# Contract

November 7th, 2006
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- ----------- -------------------------- ------------------------- ------------------------- ------------- ------------ ------------- Maximum Annual Recalculate Benefit Withdrawal Amount Withdrawal Automatic MAW for Year Contract Value Guaranteed Amount Amount Reset Lifetime - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Begin Year End Year Begin Year End Year Begin Year End Year - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Issue \$100,000 N/A \$100,000 N/A \$5,000 N/A N/A N/A N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 1 \$105,000 \$101,000 \$100,000 \$101,000 \$5,000 \$5,050 \$4,000 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 2 \$106,050 \$102,050 \$101,000 \$102,050 \$5,050 \$5,103 \$4,000 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ -------------
Because each \$4,000 Withrawal does not cause the cumulative dollar amount withdrawn (including current withdrawal) in the current Benefit Year to exceed the MAW: a. The Guaranteed Amount is reduced by the amount of the Withdrawal; and b. The Maximum Annual Withdrawal (MAW) Amount is unchanged In Benefit Year 1, since the Contract Value is (\$101,000) is higher than the Guaranteed Amount (\$96,000) on the first valuation date of the Benefit Year, the Guaranteed Amount is reset to the Contract Value. The MAW is increased because 5% of the new Guaranteed Amount is greater than the current MAW (5% x 101,000 = \$5,050). Example # 2 - Withdrawal Exceeding Maximum Annual Withdrawal (MAW) Amount The values shown below are based on the following assumptions: o Initial Purchase Payment = \$100,000 o Rider Date = Contract Date o No subsequent Purchase Payments o Annual Net Return = 5% (the gross return minus all contract changes; including rider charges) o \$6,000 Withdrawal is taken at end of Benefit Year 1 and Benefit Year 2
- ----------- -------------------------- ------------------------- ------------------------- ------------- ------------ ------------- Benefit Contract Value Guaranteed Amount Maximum Annual Withdrawal Automatic Recalculate Year Withdrawal Amount Amount Reset MAW for Lifetime - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Begin Year End Year Begin Year End Year Begin Year End Year - ------------ ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Issue \$100,000 N/A \$100,000 N/A \$5,000 N/A N/A N/A N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 1 \$105,000 \$99,000 \$100,000 \$99,000 \$5,000 \$4,950 \$6,000 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 2 \$103,950 \$97,950 \$99,000 \$97,950 \$4,950 \$4,898 \$6,000 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ -------------
Because each \$6,000 Withrawal does cause the cumulative dollar amount withdrawn (including current withdrawal) in the current Benefit Year to exceed the MAW: a. the Guaranteed Amount will equal the least of: 1. The Contract Value immediately following the Withdrawal (\$105,000 - \$6,000 = \$99,000); or 2. The Guaranteed Amount immediately prior to the Withdrawal less the amount of the Withdrawal, but not less than zero (\$100,000 - \$6,000 = \$94,000). b. the Maximum Annual Withdrawal (MAW) Amount will equal the least of: 1. The MAW prior to the Withdrawal (\$5,000); 2. The greater of: a) 5% of the adjusted Guaranteed Amount immediately following the Withdrawal (5% x 94,000 = \$4,700); or b) 5% of the Contract Value immediately following the Withdrawal (5% x \$99,000 = \$4,950). ; or 3. The new Guaranteed Amount (\$94,000). In Benefit Year 1, since the Contract Value (\$99,000) is higher than the Guaranteed Amount (\$94,000) on the first valuation date of the Benefit Year, the Guaranteed Amount is reset to the Contract Value. The MAW is unchanged because 5% of the Guaranteed Amount (5% x \$99,000 = \$4,950) is not greater than the MAW prior to the Reset. Example # 3 - Withdrawal Exceeding Maximum Annual Withdrawal (MAW) Amount The values shown below are based on the following assumptions: o Initial Purchase Payment = \$100,000 o Rider Date = Contract Date o No subsequent Purchase Payments o Annual Net Return = -5% (the gross return minus all contract changes; including rider charges) o \$6,000 Withdrawal is taken at end of Benefit Year 1 and Benefit Year 2
- ----------- -------------------------- ------------------------- ------------------------- ------------- ------------ ------------- Benefit Contract Value Guaranteed Amount Maximum Annual Withdrawal Automatic Recalculate Year Withdrawal Amount Amount Reset MAW for Lifetime - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Begin Year End Year Begin Year End Year Begin Year End Year - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Issue \$100,000 N/A \$100,000 N/A \$5,000 N/A N/A N/A N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 1 \$95,000 \$89,000 \$100,000 \$89,000 \$5,000 \$4,450 \$6,000 No N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 2 \$84,550 \$78,550 \$89,000 \$78,550 \$4,450 \$3,928 \$6,000 No N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ -------------
Because each \$6,000 Withrawal does cause the cumulative dollar amount withdrawn (including current withdrawal) in the current Benefit Year to exceed the MAW: a. the Guaranteed Amount will equal the least of: 1. The Contract Value immediately following the Withdrawal (\$95,000 - \$6,000 = \$89,000); or 2. The Guaranteed Amount immediately prior to the Withdrawal less the amount of the Withdrawal, but not less than zero (\$100,000 - \$6,000 = \$94,000). b. the Maximum Annual Withdrawal (MAW) Amount will equal the least of: 1. The MAW prior to the Withdrawal (\$5,000); 2. The greater of: a) 5% of the adjusted Guaranteed Amount immediately following the Withdrawal (5% x 89,000 = \$4,450); or b) 5% of the Contract Value immediately following the Withdrawal (5% x \$89,000 = \$4,450). ; or 3. The new Guaranteed Amount (\$94,000). Example # 4 - If a Withdrawal is made during the Waiting Period, the Owner may make a one-time election to recalculate the MAW to a lesser amount so that it will be paid for the lifetime(s) of the Single Life or Joint Lives (if applicable) if all of the following occur: The values shown below are basd on the following assumptions: o Initial Purchase Payment = \$100,000 o Issue Age 62 o Rider Date = Contract Date o No subsequent Purchase Payments o Annual Net Return = -6% (the gross return minus all contract changes; including rider charges) o Owner takes Withdrawal equal to the MAW each benefit year
- ----------- -------------------------- ------------------------- ------------------------- ------------- ------------ ------------- Benefit Contract Value Guaranteed Amount Maximum Annual Withdrawal Automatic Recalculate Year Withdrawal Amount Amount Reset MAW for Lifetime - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Begin Year End Year Begin Year End Year Begin Year End Year - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Issue Issue \$100,000 N/A \$100,000 N/A \$5,000 N/A N/A N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 1 \$94,000 \$89,000 \$100,000 \$95,000 \$5,000 \$5,000 \$5,000 No N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 2 \$83,660 \$78,660 \$95,000 \$90,000 \$5,000 \$5,000 \$5,000 No N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 3 \$73,940 \$68,940 \$90,000 \$85,000 \$5,000 \$4,250 \$5,000 No Owner - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 4 \$64,804 \$60,554 \$85,000 \$80,750 \$4,250 \$4,250 \$4,250 No N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ -------------
The owner takes Withdrawals during the Waiting Period. At the end of the Waiting Period, the owner elects to recalculate (5% x 85,000 = \$4,250) the MAW to a lessor amount so it will paid for the lifetime of the Single Life. Example # 5 - If an Automatic Reset of the Guaranteed Amount has occurred after the Waiting Period which causes the MAW to be greater than or equal to the MAW immediately prior to the Reset, then the MAW will continue during the lifetime(s) of the Single Life or Joint Lifes, if applicable, as long as the MAW is greater than zero. The values shown below are based on the following assumptions: o Initial Purchase Payment = \$100,000 o Issue Age 62 o Rider Date = Contract Date o No subsequent Purchase Payments o Annual Net Return = 6% (the gross return minus all contract changes; including rider charges) o Owner takes Withdrawal equal to the MAW each benefit year
- ----------- -------------------------- ------------------------- ------------------------- ------------- ------------ ------------- Benefit Contract Value Guaranteed Amount Maximum Annual Withdrawal Automatic Recalculate Year Withdrawal Amount Amount Reset MAW for Lifetime - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Begin Year End Year Begin Year End Year Begin Year End Year - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- Issue \$100,000 N/A \$100,000 N/A \$5,000 N/A N/A N/A N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 1 \$106,000 \$101,000 \$100,000 \$101,000 \$5,000 \$5,050 \$5,000 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 2 \$107,060 \$102,010 \$101,000 \$102,010 \$5,050 \$5,101 \$5,050 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 3 \$108,131 \$103,030 \$102,010 \$103,030 \$5,101 \$5,152 \$5,101 Yes Automatic - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ ------------- 4 \$109,212 \$104,060 \$103,030 \$104,060 \$5,152 \$5,203 \$5,152 Yes N/A - ----------- ------------- ------------ ------------ ------------ ------------ ------------ ------------- ------------ -------------
The owner takes Withdrawals during the Waiting Period. At the end of the Waiting Period, the Guaranteed Amount Resets to \$103,030 causing the MAW to increase from \$5,101 to \$5,152. Since the Waiting Period has expired and the Reset of the Guaranteed Amount caused the MAW be greater than or equal to the prior MAW immediately prior to the Reset, the MAW will last a lifetime.
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