EXHIBIT 4(a)
[METLIFE LOGO]
Metropolitan Life Insurance Company
A Stock Company
Xxx Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000
SINGLE PREMIUM FLEXIBLE INCOME
IMMEDIATE PAYMENT CONTRACT
This is a legal contract between you and MetLife that describes your benefits
and rights and the beneficiary's rights in Question and Answer format. Please
read this contract carefully.
This contract is not eligible for dividends. There is no cash surrender benefit.
In accordance with Section 72(u)(4) the Internal Revenue Code of 1986, as
subsequently amended, payments under this contract must begin no later than
12-months from the contract issue date specified on the specifications page.
ANY PAYMENTS PROVIDED BY THIS CONTRACT WHICH ARE BASED ON THE INVESTMENT RETURN
OF THE SEPARATE ACCOUNT ARE VARIABLE AND ARE NOT GUARANTEED AS TO AMOUNT. THE
SEPARATE ACCOUNT CONSISTS OF A NUMBER OF INVESTMENT DIVISIONS WHICH CAN BE
CHOSEN TO SUPPORT ANY VARIABLE PAYMENTS. THE INVESTMENT DIVISIONS AVAILABLE AS
OF THE ISSUE DATE ARE DESCRIBED IN THE PROSPECTUS. A CHARGE WILL BE ASSESSED
AGAINST THE ASSETS IN THE SEPARATE ACCOUNT EQUAL TO THE CONTRACT CHARGE DEFINED
IN QUESTION 1.
IF WE ARE MAKING VARIABLE PAYMENTS, THE AMOUNT PAID AS OF ANY PARTICULAR PAYMENT
DATE MAY BE MORE OR LESS THAN THE AMOUNT PAID AS OF THE PRIOR PAYMENT DATE.
PAYMENTS WILL GO UP WHEN THE ADJUSTMENT FACTOR IS MORE THAN ONE AND DOWN WHEN IT
IS LESS THAN ONE. (FOR AN EXPLANATION OF HOW THE ADJUSTMENT FACTOR IS DETERMINED
SEE QUESTION 8).
[[10]-DAY RIGHT TO EXAMINE
You may return your contract to us at our designated office or to the person you
purchased it from within [10] days of the date you received it. If you return it
within the [10] day period, the contract will be canceled from the contract
issue date. We will refund the total consideration received on your behalf
adjusted to reflect net investment performance and changes in the specified
interest rate since the date of purchase, minus any payments made prior to your
cancellation of this contract.]
/s/ Xxxxx X. Xxxx /s/ Xxxxxx X. Xxxxxxxxx
---------------------------- -------------------------------------
Xxxxx X. Xxxx Xxxxxx X. Xxxxxxxxx
Vice-President & Secretary Chairman of the Board,
President and Chief Executive Officer
Form PSC (MISP)(0403)
FLEXIBLE INCOME PAYMENT SPECIFICATIONS PAGE
CONTRACT OWNER: [Xxxx Xxxxx]
ANNUITANT: [Xxxx Xxxxx]
DATE OF BIRTH [AND SEX] OF ANNUITANT: [January 1, 2003] [Female]
[JOINT ANNUITANT: Xxxx Xxxxx]
[DATE OF BIRTH, [AND SEX] OF JOINT ANNUITANT: May 1, 2003 Male]
CONTRACT NO.: [123456789] CONTRACT ISSUE DATE: [January 1, 2003]
INITIAL PAYMENT DATE: [February 1, 2003]
Note: If the initial payment date is more than 10
days after the contract issue date the
variable payment numbers shown will be used
as the basis to determine the initial
payment described in questions 6 and 7 but
will not be the actual amount we pay.
[BENEFICIARY, DATE OF BIRTH: Xxxxx Xxxxx January 23, 2001]
TAX MARKET: [Non-Qualified]
[MORTALITY TABLE: 1983 U.S. IAM Basic, Male with U.S. Projection Scale G, Male]
INDEX RATE BASIS: [10-year LIBOR Interest Rate Swap Index minus 1%. The Index
is published in the Federal Reserve Statistical Release H.15
as posted on the Federal Reserve
website at: xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/X00]
SEPARATE ACCOUNT: [Metropolitan Life Separate Account E]
SEPARATE ACCOUNT SERIES FUNDS: [Metropolitan Series Fund, Inc., MetLife
Investors Series Trust]
TOTAL CONSIDERATION: [$50,000.00]
CONTRACT CHARGE: [1.25%]
Additional Separate Account Charge on Investment Divisions:
[all Funds 0.25%] We reserve the right to impose additional
Separate Account Charges on Investment Divisions that we may
add to the Contract at any future date. The addition for any
Investment Division will not be greater than 0.25%.
Total Charge: [1.50%]
TYPE OF ANNUITY: [Lifetime Income Annuity with a Guarantee Period with
Withdrawal Option]
PAYMENT FREQUENCY: [monthly]
[MINIMUM WITHDRAWAL AMOUNT: $1000.00] [ADMINISTRATIVE WITHDRAWAL CHARGE: $95.00]
INITIAL FLEXIBLE INCOME PAYMENT
OPTION A:
- FIXED PAYMENT $[000.00] [000%]
- VARIABLE PAYMENT*
-[x Investment Division] $[000.00] [000%]
-[y Investment Division] $[000.00] [000%]
TOTAL INITIAL FLEXIBLE INCOME PAYMENT OPTION A: $[000.00] [000%]
ANNUITY DESCRIPTION FOR [Lifetime Income Annuity with a Guarantee Period with
Withdrawal Option:
1. If the annuitant is alive on the initial payment date, we will pay the
calculated payment from that date until the annuitant dies. We
guarantee, however, that once payments start we will make the
calculated payment until [month/day/year] whether or not the annuitant
is alive. We will make no further payments if the annuitant dies after
[month/day/year].
2. Withdrawals may be made subject to the following terms:
a. During the two-year period beginning with the initial payment date and
ending on [month/day/year], you may request a full or partial
withdrawal of the fair market value of this annuity. We will make no
further payments if a full withdrawal of the fair market value occurs.
A partial withdrawal of the fair market value of this annuity will
result in a pro-rata reduction of all future calculated payments. The
pro-rata reduction will be equal to the ratio of the withdrawal amount
to the full fair market value of this contract at the time of the
withdrawal.
b. Withdrawals made after the end of the two-year period will be limited
to the withdrawal value of the guaranteed income payments* that are
payable up to and including [month/day/year]. Any such withdrawal will
result in a pro-rata reduction of the calculated benefit until
[month/day/year]. The pro-rata reduction will be equal to the ratio of
the withdrawal amount to the fair market value of the remaining
guaranteed income payments payable under this contract at the time of
the withdrawal. Beginning with the first calculated payment due on
[month/day/year], provided the annuitant is alive on that date, we will
make the full calculated payment determined as if no withdrawal of the
withdrawal value of the guaranteed income payments had occurred.
c. All withdrawals will be subject to an administrative charge, which will
be deducted from the withdrawal amount prior to payment, and all
withdrawals will be subject to a minimum withdrawal amount (see
specifications page to determine the administrative charge and the
minimum withdrawal amount). If amounts withdrawn during the first two
years would result in the calculated payment due immediately following
the date of withdrawal to be less than $100.00, then the full fair
market value must be withdrawn, and we will make no further payments
under this contract. If any withdrawal made after [month/day/year] but
before [month/day/year] would result in a payment that is less than 25%
of the payment amount due on the first payment date after
[month/day/year], (computed as if no withdrawal of the guaranteed
income payments had occurred) no withdrawal will be permitted.
d. Both the basic income payment option B amount(s) and the flexible
income payment option A will be aggregated for purposes of determining
the fair market value of the annuity and the withdrawal values of the
guaranteed amounts. Subject to the above restrictions, a request to
withdraw a specific dollar amount will be treated as a withdrawal from
both the flexible income payment option A and the basic income payment
option B. Reductions in any remaining income payments after a
withdrawal will be made proportionately to both the flexible and basic
income annuity options under this contract.
e. Notwithstanding anything in this contract (including the basic income
payment option B endorsement) to the contrary, solely for purposes of
this withdrawal feature, neither the fair market value nor the
withdrawal value of the income annuity may exceed the total future
expected payments as determined under the applicable income
tax regulations of section 401(a)(9) of the Code.
3. We will pay the payee(s) named by the owner. If no payee is designated,
or no designated payee is alive when a payment is due, we will make
payment to whomever of the following are alive in the following order:
the annuitant, if living otherwise, the beneficiary, if living. If both
are dead, any guaranteed payments due will be made to the estate of the
last to die of the annuitant and the beneficiary.
4. We may withhold amounts from income payments and withdrawals, or reduce
future payments, as required under applicable federal state or local
tax law to satisfy any tax liability with respect to such payments and
withdrawals (including without limitation income, estate and gift,
generation skipping transfer tax, other excise taxes [and premium
taxes]).
*The "WITHDRAWAL VALUE OF GUARANTEED INCOME PAYMENTS" as determined on any
valuation date is equal to the flexible income payment option A as of that
date multiplied by the amount that would be needed to purchase $1 on each
payment date for which the flexible income payment option A is guaranteed to
be paid regardless of the death of the annuitant(s).]
INTEREST RATE APPLICABLE TO UNDER PAYMENTS OR OVER PAYMENTS
DUE TO MISSTATEMENT OF AGE AND/OR SEX: [5%]
THE DESIGNATED OFFICE RESPONSIBLE FOR SERVICING YOUR CONTRACT IS:
[MetLife Retirement Group
Metropolitan Life Insurance Company
0000 Xxxxxxxx Xxxxxxx - Xxxxx 000,
Xxxxxxxxxx, XX 00000.].
QUESTION KEY PAGE
1. What do the basic terms used in this contract mean?.......................................... 2
2. How is the net consideration allocated under this contract?.................................. [4]
3. Can the initial flexible income payment option A payment shown on
the specifications page change?.............................................................. [4]
4. How was the initial flexible income payment option A payment determined?..................... [5]
5. How does the separate account operate?....................................................... [5]
6. When are the variable payments determined?................................................... [6]
7. How does MetLife calculate the variable payment?............................................. [6]
8. How is the adjustment factor determined?..................................................... [7]
9. How is the index rate calculated?............................................................ [8]
10. How can you change your flexible income payment option A?.................................... [8]
11. What is the death benefit if the annuitant dies?............................................. [9]
12. How do we calculate the flexible income payment option A payment when you
elect to change how it is paid?.............................................................. [9]
13. How will a transfer of all or a partial amount of the fair market value affect your
payments?.................................................................................... [10]
14. What if an annuitant's age [or sex] as of the contract issue date
is not correct?.............................................................................. [10]
15. What are the owner's rights under this contract?............................................. [11]
16. What information can we ask for after the issue date of this contract?....................... [11]
17. Can this contract and the payments provided under it be assigned,
transferred or used as collateral for a loan?................................................ [11]
18. How does MetLife receive notice regarding any changes to be made to this contract?........... [11]
19. How do Federal income tax rules affect this contract?........................................ [11]
20. Are there any other tax rules affecting this contract?....................................... [11]
21. Does this contract contain all the provisions affecting it?.................................. [12]
1. WHAT DO THE BASIC TERMS USED IN THIS CONTRACT MEAN?
"Adjustment factor" means the factor used to determine any changes in
the variable payment. (For an explanation of how the adjustment factor
is determined see question 8.)
"Annuitant" is the person or persons on whose lifetime an income will
be based. If more than one annuitant is named and an annuitant dies, we
will continue to make payments during the life of the surviving
annuitant, but possibly in a reduced amount (see specifications page).
As used in this contract the word annuitant will refer to the named
annuitant on the specifications page unless he/she is no longer living,
in which case the word annuitant will refer to the surviving annuitant,
if any.
"Annuity purchase rate" means the dollar amount required by us as of
any valuation date to provide a flexible annuity income of $1 as of
each payment date. This rate, which is specific to the type of annuity,
is typically based on two assumptions; namely, a mortality basis, if
applicable, and the index rate. Mortality basis is a measurement scale
used to determine the annuitant's life expectancy. We guarantee that
the mortality basis (which consists of a mortality table and projection
scale) used, as of the contract issue date will not change. If the
annuitant dies, then the annuity purchase rate will be the rate
specific to the type of annuity, which reflects the remaining
payment(s), if any.
Neither expenses actually incurred nor mortality actually experienced
shall adversely affect the dollar amount of variable annuity payments
to any annuitant for whom variable annuity payments have commenced.
"Basic income payment option B" is an annuity payment option available
under this contract that provides a fixed annuity income. You may
request and MetLife will provide an example of how a transfer to this
annuity option will impact payment amounts under your flexible income
payment option A and basic income payment option B. A transfer to basic
income payment option B will not result in a lower payment than if you
reallocated an equal amount to the fixed payment portion of your
flexible income payment option A.
"Beneficiary" is the person or persons named to receive any death
benefit payable, after an annuitant DIES. A contingent beneficiary may
be named to become the beneficiary if all the beneficiaries die while
an annuitant is alive. If no beneficiary or contingent beneficiary is
named, or if none is alive when an annuitant dies, we will pay the
annuitant's estate. If more than one beneficiary is alive when an
ANNUITANT dies, we will pay them in equal shares unless directed
otherwise. The type of annuity you choose will determine if you need to
name a beneficiary.
2
"Business day" means a day on which the New York Stock Exchange is open
for business. A business day ends as of the close of regular trading on
the New York Stock Exchange.
"Code" refers to the Internal Revenue Code of 1986, as subsequently
amended.
"Contract charge" is a fee which covers costs associated with the
administration of this annuity, the mortality and expense risk, and
distribution costs and other costs necessary to maintain this annuity;
e.g., financial, accounting, actuarial and legal expenses. This fee
will be no more than 1.50%, annually, of the average value of amounts
in the separate account. The initial contract charge is shown in the
specifications page.
"Fair market value" of this contract as determined on any valuation
date is equal to the flexible annuity income as of that date multiplied
by the corresponding annuity purchase rate determined on that same
date.
"Flexible income payment option A" as of any valuation date means the
total fixed and variable payments payable under flexible income payment
option A as of that date. (For an explanation of how the flexible
income payment option A payment is determined, see question 4.)
"Fund" refers to the various series funds offered under the investment
divisions of the separate account. A fund is divided into portfolios,
each of which has its own investment objectives, investment management
fees and other charges. We will periodically provide this information
to you. The investment divisions of the separate account invest in
these portfolios.
"Income determination date" under this contract means the 10th day
prior to a payment due date. The contract issue date will also be
considered an income determination date if it falls within 10 days of
the initial payment date.
"Index rate" is the yield as defined in question 9.
"Net consideration" means the total consideration, less any applicable
taxes, any administrative fees, and, if applicable, any brokerage costs
associated with establishing this contract.
"NIR" or "Net Investment Return" is the percentage change in the value
of an investment division since the last valuation date which already
reflects any expenses and charges associated with the underlying fund
portfolio. It is reduced by the daily equivalent of the contract charge
for every day since the last valuation date.
"Payment date" is each anniversary of the initial payment date. The
number of payment dates you will have in any year will be based on the
payment
3
frequency you elected, i.e., monthly, quarterly, semi-annually or
annually. Your payment frequency cannot be changed.
"Separate account" is the account under this contract to which we
allocate the portion of the net consideration to support the variable
payments. It is an investment account we maintain separate from our
other assets. The separate account consists of a number of investment
divisions. The separate account is valued each business day. A detailed
description of each investment division currently available under this
contract is contained in the prospectus. You will be notified if the
funds that are available change in the future.
"Total consideration" means the total amount of money we received to
purchase this annuity. The amount is shown on the specifications page.
"Valuation date" refers to each day the variable payment is calculated.
A valuation date will also occur on any day that we determine the fair
market value or, if applicable, the withdrawal value of guaranteed
income payments under this contract.
The terms "we," "us," "our" and "MetLife" refer to Metropolitan Life
Insurance Company.
The terms "you," and "your," will refer to the annuitant (as defined in
this question 1). The annuitant may exercise all rights under this
contract (For an explanation of all rights under this contract see
question 15).
2. HOW IS THE NET CONSIDERATION ALLOCATED UNDER THIS CONTRACT?
Except as noted in question 3, the specifications page shows the
initial flexible income payment option A amount payable as of the
initial payment date. It also indicates what percentage of the initial
flexible income payment option A was selected to be paid as a fixed
and/or variable payment. Based on this selection, MetLife has allocated
a portion of the net consideration to its general account to provide
for any fixed payment and a portion to the applicable investment
divisions in the separate account to provide for any variable payment.
3. CAN THE INITIAL FLEXIBLE INCOME PAYMENT OPTION A PAYMENT SHOWN ON THE
SPECIFICATIONS PAGE CHANGE?
Once this contract is issued, you will be unable to change the type of
annuity, the annuitant or the date payments commence. If the initial
payment date is more than 10 days after the contract issue date the
initial variable payment may be different from that shown on the
specifications page (see question 6). If you change the allocation
between fixed and variable payments, or between the investment
divisions, it may also change (see questions 10 and 11).
If you transfer all or a portion of the fair market value of this
flexible income payment option A to provide a payment under basic
income payment option B,
4
the flexible income payment option A payment will change (see questions
10 and 12).
4. HOW WAS THE INITIAL FLEXIBLE INCOME PAYMENT OPTION A PAYMENT
DETERMINED?
The initial flexible income payment option A payment was determined by
dividing the net consideration by the annuity purchase rate in effect
as of the contract issue date and then allocating that amount between
fixed and variable payments based on your election. If you chose to
have a portion payable as a variable payment, the name of the
investment divisions, together with the percentage allocation selected
are also shown.
Under the fixed payment, the annuity income does not change unless you
elect to change all or a portion of these payments to variable
payments, change all or a portion of any variable payment to a fixed
payment, or transfer all or a portion of your annuity's fair market
value to basic income payment option B. Under the variable payment, the
income payment amount changes based on both the NIR of the investment
division(s) supporting the payment and the index rate. How much the
variable payment will change and whether the change will be positive or
negative will depend on the adjustment factor determined for each
investment division. (For an explanation of how the adjustment factor
is determined see question 8.)
5. HOW DOES THE SEPARATE ACCOUNT OPERATE?
The separate account is divided into investment divisions, each of
which buys shares in a corresponding portfolio of the fund. Therefore,
the separate account does not invest directly in stocks, bonds, etc.,
but leaves such investments to the fund portfolios to make. The shares
for each fund portfolio may also be bought by other separate accounts
of ours or our affiliates. Thus, the rate of return for each investment
division will generally be the same as that of the corresponding fund
portfolio, reduced by the annual contract charge.
We calculate the NIR of the investment divisions as of each valuation
date, i.e., the date we calculate the variable payment.
We own the assets in the separate account. The separate account will
not be charged with liabilities that arise from any other business that
we conduct. We will add amounts to the separate account from other
contracts of ours. MetLife guarantees that we will always maintain
assets in the separate account with a value at least equal to the
reserves for the variable payment payable in accordance with the terms
of this contract.
Changes to the separate account may also be made if we think they would
best serve the interests of participants in or owners of contracts that
participate in the separate account or would be appropriate in carrying
out the purposes of such contracts. Any changes will be made only to
the extent and in the manner
5
permitted by applicable laws. Also, when required by law, we will
obtain your approval of the changes and approval from any appropriate
regulatory authority.
Examples of the changes to the separate account that we may make
include:
- To transfer any assets in an investment division to another
investment division, or to one or more other separate
accounts, or to our general account; or to add, combine, or
remove investment divisions in the separate account.
- To substitute, for the shares of the fund portfolio held by
any investment division, the shares of another class of the
fund or the shares of any other investment permitted by law.
If any modifications result in a material change in the underlying
investments of an investment division to which an amount is allocated
under this contract, we will notify you of the change. You may then
choose to have the variable payments supported by other investment
divisions available under this contract.
6. WHEN ARE THE VARIABLE PAYMENTS DETERMINED?
The variable payments are determined as of each valuation date. A
valuation date will occur on the "income determination date", which is
when we calculate the variable payment payable for the applicable
period. In addition, a valuation date will occur as of the effective
date of an election to transfer all or a portion of this annuity's fair
market value to basic income payment option B, or if under flexible
income payment option A, an election is made to (i) change the
allocation between fixed and variable payments, or (ii) change the
investment division or investment divisions supporting the variable
payments. A valuation date will also occur on the date that any
withdrawal amount or death benefit, if any, is paid out under this
annuity.
While the variable payment will be calculated as of each valuation
date, only the amount calculated as of the income determination date
will be reflected in the payment.
We can delay the valuation date if the Securities and Exchange
Commission has determined that an emergency exists making the
calculation of the investment divisions' NIR not reasonably
practicable. We may also change the income determination date by giving
you 30 days notice, to the extent permitted by law.
7. HOW DOES METLIFE CALCULATE THE VARIABLE PAYMENT?
A variable payment is calculated for each investment division selected.
On a valuation date we determine the new variable payment by
multiplying the payment calculated for that investment division on the
last valuation date by the
6
adjustment factor determined for that investment division. If the
adjustment factor is greater than one, the variable payment amount
supported by that investment division will increase. If the adjustment
factor is less than one, the variable payment amount supported by that
investment division will decrease.
If more than one investment division is chosen, the new variable
payment is the sum of the amounts determined for each investment
division.
8. HOW IS THE ADJUSTMENT FACTOR DETERMINED?
The adjustment factor under this contract is used to measure the effect
of changes in both the investment division's NIR and the index rate on
the variable payment. The adjustment factor is equal to the product of
two factors, the investment factor and the interest factor.
Adjustment Factor = Investment Factor x Interest Factor
Investment Factor - This factor is calculated in the following manner:
- First, we add one to the investment division's NIR for the
period from the last valuation date to the current valuation
date.
- Second, we adjust the index rate that was in effect on the
last valuation date to reflect the time period from the last
valuation date to the current valuation date. We then add one
to this adjusted index rate.
- Third, we divide the number determined in the first step by
the number determined in the second step. The new number
resulting from the division of these two numbers is the
investment factor.
The investment factor reflects the impact on the variable payment of
the investment division's NIR since the last valuation date. It will be
greater than one if the investment division's NIR since the last
valuation date is greater than the index rate effective as of the last
valuation date. It will be less than one if the investment division's
NIR since the last valuation date is less than the index rate effective
as of the last valuation date.
Interest Factor - This factor is calculated in the following manner:
- First, we calculate the annuity purchase rate based on the
index rate in effect as of the last valuation date. The
annuity purchase rate uses the same mortality basis used as of
the contract issue date but is recalculated to reflect the
annuitant's age, if applicable, and remaining future variable
payments as of the last valuation date.
- Second, we calculate another annuity purchase rate in exactly
the same way as in the first step, except we now use the index
rate in effect as of the
7
current valuation date to value those payments that would be
paid after the current valuation date.
- Third, we divide the annuity purchase rate calculated in the
first step by the annuity purchase rate calculated in the
second step. The number resulting from the division of these
two rates is the interest factor.
The interest factor reflects the impact on the variable payment due to
the change in the index rate from the last valuation date to the
current valuation date. It will be greater than one if the index rate
effective as of the current valuation date is greater than the index
rate effective as of the last valuation date. It will be less than one
if the index rate effective as of the current valuation date is less
than the index rate effective as of the last valuation date.
The adjustment factor is always greater than one if the investment and
interest factors are both greater than one. The adjustment factor is
always less than one if the investment and interest factors are both
less than one. If the investment factor is greater than one and the
interest factor is less than one, or if the investment factor is less
than one and the interest factor is greater than one, then the
adjustment factor may be greater than one or less than one, depending
on which factor has the greater impact.
9. HOW IS THE INDEX RATE CALCULATED?
The index rate is the yield of the Index (see the specifications page
for the applicable Index) It is calculated on a monthly basis and will
be used as an annual effective rate. If the reporting source reports
incorrect information, MetLife will use the corrected information. If
these yields are no longer available or are not readily available from
the specified reporting source, we will determine and use an
alternative index rate basis, which we consider to be the most
appropriate, or a comparable source.
We may increase the frequency of the index rate calculation. If we do
so, we will give you advance written notice.
10. HOW CAN YOU CHANGE YOUR FLEXIBLE INCOME PAYMENT OPTION?
There are two ways that the flexible income payment option A can
change. First, you can reallocate all or a portion of the flexible
income payment option A between fixed payments and variable payments,
as well as change the investment divisions supporting the variable
payments. For an explanation of how this reallocation can affect the
flexible income payment option A payment see question 11.
Second, you can transfer up to the full fair market value of flexible
income payment option A to provide a basic income payment option B
payment. For an explanation of how this transfer can affect your
flexible income payment option A payment see question 12.
8
For changes made under this question 10, one change may be made per
business day. However, for administrative reasons, we reserve the right
to limit the number of changes in any 12-month period. If we do so, in
no event will we limit the number of changes to less than one per
month. We will give you 30 days advance written notice. If applicable,
We reserve the right to limit a you or your beneficiary's ability to
make a change if the number of changes made by you or the beneficiary
exceeds 10 per month and is causing financial harm to owners of other
contracts by requiring excessive transaction activity in the fund
portfolios at times that adversely affect the price at which the assets
in the portfolios are bought or sold.
Changes will be made as of the end of a business day if received before
4PM Eastern Standard Time on a business day. Otherwise the change will
be made as of the end of the next following business day.
11. WHAT IS THE DEATH BENEFIT IF THE ANNUITANT DIES?
If the annuitant or the joint annuitant, if any, dies before the
initial payment date, but after the free-look period defined on the
cover page of this contract, we will refund the net consideration, plus
or minus any income gains or losses incurred as a result of your
investment in the separate account fund portfolios, received for this
contract as a death benefit in a lump sum.
To determine if there is any death benefit payable after the initial
payment date, see the annuity description on the specifications page.
12. HOW DO WE CALCULATE THE FLEXIBLE INCOME PAYMENT OPTION A PAYMENT WHEN
YOU ELECT TO CHANGE HOW IT IS PAID?
If you request a change from (a) a variable payment to a fixed payment,
(b) a fixed payment to a variable payment or (c) one investment
division supporting the variable payment to another, you must identify
the percentage of the current payment to be changed and the applicable
investment divisions affected. We then recalculate the variable payment
as of the effective date of the change by applying the adjustment
factor determined for each investment division supporting the variable
payment. After that, we increase and/or decrease the recalculated
payments, as appropriate, by the percentage selected. For example:
(a) If you choose to change 50% of the variable payment supported
by investment division A to a fixed payment and the variable
payment (as of the date of the change) is $100, the fixed
payment will be increased by $50 and that variable payment
will be decreased by $50.
(b) If you choose to change 50% of the fixed payment to a variable
payment supported by investment division A and the fixed
payment is $100, that variable payment will be increased by
$50 and the fixed payment will be decreased by $50.
9
(c) If you choose to change 50% of the variable payment supported
by investment division A to be supported by investment
division B and the variable payment is $100, the variable
payment supported by investment division B will be increased
by $50 and the variable payment supported by investment
division A will be decreased by $50.
13. HOW WILL A TRANSFER OF ALL OR A PARTIAL AMOUNT OF THE FAIR MARKET VALUE
TO BASIC INCOME PAYMENT OPTION B AFFECT YOUR PAYMENTS?
While the total amount of income annuity may change, a transfer to the
basic income payment option B will not affect the payee, the
annuitant(s), or the remaining guarantee period as specified under this
contract. However, you will not be allowed to make any reallocations or
transfers from the basic income payment option B.
If the full fair market value of flexible income payment option A is
transferred, we will have no further obligations under, and no further
payments will be made under flexible income payment option A after the
date of the transfer.
If less than the full fair market value is transferred, then the amount
of any remaining flexible income payment option A payments payable
under this contract will be less than the amounts that would have been
paid had there been no transfer. Following such a transfer, the amount
of each flexible income payment option A payment made after the
transfer date will be reduced by a percentage equal to the ratio of the
transfer amount to the full fair market value of flexible income
payment option A at the time of the transfer.
14. WHAT IF AN ANNUITANT'S AGE OR SEX AS OF THE CONTRACT ISSUE DATE IS NOT
CORRECT?
If the date of birth or sex as shown on the specifications page is not
correct, we will adjust the payments to agree with the correct age or
sex. If we have already made any payment that was wrong then any
overpayment will, together with interest at 5%, be deducted from future
payments. Any adjustment due to an underpayment will, together with
interest at 5%, be paid immediately upon receipt of the corrected
information.
15. WHAT ARE THE OWNER'S RIGHTS UNDER THIS CONTRACT?
You have all the rights under this contract, including the right at any
time to change the beneficiary, if applicable. No change will be
effective until written notice of the change is received by us.
Any change in a beneficiary designation will take effect as of the date
the request was signed but without prejudice to us on account of any
payment made by us before receipt of the request or so soon thereafter
that payment could not reasonably be stopped. When contacting us, you
should mention the contract number and your name.
10
16. WHAT INFORMATION CAN WE ASK FOR AFTER THE ISSUE DATE OF THIS CONTRACT?
We can request proof that you are alive as of the payment date. If we
have made a request, we may make no further payments until proof is
received. If the annuitant is not then living, we will require proof of
the authority of any person who makes a claim to receive any amount
payable as of the annuitant's death.
17. CAN THIS CONTRACT AND THE PAYMENTS PROVIDED UNDER IT BE ASSIGNED,
TRANSFERRED OR USED AS COLLATERAL FOR A LOAN?
No. This contract and the payments provided under it are not assignable
and will be exempt from the claims of creditors to the maximum extent
permitted by law.
18. HOW DOES METLIFE RECEIVE NOTICE REGARDING ANY CHANGES TO BE MADE TO
THIS CONTRACT?
All requests you may have concerning this contract, like a change of
payments or a change of beneficiary, if applicable, should be sent to
our "designated office." (see the specifications page for the address
of the designated office.) If we change it, we will notify you.
19. HOW DO FEDERAL INCOME TAX RULES AFFECT THIS CONTRACT?
See the tax endorsement attached to this contract.
20. ARE THERE ANY OTHER TAX RULES THAT AFFECT THIS CONTRACT?
We reserve the right to deduct from the total consideration received or
payments made under this contract any taxes paid by us to any
governmental entity relating to this contract (including without
limitation: premium taxes, federal, state and local withholding of
income, estate, inheritance and other taxes required by law, and any
new or increased state income taxes that may be enacted into law).
We will, at our sole discretion, determine when taxes relate to the
contract, including for example when they have resulted from: the
investment experience of the separate account; our receipt of the total
consideration; commencement of payments, payments of death benefits; or
partial and full withdrawals; and any new or increased taxes which may
become effective that are imposed on us and which relate to the total
consideration, earnings, gains and losses, fees and charges under this
contract.
21. DOES THIS CONTRACT CONTAIN ALL THE PROVISIONS AFFECTING IT?
Yes. This contract, the Basic income payment option B Endorsement, and
any other riders and endorsements included in it make up your entire
contract with us. We will never contest the validity of this contract.
Changes in its provisions
11
may only be made in writing by our President, Secretary or a
Vice-President. No provision may be waived or changed by any of our
other employees, representatives or agents.
12
