulations thereunder.
For the purposes of this requirement, any amount paid to any of your
children will be treated as if it had been paid to your surviving
spouse if the remainder of the interest becomes payable to the
surviving spouse when the child reaches the age of majority.
If the beneficiary is your surviving spouse, the spouse may treat
the Contract as the spouse's own IRA. This election will be deemed
to have been made if the surviving spouse makes a regular IRA
contribution to the Contract, makes a rollover to or from the
Contract, or fails to elect any of the above distribution options.
If you die before your entire interest has been distributed, no
additional premiums will be accepted under this Contract after your
death unless the beneficiary is your surviving spouse.
9. For purposes of the foregoing provisions, life expectancy and joint
and last survivor expectancy shall be determined by use of the
expected return multiples in Table V and VI of Treasury Regulation
Section 1.72-9 in accordance with Code Section 408(b)(3) and the
regulations thereunder. In the case of distributions under paragraph
7 of this Rider, the life expectancy of you and your beneficiary
will be initially determined on the basis of your attained ages in
the year you reach 70 1/2. In the case of distribution under
paragraph 8 of this Rider, life expectancy will be initially
determined on the basis of your beneficiary's attained age in the
year distributions are required to commence. Unless you (or your
spouse) elects otherwise prior to the time distributions are
required to commence, your life expectancy and, if applicable, your
spouse's life expectancy will be recalculated annually based on your
attained ages in the year for which the required distribution is
being determined. The life expectancy of a nonspouse beneficiary
will not be recalculated.
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The annual distribution required to be made by your Income Date is
for the calendar year in which you reached age 70 1/2. Annual
payments for subsequent years, including the year in which your
Income Date occurs, must be made by December 31 of that year. The
amount distributed for each year shall equal or exceed the annuity
value as of the close of business on December 31 of the preceding
year, divided by the applicable life expectancy or joint and last
survivor expectancy.
You may satisfy the minimum distribution requirements under Code
Section 408(b)(3) by receiving a distribution from one IRA that is
equal to the amount required to satisfy the minimum distribution
requirement for two or more IRAs. For this purpose, if you own two
or more IRAs, you may use the alternative method described in Notice
88-38, 1988-1 C.B. 524, to satisfy the minimum distribution
requirements.
You or your beneficiary, as applicable, shall have the sole
responsibility for requesting a distribution that complies with this
Rider and applicable law.
10. Prior to the expiration of the 2-year period beginning on the date
you first participated in any SIMPLE IRA plan maintained by your
employer, any rollover or transfer by you of funds from this SIMPLE
IRA must be made to another SIMPLE IRA. Any distribution of funds to
you during this 2-year period may be subject to a 25 percent
additional tax if you do not roll over the amount distributed into
another SIMPLE IRA. After the expiration of this 2-year period, you
may roll over or transfer funds to any IRA that is qualified under
Code Sections 408(a) or 408(b).
MODIFICATIONS
We reserve the right to amend the Contract or this Rider to the extent necessary
to qualify as an individual retirement annuity for federal income tax purposes.
CHARGE FOR THIS RIDER
There is no charge for this Rider.
EFFECTIVE DATE
This Rider is effective as of the Contract Date.
TERMINATION
This Rider will terminate on the date of the first to occur of the following
events:
1. The Contract is surrendered.
2. The entire interest in the Contract has been distributed.
3. You request the termination of this Rider.
TERMS AND CONDITIONS
All of the terms used in this Rider have the same meanings as in the Contract
unless otherwise clearly indicated in this Rider. This Rider is subject to all
the exclusions, definitions and provisions of the Contract which are not
inconsistent with the terms of this Rider.
[SIG]
Chairman
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