EXHIBIT (4)(f)(v)
[LOGO] METLIFE(R)
METROPOLITAN LIFE INSURANCE COMPANY
(A Mutual Company Incorporated in New York State)
in consideration of the purchase payments it receives under this contract, will
pay the benefits of this contract according to its provisions. The
contractholder and MetLife execute this contract in duplicate to take effect as
of the contract date.
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SPECIFICATIONS
GROUP ANNUITY CONTRACT NUMBER [12345]
EGN NUMBER [67890]
CONTRACT DATE [September 1, 1996]
CONTRACTHOLDER [ABC County]
EMPLOYER [ABC County] Deferred
Compensation Plan
ADMINISTRATIVE FEE See item [4.2]
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ALL VALUES PROVIDED BY THIS CONTRACT WHICH ARE BASED ON THE INVESTMENT
EXPERIENCE OF THE SEPARATE ACCOUNT ARE VARIABLE AND ARE NOT GUARANTEED AS TO
AMOUNT. AVAILABLE SEPARATE ACCOUNT INVESTMENT DIVISIONS AS OF THE CONTRACT DATE
ARE: THE METROPOLITAN GROWTH, INCOME, DIVERSIFIED, AGGRESSIVE GROWTH, THE
INTERNATIONAL STOCK AND STOCK INDEX DIVISIONS, FIDELITY DIVISIONS AND THE
▇▇▇▇▇▇▇ DIVISIONS. A DESCRIPTION OF EACH OF THESE DIVISIONS IS INCLUDED IN THE
PROSPECTUS.
By______________________________ Metropolitan Life Insurance Company
________________________________ /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Signature ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Vice-President
& Secretary
____________________________ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title ▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman, President & Chief
________________________________ Executive Officer
Witness
_______________________________________
_________________________________ Registrar
Date
_______________________________________
_________________________________ Date
City and State
_______________________________________
City and State
This contract is not eligible for dividends--see item [12.7].
PLEASE READ THIS CONTRACT CAREFULLY
IRC Section 457(b) --Deferred Compensation
Cover Page
Form G.3068
Contents
==================================================================
Section Page
------- ----
1 DEFINITIONS 3
2 RELATION BETWEEN PLAN AND CONTRACT 5
2.1 General Understanding 5
2.2 Changes in Plan's Provisions; Competing Plan 5
[ 2.3 Requests for Plan Benefits and Transfers] 6
3 EMPLOYEE ACCOUNT; PURCHASE PAYMENTS 7
3.1 Employee Account 7
3.2 Purchase Payments 7
4 FIXED INTEREST ACCOUNT 8
4.1 Crediting of Interest 8
4.2 Administrative Fee 8
5 SEPARATE ACCOUNT 9
5.1 Separate Account E 9
5.2 Accumulation Units 9
5.3 Valuation 9
5.4 Administrative Fee 10
5.5 Changes to the Separate Account 10
6 TRANSFERS 11
6.1 Transfers Generally 11
7 WITHDRAWALS 12
7.1 Withdrawal Request 12
7.2 Partial Withdrawals 12
7.3 Withdrawal Charges [If Additional Funding Options
Become Available] 12
7.4 Exemptions From Withdrawal Charges 13
7.5 Free-Corridor 14
7.6 Example of Withdrawals 15
7.7 Right to Delay 15
==================================================================
1
Contents (continued)
==================================================================
Section Topic Page
------- ----- ----
8 FEDERAL INCOME TAXES 16
8.1 Federal Income Tax Rules As They Relate to 457(b)
Annuities
16
9 DEATH BENEFIT
9.1 The Amount of the Death Benefit 17
9.2 Who Receives the Death Benefit 17
17
10 INCOME PLANS
10.1 Income Plans Available 18
10.2 Income Plan Purchases 18
10.3 Cost of Annuities 18
10.4 Guarantee 19
10.5 Income Annuity Certificates 20
10.6 Misstatements 20
20
11 DISCONTINUANCE
21
12 GENERAL PROVISIONS
12.1 Entire Contract 23
12.2 Claims of Creditors; Assignment 23
12.3 Liability for Payments 23
12.4 Communications; Payments 23
12.5 Information to be Furnished 23
12.6 Applicable Law; Changes; Right to Amend 23
12.7 Non-Participating 24
12.8 Statements 24
24
==================================================================
2
SECTION 1-- DEFINITIONS
[1.1] "Annuitant" is a person for whom income payments are being made.
[1.2] "Code" means the United States Internal Revenue Code of 1986, as amended
from time to time.
[1.3] "[Contract] Year" is generally the 12 month period beginning on the
contract date of the [Contract] and every 12 month period thereafter. The
first [Contract] Year could be more or less than 12 months. If it is more
or less than 12 months, it will be specified in the [Contract].
[1.4] "Designated Office" is the administrative office servicing your contract.
Currently it is MetLife's office at [▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇]. We will notify you of any change.
[1.5] "Employee" means an employee of the Contractholder who is participating
in the Plan in accordance with its provisions and for whom money is
contributed under this Contract. Separation from service does not end
one's participation in the Plan.
[1.6] "Employee Account Balance" is the entire amount we hold under this
contract for an Employee. Amounts are for bookkeeping purposes only and
give the Employee no rights. You will be the sole owner of all Employee
Account Balances and will have the exclusive right to all contract
benefits.
[1.7] "Employee Year" for the first year is measured from the date a purchase
payment is first received on behalf of each Employee and continues to the
date specified in the [Contract]. Such date will not be less than three
(3) months or more than fifteen (15) months. Each new Employee Year
begins the next day.
[1.8] "Fixed Interest Account" means the general account described more fully
in Section 4.
[1.9] "Funding Options" refer to [the Metropolitan Series Fund, Inc., the
▇▇▇▇▇▇▇ Responsibly Invested Balanced Portfolio, the ▇▇▇▇▇▇▇ Capital
Accumulation Portfolio, and Fidelity's Variable Insurance Products Fund
and Variable Insurance Products Fund II. All are either mutual funds or
series of mutual funds used only for insurance and annuity contracts such
as this one. The Metropolitan Series Fund and Fidelity's Variable
Insurance Products Fund and Variable Insurance Products Fund II are
divided into portfolios each of which has its own investment objectives].
[1.10] "Investment Divisions" are part of the Separate Account. Each division
invests in a corresponding portfolio or series of the Funding Options,
rather than investing directly in stocks, bonds or other investments.
Thus, the investment experience of each division will generally be the
same as that of the corresponding portfolio or series, reduced by charges
under this contract for services and benefits we provide. We will tell
you about any changes.
3
[1.11] "Plan " means [the ABC County Deferred Compensation 457(b) Plan].
[1.12] "Plan Year" runs from January 1 through December 31 or such other period
that the Contractholder specifies and communicates to MetLife.
[1.13] "Purchase Payment" refers to money received under this contract.
[1.14] "Purchase Payment Year" for any purchase payment, for the first year, is
measured from the date we receive it in our designated office and
continues until the last day of the month in which the anniversary of
such receipt occurs. Each new purchase payment year begins on the first
day of the next month.
[1.15] "Section 457 Plan" means a plan that meets the requirements of Section
457(b) of the Code.
[1.16] "Separate Account" means an investment account we maintain separate from
our other assets, divided into investment options. The Separate Account
is described more fully in Section 5.
[1.17] "We", "Us", and "Our" and "MetLife" refer to Metropolitan Life Insurance
Company.
[1.18] "You" and "Your" mean the Contractholder specified on the cover page.
4
SECTION 2--RELATION BETWEEN PLAN AND CONTRACT
2.1 General Understanding
The Plan permits purchase payments to be paid under a contract of this
type. You have given MetLife a copy of the Plan as in effect on the Issue
Date. The Plan is mentioned for reference purposes only. We are not a
party to the Plan.
You and MetLife agree as follows:
(1) As of the Contract Date, the Plan has certain provisions and/or
related administrative practices applicable to [purchase payments by
and on behalf of Employees, investment options available to Employees,
allocation of such purchase payments among the Plan's investment
options, transfers of account balance amounts between such investment
options, and payments to Employees or their beneficiaries because of
retirement, separation from service, death, in-service unforeseen
emergency withdrawals, or in-service withdrawals for any reason at or
after age 70 1/2]. References in this contract to Plan provisions
and/or administrative practices mean the provisions and/or
administrative practices as in effect on the Issue Date.
(2) As used in this contract, "separation from service" does not include
transfer or other change of employment from one governmental agency to
another.
(3) Employees will exercise their own independently determined judgments
with regard to Plan option decisions, without influence or direction
by you. You may, however, add or eliminate investment options or
elect an alternative funding agent pursuant to Section [2.2 or
pursuant to Section 11].
(4) [If you request, we will serve as a third party administrator, the
compensation for which will be made by you and specified in a separate
agreement entered into at the same time as this contract.]
2.2 Changes in Plan's Provisions; Competing Plan
You will furnish MetLife with advance copies of all communications to
Employees concerning the Plan, which might have a material effect on this
contract's financial experience. Such communications include, but are not
limited to, an announcement of the addition or elimination of an investment
option, or a written explanation of Plan provisions. Such communications
will be sent to MetLife for review, but will not be subject to MetLife's
approval.
[If MetLife's financial experience under this contract would be adversely
affected as the result of a Plan amendment and/or change in the Plan's
administrative practices (e.g., restriction on transfers) that would
materially increase the amount of payments MetLife would have to make under
this contract, or materially reduce the interval between such payments,
MetLife may discontinue this contract under the terms of Section 11.]
5
[2.3 Requests for Plan Benefits and Transfers
You must, on behalf of Employees, request withdrawals or transfers pursuant
to the Plan provisions referred to in Section 2.1. [You also will specify
how the withdrawal will be used.]]
6
SECTION 3--EMPLOYEE ACCOUNT; PURCHASE PAYMENTS
3.1 Employee Account
You will establish an account for each Employee participating under the
Plan. Nothing in this contract is to be construed as giving any Employee at
any time a security interest in any Employee Account Balance or as placing
any Employee Account Balance in trust with you for the benefit of any
Employee. Employee Account Balances are not collateral security for the
payment of any benefits under any plan and are available to meet your
general obligations.
3.2 Purchase Payments
Purchase payments may be made on behalf of an Employee at any time while
this contract is in effect. The Employee on whose behalf the purchase
payment is made must be identified. All purchase payments should be sent
to our designated office unless you and we agree otherwise.
[If you permit, we will allow each Employee to choose how purchase payments
are allocated among the Fixed Interest Account and the investment divisions
of the Separate Account. An allocation for new purchase payments may be
changed by telling us. The change will be made upon receipt, unless a
later date is specified, which may be up to 30 days after we receive the
request. Allocations must be in whole number percentages (e.g., 33 1/3%
cannot be chosen).]
We will accept under your contract amounts you send us for each Employee up
to the annual and aggregate amount limitations of Section 457 of the Code.
In addition, we have a lifetime maximum per Employee for all purchase
payments of [$500,000]. We may either return amounts that are above this
limit or agree to take them (if the Code allows). We may change the
maximum by telling you in writing at least 90 days in advance.
We will not accept purchase payments for any Employee until: (a) we receive
your request that this contract be utilized for that person; and (b) we
have entered that person's name on our records under this contract. We will
not accept purchase payments under this contract for any Employee who is
not employed by you. We will not accept any purchase payments for an
Employee after you have made a withdrawal based on separation from service
of that Employee under Section 7.4(b) below.
[We will not accept any purchase payments (except transfers or exchanges)
for an Employee on whose behalf you are withdrawing money under a
systematic termination under Section 7.4(i), or who has made a withdrawal
based on separation from service under Section 7.4(b).]
7
SECTION 4--FIXED INTEREST ACCOUNT
4.1 Crediting of Interest
Interest on amounts allocated to the Fixed Interest Account will be
credited from the date they are received at our designated office or
transferred from the Separate Account. Interest will be credited on
amounts in the Fixed Interest Account until the earliest of (a) withdrawal
because of the death of an Employee (or the death of the Employee's spouse
who has continued the [Contract]), (b) the date the amounts are withdrawn
or transferred to the Separate Account, or (c) the date the Employee starts
to receive income payments. The interest rates we declare are "annual
effective yields." The interest rates we set from time to time will never
be less than 3%.
[Different interest rates may apply to each purchase payment depending on
the date the purchase payment is received at our designated office. The
declared interest rate in effect when a new purchase payment is received
will be credited on that purchase payment until the last day of the first
purchase payment year. A new interest rate will be declared for each new
purchase payment year and will apply both to the original purchase payment
and all earnings on that purchase payment. We may declare interest rates
for one year periods starting on the date the purchase payment is received,
instead of based on purchase payment years. If we do so we will tell you
in advance. We will only do this for new purchase payments.]
[We may credit a different interest rate on transfers and exchanges under
Section 3.2 than we do on other purchase payments and on transfers from the
Separate Account. The rates for new purchase payments and transfers from
the Separate Account may be different than the rates credited on amounts
already in the Fixed Interest Account. The rates also may vary depending
on the amount of the Employee's Account Balance.]
4.2 Administrative Fee
[No administrative fee applies to the Fixed Interest Account.] [At the end
of each Employee Year, we may deduct a $20 administrative fee from an
Employee's Fixed Interest Account on a "first-in, first-out" basis from
purchase payments and then from earnings on such purchase payments, if the
Account Balance is less than $10,000 and no purchase payments were received
during the Employee Year. If the Employee's Fixed Interest Account Balance
is less than $20 at the end of an Employee Year, we will waive the fee.
We may change the date on which the administrative fee is deducted to the
[Contract] anniversary. If we do so, we will tell you in advance.]
8
[SECTION 5--SEPARATE ACCOUNT
5.1 Separate Account E
Metropolitan Life's Separate Account E, an investment account we maintain
separate from our other assets, is used under this contract for amounts
allocated or transferred to available investment divisions. 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
also will add amounts to the Separate Account from other contracts of ours.
The Separate Account is divided into investment divisions, each of which
buys shares in a corresponding portfolio of the Funding Options. Thus, the
Separate Account does not invest directly in stocks, bonds, etc., but
leaves such investments to the Funding Options to make. The Funding
Options also may be bought by other separate accounts of ours, our
affiliates and other insurance companies.
5.2 Accumulation Units
We keep track of each investment division of the Separate Account
separately using accumulation units. Initially, we set the value of each
accumulation unit. At the end of each valuation period, we then revise it
by taking the net asset value of a share in the applicable Funding Options
portfolio at the end of the valuation period, add any Funding Options
dividend or capital gain distribution during the valuation period, subtract
any per share charge for taxes and reserves for taxes, and divide this
total by the net asset value of a share of the same portfolio as of the
start of the valuation period. Then we subtract a charge not to exceed
[.000025905] per day (an effective annual rate of [.95%]) for
administrative expenses and mortality and expense risks we assume under
each [Contract]. This calculation results in a factor that we multiply the
previous accumulation unit value by in order to determine the new
accumulation unit value.
5.3 Valuation
A valuation period is the period between one calculation of an accumulation
unit value and the next calculation. Normally, we calculate accumulation
units once each day the New York Stock Exchange is open for trading, but we
can delay this determination if an emergency exists, making valuation of
assets in the Separate Account not reasonably practicable, or if the
Securities and Exchange Commission permits such deferral. We may change
when we calculate the accumulation unit value to the extent permitted by
law.
Amounts added to the Separate Account will be credited as of the end of the
valuation period during which we receive them at our designated office or
they are transferred from the Fixed Interest Account. Additions to or
withdrawals from an investment division may only be made as of the end of a
valuation period.
9
5.4 Administrative Fee
No administrative fee applies to the Separate Account.
5.5 Changes to the Separate Account
We may make certain changes to the Separate Account if we think they would
best serve the interests of Employees in or owners of the contracts 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 permitted by
applicable laws. We will notify you in advance of any change we intend to
make and where necessary obtain your approval.
If any changes result in material change in the underlying investments of
an investment division to which an amount is allocated, a new choice of
investment divisions may be made.]
10
[SECTION 6--TRANSFERS
6.1 Transfers Generally
Transfers may be made between investment divisions of the Separate Account,
from an investment division to the Fixed Interest Account, or from the
Fixed Interest Account to an investment division. [However, only one
transfer per Employee Year can be made from the Fixed Interest Account to
the Separate Account and only up to 20% of the Fixed Interest Account
Balance may be transferred.] [However, any transfers from the Fixed
Interest Account are subject to any applicable withdrawal charge described
in Section 7.] You may make transfers by making a written request at our
designated office or by telephone.
If a transfer is made from the Fixed Interest Account, we will determine
which purchase payments and earnings to take it from as if it was a
withdrawal as described in Section 7. If a transfer is made from the Fixed
Interest Account to the Separate Account and then a transfer is made from
the Separate Account to the Fixed Interest Account [(or from the Separate
Account to the Fixed Interest Account, and then from the Fixed Interest
Account to the Separate Account)] within 12 months, this will be treated as
a return of the same money whether or not it really is. Thus, after the
transfer back to the Fixed Interest Account, it will earn the same interest
rate that it would have been earning had neither transfer ever taken place.
Any amounts in excess of the original transfer and any amounts transferred
more than 12 months after the first transfer will be treated as a new
purchase payment.]
11
SECTION [7]--WITHDRAWALS
[7.1] Withdrawal Request
Withdrawals may be made by contacting our designated office. Any
withdrawal request must be signed by you or your designee and must
clearly state [the account (and investment division, if any)] from which
the withdrawal is to be made. The minimum withdrawal is [$500] or the
Employee's entire account or division balance, if less.
[No withdrawal charge applies unless additional funding options are made
available under the Plan, as discussed below.]
[7.2] [Partial Withdrawals
If a partial withdrawal is made from [an investment division or] the
Fixed Interest Account, we will [first] withdraw any amounts from
[purchase payments] [in the Fixed Interest Account] that can be withdrawn
with no withdrawal charge, then withdraw amounts from [purchase
payments][in the Fixed Interest Account] subject to a withdrawal charge
(ignoring the [20%] exemption provided below), and will then withdraw
other amounts from any [earnings] on such purchase payments, in each case
on a "first-in, first-out" (FIFO) basis. To determine from what amounts a
withdrawal is taken for tax purposes, we will apply tax rules which may
be different.]
[7.3] [Withdrawal Charges [If Additional Funding Options Become Available]
[If the Plan offers funding options that are different than those offered
as of the issue date, we may impose withdrawal charges. If we do so, we
will tell you and the following withdrawal charges will apply.]
Withdrawal charges when they apply, are imposed on each purchase payment
[in the Fixed Interest Account] for the first [seven] purchase payment
years as shown in the following table.
=====================================
During Purchase Payment Year
[ 1 2 3 4 5 6 7 [8] &
Beyond
7% 6% 5% 4% 3% 2% 1% 0%]
=====================================
To determine the withdrawal charge, [we treat an Employee's Account Balance
as if it were a single account, and ignore both the Employee's actual
allocations and what account or division the withdrawal is actually coming
from. To do this,] we first treat the withdrawal from [the Fixed Interest
Account] as coming from purchase payments that can be withdrawn without a
withdrawal charge, then from
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other purchase payments, and then from [earnings] on such purchase
payments--in each case on a first-in, first-out basis. Once we have
determined the amount of the withdrawal charge (as explained below), we
will actually withdraw it from [the Fixed Interest Account] [each
account and investment division in the same proportion as the withdrawal
that is being made.] In determining what the withdrawal charge is, we do
not include [earnings], although the actual money to pay the withdrawal
charge may come from [earnings].
For partial withdrawals from [the Fixed Interest Account], we pay you
what was asked for [provided such amount is eligible for withdrawal] and
reduce the [Fixed Interest] Account Balance by a larger amount, as
follows: the amount to which no withdrawal charge applies, plus the
amount to which a withdrawal charge applies divided by 100% minus the
percentages shown above (so that if the percentage shown is 7% we divide
by 93%). If the Employee's [Fixed Interest] [account balance] [in any
investment division or account] is not sufficient to allow us to make a
partial withdrawal and deduct the withdrawal charge, we will treat your
request as a request for a full withdrawal. For full withdrawals [from
the Fixed Interest Account], we multiply each amount to which the
withdrawal charge applies by the percentages shown above, keep the
resulting amount as a withdrawal charge and pay you the rest.]
[7.4] [Exemptions From Withdrawal Charges
When withdrawal charges are imposed, no withdrawal charge will apply:
(a) to any [full] withdrawal [from the Fixed Interest Account] made
while the Employee is disabled (as defined under Section 72(m)(7) of the
Code).
(b) to any [full] withdrawal [from the Fixed Interest Account]:
(1) because of an Employee's separation from service from the employer
sponsoring the Plan [provided the Employee has been covered under
this contract for at least ten (10) uninterrupted years]; or
(2) because of the Employee's retirement pursuant to the Plan's written
provisions, or, if no provisions exist, after the tenth Employee
Year (as verified in writing in a form acceptable to us).
[This exemption from withdrawal charges does not apply to withdrawals of
any transfer or exchange amounts contributed under this contract from
other investment vehicles on a tax-free basis.]
(c) To any minimum withdrawal that is required to avoid Federal income
tax penalties.
(d) To any withdrawal made under Section 9 after the Employee's death.
(e) To any withdrawal made to provide income payments for life, or for a
period
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of five years or more if the payments cannot be accelerated.
(f) To any withdrawal that is the result of an unforeseen emergency
encountered by the Employee as defined under IRS regulations (as
verified in writing in a form acceptable to us).
(g) If the Plan is terminated, and the Employee's [Account Balance] is
transferred to another one of our annuities.
(h) To direct transfers to any funding vehicles pre-approved by us.
(i) [To a full withdrawal [from the Fixed Interest Account] which is paid
annually over four years ("systematic termination") as follows:
(1) 20% of the Employee's [Fixed Interest] [Account Balance] upon
receipt of the request (reduced by any partial withdrawal from the
Employee's [Fixed Interest] [Account Balance] made in the same
Employee Year);
(2) 25% of the Employee's then current [Fixed Interest] [Account
Balance] one year later;
(3) 33 1/3% of the Employee's then current [Fixed Interest] [Account
Balance] two years later;
(4) 50% of the Employee's then current [Fixed Interest] [Account
Balance] three years later; and
(5) the remainder of the Employee's [Fixed Interest][Account Balance]
four years later.
The remaining withdrawal may be canceled at any time, but if it is, any new
systematic termination would be paid over a new four year period. Full
withdrawals [from the Fixed Interest Account] over fewer than four years or
for amounts in excess of the percentages shown above will be subject to the
withdrawal charges described above.]
(j) For the Fixed Interest Account only, if we agree in writing that none
will apply.]
[7.5][Free Corridor
In addition to the exemptions described in Section 7.4, withdrawals in any
[Contract] Year will be exempt from the withdrawal charge to the extent of:
(i) those amounts, if any, that can be withdrawn without a withdrawal
charge, and (ii) any extra amounts needed to make the exemption equal [20%]
of the Employee's [Fixed Interest] Account Balance. For example, assume
the Employee's [Fixed Interest] Account Balance is $20,000 and no prior
withdrawals during the [Contract] Year have been made. You now ask for a
withdrawal of $2,000 (i.e., 10%) [from the Fixed Interest Account]. This
entire $2,000 may be withdrawn without a withdrawal charge. If you then
ask for another withdrawal in the same [Contract] Year and at that time the
Employee's [Fixed Interest] Account Balance is $19,000, the maximum
additional amount that may be withdrawn without a withdrawal charge is
$1,900 (i.e., 10%) for a total of [20%] withdrawn during the
14
Employee Year.]
7.6 [Example of Withdrawals
Assume four purchase payments of $2,400, each allocated 50% to the Fixed
Interest Account and 50% to the Growth Division of the Separate Account.
Further, assume withdrawal charge percentages of 0%, 3%, 5% and 7%,
respectively; and balances of $5,880 in the Fixed Interest Account and
$6,350 in the Growth Division. Assume no transfer or exchange purchase
payments and that the Employee's entire Account Balance is eligible for
withdrawal. A withdrawal of $3,500 is then requested from the Growth
Division.
The free corridor is equal to $2,446, which is determined as: (i) those
amounts, if any, that can be withdrawn without a withdrawal charge (i.e.,
in this case the first purchase payment of $2,400), and (ii) any extra
amounts needed to make the exemption equal [20%] of the Account Balance
([20%] of $12,230 = $2,446), i.e., an extra $46. To determine the charge,
we first take the $2,446 that can be withdrawn with no charge (it doesn't
matter how the Account Balance is allocated -- we are treating the
Employee's Account Balance as if it were a single account). We then take
$1,054 from the second purchase payment (which is subject to a 3%
withdrawal charge) and divide this $1,054 by 97%. The result is $1,086.60.
Since the total of these two numbers is $3,532.60 ($2,446 + $1,086.60) and
the request was for $3,500, the extra $32.60 is the withdrawal charge. We
take the $32.60 from the Growth Division, as well as taking the $3,500 from
there. The Employee's Growth Division balance is now $2,817.40, and the
total Account Balance is $8,697.40.
If a full withdrawal is then requested during the same Contract Year, we
multiply the remaining $1,313.40 from the Employee's second purchase
payment by 3% ($39.40), the third $2,400 purchase payment by 5% ($120), and
the fourth $2,400 purchase payment by 7% ($168). No charge applies to the
earnings. Thus, we withdraw $327.40 as the withdrawal charge, and pay you
the remaining $8370.]
7.7 Right to Delay
As required by law, we have the right to delay paying any cash withdrawals
from the Fixed Interest Account for up to six months. We do not intend to
do this except in an extreme emergency. We would, of course, credit
interest during any delay.
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SECTION [8]--FEDERAL INCOME TAXES
[8.1] Federal Income Tax Rules As They Relate to 457(b) Annuities
(a) Purchase payments are not included in the Employee's gross income and,
therefore, are not currently taxable. The earnings on these purchase
payments are also tax-deferred.
(b) Withdrawals will not be made available to Employees or their
beneficiaries earlier than:
(1) the calendar year in which the Employee attains age 70 1/2;
(2) when the Employee is separated from service; or
(3) when the Employee is faced with an unforeseeable emergency
(determined in the manner prescribed in IRS Regulations).
(c) You are solely responsible to ascertain that the Plan meets the
requirements of Section 457(b) of the Code, including the deferral
limitations of Sections 457(b) and (c) of the Code, and you represent
that the Plan is not subject to Title I of the Employee Retirement
Income Security Act of 1974, as amended.
(d) In order to preserve the status of this contract as a 457(b) annuity,
we have the right to amend this contract to make it comply with Federal
income tax rules. We will notify you of any amendments and, when
required by law, we will obtain the approval of the appropriate
regulatory authority.
[(e) A part-time, seasonal or temporary Employee is considered a qualified
participant under this 457(b) contract provided any benefit relied upon to
satisfy the requirements of paragraph (d)(1) of Section 3121(b)(7)(F) of
the Code is 100% nonforfeitable. A part-time, seasonal or temporary
Employee's benefit is considered nonforfeitable within the meaning of
Section 3121(b)(7)(F) if on any given day the Employee is unconditionally
entitled to a single sum distribution on account of death or separation
from service that is at least equal to 7.5% of the Employee's compensation
for all periods of credited service taken into account in determining
whether the Employee's benefit under the retirement system meets the
minimum retirement benefit requirements of Section 3121(b)(7)(F).]
We will refund to you all or part of the Employee's Account Balance, if
necessary, to maintain the contract as a 457(b) annuity. If we make such
refunds or payments, we will adjust the Employee's Account Balance
accordingly. Withdrawal charges will not apply.
16
SECTION [9]-- DEATH BENEFIT
[9.1] The Amount of the Death Benefit
The death benefit for each Employee is the [greater] [greatest] of:
[a. The entire Employee's Account Balance as of the date we receive proof
of death and a properly completed claim form (no withdrawal charge
will apply and no administrative fee will be deducted), or]
b. The total purchase payments made minus any partial withdrawals, or
c. The highest Employee's Account Balance as of the end of the calendar
year in which any prior quinquennial (5th, 10th, 15th, etc.)
[Contract] anniversary occurs, less any later partial withdrawals and
contract charges.
[9.2] Who Receives the Death Benefit
After we receive proof of death and a properly completed claim form, we
will pay you the death benefit (as of the date of settlement). If the
Employee dies before distributions begin, his entire interest must be
distributed within five (5) years after his death (or later if prescribed
by IRS Regulations). You, on behalf of the Employee's beneficiary, may
instead satisfy this requirement if you elect to have this amount applied
to purchase an income plan as described in Section 10. However, the
payment period may not exceed 15 years or the life expectancy of the
surviving spouse if such spouse is the beneficiary, and for non-spouse
beneficiaries payment must start no later than one year after death (or
later if prescribed by IRS Regulations). If the spouse is the beneficiary,
payments are not required to begin until the date on which the Employee
would have attained age 70 1/2. Also, any amount not distributed to the
Employee during his or her life must be distributed after the death of the
Employee at least as rapidly as under the method of distribution being
used as of the date of death.
17
SECTION [10]--INCOME PLANS
[10.1] Income Plans Available
In accordance with the terms of your Plan, MetLife will make available
under this contract annuity payments guaranteed for life to Employees
or beneficiaries of Employees [on a monthly, quarterly, semiannual or
annual basis]. These annuity payments also may be guaranteed for a
specified number of years, but not beyond the payee's life expectancy
or the joint life expectancy (subject to Internal Revenue Service
limitations) if there is more than one payee. If the second payee is
not the annuitant's spouse and has a longer life expectancy than the
annuitant, Federal income tax rules may further limit the length of any
guaranteed period. Other payment plans may be arranged with us
[including a variable payment plan if such plans are being offered at
the time the annuity plan is chosen.] The investment divisions under a
variable payment plan, if offered, are expected to be the same as those
specified on the cover page. The amount of each payment under an income
plan must be at least $50.
[10.2] Income Plan Purchases
All or part of any Employee's Account Balance may be used by you to buy
immediate annuities under this contract for the benefit of that
Employee or that Employee's beneficiaries.
Employees or their beneficiaries may begin receiving annuity payments
on any date designated by the Contractholder which occurs after the
Issue Date, if the Contractholder gives MetLife at least 30 days
advance notice. However, annuity payments must start no later than the
April 1 of the calendar year after the year in which the Employee
attains age 70 1/2, or at a later date if permitted by law. Upon
receipt of the Contractholder's request at Metlife's designated office
(see Section 1.4), MetLife will send the Contractholder information and
the necessary forms to sign. Once annuity payments start, neither the
Contractholder nor the payee may change the choice of annuity payments.
You must send us the following information on behalf of an Employee
whenever an income plan is requested:
(1) The date annuity payments are to start (the "Annuity Commencement
Date"). It may not be more than 60 days after MetLife receives your
request. If MetLife receives the request less than 30 days before
the date you requested as the Annuity Commencement Date, MetLife
may make the Annuity Commencement Date the first day of the month
after the date you requested.
(2) The amount to be used to buy the annuity.
(3) The form of annuity to be bought.
(4) The name, date of birth, and any other relevant data for each
annuitant.
18
The distribution of an Employee's Account Balance shall be in accordance
with [the provisions of the Plan in which he or she participates and]
any applicable federal rules and regulations. The requirements of Code
Section 401(a)(9) and the Regulations thereunder, including the
incidental death benefit requirements of Regulation Section 1.401(a)(9)-
2, shall supersede any contrary terms of this contract.
[10.3] Cost of Annuities
The costs of annuities under this contract are set forth in the schedule
below. MetLife may change them on or after the first anniversary of the
Issue Date by giving the Contractholder at least 90 days notice. No such
change will be made within one year of any previous change nor will such
change adversely affect any Employee for whom an Employee's Account
Balance was maintained immediately prior to the date of the change.
[The cost of each annuity is $300, plus any applicable tax, plus the
amount from the appropriate schedule below for each $1 of monthly
annuity payment.]
(1) Life Annuity - Payable on the first day of each month from the date
------------
of purchase to the first day of the month in which the annuitant
dies.
Annuitant's Amount per $1 Monthly
Exact Age Annuity Payment
----------------------------------
55 $212.44
60 188.22
65 162.33
Edition B
(Unisex)
(2) 100% Joint and Survivor Annuity - Payable on the first day of each
-------------------------------
month from the date of purchase to the first day of the month in
which the second of the annuitants dies.
Annuitants' Exact Ages
----------------------
Primary Survivor Amount per $1 Monthly
Annuitant Annuitant Annuity Payment
-----------------------------------------------------
55 60 $239.73
60 65 216.25
65 65 201.68
Edition B
(Unisex)
19
(3) Life Annuity with 10 Years Certain Payments - Payable on the first
-------------------------------------------
day of each month from the date of purchase to the first day of the
month in which the annuitant dies, with 120 payments guaranteed.
Annuitant's Amount per $1 Monthly
Exact Age Annuity Payment
------------------------------------------
55 $215.93
60 193.75
65 171.32
Edition B
(Unisex)
On request, MetLife will furnish values for ages and forms of annuity
not shown. Also, if at the time an annuity is bought, MetLife makes it
available on more favorable values under contracts in the class to which
this contract belongs, then such more favorable values will be
applicable.
[10.4] Guarantee
If at any time an immediate annuity is bought, MetLife makes it
available at a lower cost under contracts in the class to which this
contract belongs, then such lower cost will apply.
[10.5] Income Annuity Certificates
As of the election of an income plan, MetLife will deliver to the
Contractholder a certificate issued to the annuitant that outlines the
benefits payable under the annuity.
Any certificate or certificate rider issued under this contract that is
certified in MetLife's name will be considered certified by MetLife as
fully as if the signature of one of its officers appeared.
[10.6] Misstatements
If MetLife determines that any relevant fact relating to any annuity is
misstated, MetLife will not pay more than it would have paid based on
the correct information and the cost of the annuity. Any overpayment
will, together with interest, be deducted from future payments. Any
underpayment will, together with interest, be paid immediately upon
receipt of the corrected information. The interest rate will be that
used to determine the cost of the annuity.
20
SECTION 11--DISCONTINUANCE
Discontinuance of Contract
Either you or we may discontinue this contract for any reason as of any
Business Day by giving the other party at least [30] days notice. In
addition, if the Plan terminates or ceases to be a 457(b) Plan, or if you
fail to fulfill your duties under this contract, we may end this contract
immediately by giving you such advance notice as is reasonable under the
circumstances.
The effective date that this contract ends will be the Discontinuance Date.
On the Discontinuance Date you may request us to make a transfer of the
aggregate of the Employee Account Balances to another funding vehicle you
name. The transfer date will be the later of the date you specify or 120
days after we receive your request, unless you choose installment payments
in which case payments will be made as specified below.
Any Employee Account Balance transferred will include the deduction of any
applicable withdrawal charges unless you choose installment payments as
described below.
Fixed Interest Account Distribution
-----------------------------------
For the Fixed Interest Account Balances, [and subject to any approvals or
limitations required by a regulatory agency,] we will make payments under
either one of the following options as selected by you. If you do not elect
before the transfer date to have payment made in a single sum, then payment
will be made in installments as under option (2).
(1) GAC Transfer Payment: You may transfer the Fixed Interest Account
---------------------
Balances within 31 days after the Discontinuance Date to a MetLife
group annuity contract without a withdrawal charge so long as any event
described in Section 2.2 does not occur or has not occurred. That
contract will guarantee principal and interest and contain all other
provisions required by law for contracts providing such rights.
(2) Five Installment Payments: The Fixed Interest Account Balances may be
--------------------------
paid (on a pro rata basis among Employee Account Balances) to another
funding vehicle under the Plan (including any MetLife investment
alternative under the Plan not included in this contract) as designated
by you in accordance with the following schedule, provided that any
such transfer will be to the default investment alternative under the
Plan, if any (i.e., the Investment Funds in which funds are allocated
if you do not elect an Investment Fund), except for any Employee
Account Balance as to which you elect another allocation. The first
such installment will be payable within 31 days after the
Discontinuance Date and the following four installments will be paid
annually on the anniversary of that date in the amounts shown below.
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Payment Amount of Payment
------- -----------------
First Payment One-fifth of the amount, including accrued interest,
then remaining in the Fixed Interest Account
Second Payment One-fourth of the amount, including accrued interest,
then remaining in the Fixed Interest Account
Third Payment One-third of the amount, including accrued interest,
then remaining in the Fixed Interest Account
Fourth Payment One-half of the amount, including accrued interest,
then remaining in the Fixed Interest Account
Fifth Payment The amount, including accrued interest, then
remaining in the Fixed Interest Account
While installment payments are being made under this option (2), we will
continue to credit interest on the unpaid portion of the Account Balances
in accordance with Section 4.1. Furthermore, the withdrawal charges
described in Section 7.3 will be waived.
Any other payment method mutually agreeable to both the Contractholder and
MetLife may be arranged, subject to any required regulatory approvals.
Separate Account Distribution
-----------------------------
Upon discontinuance we will pay a single lump sum payment of the Account
Balances in the Separate Account. The amount of the single sum payment
will be the amount remaining in the Separate Account as of the end of the
Business Day last preceding the date of such payment. Payment of the
single sum will be made in cash on a date within 31 days after the
Discontinuance Date unless a later payment date is agreed to by you and us.
If in our judgment such payment would involve the sale of assets in the
Separate Account for which there is then no readily available market, we
will defer the determination and payment of all or part of the amount
remaining in the Separate Account for such time as we deem necessary.
Payment with respect to the Separate Account on another basis may be
arranged by agreement between us and you.
MetLife's liability for guarantees under this contract will cease upon
making the final payment under this contract.
22
SECTION [12]--GENERAL PROVISIONS
[12.1] Entire Contract
This contract is the entire contract between the parties. The
Contractholder's statements, if any, will be deemed representations and
not warranties. No sales representative or other person, except an
authorized officer of MetLife, may make or change any contract or make
any binding promises about any contract. Any amendment, modification or
waiver of any provision of this contract will be in writing and may be
made effective on behalf of MetLife only by an authorized officer of
MetLife, and on behalf of the Contractholder only by an authorized
officer of the Contractholder.
[12.2] Claims of Creditors; Assignment
No amounts payable under this contract may be assigned or encumbered
and, to the extent permitted by law, no amount payable under this
contract will be subject to legal process or attachment for payment of
any claim against any payee. This contract may not be assigned to any
person; however, if the Plan is consolidated or merged with another plan
or if the assets and liabilities of the Plan are transferred to another
plan, this contract may be assigned to the plan sponsor of such other
plan. Any successor to MetLife, whether by merger, acquisition or
otherwise, will automatically succeed to MetLife's rights and
obligations under this contract.
[12.3] Liability for Payments
Except as described in Section 10.6, MetLife has no obligation to
inquire as to the authority of any payee to receive any payments made
under this contract or to inquire into or see to the payee's application
of any amounts so paid.
[12.4] Communications; Payments
All communications between you and us provided for in this contract will
be in writing. You will communicate your address to us. Any
communication or payment may be made on your behalf by a party or
parties you name.
[12.5] Information to be Furnished
You will furnish all information and documents that MetLife may
reasonably require to determine its rights and duties under this
contract and to otherwise administer this contract in accordance with
its terms.
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[12.6] Applicable Law; Changes; Right to Amend
This contract is subject to the requirements and restrictions under the
Code applicable to 457(b) annuity contracts and will be governed by and
construed in accordance with the laws of [the State of Arkansas].
You and we may change this contract by mutual consent at any time. In
addition, in order to preserve the status of this contract as a 457(b)
annuity contract, MetLife has the right to amend this contract at any
time to make it comply with Federal tax rules, including retroactive
amendments.
[12.7] Non-Participating
This contract is non-participating and does not share in any distribution
of our surplus.
[12.8] Statements
At least [twice] each [Contract] Year before income payments start, we
will send you a statement for each Employee with details on purchase
payments, values, withdrawals, and other information about the Employee's
Account Balance. Information will be provided at other times, if
requested in writing and sent to our designated office, unless we have
agreed to some other procedure such as notice by telephone.
24